|
Getting your Trinity Audio player ready...
|
With the state budget hanging precariously in the balance, Gov. Gavin
Newsom filed a lawsuit today to block President Donald Trump’s tariff
powers.
The lawsuit, which Newsom and Attorney General Rob Bonta filed in
federal court in San Francisco, argues that Trump does not have the
constitutional authority to unilaterally enact tariffs. Trump cited the
United States’ large trade deficit to declare a national emergency earlier
this month and impose sweeping import taxes on the rest of the world.
Visiting an almond farm in Turlock, which stands to lose export business to
retaliatory tariffs, Newsom expressed anger over the “toxic uncertainty” of
the president’s trade policy. He said the policies are harming California
more than any other state and called the tariffs a betrayal of the voters
who supported Trump because of his promise to bring down the cost of
living.
“This is recklessness at another level. The geopolitical impacts are
outsized. The trade impacts are outsized,” Newsom said. “No rationale, no
plan, no conscience to what it’s doing to real people.”
In a matter of days in early April, Trump invoked the International
Emergency Economic Powers Act of 1977 to establish a universal 10% tariff
on all countries importing goods to the United States, with even higher
reciprocal tariffs on some nations, then abruptly reversed course hours
after they took effect, pausing most of the reciprocal tariffs while
ratcheting up the import tax on China to 145%.
The chaos tanked the stock market, a huge risk for California’s
forthcoming budget, which depends disproportionately on income tax
revenue from capital gains earned by the wealthiest taxpayers. The state is
also particularly vulnerable to other economic pain from the tariffs,
because China is California’s largest trading partner, propping up
manufacturing, agriculture, tourism and major ports in Los Angeles, Long
Beach and Oakland.
Other significant potential impacts for California include driving up the
cost of construction materials just as Los Angeles begins rebuilding from a
series of devastating fires that flattened several neighborhoods in January.
California’s economic outlook is declining
Newsom said today that, anticipating higher inflation and higher
unemployment from the tariffs, he has downgraded California’s economic
outlook in a revised budget proposal that he plans to unveil next month.
Though he did not speak to Trump about the lawsuit, he said he gave the
White House a heads up.
In a statement, the White House slammed Newsom for undermining
Trump’s efforts to rescue American industry.
“Instead of focusing on California’s rampant crime, homelessness, and
unaffordability, Gavin Newsom is spending his time trying to block
President Trump’s historic efforts to finally address the national
emergency of our country’s persistent goods trade deficits,” spokesperson
Kush Desai said.
In their lawsuit, the fifteenth that California has filed against the Trump
administration since January, Newsom and Bonta asked a judge to
immediately pause Trump’s tariffs.
The state contends that the International Emergency Economic Powers Act
specifies many remedies a president can take in response to a foreign
economic threat, but tariffs are not among them. Without this specific
authorization from Congress, the lawsuit argues, Trump’s actions are
“unlawful” and “unprecedented.”
Joining Newsom in Turlock, Bonta said Trump was “attempting to override
Congress and steamroll the separation of powers” and that his “rogue and
erratic tariffs” must be stopped to prevent further damage to California’s
economy.
“Trump has had to resort to creating bogus national emergencies that defy
reason,” Bonta said in Turlock. “Bottom line: Trump doesn’t have the
singular power to radically upend the country’s economic landscape.
That’s not how democracy works.”
The lawsuit continues Newsom’s shift back toward a more aggressively
confrontational stance against the Trump administration. After the Los
Angeles wildfires, the governor sought to reset his relationship with
Trump as he lobbied for federal disaster aid.
But even though Congress has yet to approve any further assistance for
Los Angeles, Newsom has begun more vocally opposing the president’s
economic policies in recent weeks.
In the wake of Trump’s tariffs announcement earlier this month, Newsom
said California would pursue its own “strategic partnerships” on
international trade. The state this week launched a new tourism
campaign in Canada, which has been the second largest source of
international visitors to California but has already seen a steep decline this
year.
Newsom was unusually harsh when speaking about Trump’s tariffs in
Turlock, calling them the “poster child” for stupidity and an example of
“crony capitalism” because of the president’s willingness to exempt
products from favored industries such as electronics manufacturing.
“This is the personification of corruption,” Newsom said. “How in the hell
are we sitting by and letting this happen?”
