Big couple of weeks! The Supreme Court handed consumers a win on tariffs then watched the president rebuild the wall within mere hours. On housing, the states are doing the work and understanding what is at stake when it comes to the Midterms and affordability. Here's what happened and why it matters.
New Pro–CoL Developments:
The Supreme Court Struck Down IEEPA Tariffs in a Landmark Ruling
What happened: On February 20th, the Supreme Court ruled 6-3 in Learning Resources Inc. v. Trump that the International Emergency Economic Powers Act does not authorize the president to impose tariffs. Chief Justice Roberts, joined by Justices Gorsuch, Barrett, Sotomayor, Kagan, and Jackson, held that two words in a 1977 emergency law “regulate” and “importation” cannot bear the weight of a sweeping delegation of Congress’s constitutional power over tariffs. The ruling invalidated all IEEPA-based tariffs, including the “Liberation Day” reciprocal tariffs and the fentanyl-related tariffs on China, Canada, and Mexico.
Why it matters: This is the most consequential check on executive tariff authority in modern history. The IEEPA tariffs had pushed the average effective tariff rate to roughly 16% — the highest since 1936. The Tax Foundation estimated they cost U.S. households an average of $1,300 in 2026 and would have raised $1.4 trillion over the next decade. Their removal immediately dropped the effective tariff rate to around 4.5%. But here’s the catch: the ruling is simultaneously a win and a setup for the next fight (see Anti-CoL section below). Refunds to importers are expected but not guaranteed the Court punted on the mechanics, and whether consumers ever see that relief is an open question.
Indiana Housing Reform Moves Forward
What happened: Indiana’s Senate passed HB1001, a wide-ranging housing bill designed to make it easier to build more homes. The measure allows single-family houses, townhomes, ADUs, and certain affordable housing projects to be approved without public hearings. It limits local building fees, reduces design mandates, tackles long permitting timelines, and curbs minimum parking requirements — all policies that can raise construction costs. Lawmakers added an amendment allowing cities and towns to opt out of many of the bill’s provisions.
Why it matters: The bill aims squarely at supply. With the average first-time homebuyer now 40, supporters argue that teachers, police officers, and young families are being priced out of the communities where they work. While the opt-out clause weakens the reform, the legislation still shifts policy toward making homebuilding easier — a significant step in a state grappling with rising housing costs.
Illinois Governor Goes Big on Housing
What happened: Governor J.B. Pritzker proposed statewide zoning changes that would limit local control over housing approvals, allow more multi-unit housing and ADUs, and pair those reforms with infrastructure funding.
Why it matters: Illinois is joining the growing list of states diagnosing local zoning as the core bottleneck to housing supply. Pritzker is betting that state preemption, combined with funding carrots, can break the NIMBY logjam that has kept the state undersupplied. The key question now is whether the proposal can translate from announcement to enacted legislation.
Shapiro Launches Ambitious Plan to Make Pennsylvania a Homebuilding Leader
What happened: Governor Josh Shapiro rolled out a comprehensive housing strategy designed to reverse Pennsylvania’s lagging housing production and position the state as a national model for homebuilding.
Why it matters: Rather than focusing narrowly on regulatory reform, Shapiro is framing housing growth as an economic competitiveness strategy. That aspirational messaging could broaden support beyond traditional housing advocates. As in Illinois, the critical test will be whether the vision translates into durable legislative action.
Arizona Moves to Codify Exaction Reform
What happened: SB1787 cleared the Senate Regulatory Affairs committee on February 18th. The bill would write the Supreme Court's Sheetz v. El Dorado ruling into state statute, mandating that local governments make individualized assessments for every development exaction, the fees and conditions imposed on new construction projects.
Why it matters: Exactions are one of the hidden taxes on housing. When a city can slap arbitrary fees on a new development without proving they’re proportional to the project’s actual impact, those costs get passed straight to homebuyers and renters. Arizona is the first state to try to codify Sheetz at the state level, which could set a template for others. Combined with Arizona’s ADU and middle housing laws that took effect January 1st, the state is building one of the most comprehensive pro-housing frameworks in the country.
New Anti–CoL Developments:
Trump Immediately Replaced IEEPA Tariffs — and Consumers Won’t See Relief
What happened: Within hours of the Supreme Court ruling, Trump signed a proclamation imposing new 10% global tariffs under Section 122 of the Trade Act of 1974, effective February 24th. By Saturday, he announced the rate would increase to 15%. Treasury Secretary Bessent said combining Section 122, Section 232, and Section 301 tariffs would result in “virtually unchanged tariff revenue in 2026.”
Why it matters: The Supreme Court gave, and the president took right back. The Yale Budget Lab calculates the current tariff regime costs the average household roughly $800–$1,300 depending on whether Section 122 tariffs expire or are extended. Section 122 technically has a 150-day limit. Meanwhile, Goldman Sachs says the “bulk” of tariff cost pass-through to consumers has already happened, and prices are sticky, companies that raised prices aren’t going to roll them back. For consumers, the legal framework changed; the cost of living didn’t.
USDA Projects Food Prices Rising 3.1% in 2026 — With Painful Category Spikes
What happened: The USDA’s February 2026 Food Price Outlook projects overall food prices will rise 3.1% this year. The worst categories: sugar and sweets up 6.7%, beef and veal up 5.5%, and non-alcoholic beverages (driven by coffee) up 5.2%. Beef prices are already 15% higher year-over-year due to the smallest U.S. cattle herd since 2019, and coffee has surged 18.3% from a year ago. Ground beef hit a record $6.23/lb last year.
Why it matters: The topline grocery inflation number (2.5% for food-at-home) sounds manageable until you look at what’s actually getting more expensive. It’s not luxury items — it’s ground beef, coffee, cereal, and sweets. These are the staples that define a family’s weekly grocery run. Seven of 15 food-at-home categories will grow faster than their 20-year historical average.
ACA Premium Spikes Are Hammering Millions
What happened: Enhanced ACA premium tax credits expired at the start of 2026 after Republicans declined to extend them in the reconciliation bill. KFF estimates the average subsidized enrollee is seeing premiums rise by 114%. The Urban Institute projects 4.8 million Americans will drop coverage. Employer-sponsored health insurance premiums are also rising 6-7% more than double the current inflation rate. CBO projects that combined with Medicaid cuts in the One Big Beautiful Bill, 14.2 million more people could become uninsured.
Why it matters:The subsidy expiration hits a diverse cross-section — self-employed workers, small business owners, farmers, ranchers and the impacts are geographically concentrated in states like Florida (4.7 million enrollees), Texas, and California. For a single mom like the ones profiled in CBS’s reporting, premiums tripling from $900 to $2,500 means choosing between coverage for yourself or your child. This is one of the single largest anti-affordability development of 2026 so far, and the political consequences will be felt through the midterms.
Win of The Week!
Win of the week goes to the IEEPA ruling!
The message was clear: the president cannot unilaterally impose sweeping taxes on the entire U.S. economy without proper congressional authorization.
At a time when families are feeling squeezed at the grocery store, the Court effectively said what many Americans already knew, these actions made everyday goods more expensive. And that matters. We discussed it all on our Substack Live with PPI’s Ed Gresser; you can catch that here:
While Trump is already exploring other avenues to reimpose similar tariffs, the Supreme Court sent a strong constitutional signal: executive overreach that raises costs for working families won’t go unchecked.
As I’ve argued, Democrats would be wise to hammer this point throughout the midterms the Court just underscored that these policies weren’t just controversial, they were unlawful, and they hit Americans directly in their wallets.