California becomes 1st state to sue Trump over tariffs

California has become the first US state to sue President Donald Trump because of his use of tariffs.

"Today, I announced a lawsuit on behalf of the State of California, suing the Trump administration," Governor Gavin Newsom said in a video on Wednesday after filing the lawsuit in federal court that targeted Trump's use of the International Economic Emergency Powers Act (IEEPA) to impose tariffs without congressional approval.

"California is the largest manufacturing state in our union, one of the largest trading partners around the globe. No state will be impacted more than the State of California, as it relates to the unilateral authority that's been asserted by the Trump administration to impose the largest tax increase in modern American history", he added.

"It's the worst own-goal in the history of this country," Newsom said. "One of the most self-destructive things that we've experienced in modern American history."

With 40 million people and a large, outward-facing economy that accounts for 14 percent of the US GDP, California looks set to bear the brunt of the economic damage forecasters expect from recent gyrations.

Newsom's office says California — which would be the world's fifth-largest economy if it were an independent country — could lose billions of dollars in revenue if Trump's tariff policies shrink international trade.

'No authority'

The US Constitution vests the authority to impose tariffs in Congress, and the law that Trump cites as authority for his new tariffs, the IEEPA, does not allow the president to "tax all goods entering the United States on a whim," the state said in its lawsuit.

"President Trump's new tariff regime has already had devastating impacts on the economy, creating chaos in the stock and bond markets, wiping out hundreds of billions of dollars in market capitalisation in hours, chilling investment in the face of such consequential Presidential action with no notice or process, and threatening to push the country into recession," the lawsuit said.

California, the world's fifth largest economy and the largest importer of goods among US states, "bears an inordinate share" of the tariffs' costs," according to the lawsuit.

White House spokesman Kush Desai said on Wednesday that California Governor Gavin Newsom should focus on addressing crime, homelessness, and high prices in his state instead of trying to block Trump's tariffs.

"The entire Trump administration remains committed to addressing this national emergency that's decimating America's industries and leaving our workers behind with every tool at our disposal, from tariffs to negotiations," Desai said.

The Trump administration already faces three similar lawsuits — one in the New York-based Court of International Trade by business advocacy group Liberty Justice Center seeking to block all of the tariffs, one in Florida federal court by a small business owner seeking to block the tariffs on China, and a third filed in Montana by members of the Blackfeet Nation — a Native American tribe that spans Montana and Canada's Alberta province — challenging Trump's tariffs on Canada.

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Source: TRT