Washington — The last few months have thrown Lindsay Hagerman for a loop. As the co-owner of RainCaper, a Pennsylvania-based company that offers art-inspired travel accessories and gifts, she’s been reevaluating her pricing strategy. With tariffs on goods from China fluctuating wildly—sometimes from 10% to 20% to 145%—Hagerman finds herself uncertain about how to price her products. “Is this just a phase, or is this how things will be now?” she wonders. “I don’t want to overcharge customers, but I have expenses to cover too.”
RainCaper, which Hagerman started with her mother nearly ten years ago, sells items like rain capes, umbrellas, and scarves. Since these products come from China, she’s felt the impact of the trade wars and tariffs first-hand. She had to make tough choices: trim expenses and even lay off a couple of employees. Manufacturing locally was also explored but deemed too costly and impractical for logistics.
Hagerman isn’t alone. Small business owners across the U.S. are anxiously awaiting a decision from the Supreme Court regarding President Trump’s authority to impose these tariffs. While lower courts have ruled many tariffs illegal, a Supreme Court ruling could significantly affect future trade policy and how power is distributed between Congress and the presidency.
Using a law called the International Emergency Economic Powers Act (IEEPA), Trump has imposed various tariffs, claiming trade deficits and drug trafficking as national emergencies. Critics argue that leveraging this law for tariffs is excessive and may reshape how future administrations approach trade.
Experts predict that if Trump wins this legal battle, upcoming administrations may use this broad interpretation of IEEPA to impose tariffs more freely. “This could reshape the power dynamics between Congress and the presidency,” says Timothy Meyer, a law professor at Duke. “The president could claim the right to tax a wide range of goods.”
The economic impact of these tariffs is alarming. An analysis by the Tax Foundation found that these duties could cost Americans around $1.7 trillion by 2035 and cut GDP growth by 0.7% annually. Additionally, small businesses often face unique challenges due to their smaller margins. Julie Robbins, who runs EarthQuaker Devices, shares the same concern. “I worry we’re witnessing a ‘mass extinction’ of small businesses,” she says. Her company has struggled with nearly $40,000 in tariffs and has had to let some employees go, despite wanting to keep jobs in the U.S.
Other businesses also feel the strain. Cephalofair Games, a California-based board game publisher, has incurred over $144,000 in tariffs recently. They’ve raised their prices and had to downsize. The uncertainty makes it challenging to plan for the future, as they constantly monitor Trump’s social media for tariff-related announcements.
“We can’t really plan anything with all this uncertainty,” says Price Johnson, Cephalofair’s COO. “It feels like we’re waiting for a decision that could change everything.”
As the legal battle unfolds, small businesses like RainCaper are left in limbo, and the consequences of the Supreme Court’s ruling could resonate for years. The balance of power, economic health, and the fate of countless small businesses hang in the balance.
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Supreme Court of the United States, Tariffs
