During remarks on the Senate floor Wednesday, Sen. Rand Paul (R-KY) spoke in opposition to tariffs and the emergency authorities that have been granted to Presidents to impose them.
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NewsTranscript
00:00Nomination, Department of Justice, Harmeet Dhillon of California to be an
00:06Assistant Attorney General.
00:16President, the Senator from Kentucky, asking Adam's consent to proceed to
00:22legislative session. Without objection. I ask that the Senate Executive execute
00:28the order of March 26th with respect to SJ Rez 37. Under the previous order the
00:36Committee on Finance is discharged from further consideration of SJ Rez 37
00:42which the clerk will report. SJ Rez 37, joint resolution terminating the
00:50national emergency declared to impose duties on articles imported from Canada.
00:55Under the previous order there are now six hours of debate equally divided on
01:00the joint resolution. Mr. President, the Senator from Kentucky. Taxation without
01:06representation is tyranny. Bellowed James Otis in the days and weeks and years
01:14leading up to the American Revolution, this became the rallying cry of American
01:20patriots. No taxation without representation. The American patriots
01:26thought that a distant Parliament in England where they had no representation
01:32had no right to tax them. This was the rallying cry. No taxation without
01:37representation. Our founding fathers believed so strongly in this they
01:43embodied it in our Constitution. Our Constitution doesn't allow any one man
01:49or woman to raise taxes. It must be the body of Congress. Now this wasn't new.
01:55This was part of maybe a thousand year tradition from Magna Carta on. In Magna
02:02Carta it is stated no taxation without the common counsel of the realm. Even at
02:10that time they were chafing at one man, the king, determining the taxes for the
02:14land. A hundred years before our Revolutionary War, in the English Civil
02:20War, there was a debate over parliamentary supremacy versus
02:24supremacy of the king. They did not want to pay taxes that weren't approved by
02:29the Parliament. In 1683 the New York Charter on Liberties, the beginning
02:35charter for the colony of New York, stated no taxation without representation.
02:42After this English Civil War, the English Bill of Rights embodied no
02:48taxation without the consent of Parliament. This principle was
02:53long-standing. It was non-negotiable. This was what sparked the Revolution and yet
03:02today we are here before the Senate because one person in our country wishes
03:07to raise taxes. Well this is contrary to everything our country was founded upon
03:13One person is not allowed to raise taxes. The Constitution forbids it. The
03:20Constitution was so concerned with the power of taxes, which some have said the
03:25power of taxes is the power to destroy. But our founding fathers were so
03:31concerned with this that they said no, the president will not have the power to
03:37legislate. The president will not have the power to tax. Only Congress will be
03:43able to tax the people and only by originating tax bills in the House. It
03:50was that specific. They were so mortified. They were so worried by having a
03:56monarchy. They were so worried about having all the power gravitate to the
04:00executive that they said we must split the powers. They based a lot of their
04:05thinkings on Montesquieu. Montesquieu wrote in the 1740s, 40, 50 years before
04:13our Constitution, Montesquieu wrote that when the legislative and executive
04:19powers are united in one, there can be no liberty. This is something that our
04:25founding fathers took to heart. They said we must separate the powers. We must at
04:30all costs limit the power of the presidency. This isn't about political
04:35party. I voted for and supported President Trump, but I don't support the
04:40rule of one person. We are set, the president is set, to have a 25% tax on
04:48goods coming from Canada and Mexico. This is a tax, plain and simple, on the
04:53American people. But one person can't do that. Our founding fathers said no, that
04:59would be illegal for one person to raise taxes. It has to come to Congress.
05:04It has to originate in the House. This has gone on for 200 and some odd years.
