What’s Real – and What’s Not – About Trump’s Tariff Plan?

President Donald Trump has never kept secret his love for tariffs. Touting plans for a robust tariff regime as a staple of his 2024 campaign, he went so far as to call tariff “the most beautiful word in the dictionary.”

Of course, Trump has a habit of sometimes letting his rhetoric get ahead of the realistic possibilities of governing. As Jared Weisfeld, chief strategy officer at freight company RXO, noted last month at a Goldman Sachs-sponsored investor conference, “We still need to see what policies are going to get implemented as opposed to narrative that may or may not lead to an actual policy decision.”

Case in point: The Washington Post reported earlier this month that members of Trump’s staff were evaluating a tariff program that could best be described as broad, but not deep. Under the plan, the new tariffs would apply across the board to all countries. However, the scope of the duties on imports would be limited to certain sectors of the U.S. economy the White House wants to revive, such as industrial goods and energy.

For his part, Trump has shown no signs of backing down from his calls for more aggressive tariffs on all imports to the U.S. While they may be presenting a unified front behind Trump as he takes office, many GOP politicians are undoubtedly feeling antsy about all of Trump’s tariff talk. The conventional wisdom in economic circles is that tariffs would further hike consumer prices at a time when people are already weary of inflation. According to a Congressional Budget Office analysis released in December, the Trump tariffs, if implemented, would ramp up inflation and put the brakes on economic growth.

It does appear that Trump’s economic advisers are sensitive to the potential for tariff-induced economic shocks. As a result, they are reportedly mulling over a plan to phase in the tariffs on a monthly basis. The thinking apparently goes that an incremental approach would make the inflationary effects easier for consumers to digest and simultaneously allow the U.S. to gradually acquire bargaining power over its rivals.

But before we can even speculate about the economic impact of whatever form Trump’s tariffs eventually take, it’s worth noting that the source of his authority to enact them in the first place is unclear. For example, he could make an unprecedented attempt to justify the tariffs using the International Economic Emergency Powers Act, which enables the president to dictate policy on imports in cases of national emergencies. Moreover, Section 232 of the Trade Act of 1974 allows for the chief executive to levy tariffs aimed at addressing national security concerns.

Given Trump’s staunch support for tariffs as a panacea for both economic and foreign policy, we’ll probably find out soon enough if the courts believe his expansive take on executive authority in this case is justified.