Warren Buffett Advocates for Balanced Trade Over Tariffs. Could Import Certificates Provide a Better Path for the Stock Market?

Warren Buffett has been in the business world for more than seven decades. He also reads voraciously. It shouldn't be surprising, therefore, that the legendary investor has an opinion on tariffs. In a nutshell, he doesn't like them.

In a March 2025 interview with CBS News' Norah O'Donnell, Buffett called tariffs "an act of war, to some degree." However, the Oracle of Omaha put forward an intriguing alternative to tariffs years ago that's still garnering attention today.

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Buffett's idea

In 2003, Buffett wrote an article for Fortune magazine warning about the U.S. trade deficit. He noted that trade deficits began to concern him going back to 1987. Buffett wrote, "We were taught in Economics 101 that countries could not for long sustain large, ever-growing trade deficits."

Buffett didn't just point out the problem, though. He presented a potential solution that he called import certificates. His idea was to issue these import certificates to all U.S. exporters. The exporters would get import certificates equal to the dollar value of the products they exported to other countries. They would then be able to sell their import certificates to anyone wanting to import products into the U.S.

For example, let's suppose Acme Corporation exports $1 million in products from the U.S. to other countries. Acme would receive $1 million worth of import certificates that it could sell to any other company seeking to export products from other countries to the U.S. The end result would be a trade balance.

Buffett acknowledged, "My remedy may sound gimmicky, and in truth it is a tariff called by another name." However, there are major differences between his proposed import certificates and the tariffs imposed by the Trump administration. For one thing, Buffett's idea doesn't try to protect specific industries as the president's steel tariffs do. Nor do they attempt to punish specific countries like Trump's initial calls for exceptionally high tariffs on China and the European Union.

What he thinks now

What happened after Buffett proposed import certificates in 2003? Nothing. Fortune reposted the article in 2016. Buffett said then that he still agreed for the most part with what he originally wrote. However, he acknowledged that the problem of trade deficits had "diminished a bit" thanks to lower oil prices and increased domestic production of oil.

Does Buffett still like the idea of import certificates? He told Berkshire Hathaway shareholders at their annual meeting in May 2025 that the idea is "certainly better than what we're talking about now."

Buffett expressed concern about the impact the Trump administration's tariffs are having on other countries' views of the U.S. He said at the Berkshire shareholder meeting:

[I]t's a big mistake when you have 7.5 billion people who don't like you very well, and you have 300 million people crowing about how well they've done. I don't think it's right, and I don't think it's wise. 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.

The 94-year-old multibillionaire argued, "The main thing is that trade should not be a weapon." He continues to believe that "balanced trade is good for the world."

A better path for the stock market?

You might have noticed a pattern with the stock market in 2025. News about increased tariffs or tariff threats from the Trump administration has usually caused stocks to sink. But any hints that tariffs will be eased or delayed, even temporarily, have typically caused stocks to rise. It doesn't take an investing guru to see that tariffs have been perceived as bad for stocks.

Would Buffett's import certificates pave a better path for the stock market? I think so. If nothing else, Buffett's idea would remove the animosity that punitive tariffs could create with major U.S. trading partners and be much less likely to ignite a trade war that could cause economic harm.

Perhaps more importantly, though, Buffett's proposal would remove much of the uncertainty that has been prevalent with President Trump's tariffs. Buffett developed a logical and structured market-based approach to address trade deficits. Instead of on-again, off-again tariffs with rates that change frequently, investors would know what to expect.

However, Buffett didn't seem to have much hope that his import certificates would gain traction at Berkshire Hathaway's recent shareholder meeting. He joked, "[D]on't expect my import certificate idea to go down in history with Adam Smith's Wealth of Nations." Investors might wish otherwise.

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Keith Speights has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.