Tariffs have spurred widespread uncertainty for businesses in Alaska and beyond. Last week, the Supreme Court ruled that President Trump exceeded his authority when he imposed his sweeping “reciprocal tariffs” last April.
Now, Alaskans are wondering what’s next, and if they’ll ever get a refund for tariffs they paid.
President and CEO of the Alaska International Business Center Greg Wolf said that there’s not a whole lot of clarity at this point, for businesses or consumers.
This transcript has been lightly edited for clarity and length.
Greg Wolf: I was woken up by calls from members, actually. We have a statewide membership of companies, mainly exporters, so we have a little different perspective as American citizens here living in the United States.
In terms of affordability, our costs are becoming higher in the United States because of tariffs, but they're worried about the other side. When we put on, say, a 25% tariff on a particular country, that country in question will generally put another 25% on us – it's called retaliatory tariff.
A lot of the companies in our organization, we have more than 125 of them, are exporting to foreign countries. So they're very concerned about how other countries are treating us based on how we treat them.
We're not a political organization, we don't support any party or any candidate, but we are concerned about policies, particularly trade policies. So occasionally, we will speak up, either in support or in opposition to a trade policy. We will say something if it affects Alaskans. And in this case, we've been weighing in because it has been hurting Alaskan exporters.
Ava White: What was your reaction to Friday’s ruling?
GW: I thought it would come very quickly, and it didn't, but it did come down the way I thought it would: in other words, that the tariffs that the current administration has been implementing were unconstitutional and thus illegal.
It reminded me of what I learned in junior high school about the U.S. Constitution, that a new tax on American citizens has to be approved by the Congress, and tariffs are just one form of taxation. They are a tax. Someone has to pay them.
The question is, in the case of tariffs, who pays the tariff?
I think a lot of Americans thought foreign countries pay tariffs, but in fact, that's not the case, and it's never been the case in the 200 years that America has been involved in tariffs.
Anytime you hear the administration talking about a country paying tariffs, hold on to your wallet, because that means it's you.
AW: In your world, what’s different from last Thursday evening to today?
GW: A couple things.
Because of the Supreme Court ruling, the president can't roll out of bed and just decide to put a 50% tariff on some country. He could do that before Friday. Now, there has to be a more disciplined effort.
For example, he's using Section 122, of the Trade Act of 1974 that is limited to a maximum of 15%, before there was no maximum. It's limited to 150 days, before there was no limit on the number of days or weeks or months or years.
There are now boundaries that the administration has to honor, which they did not have to do before. So it's not easy for them. There's guard rails now put around them that you just can't wake up in the morning and decide a new tariff.
AW: And this is that 10% that took effect?
GW: This is another problem. What bothers a lot of our trade partners and Americans themselves, American exporters or American importers, we don't know what the tariff policy will be four hours from now, four days from now, four weeks from now, it changes. Sometimes by the minute.
I get announcements on my cell phone from Customs and Border Protection. They collect the tariffs. I get announcements every time they change a tariff rule or regulation. I used to go weeks and months without hearing anything from them. Now I'm hearing from them 10 times a day, because sometimes the tariff policy has changed multiple times in a single day.
How can you plan as an importer or exporter, as a business of any kind, when the rules change every few minutes?
AW: Some businesses have already sued [the U.S. government] over this. What's the likelihood that they will ever see that money back?
GW: Some companies had already prefiled lawsuits against the US government in anticipation of a positive ruling on their behalf, where these tariffs would clearly be identified as illegal.
Tariffs themselves are not illegal, but the way the administration chose, made it illegal and unconstitutional. Companies like Costco and others had already filed lawsuits. They want the money back.
If there are ever any refunds, it will be to those large companies. Now, what happens when they get the refund? Does that flow down to me and you as customers of those businesses? That will be an interesting question.
It’s going to court. It’s going to be a boom for the attorneys in Washington because this is going to be going on for years. And I think any government is reluctant to give any money back.
AW: Let's say all of that tariff money that's been collected, let's say it's all returned to all of those businesses, would that essentially make it a clean slate?
GW: No, because it brings back the question, “what’s next?”. You might think, “just refund the money.” This is all done by computer. They could, just as quickly as they collect it, they can refund it. But it adds to the continuing uncertainty of what's going to happen tomorrow, what's going to happen three hours from now.
It's changing every day, and this is very difficult for any business of any size, small or large, to have to try to make decisions based on total uncertainty regarding something like tariffs.
AW: What advice do you give businesses then?
GW: I wish I had a really good answer for that. They, and all of us, can only make decisions based on what we know.
This is why some companies are moving out of the International sector, at least for now, until there's more certainty. We have foreign countries who don't want to deal with this anymore, because they don't know what's going to happen with dealing with the Americans.
AW: If things are so unpredictable, what are you even watching for?
GW: I can only say what I'm hoping, I'm hoping for some stability.
Whether it's good, bad or ugly, let's decide what our policy is and stick with it, so that all of us, buyers and sellers and everybody in between can know what the rules of engagement are.
Without the rules of engagement, it's chaos, and we've been dealing with chaos since April 2.
