Evelyn Reynolds

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    The chaos Elon Musk and Doge are leaving behind in Washington

    Elon Musk formally exited his role in the Trump administration on Wednesday night, ending a contentious and generally unpopular run as a senior adviser to the president and de facto head of the so-called “department of government efficiency” (Doge). Though he promised efficiency and modernization, Musk leaves behind a trail of uncertainty and reduced functionality.The timing of Musk’s departure lines up with the end of his 130-day term limit as a “special government employee” but also plays a part in an effort by the billionaire to signal a wider shift away from Washington as he faces backlash from the public and shareholders. Musk has recently made a show of refocusing his efforts on his tech companies in interviews, saying that he has spent too much time focused on politics and plans to reduce his political spending in the future.As Musk moves on, he consigns a mess of half-realized plans and gutted agencies to his acolytes installed in key positions across the federal government. His departure throws Doge’s already chaotic impact on the government into an even grayer limbo, with questions over how much power the nebulous taskforce will have without him and who, if anyone, might rebuild the programs and services it destroyed.Doge’s debrisMusk’s initial pitch for Doge was to save $2tn from the budget by rooting out rampant waste and fraud, as well as to conduct an overhaul of government software that would modernize how federal agencies operate. Doge so far has claimed to cut about $140bn from the budget – although its “wall of receipts” is notorious for containing errors that overestimate its savings. Donald Trump’s new tax bill, though not part of Doge and opposed by Musk, is also expected to add $2.3tn to the deficit, nullifying any savings Doge may have achieved. Its promises of a new, modernized software have frequently been limited to AI chatbots – some of which were already in the works under the Biden administration.The greater impact of Doge has instead been its dismantling of government services and humanitarian aid. Doge’s cuts have targeted a swath of agencies such as the National Oceanic and Atmospheric Organization, which handles weather and natural disaster forecasting and plunged others such as the Department of Veterans Affairs into crises. Numerous smaller agencies, such as one that coordinates policy on homelessness, have been in effect shut down. Doge has brought several bureaus to their knees, with no clear plan of whether the staff Musk leaves behind will try to update or maintain their services or simply shut them off.In one early example of its cuts and the holes in government they have created, Doge targeted the government tech group that partnered with federal agencies to provide tech solutions, known as 18F.When Doge staffers entered the General Services Administration agency that housed the 18F Office, former employees have said they appeared to fundamentally misunderstand how the government operates and the challenges of creating public services.Former 18F director Lindsay Young, who is now part of a legal appeal that contends the firing of 18F violated legal requirements, is concerned that Doge’s cuts will have long-lasting effects on government functions.