Marketplace Morning Report – Fallout from the Supreme Court's Tariff Decision

Date: February 23, 2026
Host: David Brancaccio
Theme: An in-depth look at the Supreme Court's major tariff ruling, its impact on U.S. trade policy, and a data-driven conversation about the fiscal contributions of immigrants.

Episode Overview

In this concise but information-packed episode, the Marketplace team breaks down the economic and geopolitical aftermath of the Supreme Court’s decision to overturn the Trump administration’s sweeping tariffs. Through expert insights and international perspectives, the episode explains what tariffs remain, what changes are likely, and how global trading partners are reacting. The second segment delves into new research finding that immigrants overwhelmingly contribute positively to the U.S. Treasury, featuring an illuminating discussion with a co-author of the Cato Institute’s report.

Supreme Court Strikes Down Unilateral Tariffs (01:01–04:06)

Key Discussion Points

• The Ruling:
  The Supreme Court determined that the Trump administration lacked legal authority, under the International Emergency Economic Powers Act (IEEPA), for imposing broad, unilateral, globally-applied tariffs.

• What’s Affected and What Remains:

  • The ruling invalidates major “on-a-whim” tariffs, particularly those applied without Congressional oversight.
  • Other tariff authorizations remain in force:
    • Section 301 (Trade Act of 1974): Allows tariffs in response to unfair trade practices, still active against China.
    • Section 232 (Trade Expansion Act of 1962): Permits tariffs on “national security” grounds, especially on aluminum, steel, car parts, copper, and lumber.

  Quote:

  "[T]here are other laws under which President Trump has tariffs. Section 301 of the Trade Act of 1974 allows tariffs in response to unfair trade practices still in place against China." — David Brancaccio quoting Michael Strain, 01:45

• Impact on Average Tariff Rates:

  • The average effective tariff rate on foreign imports dropped from ~16% to 9% after the ruling.
  • However, new Section 122 tariffs may raise rates back up, at least for the next 150 days, to approximately 13.7%.

  Quote:

  "[T]ariffs that have been in the news a lot that President Trump has put in place on a whim [...] have been removed, which reduced the average effective tariff rate on foreign imports from around 16% before the Supreme Court's decision down to 9%. But according to the Yale Budget Lab, President Trump’s new Section 122 tariffs ratchet that back up [...] to 13.7%." — Martha Gimbel via Mitchell Hartman, 02:32–02:58

Notable Moments & Quotes

• Potential for New Investigations:
  "There are still a number of active investigations on aircraft industry, machinery, medical equipment, wind turbines and drones, which could lead to additional tariffs." — Robert McClelland, 02:14–02:25

• Next Steps for Companies and Consumers:
  Companies and consumers may consider legal action to reclaim payments made under now-illegal tariffs.

Global Response: Allies and Adversaries React (03:18–04:06)

Key Discussion Points

• India:
  Delays its scheduled delegation to Washington to finalize an interim trade deal.

• European Union:
  Meeting to consider whether to freeze ratification of last year’s trade agreement with the U.S.

• China:
  Calls for the cancellation of all U.S. tariffs; underscores its view that a trade war is detrimental to all.

• United Kingdom:
  Having previously negotiated a 10% tariff deal, the UK could now face even higher tariffs.

  Quote:

  "China says it's making a full assessment and has called for all U.S. tariffs to be cancelled, adding that in its view, a trade war benefits no one." — Felicity Hanna, 03:53

Immigrants’ Fiscal Impact: New Report’s Findings (05:07–08:17)

Key Discussion Points

• The Cato Institute Study:
  Outlines that immigrants—across all economic strata—are a net positive to U.S. government finances.

• Headline Number:
  Immigrants have reduced the federal deficit by $14.5 trillion (real 2024 dollars) over the past 30 years.

  Quote:

  "The biggest finding is that immigrants have generated a cumulative 14 and a half trillion in real 20, $24 in deficit reductions over the last 30 years." — David Bier, 05:42

• Undocumented Immigrants:

  • Net benefit of $1.7 trillion, with most excluded from Social Security and Medicare but still paying taxes.
  • Many pay into federal and local tax systems without receiving associated benefits.

  Quote:

  "They are paying taxes, particularly at the state and local level. And even if we look at just federal income taxes, a majority of the illegal immigrant population is on the books. They are paying into that system, and then they're not drawing that benefit out later when they retire." — David Bier, 06:39

• Tax Contribution Despite Lower Wages:
  Immigrants’ high labor force participation and hours worked mean they pay more in taxes than their population share would suggest.

  Quote:

  "So even though they earn lower wages because they work so many more hours, they end up paying more in taxes than their share of the population would predict." — David Bier, 07:18

• Policy Implications:
  Stricter immigration controls risk worsening U.S. fiscal health due to a shrinking working-age population.

  Quote:

  "If we end up in a situation where we cut off immigration or our working age population would go into decline before our retiree population goes in decline. So it's an enormous problem. Immigration alone is not going to fix it, but it's certainly helping and pushing in the right direction." — David Bier, 07:53

Timestamps for Key Segments

• [01:01] – Supreme Court ruling on tariffs and breakdown of impacted policies
• [02:32] – Quantitative impact on average tariff rates; policy summary
• [03:18] – International responses (India, EU, China, UK)
• [05:07] – Cato Institute study: Overview and headline findings on immigration's fiscal impact
• [05:57] – Undocumented immigrants' unique contributions
• [07:18] – Analysis: Tax contributions exceed population share
• [07:53] – Broader fiscal implications for future immigration policy

Conclusion

This episode provides a fast-paced yet thorough analysis of the immediate and ongoing effects of the Supreme Court’s tariff decision on U.S. trade policy and global relationships. The Marketplace team then pivots to data-driven insights on immigration, revealing substantial, long-term fiscal benefits as documented by a surprising source—offering both economic context and timely policy perspective for listeners seeking to understand today's headline economic issues.