Bernanke and Yellen publicly voice opposition; nearly 50 economists urge the Supreme Court to overturn Trump tariffs.

```

Nearly 50 renowned economists, including two former Federal Reserve Chairs, have jointly pressured the U.S. Supreme Court, calling for the overturning of most of the global tariffs imposed by President Trump. These economists, who have diverse political views, pointed out in a recently submitted brief to the Court that the Trump administration’s tariff policy is based on a misunderstanding of the global economy.

On Friday, October 24, Eastern Time, the economists stated in their amicus brief that trade deficits between the U.S. and other countries are a predictable and normal phenomenon, not the "extraordinary and special" threat cited by the Trump administration when invoking emergency laws. They argued that tariffs cannot bridge the trade deficit and would, on the contrary, impact the U.S. economy by trillions of dollars, affecting every family and state.

According to Xinhua, the U.S. Supreme Court announced last month that it would expedite the review of the legality of most of the tariffs imposed by the Trump administration and would hear oral arguments on November 5. The case involves tariffs under Trump’s invocation of the 1977 International Emergency Economic Powers Act (IEEPA), including a 10% "baseline tariff" applied globally, higher tariffs for trade partners without agreements with the U.S., and the so-called "fentanyl tariff."

This economists’ brief was one of many "friend of the court" briefs submitted before the November 5th Supreme Court oral arguments. Others filing opinions include 31 former federal judges, ex-military and national security officials, and foreign policy professors.

Tariffs have become central to Trump’s foreign policy. U.S. Treasury Secretary Bement warned the federal appeals court in August that overturning the tariffs would cause "dangerous diplomatic embarrassment."

Bipartisan Economists Criticize Tariffs, Refute Trade Deficit Threat Theory

Judging from the signatories, this Friday's economists’ brief comes from individuals of varied backgrounds and opinions, including former Fed Chairs Ben Bernanke and Janet Yellen, former Congressional Budget Office director Douglas Holtz-Eakin, former Council of Economic Advisers Chair under President George W. Bush Greg Mankiw, and President Obama’s former economic adviser Jason Furman.

These economists criticized Trump for imposing tariffs based on the nearly impossible goal of balancing trade deficits. Citing Nobel laureate Robert Solow’s analogy, they said there is always a trade deficit between him and his barber, "because the barber never buys anything from me."

The economists wrote in their brief: "Reciprocal tariffs cannot 'fix' trade deficits." They added: "This is very basic economics, but its implications are far-reaching."

They elaborated on the normality of trade deficits, writing:

“The U.S. is dominant in global technology, and as such, has maintained a continued (trade) surplus in services for decades. The U.S. has long had a trade deficit in bananas, because its climate is not suitable for growing bananas.”

Small Businesses Accuse Tariffs of Being Illegal Taxes

The small business Learning Resources, which is suing the Trump administration, stated in a brief filed Monday that Trump’s tariffs are essentially an illegal $3 trillion tax imposed on Americans, to be shared over the next decade.

The company said Trump usurped Congress’s taxation power when he set tariff rates in February and April under an emergency law never intended for tariffs. The brief stated: "In the ensuing months, he arbitrarily raised and lowered, suspended and resumed, threatened and rescinded threats of tariffs for all sorts of reasons."

Lawyers for another group of small businesses, led by wine and liquor distributor V.O.S. Selections Inc., said in a second brief filed Monday that Trump’s tariffs run counter to the Founding Fathers’ original intent to give Congress the power to levy taxes.

The company pointed out: "The government claims the president can at any time, at any rate, against any country and product, and for any duration, impose tariffs on the American people—simply by declaring the long-standing U.S. trade deficit a national emergency and an extraordinary and special threat."

Trump Administration Insists on Tariffs as Necessary

The Trump administration stated in a brief submitted to the Supreme Court on September 19 that the president believes tariffs are necessary to "correct America’s fatal trade deficit." The government wrote: "For the president, these cases present a clear choice: with tariffs, we are a rich country; without tariffs, we are a poor one."

The Supreme Court will rule on whether Trump legally issued tariffs under the IEEPA. The law gives the president a range of financial tools to respond to national security, foreign policy, and economic emergencies.

The U.S. Court of International Trade previously ruled against Trump, and the federal appeals court upheld this decision. The court is also hearing another challenge brought by two family-owned educational toy companies, with the federal trial judge also ruling against the government.

Trump administration officials have downplayed the impact of these lawsuits, saying that most tariffs can be imposed through other legal avenues. Tariffs on steel, aluminum, and cars were imposed under different laws and thus are not directly affected by the appeals. Tariffs continue to roil the global economy and inject uncertainty into financial markets, while Trump has used the threat of raising tariffs to pressure trading partners into reaching agreements favorable to the U.S.

Risk DisclaimerThe market involves risks, and investment requires caution. This article does not constitute personal investment advice nor does it consider individual users' specific investment goals, financial situation, or needs. Users should consider whether opinions, views, or conclusions in this article fit their particular circumstances. Investing based on this is at your own risk. ```