This is a guest post from Bashar H. Malkawi, Professor of Law, University of Sharjah
Under the Commerce Clause of the U.S. Constitution, the Congress has the power to regulate commerce with foreign nations. In addition, Congress has the exclusive power to regulate commerce among the several states and with the Indian Tribes. U.S. Congress also has the authority to "lay and collect Taxes, Duties, Imposts and Excises" (Article I, section 8, paragraph 1). The U.S. executive must have the authority, delegated by the Congress, in order to negotiate.
Congress later passed the Trading with the Enemy Act of 1917, the Trade Expansion Act of 1962, the Trade Act of 1974, and the International Emergency Economic Powers Act of 1977. These acts gave power to the U.S. president that the Constitution never intended. In effect, the U.S. president who wants to restrict trade enjoys almost wide and unrestricted authority. These days, imposing tariffs on imports from certain countries can implemented on "national security" concerns.
Under the Trading with the Enemy Act of 1917, during time of war, the U.S. President has power over “all forms of international commerce, plus the power to freeze and seize foreign-owned assets of all kinds.” Under the Trade Expansion Act of 1962, the president can “impose tariffs or quotas as needed to offset the adverse impact” on “national security from imports.”
Under the Trade Act of 1974, the president has the authority to “impose tariffs up to 15 percent, or quantitative restrictions, or both for up to 150 days against one or more countries with large balance of payments surpluses” and take “retaliatory actions, at presidential discretion, including tariffs and quotas,” if a “foreign country denies the United States its FTA rights or carries out practices that are unjustifiable, unreasonable, or discriminatory.” Under the International Emergency Economic Powers Act of 1977, during time of national emergency, the president has power over “all forms of international commerce, plus the power to freeze foreign-owned assets of all kinds.”
To limit the executive branch authority in this area of trade, there are several options. For instance, Congress could repeal all these Acts. However, this is not plausible for all sorts of reasons being economic or political. Other alternative would be to align these Acts with their original intent as a powerful trade remedy tool for the president and Congress to respond to "genuine threats" to national security. The alignment could mean an investigation process by the Department of Commerce whether there is increased imports that threat national security. In addition, Congress must be consulted and, in certain circumstances, must have the authority to oppose imposing tariffs.
The U.S., and other countries for that matter, cannot resolve perceived trade imbalances using "national security" rationale for imposing tariffs and other trade restrictions. Real free trade includes no trade agreements, no government subsidies, and no tariffs or quotas. There is a long road ahead before achieving true and real free trade.
