Warren Buffett: Tariffs are ‘an act of war’

[Rive]

@Rive can you give an example of what you are talking about?

China was already mentioned. In short, China kept export prices low by government funded incentives and monetary politics, and this ended in a world wide dependency. Especially inconvenient, that by now even key sectors are affected => tariffs.
It's also a relative common sight (even now) that an economically superior entity can hinder or prevent local industries to develop by enforcing free trade through monetary or political means.

So while in general free trade is considered desirable, protectionism also has its place and demonizing tariffs by such one-sided phrasings is just a no-go.

It's just if you have a really big wrench (tariffs) in the toolbox then you should be really, really careful with swinging it around mindlessly.

 

[phinds]

In short, China kept export prices low by government funded incentives and monetary politics, and this ended in a world wide dependency.

Yes, Americans have become addicted to cheap goods sold by Walmart and produced in China, just as China has become dependent on American semiconductors.

I don't see how you get "act of war" out of either of those.

 

[Grinkle]

Yes, Americans have become addicted to cheap goods sold by Walmart and produced in China, just as China has become dependent on American semiconductors.

There is a meaningful difference between an economic efficiency and an economic monopoly.

Americans became addicted to cheap goods that could be manufactured in America but then they would not be so cheap.

China cannot at this time manufacture many of the chips that are manufactured by American companies due to lacking the technology to do so.

 

[Grinkle]

I don't see how you get "act of war" out of either of those.

My own context for act of war in this thread has been trade war.

Unlike PF, we will often find ourselves without recourse to math as our unambiguous arbiter of exactly what one is claiming or arguing. We will have to rely on our own best efforts to define our terms.

In my own view, an act of trade war is an act that can reasonably be expected to provoke a hostile economic response. A government subsidizing a domestic company to provide that company an external efficiency which all parties know will then be used by that domestic company to undercut any foreign competition qualifies.

A government over-riding free market incentives and prohibiting a domestic company from engaging with a foreign company (export controls) might qualify, depending on the motivation for establishing the controls. I don't believe China sees US semi-conductor export controls as an economic attack per se, but maybe that's a grey area.

 

[gleem]

I'm not sure if Trump is that confident in his tariff plan. He stated that he would reconsider the tariffs if the fentanyl traffic was reduced significantly, which I understand it already has. It would give him a reason to declare a win and not have to face the economic consequences of the tariffs.

 

[Klystron]

This NYT article describes Mexico's plans as tariffs descend on our vibrant trading partners. Link should allow guest access.

Trump's latest demands to move manufacturing plants to US states seems particularly bizarre and corrupt.

But Mr. Trump, whose criticism of Mexico had focused on illegal fentanyl, shifted his terms on Monday, saying that Canada and Mexico needed to relocate automotive factories and other manufacturing to the United States.

 

[phinds]

My own context for act of war in this thread has been trade war.

Ah. Well, I didn't have my mind reading hat on, so I didn't realize that ...

 

[Grinkle]

I didn't have my mind reading hat on

You quoted a statement that says we are talking about a trade war in your post #3. After I read posts 2 and 3, I assumed no one thought we are talking about a shooting war. Were you talking about a shooting war in your post 32?

 

[phinds]

He stated that he would reconsider the tariffs if the fentanyl traffic was reduced significantly,

Uh ... just how "significantly" does he expect Canada to reduce the fentanyl traffic over its border since that is estimated as being something like .4% (that's 4 parts in 1,000) of the total entering the US.

https://www.cfr.org/article/how-does-fentanyl-reach-united-states

Canada plays virtually no role in the U.S. fentanyl influx, especially compared to the other countries. The country contributes less than 1 percent to its southern neighbor’s street fentanyl supply, as both the Canadian government and data from the DEA report.

 

[gleem]

Uh ... just how "significantly" does he expect Canada to reduce the fentanyl traffic over its border since that is estimated as being something like .4% (that's 4 parts in 1,000) of the total entering the US.

That's why I said that He may not be confident in his tariff plan. He can use any measure he wants and claim success and save face. Both Mexico and Canada have already significantly reduced fentanyl traffic since he announced the tariffs.

 

[Grinkle]

@gleem Why do you think he is imposing tariffs?

I am not at all confident I have any idea. Things that occur to me -

He believes it makes him seem unpredictable and dangerous to impose tarriffs for no well articulated reason and no well articulated path to removing them, and acting this way will lead to other world leaders deferring to him no matter the issue just to avoid being tariffed.

He believes tariffs will somehow end up increasing the US GDP (my translation of him saying 'make America rich again', if it doesn't mean higher GDP then I have no clue what it really means) and will incentivize Mexico and Canada to find a way to seal the borders from their side.

