The Federal Judiciary Is Trapped

This episode is brought to you by Ground News. Here at Amicus, we read a lot about the Supreme Court, but it's not the only news we consume. And like you, we seek out different sources on the same subject to get the full story. Ground news is a great way to get down to the facts. It's an app and website that makes it easy to compare news sources break free from algorithms and think critically about where you're getting your news. Recently, I went to Ground News to learn more about the resignation of British Prime Minister Keir Starmer. Ground News had rounded up coverage from 40 different sources. According to the platform, 46% of the coverage is... center or nonpartisan. But if you click right, you can see right-leaning coverage that claims, quote, Keir Starmer offered Britain nothing. And if you click left, you'll see headlines lamenting that Keir Starmer is, quote, the latest casualty of the Downing Street meat grinder. The Nobel Peace Center called Ground News, quote, an excellent way to stay informed, avoid echo chambers, and expand your worldview. Here's how to get started. Go to groundnews.com slash AC to get 40% off their unlimited access vantage subscription. That's groundnews.com slash AC and you'll get 40% off the vantage subscription, whether you subscribe yourself or send it as a gift. Make sure to use our link so that they know that we sent you. That's groundnews.com slash AC.

This episode is presented by Planned Parenthood Federation of America. Many of the most important legal fights in this country come down to a basic question. Who gets to make decisions about our bodies and our health care? That question isn't theoretical. It's playing out right now. The Trump administration's backers in Congress are trying to permanently defund Planned Parenthood, an effort to shut down health centers and block patients' care, especially from those with low incomes. Together, we have the power to protect and expand affordable care. Visit plannedparenthood.org slash defend and make a gift today. This is Amicus Slate's podcast about the courts and the law and the Supreme Court. I'm Dahlia Lithwick. The lower courts are trying mightily to honor their oath, and they are holding Donald Trump accountable for every single violation of the Constitution and laws of the United States. But, of course, the Supreme Court of the United States is doing anything by.

If amicus were a daily podcast about the courts and the law, we would be hard-pressed to clock every norms violation, every injunction, every extrajudicial murder taking place in the Caribbean or the Pacific throughout the past months. And on weeks like this, it's not even clear that an hourly show could do justice to the havoc being brought at the Justice Department, the Pentagon, to snap recipients, to lawful protesters on the streets of Chicago and Portland, inside the FBI, and ICE, or CBP, or indeed among members of the federal judiciary. So we try as best we can to make meaning of it all to find trend lines and themes to find exit ramps and optimism and legal leverage and wins by increments. And this week we're talking to one of the most stalwart defenders of the law and the Constitution and the vision of the founders that I have had the honor to know. Judge J. Michael Ludig, whose piece this week in the Atlantic reminds us to take seriously and also literally, and also very much to heart, the threats to democracy that are being posed by Donald J. Trump. Later on in the show, we're going to be hearing from Rick Waldenberg, the CEO of Learning Resources, the family-owned business that sued the Trump administration for the so-called Liberation Day tariffs that are right now. walloping American businesses and farmers and consumers right in the pocketbook. His case goes before the Supreme Court this coming Wednesday, and he, very much like Judge Ludig, is very clear about the dangers of a monarchic president operating without guardrails and without an internal breaking system. At some point... Somebody needs to stand up. If everybody thinks that somebody should stand up just not me, nobody stands up. But first, Judge J. Michael Ludig, who really understands what it means to put the law and the Constitution above personal interests. He played a key role in short-circuiting Donald Trump's efforts to overturn the 2020 election on January 6, 2021. He's a former federal judge on the U.S. Court of Appeals for the Fourth Circuit. He served on that court for 15 years from 1991 to 2006. Before he was appointed to the federal bench by President George H.W. Bush, he served as Assistant Attorney General at the U.S. Department of Justice and counselor to the Attorney General of the United States. Judge Ludig, it is such a treat to talk to you. Welcome back to Amicus. Thank you, Dahlia. It's really an honor to be on your show today.