“In government, it’s just so much easier to tear things down than it is to build things up,” Young said.The mass layoffs at the Department of Health and Human Services represented a similar loss of institutional knowledge that Doge does not seem intent on replacing.Carl Tobias, a law professor at the University of Richmond who has been tracking Doge’s cuts, used the agency’s tobacco unit as an example, which was severely affected by the cuts. “The loss of so much expertise, especially in the healthcare area will mean that more Americans will become sick or die earlier than they might have,” he said. “It also may take many years and great expenditure of resources to restore that experience and expertise.”Musk’s gutting of USAid, formerly the world’s largest single provider of humanitarian aid, is one of the starkest examples of the disarray and harm that Doge’s cuts have caused. The US canceled approximately 83% of USAid programs, imperiling services around the world aimed at humanitarian assistance and disease prevention. One pioneering program under USAid, Pepfar, which coordinates the US HIV/Aids response, has seen its services reduced worldwide and its staff left in confusion over what they can still do for people who relied on their organization. Doge’s cuts to the program have likewise threatened the rollout of a new anti-HIV drug that researchers have hailed as a “miracle” for its effectiveness.As Musk returns to Tesla and SpaceX, the agencies he laid waste to are left to pick up the pieces.skip past newsletter promotionafter newsletter promotionThe Doge staffers still holding sway in governmentWhile Musk is returning to his tech empire, many of the former employees and inexperienced young engineers whom he hired to work for Doge are set to remain part of the government. One of the largest questions about what Doge’s future looks like is whether these staffers, some of whom gained near unfettered access to the government’s most sensitive data, will retain the same powers they enjoyed under Musk.Doge staffers, such as billionaire investor and Musk ally Antonio Gracias, have embedded themselves at key agencies such as the Social Security Administration and Federal Aviation Administration. They have worked as a sort of parallel government task force, operating with a lack of transparency as their attempts to access databases and migrate data has caused disarray and technical problems. Whether Trump and agency heads allow them to continue on with carte blanche remains unseen.Already at least two prominent Doge staffers have followed Musk to the exit. The billionaire’s longtime top lieutenant Steve Davis, who was running the day-to-day operations of Doge, left his role on Thursday. Spokesperson Katie Miller, wife of Trump’s deputy chief of staff Stephen Miller, also left the White House to work full-time for Musk, according to CNN.Some of Musk’s dictates have already been rolled back since he left Washington earlier this month, including a much-derided mandate that required federal employees to send a list of five things that they accomplished each week. The weekly email, which was initially introduced with the threat of being fired for non-compliance, was largely ignored and viewed by many as pointless busywork. On Wednesday, the Pentagon formally announced that it would halt the practice.Doge is not being left leaderless, however. Taking over for Musk, according to the Wall Street Journal, is Christian nationalist and key figure in the rightwing Project 2025 manifesto Russ Vought. A longtime believer that the president should have sweeping executive powers, Vought has said that he wants federal employees to be left “in trauma” and to slash federal funding.Musk has praised Doge’s work and pledged that it will continue without him, and as recently as this week is still removing veteran officials it disagrees with from federal agencies. Even at reduced numbers, Musk’s allies also still have access to immense amounts of sensitive and confidential data they are reportedly intending to use to surveil immigrants.What seems farther away than ever in the chaos, however, is Musk’s promise to make the government more efficient and better serve the public.“You don’t need that many people to decide to just cut things,” 18F’s Young said. “But if you actually want to build things, that takes thought. It takes effort.” More

