During a recent appearance on CNN’s The Brief with Jim Sciutto, investor and entrepreneur Kevin O’Leary described the economic relationship between the United States and China as a long-term economic dance.
O’Leary said that while tensions between the two powers often focus on specific sectors, the two economies have become far too interconnected to separate.
O’Leary explained that one moment the dispute centers on chips, then TikTok, and then rare earths or soybeans.
“You can’t separate the two economies anymore because they’re too dependent on each other,” he said in a post on X that accompanied a clip of his CNN appearance.
He described the situation as “a very long dating relationship” shaped by constant negotiation and shifting leverage.
A Paradox of Dependence and Distrust
O’Leary said the U.S. made a mistake in expecting China to play by global trade rules after joining the World Trade Organization.
“They never played by the rules,” he said, adding that China built its success on technology taken from Western nations.
“You can find French source code, American source code, Canadian source code. They just stole it, and they built a booming economy around it that they claim their own.”
Despite ongoing disputes and deep frustration, O’Leary said companies cannot ignore China’s massive consumer market.
“Every major company still needs access to their massive consumer market. That’s the paradox,” he said in a post.
He also criticized China’s financial practices, saying that Chinese firms listed in the U.S. operate with “lesser compliance costs” because “they don’t actually abide by the rules we have for listed companies here.”
Energy and AI: The New Battlefield
Turning to technology, O’Leary said that the next phase of economic competition will center on artificial intelligence and energy.
“The country that wins the AI race wins the future,” he said. He warned that China is moving faster because it is not limiting its energy production the way the U.S. is.
“They’re kicking our asses right now in the AI race because they have access to more power than we do,” O’Leary said.
“They don’t care if they take a power plant that burns coal and build a data center with it.”
O’Leary, who said he is investing heavily in data centers himself, emphasized that energy policy is directly tied to economic strength.
“Power equals progress,” he wrote on X. “If the U.S. doesn’t get serious about energy, compute, and clear policy, we’ll lose our edge.”
He added that building data centers requires land, fiber, water, and affordable energy, resources that are growing more competitive worldwide.
While some industry experts see small nuclear reactors as a future energy source for AI infrastructure, O’Leary said nuclear power remains too costly and far from implementation.
“Nuke power is too expensive, it’s too far away. It’s a great source, and one day will be important, but we’re talking 14 years from now,” he said.
For now, he believes the most viable short-term solution is natural gas, especially near existing or stranded pipelines.
Tariffs and Trade Policy
On trade, O’Leary said that investors are not overly alarmed by tariffs or the ongoing trade war.
He argued that President Donald Trump’s tariff strategy effectively acts as a value-added tax.
“We believe that what Trump is doing is imposing on the U.S. a VAT tax, a value-added tax, a consumption tax. He’s calling it a tariff,” O’Leary said.
He predicted that the approach will eventually result in reciprocal agreements with other nations.
However, O’Leary criticized some of the administration’s specific tariff decisions, including the 39% tariff on Switzerland.
“That’s absurd,” he said. “They can’t do that long-term.” He noted that Swiss gold remains highly sought after by investors, including himself.
“I don’t want anybody else’s gold except that Swiss UBS bar with the SA cert around it. That’s what I buy when I buy gold. Nothing else will do.”
A Warning for U.S. Competitiveness
O’Leary closed by warning that if the U.S. does not prioritize energy infrastructure and computing power, it risks falling behind China not only economically but militarily.
“By then, the country with the best AI has the best drones and will be the most powerful militarily,” he said.
For O’Leary, the U.S.-China relationship is built on contradiction, rivalry and reliance existing at once. And as he put it, it’s a dance neither side can easily walk away from.