Warren Buffet treated 35,000 of his adoring shareholders to his annual egofest in Omaha yesterday, giving many of the shareholders a few minutes in front a microphone so that they might approach the Oracle and seek his insight.
Like the rest of the economy, Berkshire Hathaway has had a bad year. There's a lot to like about Buffet, and he is an amazing businessman. But he's also a rank hypocrite and he needs to be called on it.
Here's the online version of the Washington Post's coverage of his party. Because I rousted myself this morning and made the drive to the local gas station/store and purchased an actual Washington Post newspaper, I was able to read "the rest of the story", or for some reason, a story that was a little longer. Here's one of several paragraphs that I didn't read online:
"Buffet has said that his son Howard will take over as chairman to ensure that Bershire's culture is preserved. Howard Buffet already serves on the board."
Why was this not in the online version of the story? Is it because Buffet is on the Board of Directors of the The Washington Post? Because he carried on an affair with Katherine Graham? Did he ask that this paragraph be removed because it makes him look like a banana republic dynast, placing his wastrel of a son Howard on the Board of Berkshire Hathaway and then naming him as his replacement as Chairman? Read The Snowball, and you'll get a fine idea of what a "late bloomer" Howard was. He surely didn't inherit his father's savvy as a businessman, but his inheritance of a last name sure has gotten him some plum board seats.
What has our man Warren said in the past about dynastic tendencies and the passing of wealth between generations? From Wikipedia:
"From a NY Times article: "I don't believe in dynastic wealth," Warren Buffett said, calling those who grow up in wealthy circumstances "members of the lucky sperm club." Buffett has written several times of his belief that, in a market economy, the rich earn outsized rewards for their talents:
“ A market economy creates some lopsided payoffs to participants. The right endowment of vocal chords, anatomical structure, physical strength, or mental powers can produce enormous piles of claim checks (stocks, bonds, and other forms of capital) on future national output. Proper selection of ancestors similarly can result in lifetime supplies of such tickets upon birth. If zero real investment returns diverted a bit greater portion of the national output from such stockholders to equally worthy and hardworking citizens lacking jackpot-producing talents, it would seem unlikely to pose such an insult to an equitable world as to risk Divine Intervention. ”
His children will not inherit a significant proportion of his wealth. These actions are consistent with statements he has made in the past indicating his opposition to the transfer of great fortunes from one generation to the next. Buffett once commented, "I want to give my kids just enough so that they would feel that they could do anything, but not so much that they would feel like doing nothing".
What in God's name is appointing your son to your board and the board of companies you own, if not grand participation in the "lucky sperm club".
Buffet's a great businessman and a savvy judge of value. But he's also a blowhard hypocrite.