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    Trump administration sets quota to arrest 3,000 people a day in anti-immigration agenda

    The Trump administration has set aggressive new goals in its anti-immigration agenda, demanding that federal agents arrest 3,000 people a day – or more than a million in a year.The new target, tripling arrest figures from earlier this year, was delivered to Immigration and Customs Enforcement (Ice) leaders by Stephen Miller, the White House deputy chief of staff, and Kristi Noem, the Department of Homeland Security (DHS) secretary, in a strained meeting last week.The intense meeting, first reported by Axios and confirmed by the Guardian, involved Ice officials from enforcement and removal operations (ERO) and homeland security investigations (HSI) – both separate offices within DHS. ERO is in charge of immigration enforcement, including arrests, detention and deportation, while HSI typically focuses on investigating transnational crime, such as drug trafficking, human smuggling and the spread of online child abuse.The 21 May meeting in Washington DC is the latest example of the increasing pressure being placed on officials nationwide to increase the number of arrests of immigrants, as the administration doubles down on its anti-immigration agenda.The latest phase of the crackdown includes new tactics, such as mandating federal law enforcement agents outside Ice to assist in arrests and transports, more deputizing of compliant state and local law enforcement agencies, and arresting people at locations that were once protected, like courthouses.“ This administration came into office with the illusion that they had been given a broad mandate to effectuate an aggressive immigration enforcement agenda, and they are doubling down now on that agenda,” said Nayna Gupta, policy director for the American Immigration Council. “ Public polling is showing decreasing support for Trump’s immigration agenda, as Americans wake up to the reality that mass deportation means arrests of our neighbors and friends, masked agents in our communities and people afraid to go to work and show up to school, in ways that undermine our local economies.”Helter-skelter action has led to citizens caught up in the dragnet, Ice skirting due process – to the chagrin of the supreme court and lower courts – over-crowding in detention centers, arrests based on ideology and officials deporting people to third countries.“The sweeping Ice raids and arrests are hitting families, longtime residents, children and communities in a way never seen before,” said Jesse Franzblau, associate director of policy for the National Immigrant Justice Center.As the number of people crossing the border into the US without authorization has plummeted even further than after the final Biden crackdown, operations in the US interior have increased.“Under Secretary Noem, we are delivering on President Trump’s and the American people’s mandate to arrest and deport criminal illegal aliens and make America safe,” Tricia McLaughlin, the homeland security assistant secretary, said in a statement.But even if the new target is fulfilled, it’s a far cry from Trump’s election campaign pledges to deport 15m to 20m people, which itself is more than the estimated 11m undocumented population.Agents with the FBI, HSI, Drug Enforcement Administration, Bureau of Alcohol, Tobacco, Firearms and Explosives and other federal law enforcement agencies have been co-opted from normal priorities to carry out immigration enforcement work. Current and former federal officials told the Guardian there is concern that important non-immigration-related investigations are falling by the wayside as a result.There has also been a huge escalation by local police and sheriff’s departments assisting, deputized by Ice to perform federal immigration arrests under a program called 287(g).Ice has also been targeting unusual places.On Tuesday, Ice and several other federal law enforcement agencies arrested roughly 40 people on the Massachusetts islands of Nantucket and Martha’s Vineyard. The US Coast Guard transported those apprehended, Ice said, angering some residents, local media reported.The agency has also been arresting people at courthouses throughout the country – a trend that has troubled advocates and policy analysts.“We’re seeing the Trump administration take the unprecedented step of arresting non-citizens who are following the government’s rules and procedures, and showing up for their court hearings,” said Gupta. “ They are desperate to reach a certain number of arrests per day. And the only way they can find non-citizens easily and quickly is to go to the courthouses, where they [immigrants] are doing exactly what they’re supposed to do.”On Wednesday, sources told the Guardian that officials had arrested people at two separate immigration courts in New York City. The outlet the City observed seven people arrested in a lower Manhattan court.Internal documents accessed by the Washington Post show Ice officers in more than 20 states have been instructed to arrest people at courthouses immediately after a judge orders them deported or after their criminal cases are dropped and they try to leave.The number of people held in detention by Ice reached 49,000 by 18 May, an increase of more than 10,000 since Trump took office, with the agency using local jails and federal prisons to hold immigrants, amid overcrowding.Austin Kocher, an assistant research professor at Syracuse University who closely tracks immigration detention data, said of the 3,000 daily arrest quota: “ The big question for me is: where are they going to put people?”Meanwhile, last month, the Trump administration ordered immigration judges to quickly dismiss cases by denying asylum seekers a hearing. The directive “has nothing to do with efficiency – it’s about slamming shut the courthouse door on people who have the right to seek asylum and a fair day in court”, Shayna Kessler, the director of the Advancing Universal Representation initiative at the Vera Institute of Justice, said.On Capitol Hill, the major spending bill passed by the House would balloon spending for immigration enforcement, at the US-Mexico border and in the interior, while cutting everyday services.“The administration is on a reckless spending spree, counting on Congress to bail them out for overspending hundreds of millions of dollars in private prison contracts with ties to top-level officials,” Franzblau said.He concluded: “It is beyond cruel to superfund Ice’s rampant violations of constitutional protections and expand the deadly immigration detention and enforcement apparatus.” More

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    Trump violating right to life with anti-environment orders, youth lawsuit says

