Supreme Court strikes down Trump's tariffs
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What did the Supreme Court rule about Trump's tariffs?
President Trump had no legal right to impose many of those tariffs the way he did. I'm David Brancaccio in Los Angeles. The U.S. Supreme Court just ruled that the cornerstone of the president's tariff policy is illegal. The 6-3 ruling says the International Emergency Economic Powers Act is not designed for this. Among tariffs rendered illegal are the ones Trump announced last April on what he called Liberation Day. Marketplace's Nancy Marshall-Genzer covers Washington.
The tariffs now ruled illegal increased prices for consumers. A report from the Federal Reserve Bank of New York says U.S. businesses and consumers end up shouldering nearly 90 percent of the cost of all import taxes. Some businesses are vowing to go to court to get a refund. An enormous amount of money has been collected by the U.S. Treasury under these tariffs, which are now deemed illegal. We don't know yet if that money will be refunded, and if so, how. In the opinion, Justice Brett Kavanaugh notes that refunds, if it comes to that, would be an issue. He adds that, quote, refunds of billions of dollars would have significant consequences for the U.S. Treasury, and the process would likely be a mess.
I'm Nancy Marshall-Genzer for Marketplace.
President Trump has other tools under law to reimpose some tariffs without prior consent of Congress, but at least one key strategy would need congressional approval after some months had passed. What a miss. The economy grew at less than half the rate expected as 2025 wound down. That's from today's calculation of gross domestic product, which grew at an annual rate of 1.4 percent in the October to December quarter, when economists were expecting twice that. Christopher Lowe of FHN Financial.
Government shutdown in a nutshell. It's because we measure government activity based on the money they spend. And usually that works really well. But of course, with the government shutdown for half of the quarter and non-essential workers literally not allowed to do any work, but still paid for it, well, there was a big increase in spending that did not translate into production.
One of the most powerful players on Wall Street, this is Goldman Sachs, is ditching its diversity criteria for its board, according to multiple published reports. There's pressure against these principles by the Trump administration, yet studies indicate that workplaces that include more women, people of color, LGBTQ people, and those from other marginalized groups are more productive, innovative, and profitable.
How have consumers and businesses been affected by these tariffs?
Here's Marketplace's Carla Javier.
Carlos Chapman at SMU says a lot of the high-profile announcements and DEI rollbacks are... Kind of lightning rod headline generating activity. So instead of listening to what companies say, Atinuke Adediran at Fordham says watch what they do. Some are indeed backing away from diversity efforts. But in other cases... Companies are, you know, replacing words like equity with diversity. belonging, inclusion, etc. Companies are making these moves because they're afraid that the federal government will retaliate against them if they don't. Mae McDonald at the University of Pennsylvania's Wharton School says that threat.
It introduces direct costs that I think scares a lot of companies from being vocal and scares a lot of shareholders from being vocal in this space right now.
Some shareholders have pressed companies to abandon diversity initiatives, but others see value in them. McDonald says even in this environment, pro-DEI shareholders can have conversations behind closed doors with board leaders. Companies that are trying to navigate these waters have a lot of conflicting forces to take into consideration, says John Solorzano of Vinson & Elkins, who consults firms on DEI issues.
You're trying to avoid being kind of targeted by the federal government, but at the same time, you're also not trying to be boycotted by your core customer base or consumer base. And there have been some pretty high-profile companies that have been targeted both on the left and the right.
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