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The European Parliament is sent to freeze ratification of its US trade deal, the block demanding clarity after President Trump's new fifteen percent tariff.
The move follows the Supreme Court.
Ruling limiting his emergency powers. You leaders say approval can't move forward mid growing trade uncertainty. Let's stay on tariffs. And I'm joined now by Missouri Representative Jason Smith, who also serves as the chairman of the House Ways and Means Committee, and he is the chief tax writer in Congress. Chairman Smith, thank you so much for joining us this morning. Let's start with the elephant in the room. The tariffs were a big source of fiscal revenue for twenty twenty five.
Do you anticipate that that all will get refunded, and if not all, much of it will get refunded.
Now, to say that the tariffs were a significant impact of revenue is to say it lightly. In fact, it has been projected by the Congressional Budget Office that the tariffs that were in place would reduce the national deficit by three trillion dollars, and.
That's pretty substantial.
However, the Supreme Court decision is not going to affect the revenue that's coming in for the most part, because under.
A lot of the Federal Trade.
Statutes in regards to unfair trade, whether it's Section one, twenty two, three oh one, or two thirty two, the President is going to be able to levy his authority to implement virtually the same tariffs that were in place under IEPA that the Supreme Court throughout.
Sure, but the tariffs that were implemented through IEPA. Representative Smith, is it your message maybe to Corporate America that if they've joined this lawsuit, that maybe they shouldn't be expecting the tariff free funds? How do you expect that to play out?
You know, it's really unfortunate that the Supreme Court was crickets when it came to their very large, their large opinion, but they didn't even address this. So of course now it's going to be reprimanded down to the lower courts. They will make those decisions, but it's going to.
Be a process.
It's going to take three to four years probably before it's addressed.
There is this question of uncertainty that's certainly one of them. Chairman Smith, what's going to happen with the refunds. But then there's this other lingering uncertainty of having a president who first announced is ten percent tariffs and then fifteen percent with Section one twenty two, which can only be in place for a limited number of days. How is
this helping uncertainty in corporate America? Do you think that there could have been an argument to just say, Okay, the Supreme Court has made its decision and we carry on as is.
You know, certainty is great for the economy. That's why we passed the big, beautiful bill, the Working Families Tax Cut, six months early, to give this certainty to those small businesses, those big companies. But in regards to the tariffs, I think it's very certain there's probably not going to be any refunds. I don't see a pathway in Congress that
there's going to be refunds. And so you're going to look at over so course of the President Trump's administration, he's going to continue to use those tariff revenues to bring down the deficit.
There is another matter to this, though, and it can easily and many people have framed this as simply a consumer price hike. Representative Smith, do you expect that all of the Republicans in Congress will be behind this when we're just three and a half months away from a midterm election where affordability is on the ticket.
I think it's very important to understand trade policy just as a whole of where it is with all Americans, but also all members of Congress and the United States Senate. It's a deeply divided issue. Whether you're Republican or whether you're Democrat. There's not a uniform opinion of one party. In fact, you have Democrats that agree with Republicans, and Republicans agree with Democrats on various aspects of whether they're
pro tariffs or they're anti tariffs. So if something moves forward from a legislative perspective, it will have to be bipartisan because it is such a bipartisan division when it comes to those different items. But let's look at what tariffs have done. We have the lowest trade deficits since two thousand and nine, and when you refund tariffs, you're refunding money to corporations that benefit by purchasing products outside
of the United States. Who benefited from tariffs was the US manufacturers and US farmers.
So to be clear, are you and your colleagues working on legislation right now to codify tariffs.
We've been working on trade legislation throughout my three years as Chairman of the Ways and Means. If you if you just look at most recently in the last month, we reinstituted and extended the Haiti and the Gooa trade preferences programs. So we're in the middle of all the different trading aspects. If you look at the Big Beautiful Bill, we addressed a minimus when it came to China and other packages coming in the United States.
We're going to continue to do so. Tariffs are not.
The debt is still exploding because in large part the one big Beautiful Bill, Representative Smith, are we done cutting the deficit? Is this it for now?
We can't be done cutting the deficit.
When you look at a national security threat, it's definitely our fiscal house. When you're looking at approaching forty trillion dollars in national debt, we have to be looking at ways to trim the budget twenty four to seven.
So are you then, with all of this disappointed in a lot of your Republican colleagues. There have been some Senator Paul Representative Bacon, who publicly applauded the Supreme Court ruling. Representative Smith, it doesn't seem like there's cohesion at this moment.
Well, Senator Paul didn't vote for the Big Beautiful Bill either. So there's always division within the Republican Party. But guess what, there's bigger division in the Democrat Party Because Hakeem Jeffries is not even the minority leader of the House. His
lip base affects all of his policies A decisions. That's why we're in a government shutdown right now with the Department of Homeland Security and why they're not funding TSA agents in the airport, why they're not funding FEMA, and why they're not funding the US Coast Guard.
Yeah, there's a lot of backlash this weekend about a brief decision to shut down TSA pre check. Chairman Smith, where do we stand on funding the Department of Homeland Security?
Is there any movement?
There has been zero movement from what I have seen. The Democrats are demanding unrealistic expectations and solutions. They're the ones who shut down government. They need to come back to the table and make sure those TSA agents, the Coastguard, the Secret Service, FEMA that they have paychecks.
There still has been just mass outrage about what's happening with immigration and with ICE. Representative Smith, Where would anyone budge on this? How does it come to a solution?
Well, what doesn't make sense is that they say they want to defund ICE, but guess what. ICE was funded for four years in the One Big Beautiful Bill.
So by shutting down.
The Department of Homeland Security budget that does not affect funding of ICE. ICE is continuing to be funded because we did it for four years. So it is absolutely only politics of why the Democrats are shutting down government. They say that they're doing to defund ICE, but they know that they're not defunding ICE by shutting down.
Pro Some of the polls, though, have moved in the wrong direction for this administration on things the President ran on immigration, on this economy, on affordability again, three and a half months away from the midterms. Is this an administration and a party a GOP that risks losing control of the narrative.
Anyone can find a poll that favors their narrative, There's no question about it. What I will say is is I was back home in my Congressional district. All last week traveling throughout my twenty eight counties, and people were very portive of the President's immigration policies and securing the border, and the fact that three million people have illegals have been deported or voluntarily left.
I still think some of the images coming out have shocked people. But all this said, Representative Smith, there are a lot of issues that this administration now needs to tackle, especially in light of Friday's ruling. What are you expecting for the president State of the Union address tomorrow?
I think the President's going to highlight what he's done in his first year in office, which I believe what President Trump has done in his first year of office is more than what most presidents do in eight years, when you look at securing the border, which we just discussed, creating the largest tax cut in US history, and fulfilling his campaign promises of no tax on tips, no tax on overtime, tax relief for seniors, increasing the child tax credit,
creating the Trump Investment Accounts, making one hundred percent expensing of new factories. You've seen more than ten trillion dollars of investment come back into the United States. We have the lowest interest rate in five years, the lowest gas prices in five years, and guess what, the murder rate in the United States is the lowest since nineteen hundred.
These are huge successes. But when you look on the foreign stage, the president has eliminated eight different conflicts, so I think that's a lot of success that some presidents would be begging for, although.
There might be another conflicts brewing with a run or at least an escalation, which also might un do some of the work in gas and oil prices. Representative Smith, we're going to have to leave it there. Thank you for joining us. Representative Jason Smith, Chairman of the House Ways and Means Committee,