Wisdom from Omaha

Superinvestors Warren Buffett and his business partner, Charlie Munger, recently presided over their Berkshire Hathaway annual meeting in Omaha, Nebraska, answering dozens of questions from shareholders, journalists and stock analysts for more than five hours. On health care: Buffett noted that if the GOP health-care bill that was recently approved by the House of Representatives had been in effect last year, “My federal income taxes would have gone down 17 percent.” He noted that the bill represents “a huge tax cut for guys like me.” Buffett also said that while corporate executives complain about tax rates, health care costs are the real problem, pointing out that corporate tax payments as a percentage of GDP have shrunk from 4 percent in 1960 to just 2 percent now. On the other hand, medical costs have ballooned from 5 percent of GDP to 17 percent of GDP currently: “Medical costs are the tapeworm of American economic competitiveness.” Munger noted that politicians aren’t addressing the issue effectively, saying, “Both parties hate each other so much that neither one of them can think rationally.” On scuttlebutt: Buffett recommended Philip Fisher’s classic book, “Common Stocks and Uncommon Profits” (Wiley, $25) and its “scuttlebutt” concept for researching companies, whereby investors can learn a lot just by asking questions — of a company’s executives, workers, customers, competitors and so on. On robotics and artificial intelligence: Buffett noted that autonomous vehicles could hurt his GEICO insurance business and driverless trucks might hurt his BNSF railroad. Artificial intelligence would “result in significantly less employment in certain areas, but that’s good for society.” Advice for all: Buffett recommended looking for the job you’d take if you didn’t need a job, while Munger urged: “If you really want anything, don’t wait.” There’s much more to learn about money, investing and life from Buffett. Read his annual letters to shareholders at berkshirehathaway.com. Roger Lowenstein’s book, “Buffett: The Making of an American Capitalist” (Random House, $19) is an excellent read, too. (The Motley Fool owns shares of and has recommended Berkshire Hathaway.)