Tariffs, Emergency Powers, and Legal Uncertainty: The Latest US Trade Moves
- Schulz Trade Law
- Aug 1
- 2 min read
Tariffs, Emergency Powers, and Legal Uncertainty
Michelle Schulz Breaks Down the Latest U.S. Trade Moves
August 1, 2025
What happens when emergency powers are used for trade deals? Michelle Schulz explains the legal and economic ripple effects.
“It’s About to Get Interesting”
Sudden Tariff Hikes and Vague Deals
Michelle Schulz opens by highlighting the confusion and volatility surrounding current U.S. tariff policy:
“We are now looking at a snap back to the reciprocal tariffs, plus other overlapping tariffs… that the U.S. importing companies will have to pay.”
Unlike traditional free trade agreements, Schulz notes that these new arrangements with countries like the EU and Japan lack legal detail and transparency:
“This is more like a letter or a statement on Truth Social... It doesn't address the details.”
The result? U.S. businesses are left without clarity, facing potentially high tariffs of 10–15% with little room for planning or negotiation.
“Is This an Emergency or Leverage?”
The Legal Questions at the Heart of Tariff Authority
The Trump administration is relying on the International Emergency Economic Powers Act (IEEPA) to justify the tariffs. But Schulz questions whether this law was ever meant to apply:
“Many would say this is not an emergency, this is a deal… This is leverage.”
She explains that traditional trade remedies under Sections like 232 (for national security concerns) go through investigations and proper channels. These new reciprocal tariffs are broad, fast-tracked, and based on a controversial interpretation of emergency powers:
“The legal argument is this is not an emergency… You don't have the right to use that particular law to require U.S. importers to pay this tax.”
Global Consequences
Lost Leverage and Shifting Supply Chains
Beyond legal concerns, Schulz warns that U.S. trade unpredictability is already leading global companies to consider leaving the American market:
“We have already seen clients either move their services, move their manufacturing, or at least consider it… It may not be worth it to be in the U.S.”
She adds that if courts eventually decide these tariffs are unlawful, it could undercut U.S. credibility and disrupt global trade relationships even further.
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