Markets Rally as Trump Pauses Tariffs. Should Presidents Have This Much Power?
Last week, President Donald Trump imposed double-digit tariffs on imports from nearly every nation on the planet. The move spooked investors, and the markets plummeted in response. Then this week, Trump announced a 90-day pause on most of the tariffs, at which point the market immediately rallied.
As both Wall Street and Main Street struggle to follow what’s going on at any given moment, it’s a perfect time to ask whether a president should have this much power over the global marketplace.
On April 2, Trump announced that nearly all imports would soon be subject to tariffs between 10 percent and 49 percent. In response, the stock market saw the largest two-day decline in history, shedding $6.6 trillion in value. At the same time, the value of the American dollar also tumbled, while U.S. Treasury bond yields spiked, a sign of higher interest rates to come.
At the opening bell on April 9, the S&P 500 index was down 18.9 percent—just shy of a bear market.
Later that day, Trump announced “a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%.” The only exception was China, which would be hit with a tariff of 125 percent “effective immediately.” Markets immediately rallied: The S&P rose nearly 8 percent within the next hour and ended the day up 9.5 percent.
“It took great courage—great courage—for him to stay the course until this moment,” Treasury Secretary Scott Bessent told reporters after Trump announced the pause, adding, “This was his strategy all along.” (Just yesterday, White House press secretary Karoline Leavitt said Trump was “not considering an extension or a delay” of tariffs.)
The Founders clearly never envisioned such unfettered power in one person’s hands: Article I, Section 8 of the Constitution gives “Power To lay and collect Taxes, Duties, Imposts and Excises” to Congress, not the president.
But over the cours
Article from Reason.com
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