2019: Would increased regulation harm Berkshire?

ANDREW ROSS SORKIN (NEW YORK TIMES/CNBC): Warren and Charlie, this is a question — actually, we got a handful of questions on this topic. This is probably the best formulation of it.

Warren, you have been a long-time, outspoken Democrat. With all the talk about socialism versus capitalism taking place among Democratic presidential candidates, do you anticipate an impact on Berkshire in the form of more regulations, higher corporate taxes, or even calls for breakups among the many companies we own if they were to win?

And how do you think about your own politics as a fiduciary of our company, and at the same time, as someone who has said that simply being a business leader doesn’t mean you’ve put your citizenship in a blind trust?

WARREN BUFFETT: Yeah. I have said that you do not put your citizenship in a blind trust. But you also don’t speak on behalf of your company. You do speak as a citizen if you speak. And therefore, you have to be careful about when you do speak, because it’s going to be assumed you’re speaking on behalf of your company.

Berkshire Hathaway certainly, in 54 years, has never — and will never — made a contribution to a presidential candidate. I don’t think we’ve made a contribution to any political candidate. But I don’t want to say, for 54 years, that — (Applause)

We don’t do it now. We operate in several regulated industries. And our railroad and our utility, as a practical matter, they have to have a presence in Washington or in the state legislatures in which they operate.

So, we have some — a few — I don’t know how many — political action committees which existed when we bought it — when we bought the companies at subsidiaries.

And I think, unquestionably, they make some contributions simply to achieve the same access as their competitors. I mean, if the trucking industry is going to lobby, I’m sure the railroad industry’s going to lobby.

But — the general — well, the rule is, I mean, that people do not pursue their own political interests with your money here.

We’ve had one or two managers over the years, for example, that would do some fundraising where they were fundraising from people who were suppliers of them or something of the sort. And if I ever find out about it, that ends promptly.

My position, at Berkshire, is not to be used to further my own political beliefs. But my own political beliefs can be expressed as a person, not as a representative of Berkshire, when a campaign is important.

I try to minimize it. But it’s no secret that in the last election, for example, I raised money.

I won’t give money to PACs. I accidentally did it one time. I didn’t know it was a PAC. But I don’t do it.

But I’ve raised substantial sums. I don’t like the way money is used in politics. I’ve written op-ed pieces for the New York Times in the past on the influence of money in politics.

I spent some time with John McCain many years ago before McCain-Feingold, on ways to try to limit it. But the world has developed in a different way.

WARREN BUFFETT: On your question about the — I will just say I’m a card-carrying capitalist. (Applause)

But I — and I believe we wouldn’t be sitting here except for the market system and the rule of law and some things that are embodied in this country. So, you don’t have to worry about me changing in that manner.

But I also think that capitalism does involve regulation. It involves taking care of people who are left behind, particularly when the country gets enormously prosperous. But beyond that, I have no Berkshire podium for pushing anything. Charlie?

CHARLIE MUNGER: Well, I think we’re all in favor of some kind of a government social safety net in a country as prosperous as ours.

What a lot of us don’t like is the vast stupidity with which parts of that social safety net are managed by the government. It’d be much better if — (applause) — we could do it more wisely. But I think it also might be better if we did it more liberally.

WARREN BUFFETT: Yeah, one of the reasons we’re involved in this effort along with J.P. Morgan and Amazon — with (J.P. Morgan CEO) Jamie Dimon and (Amazon CEO) Jeff Bezos — on the medical question, is we do have as much money going — 3.3 or 3.4 trillion — we have as much money going to medical care as we have funding the federal government.

And it’s gone from 5 to 17 percent — or 18 percent — while actually the amount going to the federal government has stayed about the same at 17 percent.

So, we hope there’s some major improvements from the private sector because I generally think the private sector does a better job than the public sector in most things.

But I also think that if the private sector doesn’t do something, you’ll get a different sort of answer. And I’d like to think that the private sector can come up with a better answer than the public sector in that respect.

I will probably — it depends who’s nominated — but I voted for plenty of Republicans over the years. I even ran for delegate to the Republican National Convention in 1960. But — we are not —

I don’t think the country will go into socialism in 2020 or in 2040 or 2060.