In what might be called “Buffett/Berkshire Hathaway Week” in Omaha, it’s an appropriate time to respond to the speculation about Berkshire Hathaway’s future here.
I called Berkshire chairman Warren Buffett to confirm what I believed to be the case: The resignation of Omahan David Sokol, a top Berkshire executive, will have no effect at all on Omaha’s continuing as Berkshire headquarters and site of the annual shareholders meeting, which this week is expected to attract close to 40,000 Berkshire shareholders from all 50 states and 43 other countries.
Warren confirmed my understanding that David Sokol was not in line to be one of Buffett’s two successors (Buffett has said his plan is that on his death the chief executive’s job will be divided in two).
Warren also confirmed that there is no change in his plans to assure that, on his death, his son Howie will become chairman of the Berkshire board with no executive duties but with the specific assignment to assure that Berkshire headquarters remain in Omaha.
(In his annual written report to shareholders, Warren pointed out that after his death, family members will continue to be very substantial shareholders with a proportionately substantial voice in major Berkshire decisions.)
Some people had the erroneous impression that Omahan Sokol was in line to succeed Buffett. This mistake was reflected as recently as in a column last Sunday in The New York Times, where columnist Andrew Ross Sorkin referred to Sokol as Buffett’s “heir apparent.” The facts are, I repeat, that Sokol was not Buffett’s choice as his successor.
Speculation about the effect of Sokol’s departure was fueled in part, of course, by the fact that Sokol resigned after it became known that he had purchased $10 million worth of stock in chemical manufacturer Lubrizol, then recommended to Buffett that Berkshire purchase Lubrizol for $9 billion.
The result was a $3 million increase in the value of Sokol’s Lubrizol stock—not, in itself, a significant capital gain for a man of Sokol’s wealth. But it touched off public scrutiny of both Sokol’s and Buffett’s handling of the matter—more scrutiny and more questioning of Buffett’s handling than was justified, as I see it.
After all, Sokol resigned, and there is no indication that purchasing Lubrizol was not a sound business judgment so far as Buffett is concerned.
The “Oracle of Omaha” remains one of his hometown’s greatest assets, as reflected, for example, in his determination to keep Berkshire headquarters and the annual shareholders meeting in Omaha during his lifetime and after his death.
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Re-Election Candidate Or National Leader?
Obama Emphasis Leans Toward Re-Election
There is further evidence—as if any were needed—of the fact that for the 18 months leading up to the November 2012 presidential election, we are likely to see a president as concerned—or more concerned—with his re-election as with his presidential leadership responsibilities.
One wonders if President Obama has considered that perhaps the most effective way to win respect that might enhance his chances for re-election would be to attempt to bring Americans—especially the members of Congress—together in making the tax and government spending decisions which are crucially needed to keep this country from, in effect, going bankrupt.
The president won’t achieve that essential objective with continuing falsehoods about Republican plans to reduce taxes on “millionaires and billionaires” and traveling widely in taxpayer-provided Air Force One for a series of re-election campaign fund-raising dinners. In California last week, about 60 people paid $35,000 each to attend a fund-raiser in San Francisco.
The New York Times account of Obama’s campaign said: “While Mr. Obama’s new energy in criticizing policy has stirred supporters, it is infuriating Republicans even as he is calling for bipartisan talks with them to reach a compromise framework in time for Congress’s vote before July on raising the $14.2 trillion debt limit.”
Meanwhile, calm and clear, a “let’s work together” voice of reason—in sharp contrast to Obama’s campaign rhetoric—is coming from Republican Representative Paul D. Ryan, chairman of the House Budget Committee.
In a series of speeches to constituents in his Wisconsin Congressional district, Ryan is getting extensive news coverage. Ryan is taking what a New York Times story described as “a cooler approach.” It’s time, Ryan stresses, to try to seek more “mutual respect.” Ryan made points with his audiences by pointing out such facts as that Medicare reform would affect only people younger than 55.
Interestingly, the New York Times account concluded with these words: “…There is no question that it is Mr. Ryan’s plan that is at the center of the debate.”
