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Buffet on Tariffs > “It’s a big mistake, in my view, when you have seven and a half billion people that don’t like you very well, and you got 300 million that

Buffet on Tariffs > “It’s a big mistake, in my view, when you have seven and a half billion people that don’t like you very well, and you got 300 million that are crowing in some way about how well they’ve done - I don’t think it’s right, and I don’t think it’s wise,” Buffett said. “The United States won. I mean, we have become an incredibly important country, starting from nothing 250 years ago. There’s not been anything like it.”

disambiguation 1y ago
Also buffet on tariffs (2003) https://www.berkshirehathaway.com/letters/growing.pdf https://www.berkshirehathaway.com/letters/growing.pdf Though he makes the distinction between "import certificates" and Trump's version of tariffs.
- throw0101b 1y ago
  Contra: > A common response I’ve seen to this is Warren Buffett repeatedly expressing concern about the trade deficit. Buffett’s main concern has always been that we’re sending pieces of paper abroad that give foreigners claims on US assets. And this is true, but I’d argue it’s been a massive net positive on the whole. First, as a percentage of total ownership, foreign ownership of US securities is actually flat since 2008. So despite 20 years of a persistent current account deficit there hasn’t been a huge change in foreign ownership as a percentage of the total. But the current account deficit also reflects the way many firms in the USA outsource their comparative advantage. And that accrues to US firms (and households) as increases in net worth. This is a big reason why corporate profit margins have expanded so much in the last 30 years. Global competition has made US firms more efficient and that’s accrued to Americans as a huge gain in net worth. So this isn’t a situation where we’re just sending Dollars abroad for no good reason. We’re doing it in large part because that is investment in our businesses that has added value to those very firms and their owners. Could that all reverse? For sure. And weirdly, the thing that would cause it to reverse is ultra protectionist measures thereby reducing demand for US Dollar assets and reducing investment in US firms. * https://disciplinefunds.com/2025/04/24/three-things-you-guessed-it/ https://disciplinefunds.com/2025/04/24/three-things-you-gues...
  - robocat 1y ago
    > foreign ownership of US securities is actually flat Totally incorrect according to this graph: https://taxpolicycenter.org/sites/default/files/figure1_25.png https://taxpolicycenter.org/sites/default/files/figure1_25.p... From article: https://taxpolicycenter.org/taxvox/who-owns-us-stock-foreigners-and-rich-americans https://taxpolicycenter.org/taxvox/who-owns-us-stock-foreign... Can you cite a source for what you've written?
next_xibalba 1y ago
Buffett actually does share a fear of trade deficits, though. His proposed solution, as an alternative to tariffs, were "import certificates"-essentially a marketable credit required to import goods. These would be earned via exports by exporters, be freely priced and traded, and would essentially bind import levels to export levels.
- nabla9 1y ago
  It's really a non-problem. Net capital inflows into the U.S. = U.S. trade deficit. The balance of payments is simply: Sales of assets – Purchases of assets = Purchases of goods – Sales of goods If you balance the trade, it means foreigners must stop investing into the US.
  - chrisco255 1y ago
    If you balance the trade, it means reduced foreign ownership of U.S. assets, yes, which means ownership of U.S. assets by domestic citizens will increase. One of the primary problems with an unbalanced trade deficit is that your own inhabitants are left with less wealth over time, as assets are sold off to fund consumption.
    - ChadNauseam 1y ago
      That’s zero-sum thinking. Increases demand for US assets can make americans wealthier in many ways (e.g. providing more capital to american businesses).
      - bnjms 1y ago
        Some goods are zero sum. Land is zero sum. Ownership of land by non local entities is… idk seems bad
        epolanski 1y ago
        Why? What's the issue, if me, an Italian, own land in Indiana or North Cali?
ashoeafoot 1y ago
Change in general, should always come gradually , that way the inevitable consequences rear their head early. Its the bold paintstrokes that topple the world on its side. Obamas biofuels come to mind triggering the arab spring by raising bread prices.
- mikem170 1y ago
  > Obamas biofuels come to mind triggering the arab spring by raising bread prices. Why do you call them "Obama biofuels" when biofuel mandates were passed while Bush was president? Standards for biofuels appeared in the Energy Policy Act of 2005 [0] (mandating 4 billion gallons of biofuel by 2006, 7.5 billion by 2012) and the Energy Independence and Security Act of 2007 [1], aka the Clean Energy Act of 2007 (mandating 36 billion gallons of biofuel by 2022). Bush signed both laws. I assume that corn-state representatives were pushing for more biofuels, since farmers want to sell more corn, regardless of how green anything is, or is not. At the time Obama was one of many in congress, both Democrats and Republicans, who voted in favor of these laws. I would agree with you that biofuel production exacerbated food supply issues leading into the Arab Spring. [0] https://en.wikipedia.org/wiki/Energy_Policy_Act_of_2005 https://en.wikipedia.org/wiki/Energy_Policy_Act_of_2005 [1] https://en.wikipedia.org/wiki/Energy_Independence_and_Security_Act_of_2007 https://en.wikipedia.org/wiki/Energy_Independence_and_Securi...
sillysaurusx 1y ago
I’m a bit slow in this field. Could someone explain how this quote relates to tariffs? I’ve re-read it three times now, looking for the connection to a tax on imported goods, but I just can’t see it. I think it’s saying that the US population is crowing about how well we’ve done, and so we should be able to tax whatever imports we want? But what an odd way to say that if so. How well we’ve done seems completely unrelated to tariffs. Then the quote caps off with some back-patting about how we’ve only been around 250 years, and that our rise is unprecedented. Again seemingly unrelated to tariffs.
- terribleperson 1y ago
  Part of the justification for tarriffs is that America is somehow being 'taken advantage' of by the rest of the world and the tarriffs are the rest of the world finally paying their fair share. The reality is that (until now) America has had a uniquely privileged position in the world economy that got America, in general, very beneficial trade deals. He's commenting on the attitude driving the tariffs.
  - WalterBright 1y ago
    Uniquely privileged position? The only unique thing about America is free markets. Any country can become highly successful by enacting free markets. The only thing in the way is their disbelief that they work. There's a common thread across the world and history. The more free market a country is, the more it prospers.
    - pyth0 1y ago
      This is only true if you ignore the important material and historical factors that go into the success of a country. Like for example, the immense wealth of natural resources and variation in climates that the US has. Or how about escaping much of the devastation that Europe faced in WW2 and benefiting immensely from helping them rebuild. Or having (for the most part) incredibly safe and stable relationships with neighbors to the north and south. Free markets have certainly contributed to success, but to say it's the only unique thing about America is just wrong.

