Billionaire investor Warren Buffett has sharply criticized the Trump administration’s escalating use of tariffs, calling them “an act of war, to some degree.” The chairman and CEO of Berkshire Hathaway expressed his concerns during an interview with “CBS News Sunday Morning,” highlighting the economic burden tariffs impose on American consumers.

“Over time, they are a tax on goods. I mean, the Tooth Fairy doesn’t pay ’em!” Buffett remarked when asked about the potential impact of tariffs on inflation. “And then what? You always have to ask that question in economics. You always say, ‘And then what?'”

His comments underscored the cascading economic effects of tariffs, which are ultimately borne by American consumers through higher prices of goods.

Buffett, often referred to as the “Oracle of Omaha,” offered only guarded insights into his views on the current economic climate. When asked about the state of the economy, he said: “Well, I think that’s the most interesting subject in the world, but I won’t talk, I can’t talk about it, though. I really can’t.”

He also refrained from discussing politics, maintaining his recent stance of avoiding endorsements or political commentary. Despite his reluctance to delve into economic specifics, Buffett reiterated his confidence in the U.S. economy, stating that “a majority of any money I manage will always be in the United States because it’s the best place.” His enduring faith in the U.S. market aligns with his investment philosophy, which has consistently favored American businesses.

Since taking office, President Donald Trump has aggressively used tariffs as a cornerstone of his trade policy, targeting countries like China, Mexico, Canada, and the European Union. Economists have repeatedly warned that these tariffs could hurt the domestic economy, with additional costs likely to be passed on to American consumers rather than foreign exporters.

Trump’s approach has included placing a 10% tariff on goods from China last month, which he followed with another 10% tariff last Thursday, accusing Beijing of not doing enough to prevent fentanyl from entering the U.S. The Trump administration has also announced a 25% tariff on all steel and aluminum imports to the U.S., set to take effect on March 12.

Moreover, Trump proposed a 25% tariff on Mexico and Canada, which was initially supposed to take effect in February but was postponed, now started on Tuesday. However, Commerce Secretary Howard Lutnick hinted that the tariffs might not be as high as 25%. Trump’s tariff threats also extended to European Union countries, and he warned of a potential 100% tariff on BRICS nations if they attempted to replace the U.S. dollar as their reserve currency.

The tariffs have sparked significant backlash from affected countries, many of which have retaliated with their own tariffs on U.S. goods. China has responded to the U.S. tariffs by imposing duties on American agricultural products, hitting U.S. farmers hard and contributing to a sharp decline in exports of soybeans, pork, and other produce. Beijing also targeted the U.S. automobile industry, adding to the strain on American manufacturers.

In response to the steel and aluminum tariffs, the European Union is gearing up to impose retaliatory tariffs on iconic American products such as bourbon, motorcycles, and jeans. Canada, one of the closest U.S. allies, slapped tariffs on steel, aluminum, and a variety of consumer goods from the U.S., including ketchup and lawnmowers. Mexico, too, joined the fray by getting ready to enact tariffs on U.S. pork, apples, and cheese, aiming to protect its local industries from the impact of American trade policies.

These tit-for-tat measures have raised concerns among economists and trade experts, who warn that escalating tariffs could trigger a global trade war, disrupt supply chains, and stifle economic growth. The additional costs of tariffs are often passed down to consumers, leading to higher prices for everyday goods.

Analysts also worry that prolonged trade disputes could undermine investor confidence and create volatility in financial markets. The business community in the U.S. has been vocal in its opposition to the tariffs, with trade groups representing industries from manufacturing to retail warning of potential job losses and declining sales.

Buffett, who has previously supported Democratic candidates including Barack Obama and Hillary Clinton, has chosen not to endorse a candidate in the 2024 presidential election. His decision aligns with his recent caution against being impersonated or misrepresented, as he noted in a CNBC interview last year: “Nobody should believe anybody saying I’m telling them how to invest or how to vote.”

The billionaire’s reluctance to enter the political fray this election cycle contrasts with his active involvement in past elections.

As the Trump administration continues to wield tariffs as a policy tool, many are asking the same question Buffett posed—”And then what?”—as they contemplate the long-term effects on inflation, consumer spending, and the overall stability of the global economy.

The much-anticipated tariff war has officially begun following U.S. President Donald Trump’s decision to impose steep tariffs on imports from Canada, Mexico, and China.