I thought we would start with your piece, President for Life, that was published in the Atlantic this past week, because it opens with the proposition that Donald Trump is right now amassing monarchic powers and that he has no intention of moving off stage. after the 28 election. And I think most of the legal observers that you and I know agree that nobody who believed there would be free and fair elections going forward would behave as he is behaving. But I wanted to start by asking, is it your view that he plans to openly seek a third term or do one of these constitutional tricks? I know he's walked it back a little in the last few days. Do you find the conversation about him taking a third term in office to be distracting or unhelpful or something that we should be taking very, very seriously? Well, Dali, as I said in the Atlantic piece, the president in the short 10 months that he's been in office sought and has now seized near. absolute unchecked power in the United States of America, that is, unchecked by the coordinate branches of government, the Congress, the United States, and the Supreme Court of the United States, unchecked by the several states of the United States, unchecked by the Never before in American history has anything like this ever occurred. And for a reason, this is not the design of the Constitution. This was not the view of the founders. It was not the view of America by the framers of the Constitution. No president in the nearly 250-year history of this great nation has even thought. thought, Dolly it, to do or say one single thing that this president has said and done literally hundreds, if not thousands of times since he first took office in 2016. So the reason I wrote the piece in the Atlantic is that after only the first 10 months in office for his second term, This is the question on the minds of many, if not most, Americans. Will Donald Trump seek a third term in office? Now, Americans didn't just wake up wondering whether the president would seek a third term. It's patently unconstitutional. And the president knows that. But from essentially six weeks into this second term until literally Wednesday of this week. He was telling the American people, Dahlia, that he was seriously considering running for a third term.

and being the next president of the United States, succeeding himself, all unconstitutionally, of course. Now, nothing has ever slowed this president down, but it's worth thinking about that the Atlantic fast ran my piece the day after Donald Trump himself said, that he would love to be the next president also. And Steve Bannon, of course, a close advisor of the president, said, that Donald Trump is, quote, gonna, G-O-N-A, be the next president of the United States also. So I had, of course, written this piece for the Atlantic. It was scheduled to run, I think, on November 3rd, but the Atlantic chose to run it the morning after those comments by the president. And very significantly, though not dispositively. Within 18 hours of the 7 a.m. release date of my article, Donald Trump, speaking from Air Force One on his way to Korea, said for the first time in his life that I suppose that the 22nd Amendment prohibits me from running again. Now, So does that mean he will not run again? No, it doesn't at all. We've learned because Donald Trump has taught us that we can't accept anything he says about anything. In fact, the morning that my piece ran, I got a call from a national television reporter who said that she was reporting from the Hill, Republicans saying, that Donald Trump backed off of his plan to run for the president only because he feared that the Republicans would lose the midterms. And they said that once the midterms are passed, you know, it's entirely possible that the Donald Trump will resurrect his plans to run for a third term. So, Judge, I guess this is a game that has been played for so long that it's hard to find equilibrium here, but they'll say something outrageous. Steve Bannon will assert with confidence that there are plans afoot. to get around the Constitution. Then they walk it back. You're left wondering if we as constitutional thinkers are just chasing after whatever bait they're throwing out there. I'm hearing you say, take it seriously. I'm also hearing your article say, and I think this is important.

Whether or not he actually seeks a third term is half the problem. Subverting the election is the thing you're worried about in addition to that. But I guess I'm really curious how it is that as a legal thinker, one responds to something that may be real, maybe fanciful, might just be trolling, might be a distraction from actual egregious violations of the law. I mean, How do you make this the size that it is? Or am I hearing you say it is very consequential, treated as such, even when they walk it back? It's only a third of the problem, Dahlia, actually. The most important thing that I said in the Atlantic article is that Donald Trump has seized all the power in the United States of America. that would be necessary in order for him to subvert either the midterms or the 28 election or both and run for the presidency and actually be seated as the next President of the United States against the will of the American people. It doesn't matter what Donald Trump says today or even what he does tomorrow. What I just said is the most significant thing that could ever be said in all of American history about a President of the United States. Now, to your question, and of course you've been in the vanguard of this attempt, to resist the efforts of the current president, to undermine the Constitution and the rule of law now for a decade. So where are you and the rest of us today? Well, I've decided where I am, and that is, that when Donald Trump says he's going to do something, he will do it. That is the only way that rationally the rest of the world can regard this president. And if we don't, we dismiss him at our peril. Donald Trump has intentionally overwhelmed the nation and the federal judiciary from his first day in office. He knows that the federal judiciary, up to and including the Supreme Court of the United States, cannot possibly deal with all of his unconstitutional and otherwise illegal conduct as President of the United States of America. And of course, that's what we're seeing in the courts today. The lower courts are trying mightily to honor their oath to the court and to the person. And they are holding Donald Trump accountable for every single violation of the Constitution and laws of the United States. But of course...