disambiguation 1y ago

Also buffet on tariffs (2003) https://www.berkshirehathaway.com/letters/growing.pdf https://www.berkshirehathaway.com/letters/growing.pdf Though he makes the distinction between "import certificates" and Trump's version of tariffs.

throw0101b 1y ago
Contra: > A common response I’ve seen to this is Warren Buffett repeatedly expressing concern about the trade deficit. Buffett’s main concern has always been that we’re sending pieces of paper abroad that give foreigners claims on US assets. And this is true, but I’d argue it’s been a massive net positive on the whole. First, as a percentage of total ownership, foreign ownership of US securities is actually flat since 2008. So despite 20 years of a persistent current account deficit there hasn’t been a huge change in foreign ownership as a percentage of the total. But the current account deficit also reflects the way many firms in the USA outsource their comparative advantage. And that accrues to US firms (and households) as increases in net worth. This is a big reason why corporate profit margins have expanded so much in the last 30 years. Global competition has made US firms more efficient and that’s accrued to Americans as a huge gain in net worth. So this isn’t a situation where we’re just sending Dollars abroad for no good reason. We’re doing it in large part because that is investment in our businesses that has added value to those very firms and their owners. Could that all reverse? For sure. And weirdly, the thing that would cause it to reverse is ultra protectionist measures thereby reducing demand for US Dollar assets and reducing investment in US firms. * https://disciplinefunds.com/2025/04/24/three-things-you-guessed-it/ https://disciplinefunds.com/2025/04/24/three-things-you-gues...
- robocat 1y ago
  > foreign ownership of US securities is actually flat Totally incorrect according to this graph: https://taxpolicycenter.org/sites/default/files/figure1_25.png https://taxpolicycenter.org/sites/default/files/figure1_25.p... From article: https://taxpolicycenter.org/taxvox/who-owns-us-stock-foreigners-and-rich-americans https://taxpolicycenter.org/taxvox/who-owns-us-stock-foreign... Can you cite a source for what you've written?