He's said for years that tariffs are a good thing for America, and since he's said it for years, he's just going to do it, no other reason than that.

He believes it is a politically viable tax to levy on the American people and he does want to raise taxes without being seen to have raised taxes - if he just said "I'm doing a national sales tax" no one would like that, but he can get away with tariffs because its spelled differently than "sales tax".

None of those really resonate with me as likely, though. Still, its all I've got.

 

[phinds]

He believes it is a politically viable tax to levy on the American people

That is directly contrary to what he has said for years. He believes, or at least says he believes, that tariffs are paid by the country on which the tariffs are levied.

I watched him on live TV where he was being questioned at an economic forum with numerous of the most well known economists in the country and he said:

“It must be hard for you to spend 25 years talking about tariffs as being negative and then have somebody explain to you that you’re totally wrong,” Trump said.

trump-says-experts-wrong

 

[gleem]

@gleem Why do you think he is imposing tariffs?

I have no idea if he is shrewd, or ignorant. He talks coherently sometimes in one-on-one interviews and acts as a simpleton in public speeches. His business background of ill-managing properties, dodging taxes, and using his wealth to avoid paying contractors is ill-suited to deal with international relationships.

The US lost its manufacturing prowess decades ago. We cannot compete with cheap labor. The average manufacturing job in China pays 20% of that in the US. India has yet to show its strength, but when it does, China will suffer too. Unless we can significantly automate manufacturing, we should acknowledge that and move on.

 

[Grinkle]

That is directly contrary to what he has said for years. He believes, or at least says he believes, that tariffs are paid by the country on which the tariffs are levied.

I completely agree. Sometimes he gets caught-out being full-on-lying-narcissist as opposed to incomprehensibly unintelligent, though. Its possible this is one such case. I'm drawing a comparison to the below when I say that, and recalling the below is why I give that scenario any consideration, myself.

Trump told Bob Woodward he knew in February that COVID-19 was ‘deadly stuff’ but wanted to ‘play it down’

"It's not just old people," Trump told Woodward, acknowledging the gravity of the disease, The Washington Post reported.

www.nbcnews.com

 

[Grinkle]

we should acknowledge that and move on.

Its possible, I guess, that this is what the latter stages of moving on from manufacturing looks like for America.

 

[Ian DF]

“Tariffs are actually — we’ve had a lot of experience with them — they’re an act of war, to some degree,” Buffett said in an interview with CBS that aired on Sunday.

https://www.cnn.com/2025/03/03/business/warren-buffett-tariffs-trump/index.html

Imposing tariffs on our neighbors/allies is not criminal but it is criminally stupid.

It is interesting that at this point in time Warren Buffet wakes up after the damage that the Buy America bill that Biden signed has already cost the USA billions in federal expenses.
The bill requires federal agencies, including local authorities to buy only products that are over a certain percentage Made in America. Not Canada or Mexico but the USA.
The economics of which failed so badly that it has been swept under the media carpet last year so as not to impact the Presidential campaign.
When you pay more for products but make less from revenues, you are not going to get rich.

I think a Word doc should be amenable to just a copy/paste into this forum. To test this, I have created this post, with a link.

https://civicswatch.com/

 

[EricDMMiller]

China has announced that it is prepared for every kind of war with the United States.
China says it is ready for 'any type of war' with US (BBC)

US defence secretary Pete Hegseth has declared that the US is prepared for kinetic war with China.
Defense Secretary Pete Hegseth says US is ‘prepared’ to go to war with China over tariff threats (New York Post)

For a President that shouted "You’re gambling with World War III" at Zelensky last week, it certainly seems like his administration is moving directly in that direction. The tariff sparked trade war is just the first shot. Perhaps they are counting on their new Russian allies to help them against China.

EDIT: On the fentanyl issue, basically no fentanyl is shipped from Canada to the United States.
How Does Fentanyl Reach the United States? (Council on Foreign Relations)

It is simply an attempt to generate a casus belli for invasion and annexation of Canada. The narrative is already shifting to Canada being taken over by Mexican cartels, and the next dictator in Trump's eyes is Trudeau.

Trump Adviser Insists ‘Canada Has Been Taken Over by Mexican Cartels’ (Medaite)




It seems that they intend to escalate this rhetoric in an attempt to justify territorial infringement in the name of ridding Canada of the cartels that have taken it over (and which do not exist).

 

[MindlessPieces]

Not the way to treat your neighbours, key trading partners and key allies.
Really weird.

