Tariff Refunds on the Table If Supreme Court Rules Against Trump
Treasury Secretary Scott Bessent defended Trump-era tariffs but warned the U.S. could face massive refunds if the Supreme Court rules them unlawful.
Treasury Secretary Scott Bessent has reaffirmed the Trump-era tariff strategy amid mounting legal and economic scrutiny. During a September 7 interview on NBC's Meet the Press, he defended the tariffs as part of a robust economic policy, citing solid GDP growth and a strong stock market as proof of success-even in the face of criticism from major manufacturers and agribusinesses.
However, Bessent delivered a sobering caveat: if the Supreme Court upholds a lower court ruling that the tariffs exceeded presidential authority under the International Emergency Economic Powers Act (IEEPA), the government could be compelled to refund up to half of the tariffs collected. The resulting fiscal impact-potentially tens of billions of dollars-could destabilize Treasury finances and create ripple effects across the global economy.
A panel from the U.S. Court of Appeals for the Federal Circuit ruled that former President Donald Trump had improperly invoked the IEEPA to justify the tariffs as retaliatory measures. If the ruling stands, it could nullify years of trade policy and demand that businesses that paid these tariffs be reimbursed. Bessent made clear that the administration would comply if the Court forces their hand: "If the court says it, we'd have to do it."
This legal uncertainty arrives at a critical juncture for American agriculture and trade. While many sectors, like heavy machinery, have felt the sting of tariffs and global trade friction, Bessent dismissed concerns that major players such as John Deere are suffering. "For every John Deere, we have companies who are telling us, ‘The tariffs have helped our business,'" he said, highlighting winners in the domestic supply chain.
At the same time, Bessent downplayed disappointing August employment numbers, emphasizing a broader trend of economic resilience. "We're not going to do economic policy off of one number," he stated. "We believe that good policies are in place that are going to create good high-paying jobs for the American people."
While the tariff debate garners headlines, lawmakers are also preparing to address critical agricultural infrastructure. This week, the U.S. House of Representatives is set to vote on a five-year reauthorization of the federal grain inspection program, a foundational element for U.S. grain exports. The new legislation aims to promote innovation and efficiency by mandating that the USDA prioritize the adoption of improved grain grading technology.
A key reform in the bill exempts equipment and technology costs from a 30% cap on administrative and supervisory expenses, which is designed to keep the program affordable while allowing for modernization. The grain inspection system, crucial for maintaining quality standards in international trade, is seen as a lynchpin for ensuring U.S. commodity competitiveness in a tightening global market.
As farm input costs continue to rise and weather volatility affects yields, improving grain grading accuracy through precision agriculture tools could provide a meaningful edge. These measures are also expected to strengthen crop insurance calculations, enhance transparency in co-op pricing, and support more sustainable agriculture practices.
The agriculture policy landscape in Washington remains highly active. National Pork Producers Council members are lobbying lawmakers this week to push back against California's Proposition 12, which imposes strict sow housing requirements. As part of their campaign, they've launched a food truck near Capitol Hill to draw attention to what they see as regulatory overreach harming producers.
Simultaneously, National Farmers Union (NFU) members are pressing for swift passage of the farm bill and urgent support for struggling operations. According to the NFU, "Family agriculture is reaching a breaking point, and farmers, ranchers and consumers need policymakers to act now." NFU members are meeting with top USDA and Justice Department officials to share on-the-ground challenges, from market consolidation to climate stress.
On the food waste front, the EPA has launched a new initiative to connect food donors to households in need. At a launch event at Scott Air Force Base, surplus produce was distributed to military families, reinforcing the dual goals of reducing waste and addressing hunger. The EPA estimates the average American household loses $728 annually due to food waste, pointing to untapped efficiency in the agricultural supply chain.
Meanwhile, across the border, Canada has lifted certain tariffs on U.S. goods, though those on steel, aluminum, and autos remain. The decision reflects shifting trade dynamics in North America, with Prime Minister Mark Carney citing compliance with the Canada-U.S.-Mexico Agreement (CUSMA) as justification.
Even Washington's culinary scene is catching up with ag policy: Founding Farmers, a restaurant launched by the North Dakota Farmers Union, has won back critical favor after years of mixed reviews. With upgraded recipes and a broader menu, it continues to blend advocacy and entrepreneurship in the nation's capital.
As Secretary Bessent put it, "President Trump was elected for change. And we are going to push through with the economic policies that are going to set the economy right." Whether the courts allow those policies to stand may determine the next chapter for U.S. trade, agriculture, and fiscal stability.