US President Donald Trump has suffered a major legal setback regarding his tariff policy. The court’s decision has limited their power to impose sudden and massive tariffs on imported goods. But it is important to understand that this decision does not mean that America will again return to the path of completely free trade. The reality is that the global business environment may never be the same as before.
The Supreme Court of America has made it clear that the President will have to use the power to impose tariffs only within certain limits. This means that now it will not be easy to take big and sudden decisions without a clear legal basis. Earlier, the way in which an announcement used to create a stir in the markets all over the world, that phase will now seem to have subsided to some extent. According to media reports, particularly The Wall Street Journal, tariff policies going forward will be more deliberate, limited and regulated. That means decisions will be taken with full process, and not under emotional or political pressure.
Still why won’t the atmosphere change?
Even though the court has set a limit, the direction of US trade policy has changed in the last few years. Now the idea of protectionism i.e. protecting domestic industries has become stronger in America. The interesting thing is that not only Republicans but also Democratic leaders have started adopting a tough stance on this issue in many matters. Promoting domestic manufacturing, reducing dependence on countries like China and protecting strategic areas. All these have now become part of American policy. Therefore, even if the court’s decision changes the method, there does not appear to be a major change in the intention.
Trump still has many options
It is also worth noting that Trump still has other legal avenues to implement tariffs. For example, tariffs can be imposed on grounds of national security or unfair trade practices under provisions such as Section 232 and Section 301. The only difference will be that now they will have to present a more solid economic argument and legal basis. That means tariffs will not be completely eliminated, but they will be used in a more planned manner. This change will reduce sudden decisions, but will not eliminate the policy of duty on trade.
What effect will be seen in the long run?
Global trade may definitely stabilize a bit in the coming time, because the possibility of sudden big decisions will reduce. Companies and investors will be able to plan for the future in a better way. But it would probably not be right to expect that America will once again become a supporter of completely open trade. Tariffs have now become a permanent part of American economic strategy. These are being seen as tools to increase revenue, strengthen national security and provide political support to domestic industries. Therefore, the atmosphere has definitely changed, but it has not become old. Trump may have suffered a setback on tariffs, but the game is not over. In fact, this is the beginning of a new and more structured phase.
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