Dear Mr. Buffett
You don't know me from Adam. I'm utterly inconsequential in the scheme of things. So I hope you'll forgive my audacity in proposing one last mission in the public interest before you depart this existence.
I am emboldened by your prior efforts to encourage your peer group to pledge their wealth to the public good, and more recently to call attention to yourself as a justification for the nation to call upon the rich to carry their fair share of the tax burden. But there is one more mission in which your unique position and skills at unadorned truth-telling might yet have critical impact. Your mission, if you choose to accept it, is to inspire the business and investment titans of the US economy to get off their fear or apathy and earn their money by taking risks on the US economic revival. Only you can do this. No one else in the business community has your stature and ethical capital; and beyond the business community the President and Chairman of the Fed are a distant second and third.
Perhaps it was all illusion. Things were beginning to change toward the end of that era. By the late seventies, it was clear that the labor wage and benefits calculus that was set in motion in the economy as a whole would not work in the long run. That awareness within the hushed corridors of the actuarial consulting firms and client executive suites appeared to have set off the decline of the informal corporate contract with labor (union and non-union) and its replacement by the corporate contraction of labor. The Neutron Jack Welch cohort of take-no-prisoners--winner-take-all--only-my-numbers-matter corporate gunslingers ascended in the executive ranks, as corporate commitment to substantive community well-being began its thirty year descent. CEOs and Chairmen drank the Ayn Rand capitalist KoolAid along with Alan Greenspan, tossed over the old in pursuit of the illusory, abandoned their traditions, their institutional competencies, a vision of anything beyond the next annual report, unless the vision could conjure up an extraordinary price/earnings multiple that greater fools than they might buy.
President Obama has just delivered his jobs speech. It is more symbolic than substantive, but I do not fault him on that. To deliver substance requires a partnership with Congress. History has proved such partnership to be unlikely with a body that lacks the will, the wisdom and/or the intellectual capacity to transcend sound-bites and campaign sloganeering. His proposal, at best may be a catalyst to build momentum and public confidence .
Fed Chairman Ben Bernanke has similarly tried to address public confidence, but from the other side of the coin, chiding the public for being overly pessimistic and cautious in their spending. I don't believe that he really believes that. Perhaps I'm giving him more than his due.
Many people fault Mr. Bernanke for being an academic, for fighting the last depression, for being a stooge of Wall Street. But shortly after his Ascendancy to the Chair, I perceived subtle changes in his effort to alter public perceptions from the Capitalist Catechism of Chairman Greenspan, and to bring more transparency to the deliberations of the Fed. Mr. Bernanke clearly realizes his dual role in managing not only the money supply but public perception in an economy that we now understand to be not so much an empirical beast as an emotional basket-case. Mr. Bernanke suffered from the necessity to build his political capital before he could radically redirect attention to the problems that I believe he saw evolving. He had to therefore maintain the party line as he subtly sought to bend it to reality he may have known. But he ran out of time. And unrestrained greed, arrogance and executive stupidity in the private sector accelerated the economy in its power-dive to the Great Repression.
Both Obama and Bernanke share a common fate; they inherited conditions that were not of their own making and cannot readily be resolved by their own actions. Obama can't make fiscal policy without Congress, and Bernanke's monetary tools can at best complement fiscal policy but cannot compensate for fiscal policy deficiencies, or absence.
It is not my purpose to be an apologist for the President or the Chairman, but rather to point out that they are neither the problem nor the solutions; merely accessories to the calamity. The calamity is the non-response of the business community, and its apparent lack of leadership and consensus.
An economic elite has richly rewarded itself for embracing the illusion of prudent risk-taking while studiously avoiding the deed, or driving their corporations off the cliff, hyped on the drug of self-esteem. They appear to believe that there is less risk in BRICs than allowing the world's most stable market to atrophy through neglect and exploitation. The BRIC's may be rich in opportunity, as was the internet in the 90's, and real estate in the '00s, but the other side of the balance sheet is an equal or greater amount of risk.
A business elite and its cadre of lobbyists has pursued its diverse industry and corporate goals to the illogical extremes of an insane tax code and enfeebled regulation that add waste and risk to the economy, its businesses and the citizenry as a whole. If we continue to pursue simple-minded corporate goals with disdain for the broader social context, we will surely pass the BRICs on our way down the economic food chain.
If the private sector is truly the only source of meaningful job creation, as it likes to claim, then it is the private sector-- not the President, not the Fed, not even Congress -- that must step up and make meaningful job growth happen, if for no other reason than its own enlightened self interest. But that notion of enlightened self-interest may be beyond the intellectual band-width and MBA indoctrination of the current C-Suite cohort.
Yet, I remain an optimist, somewhat like the President. If the corporate elite can somehow be reached through their haze of self medication against the anxieties of a collapsing Euro, an imploding China, or a termination by cell phone, I believe that you are the only human on the face of this planet that might have a shot of administering a philosophical antidote to the current corporate paralysis. I would advise, if I may be so bold, to bring back-up like Bill Gates and Steve Jobs and perhaps others of your acquaintance who have evolved spiritually to recognize that we are not the end of the story, but merely a chapter which can yet be concluded with inspiration, and not as a tragedy.
* * *
It is my sincere hope that this will be your next mission and not your last. But, while we now know that taxes may not be inevitable for all of us, mortality and risk are, for both the great and the humble. So I ask you to accept this mission as if it were your last, recognizing its importance to all of us, and the eternal truth that time is unforgiving of good intentions.
Or, as more eloquently stated by an unknown author:
Whatever good I may do for my fellow man,
whatever service I may be,
Let me do it now.
Let me not defer or delay,
For I shall not pass this way again.
Onward
20110911
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