 

[dlu]

t is simply an attempt to generate a casus belli for invasion and annexation of Canada. The narrative is already shifting to Canada being taken over by Mexican cartels, and the next dictator in Trump's eyes is Trudeau.

Don't think so.
Not really liking to stick it to my own country, buy the fentanyl problem in Canada, US, and world is real.
At least the one thing Trump has done has made it mainstream, instead of it being pretty much having been ignored by the mainstream for reasons unknown.
To give it some perspective, similar number of deaths have been attributed for Covid and fentanyl overdose - around 50,000 for each ( fentanyl since 2016 )

https://www.cbc.ca/news/politics/fentanyl-produced-in-canada-1.7275200

Criminal networks are shifting from fentanyl imports to Canadian-made product​

Border seizures are down, the street price is down — and Canadian-made fentanyl has gone global​

"It is widely believed that excess product is being exported to lucrative international markets," the note reads.

In 2022, Australian border officials seized 11 kilograms of fentanyl believed to have originated in Canada.

How Does Fentanyl Reach the United States? | Council on Foreign Relations

President Trump has imposed punitive measures on several countries in the name of curbing what he characterizes as high fentanyl flows into the United States. In reality, supplies of the drug—and related deaths—have sharply declined, though they are still at worrying levels.

www.cfr.org

How Does Fentanyl Reach the United States?​

Canada plays virtually no role in the U.S. fentanyl influx, especially compared to the other countries. The country contributes less than 1 percent to its southern neighbor’s street fentanyl supply, as both the Canadian government and data from the DEA report.

Largest drug "super lab" in Canada's history busted with record amount of fentanyl, chemicals and guns seized

Police also found dozens of handguns, AR-15-style rifles and submachine-guns -- "many of which were loaded and ready to be used."

www.cbsnews.com

Largest drug "super lab" in Canada's history busted with record amount of fentanyl, chemicals and guns seized​

Officers served search warrants last week on the drug lab in Falkland, British Columbia and associated locations in Surrey, in Metro Vancouver. The RCMP released multiple photos of the operation showing officers in protective suits retrieving items from the "super lab."

Police said they seized 54 kilograms of fentanyl, "massive" amounts of precursor chemicals, 390 kilograms of methamphetamine, and smaller amounts of cocaine, MDMA and cannabis.
===
[ NOTE: if 2mg is a lethal dose, the 54 kg would have the potential to cause harm to 27 million individuals - more than half the population of Canada ]
====
The bust comes about two weeks after Canadian police said had made arrests linked to another transnational organized crime group. The RCMP said it had worked with the FBI for over a year to target a Mexican cartel-linked criminal network which had been moving large amounts of methamphetamine and cocaine from Central and South America via the United States to Canada and overseas.

 

[EricDMMiller]

Canada has had a fentanyl problem for a while. Mainly Chinese imports and labs run on Chinese precursors. The primary organized crime involved in drug trafficking in Canada are the Hells Angels and native (indigenous) crime gangs, like the Native Syndicate and Indian Posse.

It has very little to do with Mexican cartels, and as you mentioned in your own post, it contributes essentially nothing to the US problem.

 

[Pinball1970]

In case you did not see the statement from Trudeau

 

[Ian DF]

Canada has had a fentanyl problem for a while. Mainly Chinese imports and labs run on Chinese precursors. The primary organized crime involved in drug trafficking in Canada are the Hells Angels and native (indigenous) crime gangs, like the Native Syndicate and Indian Posse.

It has very little to do with Mexican cartels, and as you mentioned in your own post, it contributes essentially nothing to the US problem.

How Mexican Cartels Settled in Canada

A number of Mexican cartels are moving north, embedding in Canada's underworld, where they are displacing the traditional mafias.

insightcrime.org

In 2021 it was identified that Mexican gangs are in Canada and that the Canadian government has been slow to respond
There have been actions taken since then
But as much as Trump exaggerated many things, in this case Mexican gangs are in Canada

 

[Grinkle]

It is simply an attempt to generate a casus belli for invasion and annexation of Canada.

I don't even know how to ask the following questions of a Canadian without feeling like I'm sounding like a very unpleasant person asking "does that hurt" while looking at someone else's compound fracture. I hope it doesn't come off that way.

Even in today's world, it did not occur to me to put it on my list in post 41. I don't mean I thought about it and dismissed the possibility, I mean it never even occurred to me.

Do you truly believe this? As opposed to making a statement that more expresses exasperation and aggravation, but is not intended literally, I mean.

If you do believe it, do you think Trump would stop at using it as a wedge issue, ie spend 4 years saying "if they do even one more thing I'm going in" but never actually intend to "go in", or do you think Trump actually believes invasion and annexation is viable?

