A Major Defeat for the Legal Attack on Tariffs

The Supreme Court’s decision on Friday in FCC v. Consumers’ Research didn’t just preserve a telecom subsidy—it delivered a serious setback to efforts to dismantle President Trump’s trade agenda. In a 6–3 opinion written by Justice Elena Kagan, the Court rejected the claim that the Universal Service Fund’s contribution mechanism violates the Constitution’s nondelegation doctrine.

While the case concerned broadband access and carrier surcharges, its legal consequences reach deep into the heart of tariff policy. The Court’s reasoning, especially on revenue-related delegation, directly undermines the core argument of the plaintiffs in V.O.S. Selections v. United States, the challenge to Trump’s tariffs under the International Emergency Economic Powers Act (IEEPA).

The Court Reaffirms a Broad Standard for Delegation

The majority opinion forcefully reaffirmed the century-old “intelligible principle” test. Congress can delegate power to executive agencies, the Court said, as long as it gives them a general policy to pursue and meaningful boundaries on their discretion.

Importantly, the Court flatly rejected the argument that revenue-raising powers require a more rigid rule. “Twice before, we have rejected a party’s request to create a special nondelegation rule for revenue-raising legislation,” Kagan wrote. She emphasized that “[n]othing in the Constitution’s text or structure distinguishes Congress’ power to tax from its other enumerated powers in terms of the scope and degree of discretionary authority that Congress may delegate to the Executive.”