Sign up for the Slatest to receive the most insightful analysis, criticism, and advice delivered to your inbox daily. On Wednesday, the Supreme Court will hear oral arguments in a pair of significant challenges to President Donald Trump’s unilateral decision made on April 2—dubbed “Liberation Day”—to impose sweeping tariffs on virtually all goods imported into the United States. The implications of this case are monumental, not only for the American economy but also for global trade dynamics and foreign policy. The cases serve as a critical test of the extent of presidential power to regulate international trade without congressional approval.
At the center of this legal battle is Learning Resources, a small, family-owned business specializing in educational toys, most of which are manufactured overseas. The company initiated the lawsuit in April, and subsequent courts have ruled against Trump’s actions. The White House defends its stance by citing the 1977 federal statute known as the International Emergency Economic Powers Act (IEEPA), which ostensibly authorizes the president to regulate imports and exports in response to any unusual and extraordinary threats from abroad.
Rick Woldenberg, CEO of Learning Resources, shared his insights during an interview with Dahlia Lithwick on the Amicus podcast, discussing why a small, family-run business has taken such a bold step against the government, all the way to the Supreme Court. Woldenberg detailed the history of their company, which dates back to 1916, and emphasized their commitment to providing affordable, high-quality educational materials. With over 500 employees and offices in both the U.K. and Los Angeles, Woldenberg described how the company has been forced to produce many of its products overseas in order to keep prices competitive.
Woldenberg recounted the moment on April 2 when Trump announced the tariffs, stating, “I was in a meeting, and when I got out, the world had changed.” This announcement led him to terminate a crucial development deal and halt discussions on a joint venture intended to penetrate a new export market. Although Woldenberg and his team had anticipated some form of tariffs, the scale of the announced increases was shocking. The initial promise of a maximum of 60 percent tariffs escalated to an astonishing 145 percent within a week, severely impacting their financial projections.
Woldenberg explained the financial repercussions of these tariffs on his company’s bottom line. He articulated that while some tariffs have already impacted profit-and-loss statements, others remain as inventory costs until sold. This year, Learning Resources anticipates spending around $14 million in cash on tariffs. In stark contrast, last year’s tariff expense was zero. Looking ahead, Woldenberg estimates that the cost could balloon to $40 million in the following year, emphasizing the volatility and unpredictability of tariff rates.
The effects of these tariffs extend beyond the company itself. Woldenberg highlighted the broader impact on the local community, where thousands of employees rely on the business for their livelihoods. He stressed that the health of local communities is sustained by businesses like his, which contribute to local economies through employment and taxes. “I’m not willing to allow this to be destroyed,” he asserted, emphasizing the importance of standing against policies that threaten the foundation of their operations.
As a former lawyer, Woldenberg articulated the legal arguments being presented by the Trump administration. They assert that the IEEPA grants the president the authority to regulate imports in times of economic emergency. However, Woldenberg challenges this interpretation by referencing Article 1 of the Constitution, which explicitly assigns the power to impose and collect taxes to Congress. He argues that allowing a president to impose tariffs without legislative approval undermines the foundational principle of taxation with representation.
Woldenberg expressed his frustration regarding the lack of support from larger corporations in challenging these tariffs. He emphasized that small businesses like Learning Resources are often on the front lines, bearing the brunt of the economic strain. “I was pissed off,” he admitted, explaining that the need to defend his enterprise prompted him to take legal action. He believes that if no one stands up against unjust policies, it can lead to dire consequences.
As the Supreme Court prepares to hear this pivotal case, Woldenberg remains hopeful that the justices will recognize the potential ramifications of their ruling. He believes that a failure to distinguish between regulation and taxation could set a dangerous precedent for executive power in the United States. “The opportunity and responsibility to defend Madison’s idea and the integrity of that idea in modern society is one of the great honors of my life,” he remarked, looking forward to presenting his case.
In conclusion, the upcoming Supreme Court decision will not only affect Learning Resources but will also have lasting implications for the relationship between the presidency and congressional authority over trade policies. The case serves as a reminder of the critical balance of power that underpins the American government, and the outcome will undoubtedly shape the future of international trade regulations in the United States.
