Warren Buffett has warned how the tariffs could impact the economy now and in the future
American investor and philanthropist Warren Buffett has spoken out ahead of Donald Trump’s tarriffs coming into effect.
At midnight tonight (March 4), Donald Trump’s sweeping tariffs—25% on imports from Canada and Mexico and 20% on China—are set to take effect, marking a major escalation in trade tensions.
Canadian Prime Minister Justin Trudeau has fiercely opposed the move, urging the U.S. to reconsider while Canada prepares its own countermeasures. Meanwhile, Warren Buffett, Chairman and CEO of Berkshire Hathaway, has weighed in on the potential economic fallout.
Despite a 30-day delay in implementing some tariffs, the U.S. remains firm on its plan to impose a 25% tariff on Canadian exports and a 10% tariff on Canadian energy. The White House describes this as “bold action” to hold Canada, Mexico, and China accountable for their commitments to curb illegal immigration and stop the flow of fentanyl and other illicit drugs into the U.S.
Speaking with Norah O’Donnell on CBS Sunday Morning, Buffett called the economy “the most interesting subject in the world” but remained tight-lipped about specifics. However, when pressed on the impact of tariffs, he noted that the U.S. has had “a lot of experience” with them, adding that he sees tariffs as “an act of war to some degree.”
How Could These Tariffs Impact Inflation?
With higher costs on imported goods, businesses may pass those expenses onto consumers, potentially driving up prices on everyday essentials. The question now is: will these tariffs serve as a strategic economic maneuver, or will they spark inflationary pressure that hits American wallets?
Earlier today (March 4), Canadian Prime Minister Justin Trudeau fired back against Trump’s tariffs, vowing that Canada “will not let this unjustified decision go unanswered.” In a strong retaliatory move, Trudeau announced that if the U.S. tariffs take effect tonight, Canada will impose its own 25% tariffs on $155 billion worth of American goods, set to begin at 11:01 AM EST tomorrow.
The Canadian countermeasures will roll out in two phases:
- $30 billion in immediate tariffs on American imports.
- An additional $125 billion in tariffs on U.S. products within 21 days.
Trudeau made it clear that these tariffs will “remain in place” until the U.S. withdraws its trade actions.
Buffett on Tariffs: “And Then What?”
Meanwhile, Warren Buffett continued his thoughts on the economic impact of tariffs, warning:
“Over time, they’re a tax on goods. […] The Tooth Fairy doesn’t pay them.”
He then posed a crucial question in economics:
“And then what?”
A pointed reminder that tariffs don’t exist in isolation—they trigger ripple effects across economies, industries, and everyday consumers. The question now is: how far will this trade war escalate?
Buffett elaborated further, reflecting on the broader economic and political landscape:
“Technology changes, all kinds of things, but Washington is Washington, and the problem with politics is that you tend to have to make tiny compromises as you go along.”
Shifting gears, Norah O’Donnell pressed Buffett for his thoughts on Elon Musk’s cost-cutting measures as part of his collaboration with Trump’s Department of Government Efficiency.
Buffett, however, quickly sidestepped the topic, simply remarking:
“Better not get into all that.”
Well, enough said, I guess.