the Supreme Court of the United States is doing anything but. So this is actually precisely the reason I wanted to talk to you of all people this week. About six months ago, you published a piece in the Atlantic, the end of the rule of law in America, and you wrote this, quote, tying the nation's judiciary up in Gordian knots, Trump has gleefully stymied the federal courts with the sheer volume of his unlawful actions, end quote. In the intervening time, There's even more rope added to the Gordian knot. The sheer volume of cases, we're watching restraining orders and injunctions and then appeals courts within seconds, seemingly reversing them. And we're watching, I think, the most interesting thing I've ever seen from judges across the spectrum. Judge Emmergut saying, to the government, I think you're just lying. Judge Ellis demanding check-ins daily with the Border Patrol chief, Judge Susan Graber of the Ninth Circuit, writing, quote, I ask those who are watching this case unfold to retain faith in our judicial system for a little longer. Our friend Ryan Goodman at NYU Law School counted several dozen judges telling the Trump administration they just don't believe the Justice Department any. And this is, it's hard to convey to someone who isn't a judge or doesn't hang out with judges. This is like pressing the red button over and over. This is DefCon from a judge. And I would love to hear from you what it means when a judge says, I don't believe you. I don't trust the Justice Department. You have, in the words of one judge, squandered in a few months, years of capital that you had built up. Part of this is a structural question, which is should courts believe everything that the Trump administration tells them? I want to talk to you about the ways this is existential. What happens when you cannot trust the government and you are trying to adjudicate a case and you are saying the words, I think you're lying? You always come up with the exact word, Dahlia, and in this context, the word is existential. Earlier this week, Carol Linneg, multiple New York Times bestseller author, formerly of the Washington Post and now of MSNBC, wrote an essay in the New York Times about her new book. And she outlined in this essay, the

And they will not tolerate this. It doesn't matter anymore what the Supreme Court says. The lower courts are determined to support and defend the Constitution according to their oath, and that's what they're going to do. And I could not be any prouder than I am today of every single judge. and every single court of the United States of America below the Supreme Court. And I speak to a good number of those judges all the time, Dahlia. More in a moment with Judge J. Michael Ludig. NPR understands your curiosity is boundless, but your time isn't. That's why they make up first, the three biggest news stories of the day, with the reporting and analysis to understand them in under 15 minutes. Up First's distillation of President Trump's claims of election fraud in California was a super useful preview of what we can expect in the midterms. There's no shortage of news right now. Up First doesn't just give you the headlines. It gives you the context. Recent episodes covered how American citizens are getting caught in ISIS's growing surveillance web, what the Iran war means for the U.S. economy, and why Attorney General Pam Bondi's exit is bigger than it looks. Up First does something most daily news shows don't. It asks better questions to get better answers. Not just what happened, but how it came about, why it's a big deal and what happens next. That's the difference between knowing the news and understanding it. Follow NPR's Up First podcast so you can understand what matters and what happens next. It's hard news through a human lens. This episode is brought to you by Quince. The very best summer pieces are the ones you end up wearing on repeat, comfortable, versatile, and somehow right for almost every occasion. And that's why I love Quince. Their elevated essentials use premium materials like European linen, organic cotton, and washable silk without the traditional retail markup. Quince's 100% European linen pants, dresses and tops are the pieces you will reach for all summer long. Everything at Quince is priced 50 to 80% less than similar brands. They work directly with ethical factories and cut out the middlemen, so you're paying for exceptional quality, not brand markup. I just received their featherweight cashmere silk-fraid-edged scarf in the coolest stage. The scarf is as light as a cloud. It's silky soft, and it will be a summer staple for me for all the wedding. all the plane travel, and all the chilly evenings. Make your summer wardrobe feel easier. Go to quince.com slash amicus for free shipping on your order and 365-day returns. Now available in Canada, too, that's Q-U-I-N-C-E.com slash amicus for free shipping and 365-day returns, quince.com slash amicus.

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to even suggest that the federal courts speaking through their opinions, Dahlia, their opinions, not in sidebars, not in, you know, chatter, not in gossip, through the opinions of the federal courts, they are pushing back against Donald Trump. It is they. They who are protecting and safeguarding the integrity and the legitimacy, the very legitimacy of the federal courts in America. And what's your answer to the nihilists who say, oh, it doesn't matter what a district court does in Portland. It doesn't matter what a district court judge does in Chicago or Florida or wherever else, because at the end of the day, this will be decided. As you said, in your opening by a John Roberts court that has been pretty complacent, if not. all in for Donald Trump with a few exceptions. What's the answer to what they're doing is ultimately fruitless and pointless because they're going to lose in the long run? Well, first off, those are nihilists of the Constitution. and of America itself. Those are people who, many of whom, would tell you today that they need to lead a revolution against America and the United States government. Some of them literally a revolution. But many of the others are figurative revolution. We've only had one revolution in America, and that was almost 250 years ago. It is not an option under the Constitution of the United States today to lead a revolt against the Constitution and the United States of America. That is the definition of lawlessness in America. So then to the embedded question there at the end, if you will, does it matter given the suggestion that the Supreme Court will reverse the lower courts? You bet it matters. It matters more. than what the Supreme Court will do in the end of the day? I take very seriously. I gather you take very seriously Judge Susan Graber at the Ninth Circuit saying, don't give up on the courts. Do not give up on the judicial system. Keep watching. We're going to come through. But I wonder, how does the public do that? It seems like the catch here is simply asking people to have faith in an abstract idea. Doesn't...

