Who can raise tariffs? Article I, Section 232 and the delegated power

Ask ten Americans who has the power to impose a tariff and you will hear "the President" from about nine of them. That is a remarkable fact, because the Constitution says something quite different, in plain words, in the first Article, in the first section of powers it grants.

The story of how the answer moved from Congress to the White House is not a story of a coup. Nobody seized anything. Congress gave it away, one statute at a time, over most of the twentieth century, for reasons that seemed sensible each time. A constitutionalist's job is to read the text, trace the delegations, apply the doctrine the Supreme Court has built to police them, and say where the line is. I will do that, and I will stay away from predicting how any pending case comes out, because the courts are still working on it and a post that guesses the result would be out of date by the time it is read.

What the text says

Start where every constitutional argument should start. Article I, Section 1 reads:

All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.

Note the word "all." The legislative powers the Constitution grants belong to Congress, and the Constitution does not say that Congress may hand them to someone else.

Article I, Section 8, Clause 1 gives the substance:

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States

And Clause 3 adds the commerce power: Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes."

A tariff is a duty, a tax on imports, and it is also a regulation of foreign commerce. Both of the clauses that apply to it are in Article I, and both give the power to Congress by name. Article I, Section 7, Clause 1 adds that "All Bills for raising Revenue shall originate in the House of Representatives," the chamber closest to the voters. The Article II list of presidential powers contains no power over duties, taxes or the regulation of commerce.

The history explains why. The Revolution had begun, in part, over taxes imposed by a distant authority in which the colonists had no vote. The Framers placed the power to tax where the people could reach it. I discussed why they did so in What Commerce Among the Several States Meant to the Men Who Wrote It, and the tax-origination rule has a history of its own. A President who could set tariff rates at will would hold a power that the Founders had specifically refused to a king.

How delegation happened

Despite that text, today the President holds extensive powers over tariffs, but those powers come from statutes. Let me walk through the main ones in order. Each is a law that Congress passed, and each could be changed by Congress.

The Reciprocal Trade Agreements Act of 1934

The Tariff Act of 1930, known as Smoot-Hawley, raised duties across a very wide range of goods. Congress then moved in the opposite direction. The Reciprocal Trade Agreements Act, signed on June 12, 1934, authorized the President to negotiate agreements with other countries lowering American duties in return for lower duties on American goods, within a specified limit: no proclamation could raise or lower a rate by more than 50 percent. It was a temporary grant, and Congress had to renew it for it to continue.

This was a genuine transfer. Before 1934, apart from narrow adjustments such as the one in Hampton, a change in tariff rates took an act of Congress. After it, the President could cut rates by agreement without a new act. The Supreme Court had already approved a related delegation in J.W. Hampton, Jr. & Co. v. United States in 1928, upholding a provision of the 1922 tariff law that allowed the President to adjust rates to equalize the costs of production at home and abroad. Chief Justice Taft's opinion stated the test that has governed ever since: Congress may seek assistance from another branch so long as it lays down an "intelligible principle" to which the person or body authorized to act is directed to conform.

Section 232 of the Trade Expansion Act of 1962

Section 232 allows the President, after an investigation by the Secretary of Commerce, to adjust imports of a product that, in the finding, threatens to impair the national security. The statute lays out a process: the Commerce Department investigates and reports, and the President decides whether to act and what action to take, which can include tariffs and quotas. The law was signed in October 1962 and was passed as a tool to protect the nation against dependence on imports in critical areas, especially energy and defence supplies.

The Supreme Court considered Section 232 in Federal Energy Administration v. Algonquin SNG, Inc. in 1976, and upheld the use of the provision to impose license fees on imported oil, finding that the statute supplied enough guidance. That decision is a leading precedent on Section 232, and it is a reason the provision has been regarded as on firm legal ground.

Section 301 of the Trade Act of 1974

Section 301 gives the United States Trade Representative authority to investigate foreign practices that are unfair, unreasonable or discriminatory and burden American commerce, and to respond with measures that can include duties. It was part of the Trade Act of 1974, which Congress passed and President Ford signed in January 1975. In the previous post in this series on China I described how the investigation of Chinese practices under this section led to tariffs beginning in 2018, in The China shock was real, and what free traders and tariff hawks each get right.

The same Act contains other tools, including a temporary balance-of-payments authority that lets the President impose a limited surcharge for a limited period. Congress kept the duration short on purpose. Read the section for the exact limits, which are in the statute on Congress.gov.

The International Emergency Economic Powers Act of 1977

The International Emergency Economic Powers Act, known as IEEPA, was signed in December 1977. Before it, the President's emergency powers over foreign economic dealings rested on the Trading with the Enemy Act of 1917, which was written for wartime. IEEPA was meant to put emergency economic powers on a clearer statutory footing and tie them to a declared national emergency, with reporting requirements to Congress. It authorizes the President, after declaring an emergency in response to an "unusual and extraordinary threat" from abroad, to regulate a list of transactions, including importation.

Whether the word "importation" in that statute includes the power to impose tariffs is a legal question that has been contested in the courts. I am not going to say how it is or should be resolved. The text, the history and the briefs are all public, and the courts page on this site tracks the major cases. What I will say is that the question exists because the statute is broad, and a broad statute that leaves the answer to a dispute is exactly the kind of thing the nondelegation doctrine is meant to discourage.

The nondelegation doctrine

The nondelegation doctrine is the idea that Congress may not give away its core legislative power. It rests on the vesting clause I quoted above: if "all" legislative power belongs to Congress, then Congress has no power to give it to someone else.

