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The Trump Administration announced today that it would increase tariffs on Canadian aluminum and steel by 25%, bringing the tariffs up to 50%. Trump justified the increase in a post on Truth Social:

“I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD…The only thing that makes sense is for Canada to become our cherished Fifty First State…This would make all Tariffs, and everything else, totally disappear.”

These justifications are ridiculous. One needs to remember that it was Trump himself who negotiated the trade agreement between the US, Mexico, and Canada in July 2020, and at that time he posted this celebratory message: “BIGGEST TRADE DEAL EVER MADE, the USMCA, was signed yesterday and the Fake News Media barely mentioned it. They never thought it could be done. They have zero credibility!” Canada made no changes to its tariffs between 2020 and the recent struggle over tariffs rates. Moreover the flow of fentanyl over the US Canadian border is miniscule. According to Newsweek:

“According to U.S. Customs and Border Protection (CBP) data, around 43 pounds of fentanyl were intercepted coming from Canada into the U.S. last year, whereas Canadian authorities intercepted about 11 pounds going the opposite way during the same period.

“The Canada Border Services Agency (CBSA) reported six fentanyl seizures last month alone, all originating from the U.S. In one of the seizures, 56.1 grams of fentanyl were discovered by agents at the Windsor-Detroit Tunnel port of entry, including 20 fentanyl pills and 23 grams of a substance suspected to be fentanyl, all brought in by a pair U.S. citizens.

“Taken together, these seizures represent a tiny fraction compared to the more than 21,000 pounds seized at the U.S.-Mexico border over the course of 2024.”

All these justifications for the tariffs are spurious. But that begs the question. Trump has advisers that unquestionably have told him that American consumers will be paying higher prices for these products. Trump persists, however. Why?

Trump has announced the creation of something he calls the External Revenue Service to collect the tariff revenues. Such a new agency would require an act of Congress, so it is still a pipe dream. Right now, the tariff revenues are collected by the US Commerce Department and US Border and Customs Protection. Trump wants this revenue to offset the budget deficits that he will unquestionably aggravate with his proposed tax cuts for upper-income citizens.

The proposed tariffs will cost US families significantly more. Estimates range from $2,600 to $4000 increases per family. This is actually a tax increase on US families, and it is a tax increase not approved by Congress. Trump’s authority to raise tariffs comes from Congressional legislation that authorizes such power in case of an emergency. I actually see no emergency warranting these tariff increases–the closest “emergency” may be fentanyl, but the amounts from Canada do not warrant emergency status. So Trump has effectively managed a “stealth tax”, sidestepping the Constitutional power granted exclusively to Congress.

At some point in the future, Trump will announce the tariff revenues as part of his budget package. But he cannot admit that reality right now because it would expose his duplicity. But Congress should be aware of the extraordinary erosion of one of its central powers.