The new tariffs, which came into effect overnight, include a 25% levy on products from Canada and Mexico, a 10% tariff on Canadian energy imports, and a 20% tariff on Chinese goods—doubling the previous rate. The move has sparked immediate retaliatory measures from the affected countries, raising concerns about global trade stability and the potential for widespread economic repercussions.

The Beginning of the Tariff War

President Trump has framed the tariffs as a strategy to protect American jobs and manufacturing while also addressing illegal migration and drug trafficking. However, the decision to target the United States’ top trading partners—Canada, Mexico, and China—has led to a tit-for-tat escalation, with experts warning of a broader trade war.

Tariffs serve as a tax on imports, intended to shield domestic industries from cheaper foreign competition. But economists believe that such measures often lead to higher consumer prices and disruptions to supply chains. The new tariffs on Canadian and Mexican imports and increased levies on Chinese goods have already set the stage for retaliatory actions, creating a ripple effect that could hit various sectors of the global economy.

Canada’s Swift and Severe Response

Canadian Prime Minister Justin Trudeau responded quickly, announcing C$155 billion (US$107 billion) worth of tariffs on American goods. The tariffs will be implemented in two phases: an immediate 25% tariff on C$30 billion worth of goods, followed by additional tariffs on C$125 billion worth of American products within 21 days.

Trudeau condemned Trump’s tariffs, saying, “There was no justification” for the move, particularly since less than 1% of the fentanyl intercepted at the U.S. border originated from Canada. This rebuttal came as Trump cited drug trafficking, including fentanyl, as part of his rationale for the tariffs.

The tariffs’ potential impact on Canada’s economy is significant. The automotive sector, a vital part of Canada’s economy, could be severely disrupted. Car parts often cross the U.S.-Canada border multiple times during manufacturing, which means they might be taxed repeatedly, raising costs and potentially leading to job losses.

Canada’s provincial leaders have also hinted at drastic measures. Ontario Premier Doug Ford suggested cutting off Canadian electricity supplies to the U.S., emphasizing that Canada provides enough energy to power six million American homes.

“If they want to try to annihilate Ontario, I will do anything, including cutting off their energy, with a smile on my face,” Ford told NBC.

The Canadian Chamber of Commerce called the tariffs “reckless,” warning they could lead to a “recession, job losses, and economic disaster” on both sides of the border.

Mexico Holds Its Fire—For Now

Mexican President Claudia Sheinbaum echoed Trudeau’s sentiments, stating there was “no motive, no reason, no justification” for Trump’s actions. However, unlike Canada, Mexico has opted for a more measured approach, delaying the announcement of specific retaliatory tariffs until Sunday.

Sheinbaum’s stance indicates a potential window for de-escalation, but she made it clear that Mexico is prepared to respond if necessary. Her administration has previously demonstrated its capacity to combat drug trafficking, recently seizing over a ton of fentanyl and dismantling 329 methamphetamine labs. Sheinbaum emphasized that Mexico had already taken steps to curb the flow of illegal drugs into the U.S.

Despite this restraint, the Mexican government has been clear that it will not allow its economy to be targeted without a response. The delay in announcing tariffs could be a strategic move, allowing for last-minute negotiations or a show of good faith to avoid a full-blown trade war.

China’s Counterpunch

China, which now faces 20% tariffs on its goods entering the U.S., has wasted no time in retaliating. Beijing announced new tariffs of up to 15% on key American exports, including agricultural products such as chicken, pork, soy, and beef. China has also imposed additional export controls on 15 American companies, including defense contractors like Leidos and General Dynamics Land Systems.

The spokesperson for China’s National People’s Congress, Lou Qinjian, reinforced China’s unwillingness to be bullied: “China will not accept pressuring or threatening,” he said.

China’s Ministry of Commerce described the U.S. tariffs as harmful to trade relations and urged their withdrawal, underlining a tough stance against what it perceives as economic aggression.

The Chinese tariffs, set to take effect on March 10, could significantly impact U.S. agriculture. American exports of corn and soybeans, which represent a substantial share of trade with China, will now face heightened duties of 15% and 10%, respectively. This move could hit U.S. farmers hard, particularly as China is one of the largest markets for American agricultural goods.

The tariff war marks a significant escalation in global trade tensions. As Canada, Mexico, and China hit back with their own tariffs, the risk of prolonged economic conflict becomes more realistic. While Trump maintains that tariffs are a tool to protect American interests, economists warn that these measures could lead to widespread economic pain.

