In a surprising twist to the ongoing trade policy battles, former U.S. Deputy Assistant Attorney General John Yoo suggested that the Supreme Court's recent ruling striking down President Donald Trump's tariffs could ultimately benefit the Republican Party and the president himself as the 2026 midterm elections approach. Speaking on Fox News this past Saturday, Yoo described the decision as a potential "blessing in disguise," arguing that the removal of the tariffs might spark an economic rebound at a critical time.
The Supreme Court's ruling, which invalidated Trump's use of tariffs under the International Emergency Economic Powers Act (IEEPA), came amid a backdrop of economic slowdown. According to the latest government data, the U.S. economy expanded at an annualized rate of just 1.4% in the fourth quarter of 2025, a sharp deceleration from the 4.4% growth recorded in the prior quarter and well below economists' expectations of 3%. Factors contributing to this sluggish performance included reduced government spending linked to a partial federal shutdown, weaker exports, and softer consumer spending, though these were partially offset by increased business investment. Imports, meanwhile, declined at a slower pace than in the third quarter.
Yoo, a prominent conservative legal scholar and former official in the George W. Bush administration, tied the court's decision directly to these economic indicators. In his Fox News interview, he noted the downbeat GDP report and posited that if the tariffs had played a role in the downturn, their abrupt end could reverse the trend. "If all of the president's announced tariffs were immediately removed, and 'If he chooses to do it again,' implying if Trump chooses to overhaul his tariff plan, it would take about a year to implement," Yoo explained. "This could actually provide a 'positive boost' to the economy."
He elaborated that such a recovery might align perfectly with the political calendar, giving Trump and the GOP a lift heading into the 2026 midterms. "This might be a blessing in disguise," Yoo said, emphasizing how the ruling could unintentionally stimulate growth by easing trade barriers and reducing costs for businesses and consumers.
The Supreme Court's decision marked a significant setback for Trump's aggressive trade agenda, which had relied on emergency powers to impose broad tariffs on imports from various countries, including China and the European Union. The IEEPA, originally enacted in 1977 to address national emergencies like the Iranian hostage crisis, was invoked by Trump to justify the measures without congressional approval. Critics, including legal experts and trading partners, argued that the law did not extend to routine trade disputes, a view ultimately upheld by the court in a 6-3 ruling last month.
In response to the verdict, President Trump moved quickly to pivot his strategy. He announced the imposition of a 15% global tariff rate under Section 122 of the Trade Act of 1974, set to last for 150 days. This section allows the president to address balance-of-payments issues with temporary levies. Additionally, Trump stated he would press forward with existing tariffs authorized by Congress under Section 232, which covers national security threats, and Section 301, aimed at unfair trade practices. These include longstanding duties on steel, aluminum, and a range of Chinese goods.
However, the path forward remains uncertain. The Supreme Court did not provide clear guidance on whether affected importers are entitled to refunds for tariffs already paid under the IEEPA, leaving billions of dollars in potential reimbursements in legal limbo. Trade lawyers and business groups have filed separate lawsuits seeking clarity, and the issue could return to the courts soon. According to reports from the U.S. Court of International Trade, preliminary hearings on refund claims are scheduled for early March 2026.
International reactions to the ruling and Trump's subsequent moves have been mixed but pointed. The European Commission, representing the 27-nation bloc, issued a statement urging the United States to "honor its trade agreements and provide full clarity" on future tariff policies. Commission President Ursula von der Leyen highlighted the need for stability, noting that the uncertainty has already disrupted supply chains for European exporters of automobiles and machinery. "We expect our American partners to adhere to WTO rules and avoid unilateral actions that harm global trade," a commission spokesperson said in Brussels on Friday.
China, a primary target of Trump's tariffs, took a firmer stance. Beijing's Ministry of Commerce called for the "immediate withdrawal of all unilateral levies," accusing the U.S. of protectionism that exacerbates global economic tensions. In a statement released Sunday, Chinese officials warned that any new tariffs under Section 122 would prompt retaliatory measures, potentially reigniting the trade war that defined much of Trump's first term. "The Supreme Court's decision is a step toward rationality, but the U.S. must follow through," the ministry said.
Domestically, the ruling has divided opinions along partisan lines. Republican leaders in Congress, including Senate Majority Leader Mitch McConnell, praised Trump's adaptability, calling the 15% tariff a "smart interim measure" during a press conference in Washington last week. McConnell argued that it buys time for negotiations while protecting American workers. Democrats, however, criticized the approach as chaotic. House Speaker Nancy Pelosi remarked that the flip-flopping on trade policy "undermines U.S. credibility abroad and burdens families at home with higher prices."
Economists offer varied assessments of the tariffs' impact. A report from the Peterson Institute for International Economics, released earlier this month, estimated that the IEEPA tariffs added about 0.5% to inflation in 2025 and shaved 0.2 percentage points off GDP growth. Removing them could lower consumer costs by an average of $400 per household annually, according to the analysis. Yet some free-trade advocates, like Yoo, see the court's intervention as freeing up the economy for a quicker recovery, potentially through increased imports and investment.
The broader context of Trump's trade policies dates back to his 2016 campaign promises to combat what he called unfair foreign competition. Since taking office in 2025 for his second term, Trump has escalated tariffs, citing everything from intellectual property theft to currency manipulation. The IEEPA invocation in late 2025 was his boldest move yet, affecting over $500 billion in annual imports. The Supreme Court case, American Manufacturers Association v. United States, was fast-tracked after challenges from industry groups representing retailers and farmers hit hardest by the levies.
As the dust settles, market reactions have been muted but telling. The Dow Jones Industrial Average rose 1.2% in the week following the ruling, buoyed by expectations of cheaper imports, while the dollar strengthened against major currencies. Analysts at Goldman Sachs predict that if Trump successfully implements the Section 122 tariffs without further legal hurdles, inflation could stabilize around 2.5% by mid-2026, setting the stage for the Federal Reserve to ease interest rates.
Looking ahead, the political ramifications could be profound. With control of Congress at stake in the 2026 midterms, an economic uptick would bolster GOP incumbents in battleground states like Wisconsin and Pennsylvania, where manufacturing jobs are key issues. Yoo's optimism hinges on Trump's ability to recalibrate quickly; if implementation drags, as he suggested it might take a year, the benefits could come too late. Meanwhile, ongoing disputes with allies and adversaries underscore the fragility of global trade relations under the current administration.
For now, businesses are in a wait-and-see mode. The National Association of Manufacturers, which supported the original tariffs for protecting domestic steel producers, expressed cautious support for the pivot but called for congressional involvement to avoid more court battles. As one association executive put it in a statement, "Predictability is the lifeblood of commerce, and right now, it's in short supply." The coming months will test whether this ruling truly becomes the unforeseen advantage Yoo envisions or just another chapter in America's turbulent trade saga.