05:11You can't simply declare an emergency and say, well the Constitutional Republic
05:17was great, but gosh we've got an emergency or times are dire. The Supreme
05:22Court has repeatedly said there are no exemptions for emergency. There was no
05:28exemption for a pandemic. There is no exemption for emergencies. The Taxation
05:33Clause stands. It's an important part of the Constitution. Taxes must originate in
05:38the House. They must be voted on in Congress. No one man can raise taxes on
05:43the people. They are set to do this through a process in which an emergency
05:52has been declared. But realize this, one person declares an emergency, the
05:57president, and even if we are successful, which I think we will be successful here
06:02today, a majority will vote to say this is wrongheaded and the emergency should
06:06end. We'd have to go to the House. But even if we were successful in the House,
06:10the president would veto it. It would take a two-thirds vote in order to stop
06:14an emergency. That's such a burden that we need to consider reforming the
06:18emergency powers and reversing this. I think a president can have times that
06:24there are emergencies and the president can declare emergency, but it should last
06:2830 days at most. At the end of 30 days, the emergency would be brought to the
06:33People's House, the House of Representatives and the Senators, and we
06:36would vote whether to affirm or uphold an emergency. Right now the pretense of
06:41this emergency is fentanyl. I don't discount fentanyl. I know families who
06:45have lost kids to fentanyl. But there's more fentanyl going from the United
06:50States into Canada than there is coming from Canada into the United States. There
06:54is no emergency. The Canadians have actually been cooperative with us and
06:57said they will try to do even more. But the problem isn't in Canada. Even if the
07:06problem is valid, even if that is something that we all agree on, you can't
07:12have a country ruled by emergency. You can't have a company, a country, without a
07:17separation of powers, without checks and balances. Madison put it this way.
07:22Madison said that we would pit ambition against ambition, that all men and
07:28frankly all women are motivated by self-interest and the self-accumulation
07:33or aggrandizement of power. And so we would limit their power by pitting
07:38ambition against ambition. We would give some of the power to the House, some of
07:41the power to the Senate, some to the president. There would be checks and
07:45balances and a jostling for power, but we would check and balance each other.
07:50Part of the problem we face today with this emergency, though, is that Congress
07:55has abdicated their power. Not just recently, not just for this president.
07:58This is a bipartisan problem. I am a Republican. I am a supporter of Donald
08:03Trump, but this is a bipartisan problem. I don't care if the president
08:08is a Republican or a Democrat. I don't want to live under emergency rule. I
08:12don't want to live where my representatives cannot speak for me and
08:17have a check and balance on power. One person can make a mistake, and guess what?
08:22Tariffs are a terrible mistake. They don't work, they will lead to higher
08:28prices, they are a tax, and they have historically been bad for our economy. But
08:34even if this were something that was magic and it was going to be a pot of
08:37gold at the end of the rainbow, I wouldn't want to live under emergency
08:41rule. I would want to live in a constitutional republic where there are
08:45checks and balances against the excesses of both sides, right or left. If
08:51one person rules, that person could make a horrible mistake. On things so
08:57important as war, it's the same thing. We don't want a president just to go to war
09:02because a president might get angry with some country or have a vendetta. We're
09:06supposed to vote. That's why Declaration of War. War originates also in Congress.
09:10But we've lost so many of these things and so much of this. It's Congress's
09:15fault for giving it. Over the last 70 years, there's probably a dozen pieces of
09:19legislation where Congress said to the president, here, take this power, create
09:24emergencies, put on tariffs, negotiate for us because we're too feeble-minded to do
09:29it ourselves. But the thing is, the Constitution doesn't let us give our
09:33power away. There's something called the non-delegation clause, and it says that
09:38we're not allowed to give power away. We can't just say, here, Mr. President, take
09:42it. In this particular case, it's even worse. The rule of law, the IEPA is the
09:51acronym for it, has never been used for tariffs before and doesn't mention the
09:55word tariff. So this isn't something that was targeted in times of need. The
09:59president can have the power to put on tariffs. It never says that. This will be an
10:03extraordinary use of something never intended to be a way to have unilateral,
10:08one single person, invoke a tax on the people. With regard to tariffs, let's be
10:16very clear. Tariffs are simply taxes. Tariffs don't punish foreign governments.