feel like a meaningful call to action, right? Don't give up. Okay. How do we as people who don't want to give up? Don't think that justice is an abstraction. How do we get straight with the judges who are saying, look, we are calling out to you to help us and to bolster us? What does that look like for a listener who, again, might be trapped under the idea that John Roberts at the end of the day makes the call. What is supporting and believing in an independent judiciary look like for somebody who's just a civilian watching with hope and horror commingled? Well, everything in this constitutional republic is in the plea itself from the courts of the United States for Americans to Please have faith in the federal courts. That's the whole story. The courts themselves can do no more than that until or unless the Supreme Court acts. But your listeners need to focus and think. seriously about the plea that is being made by the federal judges of the United States of America to the American people. Please do not lose faith in the judiciary. That's the whole story of America today. Right there, Dahlia. On Wednesday, we learned from reporting from ABC and NBC news that two federal prosecutors had been put on leave at the behest of the White House because they had the temerity to describe the January 6 defendants who were pardoned by President Trump as, quote, a mob of rioters in a sentencing memo. When you stepped out of a mostly private life to counsel Vice President Pence and then again to testify before the January 6th Committee on what the Constitution does and did not require, did you imagine that we would be sitting here in November of 2025, not just pardoning, but rewriting history and dismissing. attorneys of the Justice Department who use precise language to describe precise facts in an effort to reverse every single thing that happened that day? No, of course not. And I rack my brain every day. I happened to be in New York when the New York Times article that you referenced by Alan Furer came out, and I was reading it before breakfast, and I get up early. And among others, I sent the article to my wife, and I said, this is criminal, and that's what it is. This is a man and an attorney general who every day.

are trying to rewrite American history. And Donald Trump, of course, as President of United States, you know, has directed the federal government to purge facts from the files, if you will, of the United States that he believes are in any way at all. inconsistent with his view of his presidency, one, or inconsistent with his view of American history. It could be considered the least of significance that he directed the Smithsonian to alter its exhibits. But that's symbolic, profoundly symbolic. of the fact indisputable that the President of the United States is ordering the rewriting of American history, just like his demolition of the East Wing of the White House in order to build a gold-gilded ballroom that will dwarf the remainder of the White House. I'm at a loss for words anymore, Dahlia. I mean, this is happening in real time every single day that Americans wake up and look at the news. So maybe before we say goodbye, we could talk for a moment about truth. I think one of the reasons that your work has meant so much to me is it has been so fiercely bolted to truth and to truth-telling. And you've talked a lot in this interview about the things Americans should be able to agree on, but of course there's a lot of truth that we don't agree on. And it's one thing, I think, to... exculpate January 6th insurrectionists to pardon them to say that they're patriots, it does feel, you just said this, like an entirely different proposition to punish. prosecutors for saying that they are what they are. Again, as you just said, this isn't ignoring history. This is erasing history. And I just want to read you this quote from 1984. I'm not a big fan of reading Orwell. It always feels too bang on the nose. But here's the line from 1984. quote, day by day and almost minute by minute, the past was brought up to date. In this way, every prediction made by the party could be shown by documentary evidence to have been correct, nor was any item of news or any expression of opinion, which conflicted with the needs of the moment ever allowed to remain on record. And I think what you're describing, it feels...

Very, very elemental to me what it is to erase the record. This is the thing that judges produce. This is the work product is the truthful record. I think it's a move that you're describing that we're not all catching yet. So I just wonder by way of signing off today, if you can talk for a moment about the truths that you are holding fast to despite the shifting ground underneath us. What is true? troop for you right now. And what do you want our listeners to hold on to as truth in the really, really challenging months ahead? It's been the greatest honor of my life, Dahlia, to support and defend the Constitution of the United States, the rule of law, and the federal judiciary. In that effort, which is now almost five years and running, every single day, it has been about and only about truth. I have been threatened with my life, beginning the day, beginning the day I testified before the Congress of the United States. and simply told the truth. And of course, today, many others can say the same thing about their telling of the truth in the United States of America today. So what is truth? There is a truth. There are facts. And it doesn't matter what? else says from MAGA, or frankly what the President of the United States says, there is a thing called truth in this world. There has always been and there always will be. The day that the federal courts of the United States of America attempt or acquiesce in, The denial and the rewriting of truth is the day that America fails. We in America will have failed to keep the republic that our founders charged us with keeping. It's that simple. Today, the last bastion of truth. Truth, Dahlia, in America, is the federal courts. I love what you're saying because it's such a perfect through line for how we stand up for federal judges who are telling the truth and how we ourselves have an obligation to stand up for truth and that that in and of itself is a powerful act of resistance. J. Michael Ludig is a former federal judge on the U.S. Court of Appeals for the Fourth Circuit.