    Twenty-two young Americans have filed a new lawsuit against the Trump administration over its anti-environment executive orders. By intentionally boosting oil and gas production and stymying carbon-free energy, federal officials are violating their constitutional rights to life and liberty, alleges the lawsuit, filed on Thursday.The federal government is engaging in unlawful executive overreach by breaching congressional mandates to protect ecosystems and public health, argue the plaintiffs, who are between the ages of seven and 25 and hail from the heavily climate-impacted states of Montana, Hawaii, Oregon, California and Florida. They also say officials’ emissions-increasing and science-suppressing orders have violated the state-created danger doctrine, a legal principle meant to prevent government actors from inflicting injury upon their citizens.“At its core, this suit is about the health of children, it’s about the right to life, it’s about the right to form families,” said Julia Olson, attorney and founder of Our Children’s Trust, the non-profit law firm that brought the suit. “We all have constitutional rights, and if we don’t use our constitution – if we walk away from it and we walk away from our youth – we will not have a democracy.”The lawsuit specifically targets three of the slew of pro-fossil fuel executive orders Trump has signed during his second term. Among them are two day-one Trump moves to declare a “national energy emergency” and “unleash American energy”, and another April order aimed at “reinvigorating” the domestic production of coal – the dirtiest and most expensive fossil fuel.View image in fullscreenAll three orders aimed to bolster already-booming US energy production. They also led agencies to stymy renewable energy production and to suppress climate research and data, flaunting congressional environmental protections, the lawsuit argues.The litigation is the latest in a series of youth-led climate cases brought by the non-profit law firm Our Children’s Trust. The lead plaintiff in the new case, 19-year-old Eva Lighthiser, was also a plaintiff in the firm’s Held v Montana lawsuit, which notched a landmark win in 2023 when a judge ruled that the state’s pro-fossil fuel policies violated their rights under the state’s constitution.“Trump’s fossil fuel orders are a death sentence for my generation,” said Lighthiser.Lighthiser has already seen the impacts of the climate crisis in her life: flood-related destruction to roads and bridges one summer forced her family to sell their house in Livingston, Montana.“The effects of climate change cause Eva persistent stress and anxiety about her future,” the lawsuit says. “Every additional ton of [greenhouse gas] pollution and increment of heat Defendants cause will cause Eva more harm.”Other plaintiffs in the new case previously participated in other Our Children’s Trust lawsuits, including one that reached a historic settlement in Hawaii last year; another filed by Florida youth against their state government; and a third, the federal case Juliana v US, which was filed a decade ago and dismissed without prejudice last year.Lighthiser said Trump’s re-election last year felt “like such a heavy thing”. In the wake of her 2023 win in the Montana lawsuit, she said it felt like taking “one step forward, three steps back”.She fears Trump’s policies will directly affect her well-being. In moves to prop up the dying coal industry in recent months, for instance, the administration has granted relief to both the Spring Creek coal mine and Colstrip coal-fired power station in Montana; trains transporting coal from one to the other run through Lighthiser’s hometown.“The coal cars are brimming with coal that just blows [dust] out all over my town,” said Lighthiser. “That could effect my own body and my own health, and it feels very intimidating, because it’s not something that feels like it’s in my control right now.”The lawsuit names Trump and the US as defendants, as well as the office of management and budget, the Environmental Protection Agency (EPA) and the departments of interior, energy and transportation, in addition to the head of each agency.“These are agencies that are really deeply involved in making sure that more fossil fuels stay online,” said Olson.It also targets scientific organizations such as the National Oceanic and Atmospheric Administration (Noaa) and its parent agency, the Department of Commerce, and the National Aeronautics and Space Administration – agencies that are “suppressing science” in their attempts to comply with Trump’s executive orders, said Olson.Reached for comment, Elizabeth Peace, spokesperson for the Department of the Interior, said her agency “remains committed to stewarding our natural and cultural resources, honoring Tribal trust responsibilities, and managing public lands for all Americans – while upholding fiscal responsibility”. She said the department does not comment on litigation “as a matter of policy”.Taylor Rogers, a White House spokesperson, said: “The American people are more concerned with the future generations’ economic and national security, which is why they elected President Trump in a landslide victory to restore America’s energy dominance. Future generations should not have to foot the bill of the left’s radical climate agenda.”The EPA also declined to comment.The youth plaintiffs are asking the court to declare the three executive orders unconstitutional and block their implementation. They are also demanding that it protect the rights to a clean environment granted by certain state constitutions like Montana and Hawaii, which they say the Trump directives have impinged upon.In Olson’s view, the case is winnable, particularly because it only brings claims under rights that are explicitly granted under the US constitution, and which have already been recognized by the supreme court. (Juliana v US, by contrast, argued that Americans have an implicit, but unstated, constitutional right to a life-sustaining climate system.)No matter how the case is eventually ruled, Olson said, the filing of the lawsuit is “itself a success”.“Having young people rise up at a time when democracy is threatened and when there’s retaliation against so many people in this country for standing up against the administration, that is success,” she said. “It’s about having the bravery to bring claims in the court, of not being too afraid to use their rights.”Though it is “scary to take on the man in the highest position of power”, Lighthiser said, the lawsuit is “absolutely necessary”.She hopes it will eventually help slow global warming, which has led to more frequent and intense wildfires, droughts and floods in her home state of Montana. And she hopes it will afford youth the ability to “just be kids”.She recalled one day during the summer of 2022, when the Yellowstone River flooded her hometown. “I spent seven hours that day filling sandbags for people to take to their homes,” she said.“That kind of thing is going to become more common [with] climate change,” she said. “That doesn’t sound to me like we’re getting to live freely.” More

