Bulwark Takes: "Are Americans Getting a Refund from the Illegal Tariffs?"

Date: February 21, 2026
Host: The Bulwark
Featured Speakers: Kathryn Rampell (Economics Editor at The Bulwark), Mike Froman (President of the Council on Foreign Relations, former US Trade Representative)

Episode Overview

This episode explores the Supreme Court's landmark ruling invalidating certain Trump-era tariffs, its implications for executive authority, international trade policy, and whether Americans might receive refunds for tariffs now ruled illegal. Economics editor Kathryn Rampell interviews former US Trade Representative Mike Froman, delving into legal, diplomatic, and economic consequences of the court's decision and subsequent Trump administration responses.

Key Discussion Points & Insights

1. Supreme Court Ruling: Striking Down Tariffs

• Checks and Balances Restored
  Mike Froman highlights the significance of the Supreme Court's 6-3 decision as a positive assertion of checks and balances, limiting the President’s use of the International Economic Emergency Economic Powers Act (IEEPA) to impose tariffs:

  • “This is an example of checks and balances working as the Founders intended.” (03:14, D - Mike Froman)

• Limits on Executive Power
  The Court ruled that IEEPA cannot be used for tariff imposition, citing Congress' constitutional taxing power and lack of explicit statutory authority:

  • “Taxation is so clearly a prerogative of Congress … unless Congress very explicitly delegates authorities, the Court is reluctant to give the executive the benefit of doubt.” (04:45, D - Mike Froman)

• Major Questions Doctrine
  The ruling leaned on the major questions doctrine, reserving significant economic decisions for Congress barring explicit delegation.

2. Alternative Tariff Authorities & Legal Workarounds

• Trump’s Plan B: New Tariffs under Other Statutes
  Despite the ruling, President Trump responded by announcing a new 10% global tariff under Section 122 for 150 days and preparing further actions under other laws (06:36, E - Trump statement).

  • “He’s going to use these other tariff authorities … But those laws require process.” (07:44, D - Mike Froman)

• Section 301 and 232 Explained

  • Section 301: For unfair trade practices (e.g., current China tariffs).
  • Section 232: For national security concerns (e.g., steel and aluminum).
    Froman notes that while these authorities are available, they require investigations and justifications—not the carte blanche IEEPA provided.

• Judicial Reluctance on National Security Pretext

  • Courts often defer to the President on national security, making Section 232 a powerful, though sometimes overstretched, tool (08:25–09:19).

3. Diplomatic and Economic Fallout

• Diplomatic Leverage but Increased Uncertainty
  The move to other, more process-bound tariff authorities reduces presidential nimbleness but maintains significant leverage:

  • “He can’t do it in an arbitrary fashion … but he still has a lot of authority.” (11:27, D - Mike Froman)
  • Other nations are likely to cooperate quietly to avoid retaliation but may find it harder to trust US commitments.

• Impact on Trade Relationships

  • Unpredictability strains the willingness of other countries, especially close partners like Canada and Mexico, to make concessions during trade agreement reviews (13:38–15:07, D - Mike Froman).
    • “If at the same time they’re not 100% sure that the US is going to uphold its side of the commitment, that’s tricky." (14:02, D - Froman)

4. Efficacy and Purpose of US Tariff Policy

• Tariffs as Foreign Policy Leverage

  • Froman acknowledges that tariffs have been used successfully to extract concessions, but at a cost largely borne by American consumers and manufacturers (18:45, D - Mike Froman).
    • “If we are willing to live in a less efficient, more expensive world … then that’s what the democratic process should debate.” (19:10, D - Froman)

• Uncertainty and Economic Cost

  • Trade policy randomness creates uncertainty for businesses, affecting hiring and investment; US resilience is notable but not without drawbacks (20:10, D - Froman).
    • “People aren’t really aware of what their revenues are going to be or what their costs are going to be.” (20:01, D)

5. Will Americans Get Tariff Refunds?

• Supreme Court Decision Lacks Refund Clarity
  Trump argues the court left the $175 billion in collected tariffs in limbo (21:13–22:19, E - Trump):

  • “I guess it has to get litigated for the next two years … they don’t even talk about that.” (21:22, E - Trump)

• Legal Precedent Favors Refunds

  • Froman states established law requires illegal tariff collections to be refunded; process will be messy but is ultimately obligatory:
    • “If tariffs have been collected illegally, inappropriately, mistakenly, they are to be refunded.” (22:50, D - Froman)
  • He acknowledges a historic scale, but sees it as logistically feasible though potentially slow (24:13, D).

