How the family toy business fights Donald Trump’s tariffs

Rick Woldenberg has a first-hand view of how global capitalism works, or until recently, how it works, about twenty miles north of Chicago’s O’Hare Airport. The Princeton-educated sixty-five-year-old comes from an entrepreneurial family. In the nineteenth year, his father founded a business that provided schools with products designed to help learn, such as reading and math suites. In the 190s, his mother founded a sister business that initially offered other companies to the same industry. Since then, the Woldenberg family’s company is now known as Learning Resources and Hand2Mind, has grown into a business that employs more than five hundred people and sells everything from letter blocks to building toolkits, as well as Cooper, a coding robot.

Woldenberg joined the Learning Resources in 1990 and became CEO eight years later. He has also been running Hand2Mind since 2019. The products of these companies are designed in Mount Vernon and Torrance, California, where they have another office, but actually all the items are made in Asia, mainly in China. Some of them enter through O’Hare, but most are transported to ports on the West Coast and then transported by rail to Illinois warehouses or to customers. Today, distributors include Scholastic, Walmart and Amazon.

In the early days, Woldenbergs made some toys and learning aids at their factories in the United States. But in the 1980s and early 1990s, they transferred almost all their production to factories in China and Taiwan, where rally line workers won a small portion of what their American counterparts did. Waldenberg told me a few weeks ago on his coffee at O’Hare Hilton. “We are in the most competitive consumer market in the world, and I don’t think we have any choice. “Offshore production has allowed the company to hire more people in the United States, including product designers, sales staff, executives and warehouse workers,” he said. “I don’t feel intimate about what we do.” “We have created over five hundred high-paying jobs and our products are sold in over one hundred countries. ” (According to market research firm Circana, Learning Resources is one of the top 25 toy companies in the United States)

April 2, Donald Trump Called “Liberation DayThe president announced that the levy of a package of imports increased the levy by 41%, which improved Waldenberg’s business model and many people liked it. Tariffs are taxable, and progressives can choose to absorb costs or pay a week’s salary at a higher price. I met him and the White House announced that tariffs on Chinese goods would be reduced to thirty percent, and negotiations between the two countries were between Woldenberg. Condition? “I don’t even know how much my fee will be,” Waldenberg said. I live on reality TV, not reality. ”

Waldenberg’s first response to the Liberation Day tariffs was to stop plans to build new warehouses. His second response was to sue Trump and the administration. On April 22, attorneys acting for Learning Resources and Hand2Mind filed a lawsuit in federal court in Washington, D.C., which claimed Trump’s tariffs were “extraordinary executive power robbery” that “caused irreparable damage to both businesses.” The lawsuit says that under the Constitution, Trump has no legal authority to impose these tariffs without Congress’ approval. It requires the court to prevent the government from collecting tariffs from Waldenberg businesses. The lawsuit also seeks damages.

The case was filed at the moment when major toy companies like Hasbro and Hasbro and Mattel stood. But Woldenberg, who had a JD at the University of Chicago Law School and worked in a corporate law firm before joining the family business, had been on the road before. In 2017, during Trump’s first term, he helped opposition parties in the toy industry to file a “border adjustment tax” proposal (a type of tariff) that Republicans are considering including it in their big tax bill under pressure from the administration. (The proposal was not included in the final legislation.) Now that Trump has evaded Congress and claims to have the right to impose tariffs at will, Waldenberg is taking over the White House directly. “I have supported both parties in the past and I don’t consider myself a politician,” he said, explaining the decision to file the lawsuit. “But I will defend our mission, I will defend our staff. It’s an old business and I feel a certain responsibility for it. I won’t let Mr. Trump take it away from us.”

There are trade regulations that cause the president to impose tariffs in specific cases, such as when foreign countries have been engaging in unfair trade practices. However, these laws do not cover the blanket tariffs proposed by Trump on April 2. The government cited a different regulation when announcing the taxation, the International Emergency Economic Powers Act (IEPA) in 1977, which was previously used by the president to freeze foreign assets during the national security crisis. At a court hearing in Washington a few weeks ago, Justice Department lawyers argued that Trump’s tariffs were a national security issue and that their decisions would “submit to the president on the world stage, weaken his ability to negotiate trade deals and violate the government’s ability to respond to future national emergencies.” (The government also asked the court to hand over the case to another location in Manhattan, the Federal Court of International Trade in Manhattan, where trade-related cases are often heard. “This situation has nothing to do with tariffs.” (The government also asked the court to hand over the case to another location in Manhattan, the Federal Court of International Trade in Manhattan, where trade-related cases are often heard. “This situation has nothing to do with tariffs.” qua Tariffs,” Contreras wrote: “It is about whether the IEPA enables the president to unilaterally impose, withdraw, pause, restore and adjust tariffs to reorder the global economy. The court agreed with the plaintiff’s view that there was no. ”

On the surface, the ruling won a major victory for Woldenberg, who attended the hearing with his wife and three adult children, all working for the business. Judge Contreras’s ruling comes a day after the federal court faced some Trump’s liberation day tariffs. On May 28, a panel of three judges tried two separate cases before the International Trade Court ruled that the April 2 tariffs “more than any mandate Ieepa granted to the president.” The cases were filed by litigation by the attorney general of five small businesses and democratic countries supported by liberal legal groups.

The adverse rulings of the two courts were a major legal setback for the White House. It is far from clear, though, whether they will lead to any significant changes in Trump’s tariff policies or continue to ease his regulations on Woldenberg’s business and other people in similar dilemmas. Judge Contreras initially delayed the execution of his order by 14 days to give the government time to appeal, and he suspended the injunction last week while the process took action in the DC Circuit Court of Appeals. Meanwhile, courts that have prevented Trump’s tariffs from international trade orders have been put on hold. The day after the judgment, the U.S. Court of Appeals for the Federal Circuit continued the lawsuit, awaiting further legal arguments.