The coming weeks will be crucial in determining whether this tariff war can be contained or if it will spiral into a broader economic confrontation. With Canada and Mexico already taking steps and China demonstrating its resolve, the international community is bracing for the impact of what could be one of the most disruptive trade conflicts in recent history.

OpenAI announced on Monday the launch of a new consortium called NextGenAI, aimed at bolstering AI-assisted research at leading academic institutions. The initiative, which includes 15 founding partners such as Harvard, the University of Oxford, and MIT, will be supported by $50 million in research grants, compute funding, and API access from OpenAI.

The new initiative comes at a critical moment for U.S. AI research, as the Trump administration has reportedly dismissed several National Science Foundation (NSF) employees selected for their AI expertise. The shakeup threatens the NSF’s ability to maintain crucial AI projects, leaving a gap that NextGenAI may partially fill.

Through NextGenAI, OpenAI intends to provide financial and technical support to students, educators, and researchers, with awards set to be distributed in the coming months. The company highlighted the initiative’s mission to fuel the next wave of discoveries and equip emerging talent to shape AI’s trajectory.

“This initiative is built not only to fuel the next generation of discoveries, but also to prepare the next generation to shape AI’s future,” OpenAI wrote in a blog post. “NextGenAI is designed to support the scientist searching for a cure, the scholar uncovering new insights, and the student mastering AI for the world ahead […] As we learn from this initiative, we’ll explore opportunities to expand its reach and impact.”

The consortium is being positioned as an extension of OpenAI’s educational outreach, following the launch of its ChatGPT Edu product for universities last May. By partnering with elite institutions, OpenAI aims to establish a strong presence in academic research, potentially shaping the educational and research sectors with its AI technologies.

A Strategic Move in a Competitive AI Industry

While the funding boost is a welcome relief for many in the academic community, OpenAI’s motives may not be entirely altruistic. By embedding its tools into academic research, the company could cultivate a generation of researchers and scholars who are more familiar with and reliant on its products. This approach could create a strategic advantage over rivals, including open-source AI initiatives that offer alternative tools.

Filling a Void as Federal Support Wanes

The timing of OpenAI’s announcement is also noteworthy. The reported dismissals at the NSF have raised concerns about the U.S. government’s commitment to supporting critical AI research. The NSF has traditionally been a major source of funding and support for emerging technologies, and any disruption could leave researchers scrambling for alternatives.

With NextGenAI, OpenAI could help bridge this funding gap, especially if federal grants and resources become scarcer. However, the initiative also underscores a broader trend where private companies increasingly step into roles traditionally filled by public institutions.

The consortium’s creation comes with intricacies. For universities, the funding and resources provided by OpenAI could accelerate research and provide students with valuable experience. However, it also introduces potential biases, as researchers might feel pressured to use OpenAI’s tools over competitors, which could stifle innovation and reduce the diversity of approaches in the field.

OpenAI indicated that as it learns from the NextGenAI initiative, it may consider expanding its reach and impact. This could lead to more partnerships, greater funding, and potentially broader educational programs.

In a move that has placed Ukraine in its most precarious situation since the war with Russia began, the United States has halted military aid to Kyiv following a dramatic fallout between President Donald Trump and Ukrainian President Volodymyr Zelenskyy.

The unexpected development has left Ukraine, which has been heavily reliant on U.S. military support to sustain its defense against Russian aggression, scrambling for alternatives as its war effort faces new uncertainties.

An anonymous White House official and a U.S. official confirmed to CNBC’s partner network NBC News on Monday that military support had been paused while the situation is assessed.

“The president has been clear that he is focused on peace. We need our partners to be committed to that goal as well. We are pausing and reviewing our aid to ensure that it is contributing to a solution,” the officials stated.

While the White House has not publicly commented, Ukraine’s Prime Minister Denys Shmyhal expressed Kyiv’s resolve to continue diplomatic efforts to secure support.

“Regardless of the discussions about the possibility of stopping [military aid] — we will absolutely calmly continue to work with the U.S., Congress, with the Trump administration and with him personally through all available diplomatic channels so that Ukraine and the U.S. continue our struggle for a just, lasting, stable peace in Ukraine, on the European continent,” Shmyhal said on Tuesday.