His superb piece in the Atlantic this week is called President for Life. Judge, I thank you more than I can say both for spending time with us this week, but also for your courage and your confidence. It is always, always a treat to talk to you. Thank you. Thank you, Dolly. It's always a treat for me to talk to you. We are going to take a short break. Summer always reminds me how quickly dehydration can catch up with me. Between warmer weather, travel, and long days with two kids under three, I can feel when water alone isn't enough. That's why I keep drip drop on hand. It's an easy way to stay ahead of dehydration before I start feeling tired. drip drop is proven fast hydration that's built to hydrate you faster and more effectively than water alone. It uses science-based formulas for rapid hydration, so you feel results fast while getting three times the electrolytes of leading sports drinks. And it's trusted by over 90% of top college and pro sports teams, because hydration isn't just something you do when you're behind. It's how you stay ahead. Drip drop zero sugar plus is a breakthrough fast absorbing formula with an advanced blend of six key electrolytes, 15 essential vitamins and nutrients and no sugar or artificial sweeteners. There are 16 original flavors and 8 zero sugar plus options, including my preferred choice after a long day outside with the kids, zero sugar passion fruit. Right now, drip drop is offering podcast listeners 20% off your first order. Go to dripdrop.com and use the promo code amicus. That's dripdrop.com promo code amicus for 20% off. Stock now at dripdrop.com and use promo code amicus, AMICUS.

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date back to a laboratory supply company that my grandfather bought in 1916. So I'm actually third generation. I have three kids who work at the business. So they're fourth generation. And we have over 500 employees. So we have an office in the UK with 50 people and a lot of people here in Chicago. We have an office in L.A. and folks elsewhere as well. We make hands-on learning materials which are sold into schools and also are sold into the home as toys. And we make curricular materials as well. So focusing on the pre-K through eighth grade market and basic subjects, math, reading, STEM, coding, social emotional learning, and so on. Most of the products that we sell today were never made in this country. many companies make their products overseas because that allows us to sell them at a lower price. Not only are we a multi-generational family business, but we're a mission-driven business, and so we're committed to the mission of helping kids get a great start in life, develop a love of learning, and so we're not indifferent to what our products sell for. If every child is an equal right to a great education, it's important that you keep your pencil sharp so that every child can have access to your products. So we've been making a lot of products overseas in order to keep our prices low. And the market action sort of forces that because if all of your competitors are making products in a low-cost manufacturing base, you kind of have to as well. President Trump had been talking about tariffs for a long time and certainly talked about it during the campaign. You knew probably that something was coming, something dramatic. And I guess the question was what was going to happen. Were you watching on the day that President Trump announced his Liberation Day tariffs? I was in a meeting, and when I got out of the meeting, like the world had changed, it was not a happy moment. We were in the process of trying to develop a new building for our business, and I killed that deal that day, dead. Also terminated discussions on a joint venture we were going to form to enter another export market. We're in 100 countries. There are countries we're not in. I put that on indefinite hold as a result. But no, we were not surprised he had put tariffs in place for fentanyl, fentanyl trafficking prior to that. And we knew from what he said on the stump that this was coming. And in fact, in Trump 1.0, he imposed tariffs. And so we've been actively working on shifting supply base out of China. And by the time Trump came in in January, We had succeeded in moving about 16% of our items out of China, but it turned out not to be enough. What happened in the week of liberation days, the numbers just went stratospheric. He had promised the maximum of 60% tariffs on the stump, which at the time seemed unthinkable. The amount that we were spending was under 2%. So to go to 60, like that seemed crazy. And, you know, by the end of the week following...