10:22They punish American families. When we tax imports, we raise the price of
10:28everything, from groceries, to smartphones, to washing machines, to prescription
10:33drugs. Every dollar collected in tariff revenue comes straight out of the
10:38pockets of American consumers. Conservatives used to understand that
10:43tariffs are taxes on the American people. Conservatives used to be uniformly
10:48opposed to raising taxes because we wanted the private marketplace, the
10:52private individuals, to keep more of their income, so we were always for lower
10:55taxes. And yet now the mantra that's coming is we want higher taxes. What
11:01happened? Did we all of a sudden give up all the things we used to believe in as
11:05conservatives? I for one haven't. I still think more taxes is bad for the economy.
11:10More money taken out of the productive sector, the private sector, and given to
11:14the government is a mistake. To those who still call themselves
11:19conservatives, but now support tariffs, let me remind them that Milton
11:25Friedman said tariffs raise prices to consumers and waste our resources. To
11:33those who still have a fond memory of Ronald Reagan on my side, Ronald Reagan
11:37said protectionism costs consumers billions of dollars, damages the overall
11:44economy, and destroys jobs. Ronald Reagan's vision for America can be seen
11:50in our trading relationships with Canada. In 1986, President Reagan said our trade
11:56policy rests firmly on the foundation of free and open markets. I recognize the
12:03inescapable conclusion that all history has taught. The freer the flow of world
12:08trade, the stronger the tides of human progress and peace among nations. And
12:14it's absolutely true. If you look at a chart or a graph of world trade over the
12:20last 70 years, it's gone like this. We've been trading more with each other. If you
12:25look at a world map of prosperity, it's the same curve. It's a hockey stick. It's
12:31going up exponentially. If you look at a curve of poverty, a hundred thousand
12:38people are escaping poverty every day around the world, and it's because of
12:41international trade. Trade is good, not bad. Think about it. If you buy something
12:47you're trading, if you go to the store and you buy a smartphone and you give
12:52them a thousand dollars, you want that smartphone and you don't lose. Doesn't
12:57matter where the money went, you got your smartphone. You only give money to
13:01somebody for something if you want it. If it's a voluntary trade, it's always equal.
13:05Well, it's actually always mutually beneficial. And so when people say, oh
13:10we've lost and China's winning and China's winning and we have a trade
13:14deficit with China. America doesn't trade with China. An individual buys a
13:19product. You are the trader. When you go to Walmart and you buy something at
13:24Walmart and you say, my goodness, I can get this TV for $200 less than I could
13:29get it if there were only domestic TVs, you are the contractor. The US government
13:34didn't buy the TV. You bought the TV and you did it because you saved $200. You're
13:39now $200 richer and you can go somewhere. You can buy gas to go on a
13:42trip somewhere. You are richer. But if trade were bad, you wouldn't buy the TV.
13:47You made the decision. The government didn't. Our government doesn't trade with
13:52their government. Our individuals buy products from their individuals. If it's
13:57a voluntary trade, everyone benefits or the trade doesn't occur. It is perhaps no
14:04surprise then that the United States and Canada share the world's longest
14:09international land border and are continuously at peace. Canada is a great
14:14customer of ours. In fact, Canada buys more American goods than China, Japan,
14:22England, and France combined. So do we want the Canadians to buy less of our
14:29stuff or more of our stuff? It is a crazy notion to put a 25% tariff on this
14:36enormous amount of goods. There are predictions that cars are going to cost
14:40$10,000 more because the cars go in and out. We have cars made in Kentucky, but
14:46some of the parts go to Mexico. Some of the cars go to Mexico. Some of them go to
14:49Canada. They come back. $10,000 increase. Do you love the idea of tariffs? Is it
14:54such a great word to pay $10,000 more for a car?
15:00Canada is also the leading provider of grain, livestock, meat, and poultry. The U.S.
