Senators Don't Like 25% Tariff Idea, but Legislating Not on Agenda

But senators from those states interviewed in the Capitol didn't say they were preparing to curtail the president's power to hike tariffs without congressional input. Numerous laws delegate that power to the executive, including the International Emergency Economic Powers Act, widely expected to be the tool Trump would use to make his threats a reality.

Sen. John Cornyn, R-Texas, sidestepped a question from International Trade Today on how 25% tariffs on Mexican imports would affect Texas' economy.

"There's a preceding issue, which is, under the USMCA, would that be permitted, or would that be a violation of the trade agreement we negotiated. And there's procedure under the USMCA ... to resolve that dispute," he said.

That's not really in question, given the USMCA says "no Party shall increase any existing customs duty, or adopt any new customs duty, on an originating good." However, no mechanism can force any country to honor the treaty, even if a dispute panel rules against that country.

However, Cornyn downplayed the likelihood the tariffs would be imposed. "There's a difference between the negotiation and the reality," he said.

Michigan exported $27.3 billion worth of goods to Canada in 2023, according to the Office of the U.S. Trade Representative, and about twice as many imports enter the U.S. from Canada through Michigan.

Sen. Gary Peters, D-Mich., said the possibility Trump will put 25% tariffs on Canadian exports "is a big concern. When you think about the amount of trade that just goes back and forth across the border in Michigan and Windsor [Ontario] in auto parts, they're moving back and forth constantly. I think it's been said if Michigan were a country, that we'd be the second-largest partner with Canada, so it would have a significant impact on the auto industry, and ultimately, the prices that are paid by consumers." Trade with Canada "is just part of the system that exists right now" in automaking, he said. "To untangle that would be incredibly complicated and likely counterproductive."

However, Peters sidestepped a question about whether the Senate could influence Trump not to follow through with his threat. He said: "Certainly a lot of major questions will arise from those actions, and we'll need to get answers to those questions."

Sen. Rand Paul, R-Ky., introduced a bill earlier this year (see 2409170072) that would prevent a president from hiking tariffs without Congress voting to approve that hike. When asked if there was appetite in the Senate to act on his bill, he said he didn't know.

Paul added, "The American Revolution was fought over taxation without representation. You'd think that anybody that's read their history would be concerned about a 25% tariff on Canadian and Mexican goods -- [it] would be one of the largest tax increases in our history, you'd think people would be concerned about that, and want a vote in Congress. So I don't see how it would be consistent with our traditions or our Constitution to have a massive tax levied on the people without a vote in Congress."

Sen. Ron Wyden of Oregon, who will be the top Democrat on the Finance Committee next year, said hiking tariffs in this way is wrongheaded, but when asked if he would want to try to legislate to stop it, as Paul's bill would do, he said, "I haven't seen the bill."

Wyden said: "The first thing that's important for Americans to know is they weren't told the truth about tariffs the last eight months. [Trump] constantly says foreign countries and hostile powers are going to pay the tariffs. They're not! They're going to be taxes on the American people.

"That's bad for American consumers, that could contribute to more inflation, and certainly I'm going to speak out and make sure the American people get a dose of the truth."

Sen. Mark Kelly, D-Ariz., said agriculture in his state would be most affected if there are tariffs on all Mexican imports.

It would be "really, really bad" for "not only our economy, but for the economies of Texas, California, and the rest of the country. Blanket tariffs are a bad idea," he said.

With regard to Paul's bill, Kelly said, "I'm interested in talking to him about it, but I would say, generally, this is an authority that presidents have, and they've exercised it responsibly. We want to see a responsible President Trump on this issue."

According to Georgia's Department of Economic Development, businesses in the state imported about $9 billion from Mexico in 2020. Sen. Raphael Warnock, D-Ga., said a 25% tariff on Mexican imports "would not be helpful" for his state's auto industry. "It's a bad idea, and [would] certainly contribute to inflation."

When asked if the Senate could do anything to stop those tariffs, he replied, "I think we have to try."