Warren Buffett: Why Trade Should NEVER Be a Weapon | Berkshire 2025

[Transcript]

BECKY QUICK: This first question comes from Bill Mitchell. I received more questions about this than any other question. He writes, “Warren, in a 2003 Fortune article, you argued for import certificates to limit trade deficits and said these import certificates basically amounted to a tariff, but recently you called tariffs an act of economic war. Has your view on trade barriers changed or do you see import certificates as somehow distinct from tariffs?”

(Warren Buffett's 2003 Fortune Article: https://www.berkshirehathaway.com/letters/growing.pdf)

WARREN BUFFETT: Yeah, well, the import certificates were distinct, but their goal was to balance imports against exports. And so that the trade deficit would not grow in an enormous way. In fact, it would have – It had various other provisions in attempt to help third world countries at that time as they were called to perhaps catch up a little bit. And then they had a variety of aspects to them but basically they were designed to balance trade, and I think you can make some very good arguments for the fact that balanced trade is good for the world. And the more balanced trade there is, the better, it will continue to be better. For cocoa to be raised in Ghana and coffee in Colombia and a few things.

And over time, America industry has gone from being an agricultural country – this was nothing but an agricultural country, I mean that virtually, and that was only 250 years ago – and we have become a very industrial country. And we did not want to make that a situation, in my view, where we ran greater and greater deficits building up greater and greater debts against the country. So I designed this import certificate thing, which Charlie thought was a little too much like Rube Goldberg – but it’s gimmicky, but it’s certainly a lot better than anything – I think – than we’re talking about now.

And there’s no question that trade can be an act of war, and I think it’s led to bad things just the attitudes it’s brought out in the United States. I mean we should be looking to trade with the rest of the world. We should do what we do best, and they should do what they do best. And I don't think it – (Applause) that's what we did originally. I mean we were good at producing tobacco and cotton 250 years ago, and we traded in and we want a prosperous world.

With eight countries with nuclear weapons, including a few that are what I would call quite unstable, I do not think it's a great idea to try and design a world where a few countries say, “Hahaha, we’ve won” and other countries are envious. (Applause)

So my import certificate idea which went no place. I think we got extra copies probably, not a great demand for the copies. (Laughter) Anybody if you'd like and write the office I think we could probably send you a copy of it.

But the main thing to do is trade should not be a weapon. And the United States we've won. I mean we have become an incredibly important country starting from nothing 250 years ago. There's nothing that anything like it. And it's a big mistake in my view when you have 7.5 billion people that don't like you very well and you have 300 million that are crowing in some way about how well they’ve done. And I don’t think it’s right and I don’t think it’s wise.

I do think that the more prosperous the rest of the world becomes, it won’t be at our expense – the more prosperous we’ll become and the safer we’ll feel and your children will feel someday. So that's – (Applause) But don’t expect my import certificate idea to go down there with Adam Smith’s Wealth of Nations or anything. (Laughter)

Source: https://buffett.cnbc.com/2025-berkshire-hathaway-annual-meeting/

 

[YAPSS Takeaway]