In April 2025, the Office of the U.S. Trade Representative introduced a tariff formula known as “Liberation Day.” Initially, this formula seemed sophisticated. It included Greek symbols and references to serious economic analysis. But closer examination by economists revealed flaws.
Key components within the formula neutralized each other, relying mainly on calculations driven by bilateral trade deficits. This revelation prompted an economist to question the origins of the formula. Seeking transparency, he filed a Freedom of Information Act (FOIA) request for related records. Following over a year of delays and communications with the agency, the U.S. Trade Representative admitted having 31 pages of relevant documents but refused to release them. The records contained exchanges between the agency and the White House Council of Economic Advisers concerning the tariff calculations, claiming privilege protection.
This response provoked further questions. If the economic rationale behind these tariffs was robust, why did the government conceal its work? Moreover, why did the Council of Economic Advisers, a group of seasoned experts, decline to endorse a document it reportedly helped create?
“The economic case for these tariffs was so strong, why keep the work hidden?”
The Liberty Justice Center, for two years, represented businesses contesting the administration’s tariff decisions. From this perspective, the withheld 31 pages didn’t appear as an isolated issue but part of a larger issue. Legal justifications repeatedly changed, even as the tariff policy remained unchanged.
Initially, tariffs drew justification from the International Emergency Economic Powers Act, suggesting national emergency provisions authorized worldwide tariffs. Courts rejected this theory, prompting the administration to cite Section 122, a temporary trade measure limited to 150 days by Congress. Following challenges and expiration of this authority, another statute was cited. They then resorted to Section 301, using a forced-labor investigation as a basis for a broad tariff initiative.
The consistent pattern raises concerns beyond the appropriateness of the chosen tariff policy. It questions whether the administration sought new legal and economic justifications to uphold the same tariffs as previous ones expired or were invalidated. Each shift individually may seem justifiable, but collectively, they tell a different story.
“Were law and economics driving the policy? Or were they assembled to defend pre-selected policy?”
The involvement of the Council of Economic Advisers is significant. They should offer the president unbiased economic insights. Confirmation of the Council’s engagement in tariff calculations sparks curiosity. If council professionals questioned the formula’s logic, transparency is due. If they supported it, that information should also be public. Concealing the entire record under executive privilege impedes understanding.
One mystery surrounds an academic source cited in support of the formula, a paper by economists Pau Pujolas and Jack Rossbach. The administration later used this paper in a speech defending the tariffs. However, one author asserted their research was misrepresented, opposing what the administration claimed the study supported. This contradiction, publicly challenged by the scholars, suggests misuse of academic citations.
The undisclosed 31 pages might divulge recognition of this problem within the government before the formula’s release. They might reveal whether concerns were acknowledged and overlooked or if alarms went unraised. By withholding documents, the government prevents access to this information.
Debates over tariffs, trade deficits, and industrial policies are inevitable. Yet, transparent justification is necessary for economic policies impacting extensive commerce. When seeking court deference, business trust, and public acceptance, the government must show the groundwork behind its decisions. What is the administration afraid might be revealed?
Phillip W. Magness, Chair in Political Economy at the Independent Institute, and Sara Albrecht, CEO of the Liberty Justice Center representing businesses challenging tariffs, question these actions.