President-elect Donald Trump is reportedly considering declaring a national economic emergency to justify the implementation of universal tariffs on imports, a move that could redefine the United States' approach to global trade. The plan, revealed by sources familiar with the matter, would leverage the International Economic Emergency Powers Act (IEEPA) to provide Trump with sweeping authority to manage imports during what he designates as a national crisis.
The IEEPA, a federal statute granting broad presidential powers in times of emergency, has previously been used by Trump to pressure foreign governments. In 2019, he invoked the act to threaten escalating tariffs on Mexican imports, a move that was ultimately shelved after successful negotiations. Trump's renewed interest in the law reflects his intention to reshape trade relationships in line with his campaign promises.
"Nothing is off the table," said a source familiar with the discussions, emphasizing the administration's robust deliberations over invoking IEEPA. The law would allow Trump to bypass the procedural requirements associated with other trade statutes, giving him significant latitude to impose tariffs without needing to substantiate their necessity on national security grounds.
Trump's team is also exploring alternative legal pathways for enacting tariffs. Options include invoking section 338 of U.S. trade law, which permits the imposition of new duties on nations that discriminate against American commerce, and revisiting section 301, the mechanism used during his first term to levy tariffs on China. However, both options require additional administrative steps, such as investigations or prolonged lobbying processes, making the swift implementation offered by IEEPA an attractive alternative.
While no final decision has been made, the prospect of a national emergency declaration has already rattled markets. Stock futures dipped, and the U.S. dollar strengthened against other currencies following reports of the potential move. Critics and supporters alike are preparing for the economic and political fallout that could follow.
Proponents argue that tariffs are essential for reviving American manufacturing and bolstering economic security. "The Trump team understands we have to rebuild our industrial capacity for reasons of economic and national security," said Nick Iacovella, Senior Vice President of the Coalition for a Prosperous America. "To accomplish those goals, you absolutely have to have a robust, pro-American trade policy that includes tariffs."
Opponents, however, warn of potential legal challenges and economic consequences. Similar threats during Trump's first term led to lawsuits from major business groups like the Chamber of Commerce and the Business Roundtable, which questioned the legality of using national emergency powers to justify tariffs. Such challenges could resurface if Trump moves forward with the plan.
Complicating the matter is the state of the U.S. economy. During a recent press conference, Trump highlighted the nation's economic strength while criticizing inflation. "Over the next four years, the United States is going to take off like a rocket ship," he said. Yet critics question how an emergency declaration aligns with his optimistic economic outlook.
This latest development follows a campaign season marked by Trump's promises to overhaul U.S. trade policies. He frequently proposed tariffs as high as 60% on Chinese imports and 25% on goods from Canada and Mexico. Though his rhetoric initially alarmed Wall Street, his team has since signaled a willingness to narrow the scope of the proposed tariffs, a shift aimed at calming market concerns.
The potential declaration of a national economic emergency has drawn comparisons to Trump's previous uses of emergency powers. In 2019, he declared a national emergency at the southern border to redirect funds for his border wall, a move that sparked widespread debate over the limits of presidential authority.
