On February 20, 2026, the U.S. Supreme Court delivered a landmark ruling that reverberated across the nation’s economic and political landscape, striking down most of the tariffs imposed by President Trump during his second term. According to coverage from The New York Times, the Court reasoned that the power to impose tariffs—like the power to levy other forms of taxes—is vested in Congress under the Constitution, not the President acting alone. For many Americans, especially those in the middle class, the decision was hailed as a victory. Yet, beneath the surface, the ruling’s implications are complex, and its aftermath is already stirring debate and uncertainty.
For months, tariffs had been a financial thorn in the side of American households. As reported by The Washington Post, these tariffs gobbled up a larger share of income from low- and middle-income families than from the wealthy, effectively functioning as an unfair tax increase. The burden of higher prices on imported goods was felt acutely in grocery aisles, at the gas pump, and in everyday purchases. While the Supreme Court’s decision might seem like a relief, it’s not quite the panacea many hoped for.
One of the bitter ironies of the ruling is what comes next: if the tariffs struck down by the Court are refunded, the windfall will flow mainly to large importing companies, not to the consumers who bore the brunt of the costs. As Reuters pointed out, these corporations have little incentive to pass any refunds on to shoppers. In effect, this could amount to a transfer of income from ordinary Americans to corporate coffers—a twist that hardly feels like justice to many families still struggling to keep up with basic expenses.
And the story doesn’t end there. The Trump administration has signaled its intent to pursue similar tariff policies, this time justifying them under other existing statutes. According to Politico, while this new approach may be more cumbersome for administration officials, the ultimate effect could be tariffs just as significant as those just struck down—only now, they’ll be less vulnerable to legal challenges. For critics, this maneuvering raises questions about the separation of powers and the future of congressional authority over tax policy.
Meanwhile, another front in the economic battle is heating up. With inflation and high interest rates squeezing household budgets, Americans are borrowing at unprecedented levels to make ends meet. As reported by CNN Business, credit card balances soared to a record $1.28 trillion by the end of 2025, according to data from the New York Fed. Many consumers, faced with sky-high interest rates on their cards, are turning to personal loans as a lifeline.
TransUnion, one of the nation’s major credit reporting agencies, forecasted on February 20, 2026, that unsecured personal loan originations will climb by 5.7% this year compared to last—outpacing the growth in new mortgages and credit card originations. In fact, unsecured personal loan originations hit a record 7.2 million in the third quarter of 2025, marking the second straight quarter of new highs, as detailed in TransUnion’s latest report.
“Personal loans have truly become the middle-class refinancing option for high-interest credit card debt. That’s why they’re growing exponentially,” Jim Triggs, CEO of Money Management International, told CNBC. His organization counsels more than 30,000 consumers a year, many of whom are desperate for relief from mounting debts. The appeal of personal loans is clear: they’re typically faster to obtain than loans requiring collateral, and fintech lenders like LendingClub and SoFi have made the process even more accessible. In the third quarter of 2025, fintech lenders accounted for a whopping 42% of personal loan originations, up from about one-third a year earlier, according to TransUnion.
But the surge in borrowing isn’t being fueled by the financially secure. Instead, it’s subprime borrowers—those with credit scores typically under 600—who are driving much of the growth. TransUnion projects that subprime borrowers will account for about 40% of personal loan originations this year, up from 32.5% in the third quarter of 2025. “We’re seeing a larger distribution of subprime consumers every quarter, and so they don’t have any slack,” Michele Raneri, vice president and head of U.S. research and consulting at TransUnion, told CNBC. For many, these loans are a last resort, not a stepping stone to financial stability.
The economic divide is becoming more pronounced. Higher-income Americans, who are more likely to own homes, can tap into home equity lines of credit at lower interest rates to pay off their debts. Those on the lower rungs of the economic ladder, however, are left with fewer options. “On the other side of the K, on the bottom, there are people who are struggling,” Raneri explained. The so-called K-shaped recovery—where the wealthy rebound while everyone else falls further behind—is deepening, driven by inflation and persistently high interest rates.
Even for those who qualify for personal loans, the relief is often limited. As of mid-February 2026, the average interest rate on a personal loan was 12.15%, compared to 19.6% for credit cards, according to Bankrate. Yet, as Triggs noted, subprime borrowers rarely see those average rates. “You may be paying 28%, even 30% [rates on] your credit cards, but your personal loan may only be, maybe, at 24%, so you don’t have that much relief,” he explained. And unlike credit cards, which offer some flexibility in payments, personal loan borrowers are typically locked into regular monthly payments for three to five years—a commitment that can be daunting for those living paycheck to paycheck.
Amid these economic headwinds, the Trump administration’s approach to tax and tariff policy remains under scrutiny. While the Supreme Court’s decision reaffirmed congressional authority over tariffs, the administration has found other avenues to shape tax policy unilaterally. Federal courts have generally ruled that no one has standing to challenge regulations that cut taxes, allowing the administration to sidestep statutory requirements. Just this week, the Treasury Department created new exceptions to the corporate minimum tax enacted in 2022, potentially granting massive tax breaks to companies reporting over a billion dollars in profits each year, as reported by The Wall Street Journal.
These regulatory maneuvers highlight a broader concern: the erosion of legislative control over tax policy and the growing influence of executive action. For many observers, today’s events are a reminder that, even as the courts uphold constitutional checks and balances in some areas, loopholes and legal gray zones persist—often to the benefit of the powerful.
As America grapples with rising debt, widening inequality, and shifting political winds, the Supreme Court’s decision marks a pivotal moment. Whether it brings lasting relief or simply reshuffles the burdens remains to be seen, but one thing is clear: the economic and political battles over who pays—and who benefits—are far from over.