• Discrepancy between Legal Duty & Political Will

  • Although Trump implies resistance to refunds, Froman predicts that legal procedures and suits will likely force the federal government’s hand (24:46, C–D).

6. Trade Policy Retrospectives and Geopolitics

• Regret Over Abandoning TPP
  Rampell asks about the Trans-Pacific Partnership (TPP); Froman admits the administration's withdrawal rerouted US strategy but acknowledges other CPTPP signatories have pressed on without the US (25:31–27:36, C–D):

  • “We may have been a little before our time with regard to TPP … the US isn’t getting the benefit of it.” (26:19, D - Froman)

• Shifts in Global Alliances

  • Western leaders' renewed engagement with China is seen as natural but also a byproduct of US withdrawal from multilateral engagements (28:10, D).
    • “We have certain common interests vis a vis China … ultimately those interests will draw us together, not drive us apart.” (28:43, D - Froman)

Notable Quotes & Memorable Moments

• Checks and Balances:

  • “This is an example of checks and balances working as the Founders intended.” (03:14, D - Froman)

• Major Questions Doctrine:

  • “Taxation is so clearly a prerogative of Congress … and that power, you know, without representation and the representation is the Congress.” (05:00, D - Froman)

• Tariffs as Leverage:

  • “As a former trade negotiator, I have great respect for the use of leverage in negotiations … But we shouldn’t pretend as though this is free.” (18:45–19:10, D - Froman)

• On Executive Latitude:

  • “The reason why the President liked imposing tariffs under IEEPA is that it doesn’t require any process. He could just announce it.” (07:55, D - Froman)

• On Tariff Refunds:

  • “If tariffs have been collected illegally, inappropriately, mistakenly, they are to be refunded. There’s really no question about that.” (22:50, D - Froman)

• Diplomatic Sarcasm:

  • “You don’t think your La-Z-Boy chair is critical to national security?” (10:14, C - Rampell)
  • “It certainly is critical to me.” (10:17, D - Froman)

• Audience's Doubt About Lasting Commitments:

  • “Why would [other countries] continue to work with the President?” (13:08, C - Rampell)
  • “Nobody really wants to be out alienating or offending the United States." (13:47, D - Froman)

Important Segment Timestamps

• [03:14] – Froman on the Supreme Court ruling and checks and balances
• [04:40–05:45] – Analysis of the Court’s reasoning and the major questions doctrine
• [06:36] – Trump’s statement on new tariffs (audio clip)
• [07:44–09:19] – Froman explains tariff authorities, Section 301 and 232
• [10:14–10:20] – National security justifications, with a lighthearted exchange
• [14:00] – Trade deal complications post-decision
• [18:45–19:10] – Tradeoffs and the cost of leverage
• [21:13–22:19] – Trump’s response to the tariff refund question (audio clip)
• [22:50–24:13] – Legal and logistical analysis of refunding tariffs
• [25:31–27:36] – Retrospective on the TPP and US–China relations
• [28:10–29:07] – Geopolitical implications of Western engagement with China

Summary

This episode provides a nuanced, expert walk-through of the legal, economic, and diplomatic fallout from the Supreme Court’s tariff ruling. Mike Froman commends institutional oversight, outlines complicated alternatives the administration must now pursue, and unpacks the inevitable and considerable refund process for illegally collected tariffs. The conversation underscores that while US power remains formidable and tariffs are a potent diplomatic cudgel, the cost—borne heavily by American stakeholders and international goodwill—demands serious public debate.