Liberation Day, so to speak, we were at 145%. And I guess I'm curious, Rick, what's going through your mind as this is being announced? Are you thinking... it's all over? Are you thinking, how do I pivot? Are you thinking, as you just suggested, this can't possibly be happening and something is going to correct for it? I mean, what was your thought process? As you said, you were in a new world. Well, first of all, I'm paid to never think this is it. It's over. Likewise, I can't allow myself to adopt the attitude of a victim. I am responsible for a multi-generational 100-year-plus old enterprise that's provided jobs for thousands of people over the years in Chicago. I am not lightly going to allow a politician to end that. In addition, when you run a mission-driven business, you tend to believe that you're not easily replaced and that the fabric of the universe will be slightly torn if you aren't there. And so... I'm just not going to let a politician ruin this. It was clearly a major existential threat. And so I decided, because I have some background in this issue, because I'm firmly convinced that these tariffs are unlawful, that I needed to seek litigation. And so in the middle of that week, I started contacting law firms and people in the industry to see if there was litigation that was being formed or planned. that I could participate in or help with. And that was how it got started. Did you have a sense that there was some other avenue available to you or was it fairly clear almost from the jump that if this was going to get resolved, it was going to get resolved through litigation? I don't even know if it will get resolved through litigation. I think from the beginning I felt that politics created this problem and politics will resolve it. And so I wanted to have a communication strategy so that people could understand the devastating impact of this tax increase that was unlawful. And one way to enhance the communication strategy was to also litigate. So I would say that the intent was to... alert the voters as to what's going on about an economic threat that comes with this administration of this law and at the same time challenge its legality and use all of that to shift political wins to make it more difficult for them to pursue this hidden tax increase. They want to increase our taxes. There's a way to do that pass a law. So I want to be clear because I think this is always a hitch in the messaging around this. Tariffs do not get paid by China. They get paid either by your company, you absorb the cost or they get passed along to your consumers. And I think it's worth stopping for a moment to note that despite the fact that you won very decisively in the court below, the tariffs remained in effect.

And I would love to hear from you how that has played out in terms of your production, your bottom line. Here you are almost eight months post liberation day. And I guess related to that, a lot of big, big, big companies. absorb it more readily than small businesses. So I would love to hear you just sort of map out for me how this has played out in your company in ways that might be invisible to listeners. The first thing I'd say is that you need to understand some basic accounting. So some of the tariffs have sort of passed through the Python and hit our... Profit and loss statements. Some of the tariffs are still on our balance sheet showing as inventory because they're an inventory cost until we sell them. I know in the last week I was given updated numbers on what we project to have spent in cash. on tariffs this year, which would be both what's on the balance sheet and what's on the P&L. And we're expecting to come in around $14 million. Last year, the expense for Aipa tariffs was zero. I estimated based on the run rate of our 2025 budget at 145% when we were more dependent on China. no one knew what else was coming, that it could be $100 million on an apples-apples basis. We paid in tariffs and duties unaffected by AEPA in 2024 of $2 million. $14 million in the last eight months with all the munking around that we've done suggests that next year it could be $40. And who knows if that number is high, lower, and different because they change the tariff rates every single day. But, you know, if you... paid zero in real estate taxes on your house last year, and they said this year we think it'd be jolly good if you pay $14 million, and next year 40, you'd probably notice it's a big number. It's... massive in what we try to produce as a profit and very disruptive. I don't think anybody big, small or indifferent, can carry these tariffs indefinitely. The reason that they've not been passed on fully by people is basically dependent on how much inventory you had and how intelligently you bought your inventory. To some degree, it's a question of when the piper will be paid, not if the piper will be paid. We've had a small price increase this year, which we are trying to extend so that we don't have to hurt consumers next year. So we're hoping to minimize the impact of all this munking around with tariff rates. But we've had to...

maintain our health with a small price increase, so some has been passed on. We don't think we do anyone any good if we get sick, so we can't allow ourselves to get sick. So eventually all the inventory is burned off and every manufacturer is going to have to pass it on. Some big businesses have managed to get carve outs. What's that about? There are some carveouts that are being handed out. It's my understanding. None apply to me. So like we get to pay the full boat. But some pressure has been removed from some industries, some activities. And that may continue. The Wall Street Journal reported that. the Trump administration is backing away from some of the harshest implementations. But again, no good luck for me on that. We are going to take a short break. And we're back with Rick Woldenberg, whose case against Trump's tariffs will be heard at the Supreme Court next week. You know, I've been covering the Supreme Court for a long time, and often there would be cases that would involve some Leviathan, you know, multinational corporation. And yet it was always sort of described as a mom and pop company, right? And that this was a sort of intimate family business. And I think one of the things I've heard you say in interviews is that the thing about small companies, particularly multi-generational. businesses is that they do become the local engine of jobs and just the community itself is a kind of braided into the health of that company. And I guess I'd love to hear you just amplify that for a moment because it is, I think, one of the reasons that you feel as strongly as you do about this. This isn't just your business. This is a kind of local enterprise where lots and lots and lots of folks are in the slipstream. Absolutely. It's the perspective of someone that runs a longstanding family business. You recognize that literally over the years thousands of people have worked for your company. And so that's thousands of people whose families depended on that livelihood who bought homes based on the promise that they would continue to get paid. They paid college tuitions. They paid for vacations. They funded their retirement. Sometimes they bought a bigger house, a nicer car. All of that is dependent on. their earnings from your company, and that's something that we do as a family because we're committed to this business long term. We also pay taxes. So like on the buildings that house our businesses, we pay taxes which funds local schools in the local fire department, and we do business with local businesses. This is what makes local communities healthy, and there are zillions of these small businesses that... prop up the local community. That's why you enjoy the life that you do in your local community. These local businesses are essential to the local economy. So again, we're closely associated with that. Our business has always been headquartered in Chicago. That's where I live.