The decision to pause aid, if confirmed, would mark an unprecedented shift in U.S. policy, particularly in light of the critical role American military assistance has played in bolstering Ukraine’s defense. The fallout follows a contentious meeting at the White House on Friday, where President Zelenskyy abruptly left without signing a multi-billion-dollar critical minerals deal — a moment seen by many as a diplomatic disaster.

A Huge Setback for Ukraine

For Ukraine, the pause in U.S. military aid could not come at a worse time. With over three years of war with Russia, Kyiv requires a steady supply of weapons and munitions to maintain its front lines. Defense analysts warn that a prolonged cessation of U.S. support could lead to severe consequences on the battlefield.

“This decision is not about economics. It is driven fundamentally by Trump’s view that Russia is willing to do a peace deal, and only Ukraine is the obstacle,” said Malcolm Chalmers, deputy director-general at defense think tank RUSI. “But there is no evidence that Russia would be prepared to accept a deal, and what that would be. Indeed this decision will encourage Putin to ask for more — including Ukrainian demilitarization and neutrality.”

The Kremlin, seizing on the situation, indicated it hoped the move would push Ukraine toward a peace deal. “If this is true, then this decision could indeed push the Kyiv regime toward the peace process,” Kremlin Press Secretary Dmitry Peskov told reporters, according to an NBC News translation.

Is Ukraine Now Doomed?

Defense strategists at the Center for Strategic and International Studies (CSIS) described the prospects for Ukraine as “bleak.” Analysts Mark F. Cancian and Chris H. Park explained that while equipment from previously announced commitments may still be delivered, there is a risk that the Trump administration could halt these shipments.

“The bottom line: Prospects for Ukraine are bleak. In the best case, U.S. and European aid continues, which is enough for Ukraine to stabilize the front lines, blunt Russian attacks, and buy time for a negotiated settlement,” they noted. “In the worst case, the United States cuts off shipments of equipment. What Ukraine receives from the Europeans, other global sources, and its own industry will keep its forces in the field but with declining capabilities. Russian attacks will gain more and more territory; at some point, Ukrainian lines will break. Ukraine will have to accept an unfavorable, even draconian peace.”

The Kiel Institute for the World Economy, a respected source tracking Ukraine aid, estimated that Europe had already overtaken the U.S. in total support, allocating 70 billion euros ($73.6 billion) in financial and humanitarian aid and 62 billion euros in military aid. Comparatively, the U.S. has provided 64 billion euros in military aid and 50 billion euros in financial and humanitarian allocations.

Europe’s $840 Billion Defense Plan As A Lifeline

With the U.S. stepping back, Ukraine’s hopes now rest on the European Union, which is preparing a massive urgent defense funding initiative that could raise up to 800 billion euros ($840 billion). Part of this fund is expected to support Ukraine, but analysts caution that the country’s ability to continue fighting will heavily depend on how quickly the EU can mobilize this funding.

European Commission President Ursula von der Leyen announced on Tuesday the EU’s intention to boost defense spending, emphasizing both immediate support for Ukraine and the long-term goal of enhancing European security.

“Europe is ready to massively boost its defense spending. Both to respond to the short-term urgency to act and to support Ukraine but also to address the long-term need to take on much more responsibility for our own European security,” she said.

However, despite these ambitious plans, there is concern that bureaucratic delays and the deteriorated state of Europe’s defense industry could hinder rapid assistance to Ukraine. The CSIS strategists warned, “The bad news is that the Europeans are already supplying as much as they can. Further, if the United States ceases aid, many European countries will also likely scale back.”

Can Europe Step Up?

As the situation unfolds, the EU faces mounting pressure to step into the gap left by the U.S. The CSIS notes that Europe has been a significant contributor to Ukraine’s defense, supplying roughly $1.8 billion per month in military aid. European aid was particularly crucial during late 2023 and early 2024 when U.S. funds were exhausted amid congressional debates.

The EU has also approved the use of frozen Russian sovereign assets to support Ukraine’s military needs, a move that demonstrates its commitment to Kyiv’s defense. However, the extent to which Europe can fill the void left by the U.S. remains uncertain.

European leaders have already convened emergency meetings to discuss their role in Ukraine’s defense and the broader implications of a potential U.S.-Russia peace deal that could sideline Kyiv and Europe altogether. For now, the question remains whether Europe can act swiftly enough to prevent Ukraine from being forced into a disadvantageous settlement.