Buffett criticizes Trump’s new tariffs

Warren Buffett has offered strong criticism of President Donald Trump’s newly-imposed tariffs. In an interview with CBS, the billionaire investor described tariffs as “an act of war, to some degree. Buffett emphasized that tariffs essentially function as a tax on goods. He stated that the burden of these tariffs ultimately falls on consumers. “The Tooth Fairy doesn’t pay ’em!” he joked. Buffett’s comments come as Trump’s administration pushes ahead with significant new tariffs. Starting on Tuesday, a 25% tariff on goods from Canada and Mexico will take effect. The tariffs on Chinese imports will also increase from 10% to 20%. Economists caution that these measures will likely make a wide range of products more expensive for American consumers. This includes items like cars and electronics. The escalating tariff measures have ignited fears of a broader trade war. China has already retaliated against the U.S. tariffs. The European Union could soon face additional “reciprocal tariffs” from the Trump administration as well.

Buffett criticizes tariffs as tax

Despite these concerns, U.S. Commerce Secretary Howard Lutnick dismissed Buffett’s criticism. In a CNN interview, Lutnick called Buffett’s comments “silly.” Lutnick even incorrectly suggested that tariffs could potentially replace the IRS. In fact, the IRS dates back to the Civil War era. Federal income tax became a permanent fixture in the U.S. in 1913, well before World War I. Buffett refrained from delving deeper into his “act of war” comment. However, he pointed out the long-standing association of tariffs with protectionist trade policies. This isn’t the first time Buffett has voiced disapproval of tariffs. In 2016, he criticized Trump’s trade policies as “a very bad idea. While Buffett remained reticent about his broader economic outlook, he did reaffirm his confidence in the U.S. He called America “the best place” for investment. Meanwhile, Berkshire Hathaway, Buffett’s conglomerate, is sitting on a record cash pile of $334.2 billion. The company has recently sold off stocks like Apple and Bank of America. Some interpret Buffett’s conservative moves as a bearish call on the market and economy. Others believe he may be preparing the conglomerate for his eventual successor. Image Credits: Photo by Venti Views on Unsplash