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    Federal Reserve issues rare statement asserting independence amid Trump pressure

    The Federal Reserve issued a rare, strongly worded statement on Thursday after chair Jerome Powell spoke with Donald Trump at the White House on Thursday morning, holding firm on the central bank’s independence amid pressure from Trump to lower interest rates.The three-paragraph statement emphasized the Fed’s independent, non-partisan role in setting monetary policy based on economic data.“Chair Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming economic information and what that means for the outlook,” the statement read.Powell told Trump that he and other Fed officials “will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective, and non-political analysis”, according to the statement.That the Fed, which tends to be extremely reserved with public statements, issued the brief memo shows that officials are aware of Trump’s pressure campaign and are standing firm on the Fed’s independence.At Thursday’s White House press briefing, press secretary Karoline Leavitt said that the Fed’s statement is “correct” but that Trump “did say that the Fed chair is making a mistake by not lowering rates”.Historically, presidents show deference to the Fed, respecting the central bank’s independence. But over the last few months, Trump has tried to publicly pressure Powell to lower interest rates, as the Fed did last year, though officials say that the economy – thrown into a tailspin from Trump’s trade war – has become too unstable to continue lowering rates.After Trump’s “liberation day” in early April, when he announced a slate of tariffs that ended up crashing US stock markets, Trump wrote on social media: “This would be a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates. He is always ‘late,’ but he could now change his image, and quickly.”Powell, who was appointed during Trump’s first term in 2018, has resisted the pressure from Trump and has warned that high tariffs could lead to inflation and, earlier in May, said that officials are “in no hurry” to cut interest rates – all statements that seem to have put Trump on edge.“‘Too Late’ Jerome Powell is a FOOL, who doesn’t have a clue,” Trump wrote after the Fed’s meeting.Trump had previously threatened to fire Powell, though it’s unclear whether the president has the power to do so. Last week, the supreme court allowed Trump to follow through on his dismissal of officials on the National Labor Relations Board, the panel that oversees labor disputes, but judges noted that the Federal Reserve is a “uniquely structured, quasi-private entity” – implying that it likely won’t be so easy for Trump to get rid of Powell. More

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    The Guardian view on Trump’s tariffs: the courts have drawn a line. So must Congress | Editorial

    If one thing is more challenging to the rule of law than a genuine emergency, it is the invention of a phoney one. Since returning to the White House in January, President Donald Trump has upended global trade and international relations, wiping billions off the stock market in the process, by imposing tariffs that he claims are a necessary response to an emergency. Yet that emergency does not really exist, except in the manner that Mr Trump himself has created it.The president claimed, on 2 April, that a lack of reciprocity in US overseas trade arrangements was “an unusual and extraordinary threat to the national security and economy of the United States”. He claimed that this justified him in declaring an emergency and governing by executive decree under the 1977 International Emergency Economic Powers Act (IEEPA). Congress, which normally has the responsibility to decide US trade policy, was thus wholly ignored. Statutory consultative arrangements, traditionally an essential preliminary, went out of the window too. Mr Trump was effectively exercising an executive power grab.Now, after this week’s ruling by a US federal trade court, most of Mr Trump’s tariffs have been blocked. In a case brought by a coalition of businesses and US states, the court of international trade found that most of the tariffs “exceed any authority granted” to the president under the 1977 law. The White House will appeal. Meanwhile, trade talks aimed at creating so-called deals between the US and nation-state victims of the Trump policies are likely to be paused, while existing deals, including that with the UK, may be affected too.There will be a worldwide sense of relief for as long as it lasts. But the higher courts now face an important political responsibility as well as a judicial one. The ruling has left nations and businesses hanging. Some tariffs will remain, such as those on steel, aluminium and cars. Many others are suspended. Markets hate uncertainty.The issues at stake are very large. They are immediate, because the ruling suspends many but not all tariffs, and also strategic, because it challenges Mr Trump’s wide-ranging attempts to rule by executive order. Both are extremely important. Global trade and economic recovery, in Britain among many other countries, rest on the outcome. But so does Mr Trump’s strategy, which dates back to his first term, of using IEEPA powers to rule by decree, not merely on trade issues but, for example, in sanctioning officials from the international criminal court.The good news is that the president’s plans to impose tariffs on almost every country on the planet will now be subjected to something approaching the legal and constitutional scrutiny that they should have had in the first place. The rule of law, thankfully, has struck back, at least for now.The bad news is that Congress still shows no sign of reining Mr Trump in, as it should. Ironically, the IEEPA was originally a Jimmy Carter-era legislative attempt to boost congressional oversight of presidential emergency powers. Under Mr Trump, that role has been trashed. The worst of all outcomes would be for Congress to now give Mr Trump the powers to which he has laid claim. That is a real danger. The best outcome would be for Congress to give the IEEPA a fresh set of teeth. These would ensure that emergency powers are properly defined and applied, and never again abused by this or any other overmighty president.

