Buffett’s Son Defends Occupy Wall Street Protests
Howard Buffett, the Berkshire Hathaway Inc. (BRK/A) director and son of Chairman Warren Buffett, said Wall Street protesters were provoked by abuses from corporations amid a widening disparity between rich and poor.
“I think it takes that to make things happen sometimes,” Howard Buffett, 56, said of the demonstrations in an interview yesterday in Des Moines, Iowa. Over the past 15 years, “we saw large corporations really screw people.”
Occupy Wall Street has drawn out protesters from New York to Seattle and gained empathizers among the top executives at Citigroup Inc. (C) and BlackRock Inc. Warren Buffett, the world’s third-richest person, has said he is concerned about inequity in the U.S. The younger Buffett, a farmer and philanthropist, said obtaining enough food has become more difficult for more people.
“There has never been a larger gap between earnings in this country,” said Howard Buffett, who was in Des Moines to deliver a speech at the World Food Prize conference. “There has never been a time in my lifetime when the government is going to cut an incredible amount of programs that support poor people and feed them.”
Protesters criticized the government for propping up financial firms including Citigroup and Bank of America Corp. (BAC) in 2008 while individuals struggled with unemployment, depressed wages, foreclosures and reduced retirement savings. Republican lawmakers oppose raising taxes to reduce the U.S. deficit and have pushed for cuts to government programs.
‘Get Some Balance’
“We’ve had protesting in the name of the Tea Party on the right side, and now we’re having protesting from the left side,” BlackRock Chief Executive Officer Laurence D. Fink, head of the world’s biggest asset manager, said today at a conference in New York organized by the Financial Times. “Maybe we’re going to get some balance this way. But I do believe that we should not turn our backs to this protesting.”
Mitt Romney, the former Massachusetts governor and a candidate for the Republican presidential nomination, said protesters are targeting “a scapegoat” and are wrong to divide the country. President Barack Obama, who joined Warren Buffett in a push to raise taxes on the wealthy, is guilty of “class warfare,” Romney has said.
“There has been class warfare going on,” Buffett, 81, said in a Sept. 30 interview with Charlie Rose on PBS. “It’s just that my class is winning. And my class isn’t just winning, I mean we’re killing them.”
Howard Buffett, a Berkshire director since 1993, said hunger is rising in the U.S. as well as in poorer nations. A record 45.3 million Americans received food stamps in July and almost one in six live in poverty, the government said. Buffett is president of the Howard G. Buffett Foundation, which advances agriculture in developing nations.
Warren Buffett has backed some of the biggest financial firms while chiding bankers for excesses in risk-taking and compensation. Omaha, Nebraska-based Berkshire invested $700 million in Salomon Inc. in 1987, $5 billion in Goldman Sachs Group Inc. in 2008 and $5 billion in Bank of America this year. Buffett, the father, has compared Wall Street to “a church that’s running raffles on the weekend.”
Wall Street “does a lot of good things and then it has this casino,” Buffett said in October 2010. “One of the problems we still have is we have unbalanced incentives for managers of huge financial institutions.”
Jim Chanos of hedge fund Kynikos Associates said this month he understands the anger directed at financial companies. Bill Gross, who runs the biggest bond fund at Pacific Investment Management Co., said in a Twitter post that wage earners are fighting back after three decades of class warfare in which they were “being shot at.” Citigroup CEO Vikram Pandit said yesterday he’d be happy to talk with protesters.