Ed Gresser, Vice President and Director for Trade and Global Markets at the Progressive Policy Institute, published his trade fact of the week, looking at who should be able to impose a tax under the U.S. Constitution.
The Constitution gives a pretty clear answer. Its four sentences on trade policy all come from “Article II” (on Congress), with two from Section 8’s “enumerated powers” list, and two from Section 9’ “denied powers” list. The first (see below for the others) says flatly that “The Congress shall have Power to lay and collect Taxes, Duties, Imposts, and Excises.”
Giving Congress this power wasn’t a big Constitutional-drafting controversy. The “taxes, duties, imposts, and excises” clause, in fact, appears to have survived untouched from the first draft presented to the Constitutional Convention on August 6, 1787, to its publication on September 19th. James Madison’s notes of the August 16 session (the day the Convention debated import and export taxes) report none of that day’s 15 speakers arguing that a president should be able to set tariff (or other tax) rates. Why not? A single individual given power to set tax rates could use them to reward self and friends, punish critics, impoverish political or business rivals, etc.. A big Congress with lots of mutually suspicious factions might not find this impossible, but would have much more trouble agreeing to do it.
Gresser points to a few laws that “may have inadvertently provided presidents with something closer to genuinely arbitrary power,” such as the Section 232 and Section 301 of the Trade Act of 1974, the International Emergency Economic Powers Act, and Section 338 of the Tariff Act of 1930. While none of those laws envisions a President deliberately bypassing Congressional authority to levy taxes, Gresser provides two arguments on whether current trade laws override the “Taxes, Duties, Imposts, and Excises” clause and past Supreme Court actions that deal with this issue.