Warren Buffet Gets It Wrong
A Warren Buffet documentary has just been released. As part of that a recent interview with Warren Buffet that has been getting a lot of quotes (many overstating what he said). Within in the interview/story is this:
When asked about President Donald Trump’s controversial cabinet picks, Buffet stated the American public should “overwhelmingly” support the politician’s decisions. Though he would “feel that way no matter who is president.”
“I really think a CEO, what I am, should have the ability to pick the people to help you run things. If they fail, then it’s your fault, you gotta get somebody new. Maybe you change the cabinet,” Buffett said.
I am a great admirer of Buffet, but he has it wrong.
The presidency is not a CEO position. Even considering a board of directors, the Presidency has a completely different set of responsibilities and handcuffs than a CEO. The president does not get to choose how to spend money, for instance. S/he only gets to suggest it. Congress gets to choose.
Generally, a CEO does get to choose whomever they want for key roles. Built into our constitution is explicit language preventing the president from doing that. The advice and consent of the senate.
The senate represents states. Thus, if the state objects to a cabinet choice, so should the senator.
It is an old metaphor, the CEO and president. Yet, it is a terrible one and one that Buffet should know better, even if he is not an academic, or politician.
For instance, if the voting population are a group of shareholders, I would note that a majority of the shareholders who voted, did not vote for Trump. So, by that metric he is not CEO. One could go into the electoral college and how the shareholders are unequal, but for now I will avoid that rathole.
Really, where the metaphor of a CEO and company completely breaks down is that shareholders get to sell their stock if they think it’s going the wrong way. The closest thing we have is leaving the country (I wrote a blog post on that also). Stretching the metaphor some more, there are a bunch of non-voting shares too, such as Puerto Rico, Guam, etc.
Mr. Buffet has always been a gentleman, so when one hears this
Since the election, Buffett has struck a more conciliatory tone toward Trump and called for unity. In an interview with CNN in November, he said that people could disagree with the president-elect, but ultimately he “deserves everybody’s respect.”
I chalk it up primarily to his love of the country and the respect he generally has for anyone and the OFFICE of the president. Here to I think he got it wrong. Respect is earned. If there was a blank slate, you start out with respect. This is not a blank slate. Trump has a history and even his inauguration speech was non-conciliatory and indeed fueling misinformation and fear. No, I am afraid I have no respect for Mr. Trump other than the way you respect a madman with a gun, whether that gun is the nuclear button, or the entire armed forces.
I love Mr. Buffet’s philanthropy and his style, but in this respect I think he got it wrong.