Trump’s Tariff Plan Hangs in Balance as Court Battles Escalate

President Donald Trump’s ambitious tariff plan hit a legal snag, but a federal appeals court threw a lifeline to the administration on Thursday, temporarily halting a lower court’s decision to block the sweeping import taxes. The U.S. Court of Appeals for the Federal Circuit’s ruling allows Trump’s 10% baseline tariff and reciprocal tariffs, enacted under the International Emergency Economic Powers Act (IEEPA), to move forward—for now. This legal ping-pong has markets on edge, with economists warning that prolonged uncertainty could sting consumers and small businesses alike.

The lower court, the U.S. Court of International Trade, had ruled unanimously that Trump overstepped his authority under IEEPA, emphasizing that even the commander-in-chief doesn’t get a blank check to slap tariffs on imports. The appellate panel, with judges appointed by Presidents Trump, Obama, and Reagan, disagreed enough to pause that ruling, setting the stage for a high-stakes legal showdown. Deadlines loom: plaintiffs, including five small businesses represented by the Liberty Justice Center, have until Monday evening to respond to the lower court, while the Trump administration faces a June 9 deadline to reply to the appellate court.

The White House hailed the stay as a win, with spokesman Kush Desai arguing it bolsters efforts to tackle drug trafficking and trade deficits. But not everyone’s cheering. Economist William Cline, a senior fellow at the Peterson Institute, called the tariff dreams of Trump and Vice President Vance a “fantasy,” warning they won’t magically revive Rust Belt jobs or boost fiscal growth. Instead, they could backfire, hiking costs for consumers and straining small businesses already reeling from the tariffs’ impact. As one plaintiff’s lawyer, Jeffrey Schwab, put it, the longer this drags on, the deeper the harm to businesses that might not survive the wait.

With the administration vowing to take the fight to the Supreme Court if needed, the case could escalate into a broader test of executive power. But whether the high court will touch this politically charged issue remains anyone’s guess. For now, the courts are wrestling with a classic balancing act: who’s hurt more—small businesses teetering on the edge or a government claiming national emergencies? The answer could reshape trade, markets, and the scope of presidential authority.