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    RFK Jr’s ‘Maha’ report found to contain citations to nonexistent studies

    Robert F Kennedy Jr’s flagship health commission report contains citations to studies that do not exist, according to an investigation by the US publication Notus.The report exposes glaring scientific failures from a health secretary who earlier this week threatened to ban government scientists from publishing in leading medical journals.The 73-page “Make America healthy again” report – which was commissioned by the Trump administration to examine the causes of chronic illness, and which Kennedy promoted it as “gold-standard” science backed by more than 500 citations – includes references to seven studies that appear to be entirely invented, and others that the researchers say have been mischaracterized.Two supposed studies on ADHD medication advertising simply do not exist in the journals where they are claimed to be published. Virginia Commonwealth University confirmed to Notus that researcher Robert L Findling, listed as an author of one paper, never wrote such an article, while another citation leads only to the Kennedy report itself when searched online.Harold J Farber, a pediatric specialist supposedly behind research on asthma overprescribing, told Notus he never wrote the cited paper and had never worked with the other listed authors.The US Department of Health and Human Services has not immediately responded to a Guardian request for comment.The citation failures come as Kennedy, a noted skeptic of vaccines, criticized medical publishing this week, branding top journals the Lancet, New England Journal of Medicine and Jama as “corrupt” and alleging they were controlled by pharmaceutical companies. He outlined plans for creating government-run journals instead.Beyond the phantom studies in Kennedy’s report, Notus found it systematically misrepresented existing research.For example, one paper was claimed to show that talking therapy was as effective as psychiatric medication, but the statistician Joanne McKenzie said this was impossible, as “we did not include psychotherapy” in the review.The sleep researcher Mariana G Figueiro also said her study was mischaracterized, with the report incorrectly stating it involved children rather than college students, and citing the wrong journal entirely.The Trump administration asked Kennedy for the report in order to look at chronic illness causes, from pesticides to mobile phone radiation. Kennedy called it a “milestone” that provides “evidence-based foundation” for sweeping policy changes.A follow-up “Make our children healthy again strategy” report is due in August, raising concerns about the scientific credibility underpinning the administration’s health agenda. More

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    Trump tariffs derailed by law firm that received money from his richest backers