The Supreme Court has said as much in principle, and enforced it almost never. The doctrine's high-water mark came in 1935, when the Court struck down two delegations in the same year. In Panama Refining Co. v. Ryan, it invalidated a provision of the National Industrial Recovery Act that let the President ban the interstate shipment of oil produced in violation of state limits, with no standard to guide the decision. In A.L.A. Schechter Poultry Corp. v. United States, the "sick chicken" case, it struck down the Act's broad grant of power to approve industry codes of "fair competition." I told that story in The Sick Chicken Case of 1935 and the Doctrine That Could Rein In Agencies.

In the decades since, the Court has upheld delegations as long as Congress supplies an "intelligible principle," a standard that the Court has read very generously. In Mistretta v. United States in 1989, the Court upheld the creation of the Sentencing Commission under that test. In Gundy v. United States in 2019, a plurality upheld a delegation to the Attorney General, while Justice Gorsuch, in a dissent joined by the Chief Justice and Justice Thomas, argued that the Court should return to a more rigorous standard, and Justice Alito indicated he would be willing to reconsider the question in a future case.

A related principle, the major questions doctrine, asks whether Congress has clearly authorized an agency to decide a question of vast economic and political significance. The Court applied it in West Virginia v. EPA in 2022. It is a way of reading statutes narrowly where the claimed power is enormous, and it is part of how courts are now approaching broad grants of authority. How it applies to any particular trade statute is a question for the courts and for the briefs, and I will leave it there.

The strongest objection

Here is how a defender of the delegations would state their case, and I want to give it fairly.

Trade is foreign affairs, and in foreign affairs the President has been the nation's representative since the Founding. Tariff negotiations need speed, secrecy and flexibility. A Congress of 535 members cannot adjust duties week by week as other countries change their policies. The delegations are limited by statute, they include procedures and deadlines, and Congress can revoke them whenever it wants. The Court has upheld them for decades. And the 1934 Act was a reaction to the disaster of Smoot-Hawley, when Congress set tariff rates itself, with the lobbyists in the hallway.

That is a serious argument, and part of it is correct. Smoot-Hawley is the best advertisement for delegation ever written. When Congress sets individual rates, it is vulnerable to exactly the pressure from concentrated interests that I described in big companies love the regulations their small rivals cannot afford. And there is a long tradition of presidents leading in foreign commerce.

My answer is in four numbered points.

1. Foreign affairs and taxation are not the same thing. The President's power to negotiate with other nations is real. The power to tax Americans is a separate one, and the Constitution places it in Congress. A tariff is paid by the American importer, and ultimately by the American buyer, which makes it a tax in the plainest sense.
2. A delegation that Congress can revoke is a delegation Congress can never really revoke. To undo a presidential tariff, Congress must pass a bill, and the President can veto it. The party that benefits from the delegation needs only one-third of one chamber plus one to keep it. The default favours the executive, and the Founders would not have designed a system in which the branch that holds the power can lose it only by a two-thirds vote.
3. Speed is not a constitutional value. The Framers chose a legislative process that is slow on purpose. In Federalist No. 47, Madison wrote that the accumulation of all powers, legislative, executive and judiciary, in the same hands "may justly be pronounced the very definition of tyranny." A limited grant of tariff authority with clear standards, narrow scope and short duration fits that principle. An open-ended one does not.
4. The remedy is for Congress to legislate. There is no need to wait for a court. Congress can write sunset dates into trade authorities, require a vote to continue any tariff beyond a fixed period, and set standards that make the "intelligible principle" mean something. It can reclaim the power by using it.

I would add a thing about the claim that a statute can be revoked. The delegations of 1934 to 1977 were part of a century-long habit of Congress passing hard decisions to someone else. The legislators got to claim credit for the benefit and avoid blame for the cost. That is a failure of responsibility, and it is Congress's failure, not the President's.

What a family should take from this

A tariff is a tax. When a tariff is imposed or removed, the price of a washing machine, a car part or a bag of fertilizer changes. A family has a right to expect that a decision of this size has been made by representatives it can vote out. That is the whole idea of representative government, and the whole meaning of the Revolution's complaint about taxation without representation.

This is not a partisan point. Tariffs are used by presidents of both parties, and the delegations were passed by Congresses of both parties. A conservative who likes the tariffs of one administration should ask whether he would be as pleased with the same power in the hands of the next. The constitutional rule does not depend on whose hands hold the pen.

You can read the clauses yourself on the Constitution page, and you can follow your own representative's votes on the representatives page.

The case in brief

1. Article I, Section 1 vests "all legislative Powers" in Congress, and Section 8 gives Congress, by name, the powers to lay duties and to regulate foreign commerce, so the tariff power is Congress's by text.
2. Congress delegated much of it to the President through the Reciprocal Trade Agreements Act of 1934, Section 232 of the Trade Expansion Act of 1962, Section 301 of the Trade Act of 1974 and the International Emergency Economic Powers Act of 1977, each of which Congress could amend.
3. The nondelegation doctrine, applied to strike statutes in 1935, now asks only for an intelligible principle, which the Court has read generously; the major questions doctrine of West Virginia v. EPA (2022) is a newer check.
4. The defender of delegation is right that Smoot-Hawley showed the danger of Congress setting every rate, but wrong that speed justifies an open-ended grant, because a tariff is a tax and the Constitution puts taxes where voters can reach them.
5. The remedy is for Congress to legislate: set sunset dates, require votes to extend tariffs and write standards that mean something.

What you can do: look up the statute behind a tariff that affects your business or your household on Congress.gov, and write to your representative asking whether Congress will vote on it.