I'm not willing to allow this to be destroyed. It's too important to me. I see the relationship and I'm going to defend it. The end. I'm not going to let them in Washington ruin this. So, Rick, I mentioned when I introduced you that you are a graduate of law school. I think you didn't litigate and we're not going to ask you to litigate this. But you did practice some law before joining the family business. Your best effort to explain to a lay listener, what it is that the Trump administration says is their theory of this case. What is it that allows them to sort of, as you say, willy-nilly constantly changing open negotiation, but like some spoils for some cooperating parties. What is their theory of why they get to do this when AIPA hasn't been deployed in this fashion? Their argument is that AIPA provides a power that can be exploited by the president in an economic emergency relating to. international sources that allows him to, quote, regulate dot, dot, dot, importation. And that quote in and of itself somewhat misstates what the law says, but they say that it is implicit in the concept of regulation that a president would be able to impose a tariff because tariffs have been used to regulate in the past. A tariff is a tax that is... imposed on importers when they bring merchandise into this country. So that I think is their fundamental argument. If you read their briefs that are submitted to the Supreme Court, they go a little further and they say, this is not really a tax case. This is a case about the president's right to administer foreign affairs, which is Article 2 in the Constitution. And because Article 2 in the Constitution gives him the right to administer our foreign affairs, That is an independent power that he has. And so because he is exercising his independent power, if you read tariff rights into the word regulate, he has the power to do that as a part of his power to oversee foreign affairs. That's their argument. There are answers to that. I'd like to actually highlight what an eighth grader ought to say. So. Let's not be a lawyer. Let's be an eighth grader who just finished the section of history class where they go over. How does the U.S. government work? An eighth grader would say, hey, isn't there a problem with that? Remember, we learned that in the American Revolution they didn't like taxation without representation. Didn't they throw tea in the pond somewhere? Yes, they did. And Mr. Madison said no. We're not going to let the king set taxes on us. When we're not present in Parliament, we're going to organize our government so that no individual can set taxes on Americans. It has to be a legislative process.

That's why you should read Article 1 before you read Article 2. In Article 1, it says that Congress is responsible for it has a vested power to impose and collect taxes, regulate commerce, and it is assigned the responsibility of drafting and passing legislation. Call that James Madison's gotcha. So in eighth grade, I would say, Mr. Trump doesn't have the power individually. to impose a tax because he doesn't like a commercial that's running on TV. And Athe Keir Starmer would say, sorry, I didn't see that in my textbook. The government's argument is fallacious. And aside from the mischaracterization of who pays the tariffs, the reality is if you actually read the law, what it says is that it's regulate dot, dot, dot, importation or exportation of dot, dot, dot, dot, property in which a foreign party has an interest. This law was written to facilitate seizures and embargoes. So think of like someone who is a Cuban national but has a bank account in New York. Or think of Iranian gold being stored in the U.S. or a Russian owning a farm in Oregon. That's what the law is for. I import things that I own. By the way, you should be aware. We make some of our product at a factory located in China that is owned by someone who is an American citizen who lives in San Francisco. So arguably, that product was never foreign owned. It was made by an American company in China for an American who had clean title to it when it came to the border. Yet they tariff me. So, like, maybe they should go back and use some of our products to learn how to read. Why is it that you, this family-owned business with 500 employees, VOS selection, another family-owned wine business, are out on the front lines pushing back, not just on the on-again, off-again tariffs, but against what you have just described in response to my question as just a purely monarchic theory of executive power? Where's everybody else, Rick? Why is it that the people who stand to lose the most are not being backed up with armies of huge corporations locking arms with you? It does feel like this is falling heaviest on small businesses. It's difficult for me to comment on why other people do things or don't do things. I can speak more accurately as to like why I did something. I was pissed off. I'm defending an enterprise I'm very closely identified with and that means a lot to me. And it so happens. I know a little about the law and I thought it was illegal. At some point, somebody needs to stand up. If everybody thinks that somebody should stand up just not me, nobody stands up.

