By Damian Paletta
Good morning. Former President Harry S. Truman famously adopted the saying, "The Buck Stops Here."
But what about when the buck goes in reverse? Then where does it stop?
A huge legal conundrum is playing out now in the U.S. The Supreme Court recently said President Trump's emergency tariffs were illegal, even though they had collected more than $130 billion in revenue. Another federal judge has ordered the administration to begin repaying all that money to the importers who paid the tariffs.
Thousands of companies are lining up for refunds. But a new question has emerged: Should the companies be allowed to keep the money, or should they pay it on to consumers (many of which are other businesses)?
Under the legal theory at play, if a company paid tariffs to the government and then raised prices to offset the cost, a consumer ultimately paid some of the tariff cost. Thus, if the tariff was illegal and the company gets money back, shouldn't the consumer get their money back, too? And how would that even work?
The flurry of lawsuits has begun. A Costco shopper on Wednesday sued in an Illinois federal court demanding refunds, and the lawsuit is seeking class-action status. It is likely only the beginning. More than $130 billion is a lot of money, and there will be an enormous fight over how that cash is doled out (if it ever is).
Update from yesterday's newsletter:
PLOT TWIST: Rep. Jim Clyburn (D., S.C.) is running for re-election after all. The 85-year-old congressman said Thursday he has more he wants to accomplish, bucking a trend in which large numbers of lawmakers are stepping aside.
This is an edition of the Politics newsletter, bringing you an expert guide to what's driving D.C. every day. If you're not subscribed, sign up here.
People and Policies I'm Watching
Iran war: Follow our live Middle East updates. More details were expected on the crash of a U.S. Air Force refueling plane in western Iraq.
Economy: The price index of personal-consumption expenditures -- the Fed's preferred inflation gauge -- is due out at 8:30 a.m. ET, along with revised fourth-quarter GDP data.
Trump's Friday: The president has executive time at 8 a.m. ET, signs executive orders at 2 p.m., and at 3 p.m. participates in a greeting with the winners of the National Finals Rodeo. He later departs the White House for Palm Beach, Fla.
What I'm Following
Some people aren't happy with how JB Pritzker is spending his money. The billionaire Illinois governor is funding ads to boost his lieutenant governor, Juliana Stratton, in a race that tests his clout in a state where he has leveraged his wealth to dominate the Democratic Party. His involvement has especially angered the Congressional Black Caucus, which backs Rep. Robin Kelly (D., Ill.). Both Stratton and Kelly are Black.
No one's budging a month into the DHS funding impasse. Democrats and Republicans blamed each other before leaving for the weekend, passing through security checkpoints staffed by agents working without pay. The holdup stems from Democrats demanding restrictions on ICE as a condition for funding DHS, while Republicans blocked a proposal to fund parts of the agency -- like the TSA and Coast Guard -- but not ICE.
FBI agents will train with UFC cage fighters. The "exclusive training seminar" will be at the FBI academy in Quantico, Va., where current and former cage fighters will offer insight into how they prepare for competition, FBI Director Kash Patel said. To some current and former members of the bureau's workforce, the event is the latest example of what they view as Patel's misplaced priorities.
What Else Is Happening
-- A proposal to raise the minimum wage in New York City to $30 an hour is
drawing cheers from working-class New Yorkers and concern from a business
community confronting rising costs.
-- The Trump administration is suing California to shut down the state's
moves to limit pollutants from cars and transition to zero-emission
vehicles.
-- The U.S. trade deficit narrowed in January, continuing a volatile run for
America's trade balance amid changing trade policy under Trump.
What I'm Reading
-- Temple Israel After Attack: 'We Are Safe, and We Love You All' (Detroit
Free Press)
-- Turning Point 'Rolling Along' and Hiring 100s Despite Internal Drama
(Arizona Republic)
This Week in Washington History
In 2020, Trump declared Covid-19 a national emergency. As of this week, more than 1.2 million Americans have died of Covid-related causes in the U.S. since January 2020, according to the Centers for Disease Control and Prevention.
About Me
I'm Damian Paletta, The Wall Street Journal's Washington coverage chief. I've covered Washington for 22 years as a reporter and editor. I've covered the White House, Congress, national security, the federal budget, economics and multiple market meltdowns.
WSJ Politics brings you an expert guide to what's driving D.C., every weekday morning. Send your feedback to politics@wsj.com (if you're reading this in your inbox, you can just hit reply). This edition was curated and edited in collaboration with Joe Haberstroh and Dick Streuly. Got a tip for us? Here's how to submit.
(END) Dow Jones Newswires
March 13, 2026 07:01 ET (11:01 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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