Gov. Newsom says state to sue over Trump’s tariffs
By Malathi Nayak Bloomberg California Governor Gavin Newsom revealed his state is suing to halt Donald Trump s tariffs setting up a high-stakes legal challenge to the president s landmark effort to overhaul global transaction The state will file a complaint Wednesday in San Francisco federal court challenging Trump s use of crisis powers to enact broad tariffs against Mexico China and Canada according to a message issued by Newsom s office Representatives cited harm to consumers and businesses in the world s fifth-largest financial sector RELATED Gavin Newsom wants nations to exempt California goods from tariffs That s unlikely experts say Newsom a Democrat who s considered a likely candidate to run for president in and California Attorney General Rob Bonta will seek a court order to promptly block the levies President Trump s unlawful tariffs are wreaking chaos on California families businesses and our market system driving up prices and threatening jobs Newsom announced in the comment Representatives for the White House didn t forthwith respond to an emailed request for comment on California s challenge Trump s unprecedented use of the International Emergency Economic Powers Act or IEEPA to impose tariffs on imports has rattled markets prompted forecasts of a likely recession and strained relationships with overseas trading partners The IEEPA passed in gives the president broad authority to regulate certain financial transactions when declaring a national urgency in response to an atypical and extraordinary threat It has traditionally been used to place sanctions on countries companies and individuals RELATED Newsom signs million more for fire prevention plus slew of Democratic priorities Trump became the first president to use the statute to impose tariffs when he disclosed levies in February against China Mexico and Canada to respond to the extraordinary threat of undocumented immigrants and illegal drugs moving through US borders The president is already facing at least three legal challenges to his tariffs though major industries caught in the tariff crossfire have held off from any legal action for now Two complaints were filed by conservative legal advocacy groups on behalf of small businesses and the third by members of the Blackfeet Nation in Montana Justice Department lawyers have argued that all the cases filed so far should be handled by the Court of International Agreement in Washington which specializes in lawsuits against the governing body over contract issues and are seeking to transfer cases filed in US district courts to the pact court California Market California a reliably Democratic state has already challenged an executive order Trump issued to end birthright citizenship and the freeze on federal grants and loans Newsom during his governorship has positioned himself as a national voice on issues from setting change to abortion rights His second term ends in leading to speculation he will run for president California accounts for roughly of the nation s gross domestic product has a million population and would be considered one of the largest economies in the world if it were a standalone country Newsom has reported that its economic weight gives California leverage on the global stage but it also makes it vulnerable to tariffs The state plays a crucial role in agriculture and US manufacturing including semiconductors computer equipment and vehicles It exported billion in agricultural goods in nearly of total US farm exports Almonds were the biggest contributor at billion followed by dairy products pistachios and wine with top buyers including Canada the European Union China and Hong Kong Newsom has previously disclosed he would try and insulate the state from Trump s tariff plan by going directly to global trading partners and seeking exemptions even though its unclear how he could pursue international agreements with foreign partners California plans to allege like the previous suits that the IEEPA doesn t give Trump authority to impose tariffs and that his actions violate the law absent congressional approval according to the announcement from Newsom s office Newsom and Bonta mentioned the tariffs have an outsized impact on California businesses including its more than small business exporters With assistance from Eliyahu Kamisher and Pierre Paulden More stories like this are available on bloomberg com Bloomberg L P
