Billionaire investor Warren Buffett said politicians should stop using the nation’s borrowing authority as a bargaining chip in policy debates, comparing the practice with the threat of dropping a nuclear bomb.
“It ought to be banned as a weapon,” Buffett, 83, said in an interview with Fortune magazine posted online today. “It should be like nuclear bombs, basically too horrible to use.”
Republicans in the U.S. House stalled government-funding measures in an effort to delay or curtail the Affordable Care Act, President Barack Obama’s signature health-insurance law. The inaction led to a partial government shutdown this week and the furlough of about 800,000 employees. Congress is also debating whether to raise the government’s borrowing authority. Failing to do so by Oct. 17 could trigger a default.
Charles Munger, the vice chairman at Buffett’s Berkshire Hathaway Inc., also appeared in the Fortune video. He called the threat of defaulting on the country’s obligations “deeply immoral” and criticized the party he has supported.
“We issue the reserve currency of the world,” Munger, 89, said. “If my Republican friends keep doing this, they’re going to pay a terrible price.”
Buffett, the world’s fourth-richest person, and Munger are among financial leaders urging Congress to stop using the nation’s borrowing authority as a political tool. Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein said Oct. 2 after a meeting at the White House that the debt ceiling shouldn’t be used as a “cudgel.”
Buffett, who said yesterday on CNBC that he didn’t think politicians would go beyond the point of “extreme idiocy,” told Fortune that the standoff could serve as a lesson.
“This may be like after we dropped a couple of atomic bombs,” Buffett said. “We saw that we didn’t want to do it again.”