15:07imported $97 billion worth of oil and gas from Canada last year. Canada is a
15:13major provider of cars, car parts, steel, lumber, aluminum. This amount of trading
15:19demonstrates that no American will be able to avoid the high taxes, the high
15:25prices they'll be forced to pay because of tariffs. The taxes on Canadian imports
15:31will come at a great cost to American families. The taxes on Canadian imports
15:36will make the cost of food, fuel, cars, and furniture more expensive. The former
15:43Conservatives that now sing a populist tune know deep down that their advocacy
15:48of higher taxes will cause suffering for the American family. The converts to
15:55this protectionist faith cannot help but acknowledge that even they know that the
16:00tariffs will raise prices. They admit it readily. The tariffs that they put on in
16:062019 are still punishing the farmers in our country to such an extent that the
16:12farmers are still asking for more subsidies. When the Trump tariffs went on
16:17in 2018-2019, the farmers immediately complained that they were given $23
16:22billion of taxpayer money. That's an acknowledgement that the tariffs hurt
16:26farmers. So we're gonna do it again and they're all lining up and people say
16:31we're gonna have to bail them out. Or we have to bail out the car companies too?
16:34Or we have to bail out everybody that's going to be hurt by these tariffs? It's
16:39not a good idea. The administration is currently considering a bailout for
16:47farmers. The idea that the American taxpayer will have to bail out an
16:50industry to dull the pain of tariffs is not a novel one. We've seen this one.
16:55We've seen this story. What our parents told us when we were kids is still true
17:00today. Actions speak louder than words. The supporters of tariffs know that
17:06their policies impose suffering and they are willing to spend your money to
17:10alleviate that harm. So they know tariffs are gonna hurt farm exports so they're
17:15gonna take your money and give it to the farmers. Well what kind of policy
17:19acknowledges hey I got a terrible policy it's gonna hurt these people but we'll
17:23just give them some of your money. It makes no sense at all. In addition to the
17:30previous costs, the Peterson Institute estimates that tariffs will cost the
17:34average family $1,200 a year. The budget lab at Yale University estimates that
17:40tariffs will cost the average family $4,200 a year. In fact, according to the
17:45analysis, tariffs could cost the least fortunate families on average $2,400. The
17:51middle class will likely pay higher costs of about $3,000. Tariffs are a cost.
17:56Taxes are a cost. If you tax a good, it's added on to the costs. This is what
18:02happens. It happens whether inflation is the tax or whether the tax is a tariff.
18:08It adds to the cost of goods and it will be passed on to the consumer. The average
18:16American family won't get the bailouts though. If you're a special interest and
18:22the taxes hurt you, the tariffs hurt you, you'll get a bailout. But if you're just
18:27an average person working for yourself, self-employed, and the tariffs cost all
18:33of your groceries to go up, they cause your electronics to go up, no one's going
18:38to help you. You'll just pay higher prices. If you think the cost of eggs is
18:42high, just wait until the tariff hits cars. According to Goldman Sachs, the
18:48tariffs will raise the price of a car between $5,000 and $15,000. And despite
18:54arguments to the contrary, Americans know that tariffs are a tax they will have to
18:59pay. That is why vehicle sales jumped almost 13% last month because people
19:04were trying to buy their cars before the tariff gets on their car and raises the
19:08price. People are smarter than politicians. That's nothing new. It's not
19:15just cars that will be more expensive as a result of tariffs. Energy will be more
19:19expensive. Gas prices in some parts of the country could see a 15 to 30
19:24cent per gallon price. According to the National Association of Home
19:30Builders, the building of a single-family home could be coming up $10,000 more
19:34expensive. Why? Because we import lumber. We import steel. If we make it more
19:39expensive to import lumber from Canada and steel from Canada, the price of your
19:44house goes up. Look, people already can't buy a house because interest rates are
19:47so high. Young people are living in apartments more and more. People feel
19:50stuck in their life and we're going to add to the price of lumber and steel to
19:54make homes even harder to purchase. It's a terrible idea. Washing machines were
19:59already almost $100 more expensive as a result of the original tariffs four
20:04years ago. And here's really bad news. Even beer could become more expensive. A
20:09professor at Northeastern University states that a six-pack of Corona could
20:13go up by 45 cents, but a small craft beer could be increased by as much as a
20:18dollar a pint. The former and never worse, the former and never were
20:23conservatives who try to sell tariffs as anything other than a tax cannot fool
20:29the American people, who know that their purchasing power will be weakened with
20:33every new protectionist measure unilaterally imposed by the White House.
