From MarketWatch, December 3:
‘We can re-create the exact tariff structure,’ Treasury Secretary Scott Bessent says
U.S. Treasury Secretary Scott Bessent on Wednesday expressed confidence that the Supreme Court will rule in favor of the Trump administration’s many country-specific tariffs, while also saying administration officials are ready to maintain the levies through other avenues.
Bessent’s comments match up with forecasts that President Donald Trump would respond to a court loss by switching to invoking authorities granted in sections 301 and 122 of the Trade Act of 1974, as well as Section 232 of the Trade Expansion Act of 1962.
“We can re-create the exact tariff structure with 301s, with 232s, with the — I think — a 122,” the Treasury chief said during the New York Times DealBook Summit in New York City. When Bessent was pushed on whether those options would provide a permanent solution, he seemed to indicate that would largely be the case. “The 122s are permanently, but the others, we can do it,” he said....
....MUCH MORE
Also:
November 24 - "White House preps backup plans with Supreme Court verdict looming; US, EU officials meet"
September 1 - "What Are Trump’s Options If His Tariffs Are Ruled Unlawful?"
Also relevant, March 21 - "Will Economic Detox Lead to a Recession? Maybe Not. But a Long Deep Stock Market Rout Will (See Dotcom Bust)":
If the Trump administration achieves its goal of cutting the projected deficit in half, and thus removing a trillion dollars in stimulus spending—all deficits are stimulus, whether you call them that or not—if they cut the deficit in half, a recession seems inevitable.
However, I'm not sure the media and other political posturing on the terror and ruin posed by recessions is even close to what actually happens across a population of 345 million people. This is not 1873 or 1893 or 1933, the safety nets are a bit stronger than they were in those retrograde economic eras.
A different analog that may be more instructive is the 18-month 1920 - 1921 recession, brutal for those unemployed but setting the stage for the 1920's boom in the economy and in the mass adoption of consumer technologies that 100 years later still shape society, telephones, appliances, automobiles, radio, Hollywood etc., etc.
So who knows?
The other, more important point is that the interest required to service the ever-increasing debt will destroy both the economy and the constitutional republic if the detox does not happen....
May 29's - Goldman Sachs: "Four tools at the Trump administration’s disposal after a U.S. court blocks tariffs"
September 2 - "Why the Supreme Court Could Uphold Trump’s Tariffs"
Paying particular attention to the dissenting opinion authored by Judge Taranto, beginning on page 62 of the Opinion.
September 9 - "Supreme Court agrees to decide the fate of Trump’s tariffs":
This could set up some ructions in the bond markets should the court decide against the administration. In the first place the Treasury Department will have to repay or otherwise credit the companies that paid the tariffs in question. That could amount to somewhere between $100 billion to $200 billion and just to make things extra-interesting the debit could be booked in the fiscal year that ends in three weeks.
Secondly, the lack of income from the tariffs would require the treasury to sell some $300 billion more debt than is needed if the tariffs stand.
There are a few options* for the administration under other tariff authorities but the day of the Supreme Court decision could be challenging for market participants....
November 4 - "Looking to experts for how the Supreme Court will rule on tariffs? They aren't sure either.":
It doesn't really matter how the Supremes rule, tariffs of one sort or another will be in place at the end of 2025 and the US, Mexico, Canada trade agreement will be renegotiated early next summer.
In the meantime our best guess is that the Court will rule against the Administration on at least one of the points being argued, the pundits will splash headlines about refunding the money already collected (I think it was $32 billion last month), the deficit will be calculated to grow, treasuries will get sold and I will be posting that "this isn't the real market whack" but the one before the real star-spangled, bubble-bursting, all-American market panic....
November 5 - Tariffs: Today's Supreme Court Oral Arguments
And quite a few more. The search blog box, upper left, is often rewarding.
