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Seeing Red: Buffett, Others Clash On Danger Posed by U.S. Debt
The economic future is good, Warren Buffett says before a screening of "I.O.U.S.A."
(By Nati Harnik -- Associated Press)
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"I have enormous respect for Warren, but I have to disagree," Walker said. "I have already taken into consideration that the pie is going to grow."
Walker quit the Government Accountability Office in March to become head of the Peter G. Peterson Foundation, set up by the billionaire founder of the Blackstone Group, a private-equity giant. Peterson donated $1 billion to his foundation to educate Americans on the debt and other fiscal problems.
Buffett was received warmly by his town folk, who are accustomed to seeing the cornfed Croesus tooling around Omaha in his car, which once bore the license plate "THRIFTY." Forbes magazine estimates Buffett's wealth at $62 billion.
He got his biggest laugh of the night with a story that he probably meant to be self-deprecating but that the audience clearly took as a President Bush joke.
Buffett, who is a director of The Washington Post Co., likened his faith in the U.S. economy to the way he invests in companies, including Coca-Cola and the Mars-Wrigley tie-up.
"I like to buy stock in businesses that are so wonderful, an idiot can run them -- because sooner or later one will," Buffett said, to laughter. "Maybe even like the present management we have," which brought down the house.
Joining Walker, Buffett and Peterson on the panel at Omaha's Holland Performing Arts Center were William A. Niskanen, chairman of Washington's Cato Institute, and Bill Novelli, chief executive of AARP. While the other panelists drank water, sitting next to Buffett was a pitcher of his beloved Coke. Buffett's Berkshire Hathaway investment fund is the cola giant's largest shareholder, with 8.65 percent of outstanding shares.
If Buffett has a concern about the future of the U.S. economy, it seems focused on the widening of the trade deficit.
Others on the panel, however, were most worried about the coming burden of senior citizens on Medicare and Medicaid, with secondary concerns about the long-term obligations of Social Security. Each offered potential solutions.
"We need to increase age for full retirement benefits slowly and with warning," Niskanen said. "We're living longer and we're living younger and we need to think about working until 70 rather than retiring at 65."
He also proposed an income test for the Medicare deductible so wealthier seniors would pay more than poorer ones, and said that Americans should have the option of putting half of their retirement savings into private accounts.
Novelli disagreed.