20:37And none of these tax hikes are necessary. The populists argue that the
20:42threat of tariffs are needed to force Canada to stop the flow of illicit drugs.
20:47In fact, one of the social media posts today said there was going to be a
20:52tariff on fentanyl. Really? You think the drug dealer is going to pay a tariff on
20:56fentanyl? Fentanyl's not being tariffed. That's sort of a some kind of mistaken
21:02notion. But this isn't going to happen. And as I've stated, there's more fentanyl
21:07going from the U.S. into Canada than there is coming from Canada in the U.S.
21:11It's not a real emergency. It's being used to place a tax on the American
21:15people. But already we've seen a response from Canada. In response to a
21:20threat of tariffs, Canada announced a $1.3 billion plan dedicated to border
21:26security to up border security on fentanyl. And yet the tariffs are still
21:30coming despite their help. But they've also announced more tariffs as well. The
21:36threat of tariffs seems to have worked. We need to not make Canada and America
21:41go through this when they've already responded to our requests. The chaos of
21:52one day the tariffs are on, one day they're off, next day there's a loophole
21:56for this industry or that industry is chaotic and is leading to turmoil in our
22:01markets. A week ago when the thought of tariffs came forward, the markets plunged
22:07into historically low levels. The tariffs on Canadian imports, the tariffs on
22:13Mexican imports, the tariffs on European imports, the chaos it creates in the
22:17marketplace makes it difficult to plan for businesses. The interesting thing
22:25also about the tariffs is some have said, well you know the people will see that
22:31we're standing up for them with tariffs and we're for America first. And yet when
22:36we put tariffs on, historically it has been Republicans. In 1890 McKinley put
22:41tariffs on. He was all for it and still there are people lauding McKinley. 1890
22:46the big McKinley tariff goes on. Do you know what happens in 1892? Of 170
22:52Republicans they lost a hundred seats because prices went up with tariffs. Has
22:58this ever happened before? Yep, it happened in the 1840s when they put on
23:02the tariff of abominations under John Quincy. He signed it. Once again the
23:08ruling party lost seats. When's the last time this happened dramatic fashion? Well
23:13if you study history and you want to know when the Republicans went to their
23:17lowest ebb in the entire history of our country, it came after the hot smoothie
23:21tariff in the early 1930s. Hoover was a president, a Republican. Republicans
23:26controlled Congress. They passed this dramatic tariff which most historians
23:30and most economists now say prolonged the Depression for ten years and caused
23:35the worst part of the Depression to actually be in 1937, seven years after
23:40the tariff and nearly eight years after the stock market crash. Do you know what
23:46happened to the Republicans in 1932? The Democrats won the presidency. They won
23:52the House. Do you know when Republicans got back in charge after 1932? 1994 in
23:59the House and in the 80s in the Senate. They went 50, 60 years into the desert
24:05because tariffs were such a turmoil to the country that the country rejected
24:09Republicans for nearly half a century.