 

[EricDMMiller]

I don't even know how to ask the following questions of a Canadian without feeling like I'm sounding like a very unpleasant person asking "does that hurt" while looking at someone else's compound fracture. I hope it doesn't come off that way.

Even in today's world, it did not occur to me to put it on my list in post 41. I don't mean I thought about it and dismissed the possibility, I mean it never even occurred to me.

Do you truly believe this? As opposed to making a statement that more expresses exasperation and aggravation, but is not intended literally, I mean.

If you do believe it, do you think Trump would stop at using it as a wedge issue, ie spend 4 years saying "if they do even one more thing I'm going in" but never actually intend to "go in", or do you think Trump actually believes invasion and annexation is viable?

Yes.

We truly believe it. Americans keep saying it. When someone tells you who they are, believe them.

Braid: Trudeau says Trump wants economic collapse

Prime Minister Justin Trudeau says President Donald Trump wants to force Canada into economic collapse, as prelude to annexation.

calgaryherald.com

 

[Ian DF]

Yes.

We truly believe it. Americans keep saying it. When someone tells you who they are, believe them.

Braid: Trudeau says Trump wants economic collapse

Prime Minister Justin Trudeau says President Donald Trump wants to force Canada into economic collapse, as prelude to annexation.

calgaryherald.com

India Should Designate Canada as a State Sponsor of Terror

India is withdrawing its High Commissioner from Canada after Canadian Prime Minister Justin Trudeau again accused India of masterminding the June 18, 2023, killing of Khalistani terrorist Hardeep Singh Nijjar outside the Guru Nanak Gurdwara...

www.aei.org

It is interesting that there is a lot of misinformation and mistrust between Trudeau and several other countries.
There are many sources who are questioning his motives for attacking India even though reports do not agree with his line.

 

[Rive]

Why do you think he is imposing tariffs?

I am not at all confident I have any idea. Things that occur to me -

I think you are some seriously overthinking it by searching for such depths. It's just about him displaying strength and decisiveness, creating impact: with the instincts of an established conman he's confident that for every tiny piece of his doing there will be always somebody to find a grain of truth, so opposition could be invalidated, distracted.

 

[Grinkle]

You posted what I should have included in my post 41 list. I read the below, it made a lot of sense to me, but I didn't think about it when I wrote post 41. Your subsequent comment and the posts by @EricDMMiller brought it back to mind.

I think the only reason to have those tariffs is that for some specific kind of mindsets enemies are mandatory to have. And if you don't have enemies at hand then creating them is the easy choice.
And, your allies are the closest, so you may start with them right away.

I add to my list what now seems the most likely reason Trump is imposing tariffs on Canada (and Mexico).

He wants to create a permanent state of animosity with a geographic neighbor in order to enhance his own political power, along the lines of enemies being mandatory that you said above. He is not, IMO, wanting to actually annex Canada (or Mexico), he doesn't want to do anything that might be seen as resolving a conflict (like actually annexing Canada), he wants a permanent state of animosity, much like what exists between India and Pakistan / Bangladesh.

That does resonate with me as a very likely and specific reason he is doing what he is doing with tariffs.

 

[phinds]

On the fentanyl issue, basically no fentanyl is shipped from Canada to the United States.

Exactly

 

[Klystron]

Exactly

View attachment 25

Love the frazzled expression on the goldfish. Is that Emperor Napoleon posing beneath the cuckoo clock?

 

[jack action]

Can anyone explain how news like this doesn't infuriate more Americans?

Who Likes Tariffs? Some U.S. Industries Are Eager for Them.​

The United States buys more steel from Canada than from any other country, and those imports will become much more expensive under tariffs President Trump intends to impose this week.

That’s good news to Stephen Capone, president of Capone Iron Corporation of Rowley, Mass., which makes steel stairs, handrails, gratings and other products and has around 100 employees. For too long, he said, Canadian competitors have been flooding the New England market with cheap steel products, preventing his and other local companies from winning business.

So to create a few jobs, we increase the prices for everybody in the country.

At first, with the money coming from the tariffs, it might be equivalent if the money is well redistributed. But as soon as you stop importing and buy local only (the intended long term effect), you are stuck with high prices and no tariffs. If, somehow, the prices drop, the outsiders become competitive and local jobs are lost again.

In Canada, we are urged to consume locally, you know, for patriotism. But most people still buy the cheapest stuff. I'm not getting poorer to make my neighbour richer and then, what? Try to live off of them. Why does my neighbour deserve to make a living more than the guy in Asia, South America, or Africa?