Trump Says "I'll Deal With the Courts" — The Supreme Court Tariff Ruling That Shakes the Balance of Powers

Why it matters: The U.S. Supreme Court ruled 6-3 that President Trump's tariffs under IEEPA (International Emergency Economic Powers Act) were unconstitutional, overturning a tariff regime worth more than $134 billion. Trump said "I'll deal with the courts" and openly attacked two of the judges he appointed. As the foundations of the separation of powers are shaken, the market has reacted violently with a weaker dollar, a temporary surge in BTC, and higher stock prices, and confidence in the "rule of law" is being tested.

📝 Summary: The U.S. Supreme Court ruled 6-3 that President Trump's tariffs under IEEPA (International Emergency Economic Powers Act) were unconstitutional, overturning a tariff regime worth more than $134 billion.

What Happened

• Content of the Supreme Court ruling — On February 20, 2026, the U.S. Supreme Court issued a 6-3 ruling in the case of *Learning Resources, Inc. v. Trump*, finding that President Trump's tariffs under IEEPA (International Emergency Economic Powers Act) were unconstitutional. Chief Justice Roberts wrote the majority opinion, and Justices Gorsuch and Barrett, both appointed by Trump himself, joined the majority. The court ruled that tariff authority belongs to Congress under Article I of the Constitution and that IEEPA is not a basis for tariffs.
• Trump's adversarial stance — Immediately after the ruling, Trump, who received a memo during a meeting with governors at the White House, said it was a "disgrace" and said "I'll deal with the courts." At a press conference, he attacked the judges as "unpatriotic and disloyal to the Constitution" and said of Gorsuch and Barrett that they were "a disgrace to their families." He immediately signed an executive order imposing a 10% global uniform tariff based on Section 122 of the Trade Act, effective February 24.
• Market reaction — The S&P 500 rose +0.69% and the Nasdaq +0.9%. BTC temporarily surged to over $68,000 but returned to around $67,000 due to profit-taking. The dollar fell and gold remained strong. The market digested the ruling itself as "expected," but Trump's remarks attacking the judiciary and the legal sustainability of alternative tariffs emerged as new uncertainty factors.

The Big Picture

Historical Context

The clash between the President and the Supreme Court is the most dramatic testing ground for the separation of powers designed by the United States Constitution. Historically, three precedents resonate structurally with this situation.

In 1832, President Andrew Jackson is said to have told Supreme Court Justice Marshall in the Worcester v. Georgia case over Native American rights, "He has made his decision. Now let him enforce it" (in fact, the authenticity of this quote is debated). Jackson effectively ignored the ruling. It is noteworthy that Vice President J.D. Vance quoted Jackson's words in a 2021 podcast, suggesting that Trump should also "stand before the people like Jackson."

In 1937, Franklin Roosevelt (FDR) countered the Supreme Court, which had repeatedly rejected his New Deal policies as unconstitutional, by submitting a "court-packing bill" to add six justices. Public support remained at 39% and the bill was defeated in Congress. However, the pressure worked, and the Supreme Court subsequently shifted to supporting New Deal legislation (the "switch in time that saved nine"). FDR eventually appointed eight justices during his tenure, changing the direction of the judiciary.

In 1974, President Richard Nixon complied within eight hours with a unanimous Supreme Court ruling ordering him to turn over the Watergate tapes. He resigned 16 days later. It was a moment that confirmed the principle that "no one is above the law, not even the President."

What is unique about this ruling is that Trump was rejected by two conservative judges (Gorsuch, Barrett) he himself appointed. This is proof that judicial independence is functioning, but it also carries the risk that the conflict will escalate further as the president perceives himself as "betrayed." A CNN reporter reported that Trump raged in private, calling it "this damn court." In the history of the separation of powers, it is unprecedented for a president to openly call a Supreme Court justice "a disgrace to his family."

Stakeholder Map

By the Numbers

• 6 to 3 — The vote count in the Supreme Court ruling. Three conservatives (Roberts, Gorsuch, Barrett) joined three liberals, and two Trump-appointed judges went the other way.
• $134 billion — The total amount of tariffs collected under IEEPA tariffs by December 2025. More than 301,000 importers paid, and the burden was ultimately passed on to consumers.
• $1.5 trillion — Projected revenue over 10 years if tariffs were maintained. The ruling eliminates this source of revenue, raising concerns about the impact on the fiscal deficit.
• 10% — The alternative tariff rate based on Section 122 of the Trade Act, which Trump immediately enacted. However, the law provides for a maximum of 150 days as a temporary measure, and extension requires congressional approval.
• +0.69% — The S&P 500's gain on the day of the ruling. The market welcomed the tariff elimination, but the gain was limited, suggesting that the ruling was "priced in."
• $68,000 → $67,000 — BTC's price movement after the ruling. It temporarily rose 2% but then fell back due to profit-taking, and there was no consistent reaction as "digital gold."
• 150 days — The maximum term of tariffs under Section 122 of the Trade Act. It will expire in late July 2026, and if Congress does not extend it, the alternative tariffs will also disappear.

Between the Lines — What Reports Don't Say

President Trump claims to be correcting the trade deficit, but his real intention is to maximize presidential power through tariffs and appeal to his supporters. The Supreme Court is trying to protect the independence of the judiciary, but faces the risk that the president's attacks will shake public confidence. Congressional Republicans want to avoid party divisions, but the conflict between Trump supporters and free traders is deepening, and they remain caught in the middle.