You don't have to be actually one of the great historians to know from recent events that when nobody stands up, sometimes bad things happen. If you're waiting for a postcard to come in the mail that says, hey, Rick, it's your turn. That's not going to happen. Someone just has to realize it's time to do something. So right, wrong, or indifferent. I decided to do it and I decided to put the money down to pay the legal fees and do it. Luckily for me, I'm spending so much money on tariffs, I can afford to spend a little bit more on legal fees because like I'm going to drown in tariffs. I might as well hire some good lawyers. Oh, that is some very dispiriting but inspiring math. I did read an interview that you gave to the Princeton Alumni magazine in June where you said, I'm inclined to stand up when my company is in genuine peril. My hope is that by making a lot of noise, it can be safer for other people to stand up. And it's definitely been a throughline on this podcast that. People who, if Vince Courage, keep telling us that courage is very contagious. And that's why we wanted to talk to you today. Do you have any thoughts going into arguments next week at the court? It seems to me that there is such bipartisan sense that the tariffs were disastrous at every level, that maybe this is going to be an easy case for the John Roberts Court? I do not think of the Supreme Court as a political organization. I'm expecting to get a fair hearing by nine people who've devoted their life to interpreting the law as fairly as they can. And so I don't subscribe to the theory in the newspaper that the Supreme Court can be relied on to rule one way and the other. It really has to do with what does the law say? And I don't think of what we're doing as political in nature. I think the solution will be political. When it becomes too costly politically for Mr. Trump to do this, he'll relent. So that's just kind of like a simple observation, again, informed as an eighth grader by how the government works. The voters are really in charge in this country, you know, government of the people, by the people, for the people. That's also in there. So. I don't actually have to take a position on whether I am for Mr. Trump or against him, nor do I need to offer him any advice. This just isn't the correct reading of the law. In terms of like what's going to happen at the Supreme Court, at this level of legal conflict, you have the finest lawyers against the finest lawyers. And anyone that's ever had contact with lawyers and you certainly have, they can certainly make a simple matter confusing. And so they will work hard to tease out as many different threads as they can to make it difficult for the Supreme Court to see a path forward. But I think that the Supreme Court must be concerned with what eighth graders think. And in this particular instance, if they somehow can't find a way to, say, regularly does not include the power to impose a tariff,

Then I think they are really upending what Mr. Madison did, and I think that is unthinkable. In my opinion, James Madison's invention of the American form of government is one of the great ideas in the history of mankind. It is a genuinely special insight. For me personally, the opportunity, the responsibility. To defend his idea and the integrity of that idea in modern society today is one of my great honors of my life. To stand elbow to elbow with Mr. Madison is not something I ever expected to be able to do. But I think Supreme Court has to weigh what the consequences will be for American society, not just now, but after now, in the future, what people expect from their government, what they... can rely on in terms of rule of law. It's a very heavy decision, regardless of how confusing lawyers make it. I'm looking forward to having our day in court, and I believe that our position is the right one on the law. I could obviously talk for an hour about that, but it'll probably be a good listen. I encourage everyone to tune in. Rick Woldenberg is CEO of Learning Resources and Illinois-based maker of educational toys. His case will be heard at the Supreme Court this coming Wednesday. And Rick, you are reminding me that it's not a terrible rule of thumb for the Supreme Court to triangulate once in a while against what would an eighth grader think. Thank you so very, very much for joining us. My pleasure. Thanks for having me.

That is all for this episode. Thank you so much for listening. Thank you so much for your letters and your questions. Please keep them coming. We are reachable always by email at amicus.com. You can find us at facebook.com slash amicus podcast. You can also leave a comment if you're listening on Spotify or on YouTube and you can rate us and review us on Apple Podcasts. On today's Amicus Plus bonus episode, Mark Joseph Stern and I are unpacking the many cases and injunctions and the de-injunctions or uninjunctions over Trump's extreme immigration enforcement operations and troop deployments to Portland and Chicago and what the Supreme Court's latest cryptic intervention in the Chicago case might actually mean. You can subscribe to Slate Plus directly from the Amicus show page on Apple Podcasts and Spotify. Or you can visit slate.com slash amicusplus to get access wherever you listen. That episode is available for you to listen to right now. We'll see you there. Sarah Burningham is Amicus as senior producer. Our producer is Patrick Fort. Hillary Fry is Slate's editor-in-chief. Susan Matthews is executive editor. Mia Lobel is executive producer of Slate Podcasts. And Ben Richmond is our senior director of operations. We'll be back with another episode of Amicus next week. Until then, take good care.

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