24:16The emergency declaration we're considering today is unprecedented. By
24:21declaring an emergency, the president invoked the International Emergency
24:26Economic Powers Act. They call it IEPA. It's an acronym. Don't get me started
24:31about government acronyms. But anyway, it's a law that's been used to put
24:34sanctions on like Iran. That's what it was intended for, but it was never
24:39intended for tariffs and the words tariffs don't appear in the law. Using
24:43this bill to impose tariffs is attractive to a president. He doesn't have to work with
24:47the messiness of democracy, the messiness of Congress. But you know what? That
24:53messiness is a check and a balance on power. Unlike most of our trade laws that
24:59require several procedural hurdles, IEPA just says declare an emergency and it
25:04becomes very hard for Congress to overturn this. When the Trump
25:10administration first implemented tariffs on China, it took 11 months before the
25:14tariffs could take effect. By using IEPA, the technique now, the tariffs have an
25:20almost immediate effect. But we're not at war with Canada. I don't even think we
25:25have real disagreements with Canada. They're an ally that buys more of our
25:30stuff than almost any other country in the world. Expediency is not the same as
25:36legality, though. As legal scholars have pointed out, there's reason to believe
25:40that this bill, this IEPA, this emergency bill, does not authorize the president to
25:46impose tariffs for at least two reasons. First, despite broad powers conferred to
25:51the president by this act, the plain simple text does not mention the ability
25:56to impose a tax, tariff, or duty. It runs counter to Congress's habit of clearly
26:02referencing tariff authorities in other trade statutes. This may explain why no
26:07previous president has attempted to use emergency powers to raise tariffs. Second,
26:14it's difficult to see how using this emergency power, this IEPA act, and a
26:19national emergency to impose tariffs would comport with something called the
26:24major doctrines question, or major questions doctrine. Under this doctrine,
26:28the Supreme Court will reject claims of an executive on issues of vast economic
26:34and political significance. It's hard to imagine that a 25% tax on everything
26:38from Canada would not be considered to be of vast economic significance.
26:44Congress has not clearly empowered this administration. I think it's hard to even
26:49argue that it's ambiguous. The power was never granted. This question is ripe, and
26:54this question is, this power is ripe to be rejected by the Supreme Court.
26:59Hundreds of billions of dollars worth of imports from Canada are at issue here.
27:02Clearly, this is a major economic question. Yet, Congress has not expressly
27:07delegated the authority to impose tariffs to the president. We need to
27:11return to constitutional government. We used to abide by the ancient principle of
27:17no taxation without representation. One of the first acts enacted into the law
27:21was the Tariff Act of 1789, which sought to generate by placing a 5% tax on all
27:27imported goods, and was signed into law after passage by Congress by George
27:33Washington. Alexander Hamilton's report on manufacturers is well known, and
27:38according to Professor Douglas Irwin of Dartmouth, virtually every tariff
27:42recommendation put forth in report was adopted by Congress in 1792. But simply
27:50voting on tariffs does not convert them into a good idea. It could make them
27:54constitutional. It could make this legal if Congress voted on it. It would still
27:58be economically a bad idea. As we move forward in this debate, you'll see that
28:07there are people on both sides of the aisle who question, really, whether we
28:13should be ruled by one person or whether the power should be separated. To me, this
28:18is not a partisan question. Some will try to make it a partisan question. To me, it
28:24makes no difference whether the president is Republican or Democrat. This
28:28is about the distribution of power. This is about the separation of power. This is
28:33about the admonition that Montesquieu gave us, that when the executive power
28:38and the legislative power are united in one person, there can be no liberty. Our
28:43founding fathers all believed that. They so feared the power of taxation that
28:49they gave it only to Congress. They so feared the power of taxation that they
28:54gave it specifically to originate in the House before it came to the Senate,
28:59because the House was closer to the people with elections every two years.
29:04This goes against the traditions of our country. I stand to speak against these
29:10tariffs. I stand to speak against these emergencies. I stand against the idea of
29:17skipping democracy, of skipping the Constitutional Republic, of rejecting our
29:23founding principles, not because I have any animus towards the president. I do
29:29this because I love my country and I want to see the division of power
29:33enabled such that it protects us all from the amalgamation of power into one
29:39person such that it can be abused. Another name for emergency rule is
29:44martial law. Who would want to live under one person? That's the thing we
29:50all object to in all the countries around the world that we object to is the
29:53idea that they don't have democratic rule. We should vote. This is a tax, plain
29:59and simple. Taxes should not be enacted by one person. So I will vote today to
30:04end the emergency. I will vote today to try to reclaim the power of taxation, the
30:11power of the tariff, to where the Constitution designated it should
30:15properly be, and that is in Congress. Thank you, Madam President.