WASHINGTON | Sept. 9, 2026—Forty-eight prominent economists—including former Treasury Secretary and Federal Reserve Chair Janet Yellen, Nobel laureate Simon Johnson, and former senior economic officials from Republican and Democratic administrations—are urging the U.S. Court of Appeals for the Federal Circuit to uphold the ruling striking down the Trump administration’s Section 122 tariffs.
The economists filed an amicus brief supporting affirmance of the U.S. Court of International Trade’s May 7 decision in Burlap and Barrel, Inc. and Basic Fun, Inc. v. Trump. The Liberty Justice Center represents the two American businesses and is defending the ruling that the administration exceeded the limited tariff authority Congress provided in Section 122 of the Trade Act of 1974.
Together, LJC’s appellate brief and the economists’ amicus brief present a strong legal and economic case against the tariffs. LJC’s brief explains why the administration failed to satisfy Section 122’s text, history and specific prerequisites. The economists demonstrate that the United States was not experiencing—and, under the modern monetary system, could not experience—the balance-of-payments emergency Section 122 was designed to address.
The signatories include former Treasury Secretary Janet Yellen; 2024 Nobel laureate and former International Monetary Fund chief economist Simon Johnson; former Council of Economic Advisers chairs Jason Furman, N. Gregory Mankiw and Laura Tyson; former Federal Reserve Vice Chair Alan Blinder; former Congressional Budget Office directors Douglas Elmendorf and Douglas Holtz-Eakin; and leading economists from Harvard, Princeton, MIT, the University of Chicago, Stanford, Berkeley and other institutions.
“This is an extraordinary group of economists with vastly different political and economic perspectives, but they agree on the central issue in this case: the United States was not experiencing the large and serious balance-of-payments deficit required by Section 122,” said Sara Albrecht, Chairman and CEO of the Liberty Justice Center. “The government cannot take an ordinary trade deficit, rename it an international-payments crisis and use it to claim sweeping authority to tax nearly everything Americans import.”
Section 122 permits temporary import restrictions to address specified “fundamental international payments problems” including “large and serious United States balance-of-payments deficits.”
The economists explain that such a deficit had a specific technical meaning under the fixed-exchange-rate system in place when Congress developed Section 122. It referred to a dangerous loss of official reserves—including gold—that threatened a country’s ability to maintain its fixed exchange rate and meet its international obligations. Under the floating-exchange-rate system the United States has maintained for more than 50 years, that type of reserve-drain emergency is no longer possible.
The economists warn that the government’s contrary interpretation would allow a president to impose worldwide tariffs virtually whenever he chooses. At least one of the accounting measures identified by the government has been negative throughout Section 122’s history and is likely to remain so.
Their conclusions are reinforced by separate analysis from Richard Stern of Advancing American Freedom, which filed an amicus brief earlier in the case. Stern’s paper, “Basic Balance: A Desperate Attempt to Use an Old Statistic to Impose New Tariffs,” responds directly to a July Council of Economic Advisers report—Measuring Balance of Payments Deficits—released as the appeal was being briefed and cited in the government’s opening brief.
“The use of Section 122 to impose disastrous taxes was an unlawful attempt to promote an ideology that puts the whims of bureaucrats over the interests of the hard-working American people,” said Richard Stern of Advancing American Freedom.
Stern explains that “basic balance” is an obsolete measure developed for an earlier monetary system, not evidence that the United States faced the large and serious balance-of-payments deficit Congress required before Section 122 could be invoked.
The Liberty Justice Center brought the case on behalf of Burlap and Barrel, Inc., an online spice retailer, and Basic Fun, Inc., an American toy company whose brands include Care Bears, Lite-Brite and Tonka.
On May 7, a three-judge panel of the U.S. Court of International Trade ruled that the Section 122 tariffs were unlawful. Although the tariffs expired on July 24, the litigation continues because the government is seeking to overturn that ruling and LJC’s clients are seeking complete relief, including refunds of the tariffs they paid.
The economists’ brief, LJC’s appellate brief, the lower court’s decision and additional information are available on the Liberty Justice Center’s Section 122 case page.