    Donald Trump’s tariff policy was derailed by a libertarian public interest law firm that has received money from some of his richest backers.The Liberty Justice Center filed a lawsuit against the US president’s “reciprocal” tariffs on behalf of five small businesses, which it said were harmed by the policy.The center, based in Austin, Texas, describes itself as a libertarian non-profit litigation firm “that seeks to protect economic liberty, private property rights, free speech, and other fundamental rights”.Previous backers of the firm include billionaires Robert Mercer and Richard Uihlein, who were also financial backers of Trump’s presidential campaigns.Mercer, a hedge fund manager, was a key backer of Breitbart News and Cambridge Analytica, pouring millions into both companies. He personally directed Cambridge Analytica to focus on the Leave campaign during the UK’s Brexit referendum in 2016 that led to the UK leaving the European Union.For its lawsuit against Trump’s tariffs, the Liberty Justice Center gathered five small businesses, including a wine company and a fish gear and apparel retailer, and argued that Trump overreached his executive authority and needed Congress’s approval to pass such broad tariffs.The other group who sued the Trump administration over its tariffs was a coalition of 12 Democratic state attorney generals who argued that Trump improperly used a trade law, the International Emergency Economic Powers Act (IEEPA), when enacting his tariffs.In such a polarized time in US history, it may feel odd to see a decision celebrated by liberal and conservatives. But Trump’s tariffs have proven controversial to members of both parties, particularly after Wall Street seemed to be put on edge by the president’s trade war.The US stock market dipped down at least 5% after Trump announced the harshest of his tariff policies. Recovery was quick after Trump paused many of his harshest tariffs until the end of the summer.Stocks started to rally on Thursday morning after the panel’s ruling. The judges said that the law Trump cited when enacting his tariffs, the IEEPA does not “delegate an unbounded tariff authority onto the president”. The decision is on a temporary hold after the Trump administration appealed.skip past newsletter promotionafter newsletter promotionWhile the ruling does not impact specific tariffs on industries such as aluminum and steel, it prevents the White House from carrying out broad retaliatory tariffs and its 10% baseline “reciprocal” tariff. The White House is appealing the ruling, which means the case could go up to the US supreme court, should the high court decide to take on the case.Members of both groups who sued the Trump administration celebrated the ruling. Jeffrey Schwab, senior counsel for the Liberty Justice Center, said in a statement that it “affirms that the president must act within the bounds of the law, and it protects American businesses and consumers from the destabilizing effects of volatile, unilaterally imposed tariffs”. Oregon’s Democratic attorney general, Dan Rayfield, who helped the states’ lawsuit, said that it “reaffirms that our laws matter”.In a statement, Victor Schwartz, the founder of VOS Selections, a wine company that was represented by the Liberty Justice Center in the suit, said that the ruling is a “win” for his business.“This is a win for my small business along with small businesses across America – and the world for that matter,” he said. “We are aware of the appeal already filed and we firmly believe in our lawsuit and will see it all the way through the United States Supreme Court.” More

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    ‘Trump always chickens out’: Taco jibe ruffles president’s feathers

    Trump Always Chickens Out – or Taco for short. Investors like narratives to explain the financial world, and they appear to have seized on this one: whenever Donald Trump faces a market backlash, he will back down.It would be fair to say the US president did not take kindly to the suggestion that he was being a “chicken” when asked by a reporter at the White House about the term that is gaining traction on Wall Street.“Oh isn’t that nice – ‘I chicken out.’ I’ve never heard that,” Trump mused on Wednesday in response to the reporter’s question on the so-called Taco trade. He then launched into extended comments on how high the tariffs he imposed on China were, and how he had “helped” China by cutting them.“But don’t ever say what you said,” he added to the reporter. “That’s a nasty question.” Apparently riled, he later returned to the theme, insisting that he was no chicken, and that often people accused him of being too tough.But recurrent retreats by Trump have become the basis for stock markets rebounding after falls, even as the US president has raised tariffs to their highest level in more than a century.The S&P 500, the US stock market benchmark, has gained about 1% during 2025, despite a deep slump in April as Trump announced “liberation day” tariffs on trade with most countries in the world.The stock market rise appears to have been aided by the Taco trade narrative: that market turmoil will correct the president’s course and allow companies to keep on making strong profits. That belief will strengthen if courts uphold Wednesday night’s ruling by New York’s court of international trade that Trump’s tariffs have been imposed illegally.When the Financial Times columnist Robert Armstrong coined the Taco acronym on 2 May, it was a pithy observation of market reaction to Trump’s chaotic policymaking. However, less than a month on, one question is whether being accused of being “chicken” will needle the president to take a harder line with trading partners.On some fronts – notably on transporting people to El Salvador without due process – the Trump administration has indeed defied barrages of criticism and several court orders. Yet on financial markets, the pattern is clear of a harsh initial position followed by a sizeable retreat. The partial climbdowns have often followed close behind slumping bond prices – increasing US government borrowing costs – a dynamic that could expose the world’s largest economy if left unchecked.skip past newsletter promotionafter newsletter promotionThe liberation day tariff announcement was followed by a 90-day pause. Trump said he would raise EU tariffs to 50%, before delaying that until 9 July. He ratcheted up levies to a punitive 145% on China, before dropping them to 30% during a 90-day pause. And he toyed with forcing out the Federal Reserve chair, Jerome Powell, only to backtrack quickly once investor displeasure became clear.However, the market optimism has not matched economic forecasts, which suggest that the White House’s actions are still historically significant. More