"Crazy chicken stuff" Shark Tank investor Kevin O'Leary reveals how tariffs can be used as short term weaponry 

Shark Tank investor Kevin O'Leary weighed in on the current global trade tensions, arguing that tariffs are useful as short-term leverage but not a substitute for lasting economic policy.

O'Leary, known for his candid business insights, emphasized that real solutions require structured tax reform and comprehensive trade deals, especially as countries like Canada, under new Prime Minister Mark Carney, confront mounting economic pressure.

“If they pen a deal with India, that'll become the template for all the other countries,” he said in a recent Instagram post.

Explaining:

“Boom, the market goes up. We all want to see that... No administration's ever tried to negotiate 60 trade deals at once. This is crazy chicken stuff, but if you're gonna go for it, go for it.”

Kevin O'Leary explains using tariffs as a weapon

Kevin O'Leary didn't mince words about tariffs' limitations:

"You can't replace income tax with tariffs unless you're charging more than 20%. That's too much. It's inflationary. Tariffs are short-term weapons to rebalance trade."

The investor pointed to India as a case study, noting their previous 110% tariffs on automotive imports. According to Kevin O'Leary, these high rates ultimately brought Indian officials to the negotiating table, willing to discuss more balanced arrangements.

He suggested that achieving more reasonable tariff levels, ideally zero or around 10% each way, would benefit all parties.

However, he cautioned that tariffs themselves "will not solve the deficit because they just cause prices to go up." This perspective challenges the notion that trade barriers alone can fix structural economic issues.

In a BBC News interview, Kevin O'Leary offered advice for Canada's leadership regarding the tariff situation with their southern neighbor.

"They immediately fly to Washington and start the negotiations to eliminate all tariffs between the two countries. Because the real opportunity is not to sell the country to America, but to get free trade going in both directions," he stated firmly.

The businessman highlighted the complementary economic strengths of both nations:

"Create something of a behemoth economy because the Canadians have all the precious minerals, all the resources, all the energy. The largest consumer market in the world is the United States, which represents 39% of consumption worldwide and 26.1% of world GDP. The Canadians only 2 1/2% of world's GDP."

Looking ahead at the bigger picture

Kevin O'Leary's analysis extends beyond just US-Canada relations. He views the current administration's approach to international trade as unprecedented in scope.

The Shark Tank star believes these aggressive negotiations could potentially establish new templates for global trade relationships. If successful with India, he suggests this model could be applied broadly, potentially stimulating markets worldwide.

However, he also noted that Canadian Prime Minister Mark Carney might be using anti-American sentiment strategically, diverting attention from domestic policy issues by focusing on the tariff disputes.

While acknowledging the boldness of attempting dozens of simultaneous trade negotiations, Kevin O'Leary remains pragmatic about the outcomes. He emphasizes that any US-Canada arrangement must preserve Canadian sovereignty while eliminating barriers.

"The real opportunity is not to sell the country to America, but to get free trade going in both directions, North and South, and East and Western Canada, where there have been a lot of barriers between provinces," he explained.

For O'Leary, the ideal scenario involves not just international trade improvements but also reducing interprovincial barriers within Canada itself, creating a more cohesive North American market where both countries maintain their independence while maximizing economic cooperation.

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New episodes of Shark Tank Season 16 air Fridays on ABC.