NOW PATTERN

#Power Overextension × #Institutional Decline

Imperial Overreach × Institutional Decay

Trump's judicial attack on the Supreme Court's unconstitutional tariff ruling visualized the institutional friction of the separation of powers and exposed a structure in which policy uncertainty itself is being institutionalized as a new "norm" in America.

Imperial Overreach: "Betrayed by the judges I appointed" - An unprecedented presidential attack on the judiciary

President Trump openly attacked Supreme Court justices he himself appointed as "a disgrace to their families." In the history of the separation of powers, there is no precedent for a sitting president to personally attack judges he has appointed.

The Supreme Court ruling *Learning Resources, Inc. v. Trump* on February 20, 2026, was not just a precedent in trade law, but an event that re-examined the very structure of governance in the United States.

First, let's organize the legal framework of the ruling. Chief Justice Roberts applied the "major questions doctrine" and ruled that IEEPA (International Emergency Economic Powers Act) is not a basis for tariffs. This doctrine states that "if Congress delegates to the President the power to make decisions with enormous political and economic impact, it must do so clearly," and that IEEPA has historically been used for asset freezes and sanctions, and does not contemplate indefinite tariffs.

Justice Gorsuch's concurring opinion went further into deeper principles. He stated that "the legislative process ensures that each of us has a stake in the laws that govern us," emphasizing the importance of congressional legislation. Justice Barrett also clearly concluded that "the most natural reading of IEEPA does not give the President the power to impose tariffs."

However, what was even more shocking than the legal content of the ruling was Trump's reaction. At a press conference, he denounced all six majority justices as "a disgrace to the nation" and "unpatriotic and disloyal to the Constitution," and went on to personally attack Gorsuch and Barrett, saying they were "a disgrace to their families." He also questioned the judges' motives, without presenting any specific evidence, saying they were "influenced by foreign interests and political forces."

The peculiarity of this attack is highlighted by historical comparisons. FDR clashed with the Supreme Court, but he did not attack individual judges, but tried to counter with a system (adding judges). Nixon reluctantly complied with the ruling. Trump's approach is a "dual strategy of obedience and attack," complying with the ruling while undermining its authority by attacking the legitimacy of the judiciary itself.

It is noteworthy that Justice Kavanaugh wrote a 63-page dissenting opinion. Kavanaugh argued that tariffs are a "traditional and common means of regulating imports" and that IEEPA allows them. He further argued that "the major questions doctrine should not apply to diplomatic matters." At the same time, however, Kavanaugh added that "this ruling may not substantially restrict the tariff power of future presidents," suggesting that there is room for tariffs to be imposed under other legal bases (Trade Act Sections 301, 232, etc.). Ironically, this point is consistent with Trump's immediate action to impose alternative tariffs under Section 122 of the Trade Act.

Institutional Decay: The 150-day time bomb - The structure in which "uncertainty" becomes America's new normal

The ruling declared the tariffs "unconstitutional," but it did not end the uncertainty in trade policy. Rather, uncertainty has been institutionalized, and a structure has been established in which a crisis will recur in 150 days.

Immediately after the Supreme Court ruling, Trump signed an executive order imposing a 10% global uniform tariff based on Section 122 of the Trade Act. This alternative is legally valid, but contains three structural constraints.

First, Section 122 allows for a "temporary import surcharge" of up to 150 days to address "large and serious international balance of payments deficits," but extension requires congressional approval. In other words, a "time bomb" that will expire in late July 2026 has been planted. Congressional Republicans are divided between Trump supporters and free traders, and the success or failure of an extension bill is extremely uncertain.

Second, Section 122 prohibits discriminatory tariffs by country. Trump's IEEPA tariffs set rates by country, with 34% on China and 25% on Canada and Mexico, but Section 122 only allows a uniform 10%. The political highlight of "punitive" high tariffs on China has been lost. However, existing Section 301 tariffs (7.5-25% on China, applicable to approximately $370 billion worth of imports) and Section 232 tariffs (50% on steel and aluminum) remain for country-specific responses, so there will not be a complete elimination of tariffs.

Third, the issue of returning the $134 billion in tariffs already collected has emerged. Since the Supreme Court has ruled that it is "unconstitutional," importers may file lawsuits seeking refunds. If full refunds are ordered, the fiscal deficit will expand rapidly. The revenue structure of the tax cut bill promoted by the Republican Party will also fundamentally collapse, as the originally expected tariff revenue of $1.5 trillion (over 10 years) has disappeared.

This "institutionalization of uncertainty" creates a unique dynamic in the financial markets. The S&P 500 rose +0.69% on the day of the ruling, but this was only a digestion of the short-term positive factor of "tariff elimination = reduced corporate costs." As VanEck's Matthew Sigel points out, "the loss of tariff revenue could accelerate the printing of money and the devaluation of the currency to fill the fiscal deficit." In this context, BTC and gold may generate demand as a "hedge against currency devaluation," but the movement of BTC immediately after the ruling (temporarily rising above $68,000 and then returning to $67,000) indicates that the market has not yet fully priced in this structure.

The real uncertainty lies in the movements of Congress toward the expiration date in 150 days. Senator Rand Paul of the Republican Party welcomed the ruling, saying "tariff authority lies with Congress," while Representative Buddy Carter reacted with "judicial overreach." Senator McConnell developed the principle that "Congress's role in trade policy is not an inconvenience to be avoided." There is little prospect that this party division will be resolved