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Yahoo Finance Interviews Warren Buffett

Yahoo Finance asks the Berkshire Hathaway CEO, Warren Buffett, what gives him optimism, his thoughts on education, deficits, and US vs. China.

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Highlights include Warren Buffett on:

  • What gives him optimism right now: How can you not be optimistic? If I’d been born 200 years ago my life would have been just a tiny, tiny, tiny fraction of what it is now. Every time I get in a dentist chair I’m thankful it wasn’t 100 years ago. They would’ve been pouring whiskey down me and holding me down. Everything: medicine, education, you know, just the conveniences of the life, transportation, entertainment, everything is dramatically better than it was 50 years ago. In fact, I tell the students, these students in that class today are actually living better than John D. Rockefeller Senior lived when I was born. Here was the richest man in the world -- he could not travel as well as they can travel, he could not be entertained as well as they can be entertained, he did not have the medicine they have. In all kinds of ways they’re living better than the richest man in the world lived at the time of my birth. The luckiest group of babies ever born in the world are the babies being born in the United States today.
  • Education: I think students are generally throughout the world getting a better education, certainly than they did when I was getting my education. Is it as good as it can be? No. And is it as pervasive as you’d like to see it? I mean is everybody getting the same shot? You know we like to say we have equality of opportunity in this country but unless everybody has a shot at a similar education there is no equality of opportunity. We’ve got a long way to go on that. But America’s always been an aspirational society. We said all men are created equal and then we said that blacks were only 3/5 of a person and we said women weren’t any kind of a person at all in the Constitution. We get there. We keep making progress in this country. And we’ll keep making progress in education. We’re spending $10,000 or close to that a student per year in education so it isn’t from unwillingness to put the resources up. We just haven’t learned the best ways.
  • Deficits: Our output per capita goes up year after year. How it gets divided is another matter. But if you look at real GDP per capita it’s six times what it was when I was born. Imagine that. In one person’s lifetime - if you told my parents in 1930 when my father was in the waiting room and my mother was in there delivering me - if you told them that their son was going to live in an America, in his lifetime, which real per capita GDP would go up 6 for 1 they would have said it’s going to be utopia. Now it isn’t utopia for many people, but that’s a distributional problem. We have the output for everybody to do well in this country, but a lot of people do get left behind. But we make progress on that. We passed Social Security after I was born in the mid-30s and that has done a lot for tens and tens and tens of millions of people – it’s given them some security for their old age and they used to worry about it everyday in the past.
  • U.S. vs China: I think both will be good places. I can’t pick one over the other. I don’t know but the Chinese economy is going to be far ahead of where it is now 20 years from now and the United States economy is going to be far ahead of where it is now 20 years from now. Our children are going to live better than we live. During, in a political season to hear people say your children aren’t going to live as well as you do – that is total 100% nonsense. I mean, even at 2% GDP that’s over 1% per capita and in one generation that means the next generation is going to live 25% better than we live per capita in the United States so both countries have a very, very good future.

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Warren Buffett