Scott Kennedy

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Iran tariffs threaten to unravel the U.S.-China trade truce

As of May 2026: Analyzing U.S.-China trade dynamics

The legal foundation for Trump's tariff strategy collapsed on February 20 when the Supreme Court ruled 6-3 that IEEPA does not authorize tariffs. The decision voided both the 25% Iran secondary levy and other emergency-based duties on China. Trump signed a 10% global replacement under Section 122 of the Trade Act within hours, dropping China's effective rate from 47% to about 35%.

Updated May 20

Notable Quotes

"China will not hesitate to retaliate in a way that imposes serious costs on the U.S. [and it] has prepared for a variety of scenarios, including this one."

from Iran tariffs threaten to unravel the U.S.-China trade truce · Updated May 20

"The last time we played this game, we ended up with tariff levels at 145%."

from Iran tariffs threaten to unravel the U.S.-China trade truce · Updated May 20