Van Gaal turned down the chance to manage Spurs two years ago in order to take over at Manchester United.
Pearce was speaking to SkySports News HQ's Morning View on Monday (11/4) at 11am.
He said: "Football is a global game and United are a worldwide entity, bigger financially, I understand that. But football stops for nobody, its the here and now that counts. Since Sir Alex Ferguson left United are in a transition period."
His message was simple, that both Louis van Gaal and Manchester United are at severe risk of being left behind.
Van Gaal had said, The BBC reported: "The challenge was bigger for me at Manchester United and shall always be bigger. I'm sorry for Tottenham but Manchester United is a bigger club."
United are now facing missing out on the top four and Champions League qualification for the second time in three years, while Van Gaal is in danger of losing his job.
Pearce knows all too well how quickly it can change. He has gone from managing Manchester City, England's under-21 side, and even the Three Lions senior team for one match, to being without a job after a six month spell at Nottingham Forest.