next_xibalba 1y ago

Buffett actually does share a fear of trade deficits, though. His proposed solution, as an alternative to tariffs, were "import certificates"-essentially a marketable credit required to import goods. These would be earned via exports by exporters, be freely priced and traded, and would essentially bind import levels to export levels.

nabla9 1y ago
It's really a non-problem. Net capital inflows into the U.S. = U.S. trade deficit. The balance of payments is simply: Sales of assets – Purchases of assets = Purchases of goods – Sales of goods If you balance the trade, it means foreigners must stop investing into the US.
- chrisco255 1y ago
  If you balance the trade, it means reduced foreign ownership of U.S. assets, yes, which means ownership of U.S. assets by domestic citizens will increase. One of the primary problems with an unbalanced trade deficit is that your own inhabitants are left with less wealth over time, as assets are sold off to fund consumption.
  - ChadNauseam 1y ago
    That’s zero-sum thinking. Increases demand for US assets can make americans wealthier in many ways (e.g. providing more capital to american businesses).
    - bnjms 1y ago
      Some goods are zero sum. Land is zero sum. Ownership of land by non local entities is… idk seems bad
      - epolanski 1y ago
        Why? What's the issue, if me, an Italian, own land in Indiana or North Cali?

ashoeafoot 1y ago

Change in general, should always come gradually , that way the inevitable consequences rear their head early. Its the bold paintstrokes that topple the world on its side. Obamas biofuels come to mind triggering the arab spring by raising bread prices.

mikem170 1y ago
> Obamas biofuels come to mind triggering the arab spring by raising bread prices. Why do you call them "Obama biofuels" when biofuel mandates were passed while Bush was president? Standards for biofuels appeared in the Energy Policy Act of 2005 [0] (mandating 4 billion gallons of biofuel by 2006, 7.5 billion by 2012) and the Energy Independence and Security Act of 2007 [1], aka the Clean Energy Act of 2007 (mandating 36 billion gallons of biofuel by 2022). Bush signed both laws. I assume that corn-state representatives were pushing for more biofuels, since farmers want to sell more corn, regardless of how green anything is, or is not. At the time Obama was one of many in congress, both Democrats and Republicans, who voted in favor of these laws. I would agree with you that biofuel production exacerbated food supply issues leading into the Arab Spring. [0] https://en.wikipedia.org/wiki/Energy_Policy_Act_of_2005 https://en.wikipedia.org/wiki/Energy_Policy_Act_of_2005 [1] https://en.wikipedia.org/wiki/Energy_Independence_and_Security_Act_of_2007 https://en.wikipedia.org/wiki/Energy_Independence_and_Securi...

sillysaurusx 1y ago

I’m a bit slow in this field. Could someone explain how this quote relates to tariffs? I’ve re-read it three times now, looking for the connection to a tax on imported goods, but I just can’t see it. I think it’s saying that the US population is crowing about how well we’ve done, and so we should be able to tax whatever imports we want? But what an odd way to say that if so. How well we’ve done seems completely unrelated to tariffs. Then the quote caps off with some back-patting about how we’ve only been around 250 years, and that our rise is unprecedented. Again seemingly unrelated to tariffs.

terribleperson 1y ago
Part of the justification for tarriffs is that America is somehow being 'taken advantage' of by the rest of the world and the tarriffs are the rest of the world finally paying their fair share. The reality is that (until now) America has had a uniquely privileged position in the world economy that got America, in general, very beneficial trade deals. He's commenting on the attitude driving the tariffs.
- WalterBright 1y ago
  Uniquely privileged position? The only unique thing about America is free markets. Any country can become highly successful by enacting free markets. The only thing in the way is their disbelief that they work. There's a common thread across the world and history. The more free market a country is, the more it prospers.
  - pyth0 1y ago
    This is only true if you ignore the important material and historical factors that go into the success of a country. Like for example, the immense wealth of natural resources and variation in climates that the US has. Or how about escaping much of the devastation that Europe faced in WW2 and benefiting immensely from helping them rebuild. Or having (for the most part) incredibly safe and stable relationships with neighbors to the north and south. Free markets have certainly contributed to success, but to say it's the only unique thing about America is just wrong.