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Maurers Well Deserve Medical Center Honor;
Vodka-Loving Russians Drinking Selves To Death?
One of my regular servings of a variety of shorter items:
–Very appropriately, University of Nebraska Medical Center Chancellor Hal Mauer and wife Beverly are being honored for the role they have played in the remarkable development of the Medical Center.
It is certainly appropriate that a significant new building be named for the Maurers after a remarkable period of campus improvement—including impressive new buildings to provide better facilities for medical education, research and patient care—all developed under Mauer’s leadership and with, of course, the essential help of large contributions from a number of donors.
The Harold M. and Beverly Mauer Center for Public Health will be dedicated May 18.
–I’ve been impressed—not necessarily favorably—by the proliferation of holidays which involve people getting paid for days they don’t work—including days when the work-free employees do nothing at all consistent with the reason for the holiday. (Think Martin Luther King Day.)
I called the offices of the Nebraska State Education Association on the Monday after Easter and was greeted with a recorded message which said that the office was “closed for the holiday.”
There was no indication what “holiday” was being observed.
–There is disturbing news from Russia—disturbing unless you want to see Russians drink themselves to death.
President Dmitry Medvedev referred to a “national disaster” in noting that Russians consume about 18 liters of pure alcohol per person per year—more than twice the internationally suggested limit. (No explanation of who suggests such limits.)
The life expectancy of the average Russian man is 60 years.
But the Russian government is addicted to liquor taxes. As a New York Times column pointed out, collapse of the Soviet Union in 1985 was at least partly the result of Premier Mikhail Gorbachev restricting vodka sales to Russian workers. Soviet tax revenues took a very substantial hit. This, in turn, fueled the inflation which hastened the downfall of the communist state, according to The Times column.
–Herewith another sign of the Obama administration tilt to the left at a time when various opinion surveys indicate more Americans are moving towards the political center or towards conservatism:
A story in The New York Times (you can see I read The Times regularly, since in its news columns it is by far the most informative, comprehensive of American newspapers) recently carried a story which started thus:
“In what may be the strongest signal yet of the new pro-labor orientation of the National Labor Relations Board under President Obama, the agency filed a complaint Wednesday seeking to force Boeing to bring an airplane production line back to the unionized facilities in Washington State instead of moving the work to a non-union plant in South Carolina.”
The labor board said Boeing’s decision to transfer a second production line for its new 787 Dreamliner passenger plane to South Carolina was motivated by an unlawful desire to retaliate against union workers for their past strikes in Washington and to discourage future strikes.
So it’s a federal offense, in the reasoning of the Obama administration, for an employer to discourage strikes? Go figure.
–Further on my question as to how American Muslims—whom some American religious leaders are urging us to embrace—can be comfortable being part of a religion which in the Middle East preaches hatred of Christians and on frequent occasion carries that hatred into killing Christians:
An Associated Press dispatch from Nigeria recently reported: “Angry opposition supporters in Nigeria’s Muslim north set fire to homes bearing ruling party banners Monday and heavy gunfire rang out in several towns as election officials released results showing the Christian incumbent had gained an insurmountable lead.”
Incumbent Christian President Goodluck Jonathan had a commanding lead of more than 11 million votes with only about 6 million left to be announced. The Muslim North had largely voted for former military ruler Muhammadu Buhari.
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Sophie Takes Jackie For Walks In The Rain
Another chapter in the life story of Sophie, the Yorkiepoo strong-willed charmer who has taken charge of the household of my assistant Jackie Wrieth and her husband Don:
Sophie, it develops, does not like to go out and “be a good girl” when the grass in the Wrieths backyard is rain-soaked.
During walks along the street south from the Wrieths’ home, Jackie has discovered that Sophie will do her duty in such a walk if it lasts long enough. The obvious solution (to Sophie, at least) is for Jackie to take Sophie for walks along the street when Sophie rejects doing her duty in the rain-dampened backyard.
Since such walks must, of course, be occasionally carried out while it’s raining, Sophie obviously needed a rain slicker, complete with a hood.
Pictured below is Sophie, properly attired for occasions when she takes Jackie for walks in the rain.
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