Terminating the National Emergency Declared to Impose Global Tariffs

Floor Speech

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Mr. KAINE. Mr. President, the Constitution of the United States puts two powers clearly--clearly--within the hands of Congress: the power to tax and the power to conduct trade policy, including the imposition of tariffs. These are powers for Congress, not the Executive. But President Trump finds Congress an inconvenience, and he has decided to take both of these powers onto his own shoulders by imposing a national sales tax--that is what his global tariff regime is--without any vote in Congress, purely on his own say-so, and to engage every nation in the world in a trade war on his own say-so without involving Congress.

President Trump has said in the past: ``I alone can fix it,'' and we know that that statement is false. No one alone can fix the big challenges facing our Nation. But I think if he were to say, ``I alone can break it,'' the results of the last 100 days would have proven him correct.

President Trump, on Inauguration Day, inherited the strongest economy on the planet Earth--not a perfect economy but the strongest economy, the envy of other industrialized nations. That is what he had just 100 days ago. And we know this morning that strong economy, which was growing for 3 years at a very solid pace, is now contracting.

It is not only the contraction of the economy, it is chaos in the stock market; it is declining consumer confidence; it is projections of recession by Federal Reserve districts and major economists.

All of this is happening because Donald Trump has pursued a three- step strategy of his own: massive layoffs of employees, contrary to congressionally passed appropriations bills, massive slashing of Federal spending programs, including those relied upon by everyday Americans in contravention of congressionally appropriated spending bills, and the waging of a tariff war against the entire planet.

And as my colleagues have said, it is a tariff war that gets announced and then suspended and then delayed and then announced again and then exceptions might be granted if we like you or not. It is chaos.

Last week, I traveled around the Commonwealth of Virginia, and I talked to businesses everywhere in my State. And they talked about the layoffs and they talked about the spending cuts and they talked about the tariffs and they added those three together and said what those three add up to is chaos--the chaos of unpredictability.

Many businesses told me that they want to make investments. They want to make investments to grow their businesses in Virginia, but they are unwilling to make a decision to invest as long as the rules of the road are chaotic and up in the air.

Businesses that import natural products to turn into finished products have to pay a tariff on the import. Businesses who sell their product abroad are losing markets as nations put retaliatory tariffs on the United States. And so these businesses are pausing their investment decisions.

Businesses in Virginia that are connected to multinational businesses are saying that their headquarters are deciding, well, we can invest in the United States or we can invest in another country. It is not wise to invest in the United States when everything is so chaotic.

Let's be clear, and I spoke about this with my colleagues when I talked about the Canada tariff provision that we successfully rebuked the President on a month ago. A tariff is nothing more than a sales tax. It is a sales tax on the products that everyday Americans use, especially groceries and clothing and building supplies, for farmers, the cost of fertilizer that they need as they are engaging in spring planting. Trump's worldwide tariffs are nothing but a new sales tax.

And the analysis, as this chart shows, of who the tariffs raise taxes on, like every other form of sales tax, tariffs are regressive. They hit lower income people the most. The average tax change as a share of income if the Trump tariffs are implemented, it is essentially on the poorest 20 percent of the American population, the equivalent to an additional 6.2 percent sales tax. For the next wealthiest quintile up, it is a 5.5-percent increase on the sales tax. For the next, it is 5.0, all the way up to the richest 1 percent will see their effective sales tax rate go up by 1.7 percent. This is a sales tax on everyone in the country, but it is a sales tax that, as all sales taxes do, fall hardest on those who can least afford it.

The new sales tax is affecting retirees particularly. So from NBC News:

Retirees `stunned' as market turmoil over tariffs shrinks their 401(k)s.

We have a Social Security system that is a good foundation for retirement so long as this administration doesn't mess it up, but it is not sufficient for retirement. And what you need for a dignified retirement is Social Security plus private savings, in most people's case, 401(k)s. The turmoil in the market driven by tariff uncertainty is hammering retirees more than just about any other group of people in this country.

The new sales tax is also a drag on economic growth--we saw this in the announcement this morning--but not just economic growth in the United States. I am on the Armed Services Committee, and I had a chance to go visit 2 weeks ago with the new government, incoming government in Germany.

