Warren Buffett has never been out so much on television as he has been in the last two years. Usually, we see him once a year during his annual quirky shareholders' meeting in Omaha. The interesting thing is that Berkshire has never been in such a dubious position as it has been over the same period. Yes, I'm aware that Berkshire has been profitable lately. Do you remember how much Buffett was insisting on the need for bank bailouts? He had vested interests, real skin in the game.
There seems to be a correlation with the once reclusive billionaire investor and the now very talkative one. Buffett talks health care today as a typical politician in a back and forth wiggle room position, rejecting the current bill while saying that other countries--mostly socialized countries I might add--do it better. The world pays about 9 percent of their GDP on health care he noted. We pay 17 percent.
Buffett says that we should "attack cost cost cost" as "jobs jobs jobs." But he doesn't suggest how these things might be done. Real lawmakers, not obstructionists, are in the real position of dealing with how things are done. Often times, comprises are necessary. I did not like the tone Buffett took on President Obama's effort of bipartisanship and beginning anew with that infamous "white sheet of paper" is out of the question.
Regarding the health care bill, Buffett says that he would prefer a Plan C as opposed to the current A or B but he doesn't say how this Plan C would look or why his ideas--whatever they are--could be added to the current bill. His uncertainty or inability to actually express what he means did not instill confidence.
The Oracle of Omaha seemed to be a bit of red meat for the giddy often ill-informed CNBC analysts who tried to force him to say what he was actually saying as opposed to dancing like an inept dancer. Perhaps Buffett felt as if he needed to make a television appearance as George Soros' did brilliantly yesterday on Fareed Zakaria GPS. It did not work well for him.
An article in the Huffington Post reports that "Berkshire owns clothing, furniture, jewelry and corporate jet firms, but its insurance and utility businesses accounted for one-third of the company's profit last year. It's net income jumped 61 percent in 2009 to $8.1 billion largely because the value of its investments and derivatives rose sharply."
As I read this I couldn't help but to wonder if Berkshire is so very profitable as Goldman Sachs now is through government bailouts of Wall Street firms. (Yes, I understood the necessity of the bailouts, although not the lack of accountability.) Goldman Sachs is now also reporting record profits. After all, Berkshire was heavily invested in Goldman Sachs and Goldman Sachs heavily insured by AIG. As indicated above "insurance and utility accounted for one-third of the company's profits last year." A question: Are banks essentially utilities?
What a web we are all in. But some of us get caught therein while others win big, lecturing us on what we need to do without offering any real solutions on how to do it. There is cost control containment in the current health care bill, although perhaps there could be more. Some would say that the public option would insure greater cost containment.
While being for the public option, it is not a deal breaker for me in this first stage of health care reform. Changes to Medicare has also occurred over time. But if Warren Buffett has an opinion on what needs to be further included in the current health care bill he should say so or otherwise not comment at all. After all, he is known to be the Oracle of Omaha and some might just listen to him. But in this CNBC interview what has he really said?
11 comments:
Great observation. It is very disheartening to see so many high profile Americans be driven by selfish motivation as opposed to the supporting legislation that will benefit millions of other Americans.
I wish I could trust MSNBC. Supposedly all polls show most people favor the public option. If this is really true, what's the holdup?
Dee - I agree with you that it is disheartening indeed. Don't investor invest? What's with all the talking?
That's a good question, Zorro. Perhaps the White House is trying to find agreement and if this doesn't happen Congress will indeed pass health care reform through Reconciliation. Perhaps there will be a public option in that health care bill. But as I've said, I don't care what it's called so as long as more people will be insured and there is real cost containment. The bill appears like a good first step. If they have the votes for the public option through Reconciliation, I think it will be included in the bill.
Here is something from the Huffington Post. Much like TR Reid, the article points out that the common thing among successful health care throughout the world is not-profit - be it government or private. The proponent of the Public Option never bring this up - and neither does the opposition. This should have been the focus of the argument.http://www.huffingtonpost.com/robert-kuttner/the-cure-that-dares-not-s_b_480130.html
Thanks, Zorro! You turned me on to TR Reid and I really appreciate his sound reasoning and research. I'm out of my office now and checked in on my BlackBerry but I will probably have something to say on the article. Thanks, again.
We have to give Buffett some credit for several things:
1)He's donated his fortune to the Gates Foundation to give away, giving up the ego trip of a "Buffett Foundation."
2)He's constantly campaigning for higher taxes on the rich (him!), who he points out, are taxed at a lower rate than his secretary.
I give him credit for good will: maybe he's against the HC bill because he really doesn't think it's a good idea.
At the end of the day one would still have to ask the question, if not this HC bill what is our alternative?
Please bring something to the table besides criticism and your pride in your political party.
Bob - Yes! You are right. Credit should be given where credit is due. He does not deserve credit for this CNBC interview. He was essentially useless here. If he thinks that the health care bill is a bad idea he should say so and then say why. As the Oracle of Omaha he should speak wisely and prudently. People's lives are literally in the balance. This is a moral issue.
Pam - That's precisely my point. Crudely stated: Put up or shut up.
Zorro - Thanks for the Kutter piece. I read it and it's indeed similar to Reid's thoughts. What's quite sad is the ill-informed often ignorant American people about their own system. The countries that Kutter refer spend 9 to 10 percent of their GDP for better care. We spend 17.3 of our GDP and have less actual care. Weren't the people at the town halls over the summer screaming about the deficit? We are ranked number 36 in the world. What went on over the summer is very sad. The ignorance was astounding. Seniors were screaming about the ills of socialized medicine while in the same breath yelling "take your hands of my Medicare." Of course, all of these sentiments were fueled by those who have a vested interest in things saying the same: insurance companies. They are actually causing greater risk to our country. Ideology is not pragmatic and often useless. In fact, it can be downright dangerous.
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