Germany is a great ally. More U.S. troops are on the ground in Germany than any nation other than Japan outside the United States. We are security partners in Ukraine and in European security generally. The new German Government was just elected, the Chancellor will be installed in the first week in May with a mandate to restore the German economy, which has been in the doldrums since about 2019.

And as I talked to German leaders, military leaders and leaders in the civilian government, they said this is going to be the most pro- American, pro-transatlantic Chancellor you will have seen for a very long time, but he is coming in with a powerful mandate to grow the German economy so that we can be even better security partners, so that we can work better together on the manufacture of the F-35 and to help Ukraine in its defense.

But the Trump tariffs are standing directly in the way of this new, pro-American government being able to achieve what they need to be able to achieve. And that is why the IMF said that the Trump tariffs, this new sales tax, will be a drag not just on U.S. economic growth but on global economic growth.

This is a story from less than a week ago. U.S. manufacturing was already slowing before the GDP numbers came out today. A larger share of manufacturers are reporting declines in new orders rather than increases. Some of those declines are driven because of the price effect of tariffs, the price effect of retaliatory tariffs, but some are also being driven by the uncertainty.

There is a chaos penalty on the economy. When you are not sure what is going to happen, you slow your investments, and that is why you see a decline in manufacturing.

The Trump new sales tax, again, as proof from Reuters, ``Trump tariffs would harm all involved, U.S. trade partners say.''

This is not just something that is hurting everyday Americans--those are those to whom we have a responsibility in this body, but this is affecting the global economy in a way that is shocking.

And China, Japan, South Korea--a company from South Korea just announced a huge investment in Virginia yesterday in the clean energy space. Japan and South Korea, especially, are countries that do a lot of foreign direct investment in the United States. Japan and South Korea are two of our strongest partners, but even they are responding in a hostile way to U.S. tariffs. In fact, you see China, Japan, and South Korea starting to cooperate together to ward off some of the negative economic effects of U.S. tariffs. The last thing we want to do is encourage Japan and South Korea to work closer with China. We want Japan and South Korea to work closer with the United States. But the Trump tariffs are chasing allies into the arms of adversaries. How foolish is that?

And then we end up with the chaos argument that my colleagues had mentioned before. From the New York Times last week: ``With Only Bad Options, Businesses Scramble for a Tariff Chaos Playbook.''

A tariff chaos playbook.

When the cost of your imports is going up, when your export market is shrinking, when you don't know what the end of the story will be, the options that you have are very murky. Businesses want to have predictability. They want to be able to look into a crystal ball, and if they don't completely know the future, they want to be able to make enough of a prediction about the economic climate that would justify sizable investments.

And in a time of chaos, those investments are not going to be made, and that raises the danger that this first quarter economic contraction will be followed by another, which would be the textbook definition of a recession.

So how did we get here? From an economy on Inauguration Day that was the strongest in the world, when President Trump stood 50 yards from here and said it was a golden age, to an economy that has nothing but red lights and question marks all over it, we got here because one individual decided to bypass Congress and take both the taxing power and the trade power into his own hands without a debate, without committee hearings, without deliberation, without considering what the people thought about the plan, and that one man and his decisions have taken a chain saw to the American economy.

We must turn this around, and the good news is the Senate has the ability to turn it around. When the Congress passed the IEEPA law decades ago, it recognized the potential that an Executive can overuse the emergency power, and that is why Congress did something rare in IEEPA. They gave the power even to a single Senator, even to a single Senator in the minority party to say: Wait a minute, Mr. President, you have declared an emergency and, guess what, you are wrong. And even at the request of a single Senator, this body is put on the board to have to declare whether we own the policies of the President, this Trump madness, or whether we disown it and urge him to take a different path.

All the economic trends are pointing in the same direction. We should take a different path on the economy before this gets worse. The vote we will have later today gives the Senate, the greatest deliberative body in the world, the chance to stand up and say: Let's take a different path.

I thank my colleagues for their work together on this important resolution and urge a favorable vote on the resolution that we will have later today.

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