“I was terrified of speaking in public. I avoided any class that would require it. Then I finally signed up for a Dale Carnegie course when I got out of school. I spent 100 bucks. I got this little diploma. I proposed to my wife during the term of the course, so I really got my money’s worth….”
It was ten o’clock Tuesday morning and I was on the phone with Debbie Bosanek in Omaha, Nebraska.
She happens to be Warren Buffett’s personal assistant although that’s like saying Cardinal Richelieu was Louis XIII’s valet. We talked about my interview with Buffett that was happening in a few weeks in his office at Berkshire Hathaway when suddenly Debbie says, “Here’s Warren, he’s grabbing the phone.”
“Hi Jeff. When you are coming? I’d like to talk about journalism. I don’t think that’s been done before. This is going to be fun!”
It didn’t take a forensic specialist to recognize Buffett’s distinctive half baritone, half tenor (depending, of course, on whether he’s talking about money). Now things were starting to heat up. “Thanks Warren,” was about all I could stammer. I even forgot to put the phone on speaker so my wife, Kristin, could hear. Next time, right?
I chose Buffett as icon #1 for my YouTube channel called Iconic Voices: conversations with game changers, a speaker and interview series that came out of my discussions with Christopher Callahan, Dean of Arizona State University’s Walter Cronkite School of Journalism. My idea was to find people of exceptional achievement both in business and life, and through candid, one on one interviews hear how they did it and the impact they have had on the world. Then take a look at their relationship with the media and how that has shaped public perception for better or worse. Buffett is a media maestro, with nearly 25 million Google hits – about as many as Sylvester Stallone. Cynics might say that’s a dubious accomplishment but it’s in the stratosphere for a chief executive. Then again, Buffett could be said to inhabit a stratosphere all by himself, as the interview makes clear.
January 26 turned out to be one of those rare 40 degree winter days in Nebraska, the kind that drives the locals into a near frenzy of joy. After our plane landed we jumped into a car and headed over to Berkshire Hathaway’s headquarters where Buffett rents space from the global architectural and engineering firm, Peter Kiewit (presumably to assure his shareholders there’s no edifice complex at Berkshire). The 15 story structure is visible 10 miles off as you approach from downtown Omaha. It gave me time to ponder the immense legend that has grown around Buffett which is in part a story of accumulated wealth and power and also a story about old fashioned, midwestern values. So I wasn’t sure what to expect when we arrived at the lobby and were directed to the 8th floor and down the hall to the inner sanctum.
I’ve spent some time hanging around chief executive offices, and usually they are the size of a small house or maybe even a large one. But this was more like a comfortably furnished cabin, with two old leather chairs in the anteroom, and a narrow corridor filled with curious memorabilia like Shaq’s sneakers and Congressman Howard Buffett’s (his father) campaign buttons. Berkshire isn’t exactly cramped for space as Buffett runs the headquarters with only 25 people, which sounds okay except they oversee more than 350,000 employees. Hey, how about taking over the Department of Defense?
Warren came out to greet us and walked us down to his office, and again, it’s about the size you’d expect for a vice president of a midsize department store. The first thing you notice when you enter is a big leather top desk worthy of an Edwardian merchant banker (it’s his father’s) and the second is his outbox labeled “too hard.” Of course.
We sat on the couch and he sat on an easy chair facing us. His first words were, “take all the time you need. I have all day.”
The second richest man and the fourth largest company in America, and he has all day for me. I had to digest that. But you have to understand that Warren is many things. It’s fair to say he’s complicated, in maybe the simplest of ways. He’s arrived at his state in life by not having to be the best at any one particular thing (other than investing, of course). He wouldn’t win a software writing contest against his pal Bill Gates. Instead he has chosen to find and invest in those who are the very best in the world at what they do. Part of this may be natural humility, which comes easily to him, a holdover from hard days during the Depression. But there’s also the unmistakable fact we all would benefit from: he knows himself in the deepest sense, as the Greek tragedies always tell you, and that gives him a relationship with the truth that is unshakable. He sees things for what they actually are not what they are presumed to be. The other thing is he’s a moderate in everything from his politics to the way he lives and dresses, to his investing style. It’s nearly biblical: nothing in excess, with the exception of drinking Coca Cola.
The other unsettling fact about him, while he runs a global conglomerate with excruciating attention to detail, when he’s with you he comes across as the family doctor of bygone days, never once looking at his watch although dozens may be waiting to see him outside his door.
After we chatted a bit, we took the elevator up to the 15th floor where the video set up was in motion. We were brought to a large conference room the Kiewit folks were nice enough to lend us as Berkshire’s wasn’t big enough (saving the shareholders money, again).
Warren took a plug from the bottle of Coca Cola at his side and we rolled the film.
Here are some choice quotes from our session:
Buffett’s owes his marriage proposal to Dale Carnegie
I was terrified of speaking in public. I avoided any class that would require it. Then I finally signed up for a Dale Carnegie course when I got out of school. I spent 100 bucks. I got this little diploma. I proposed to my wife during the term of the course, so I really got my money’s worth there.
The outlook for America
I’ve never been pessimistic about the United States. I bought my first stock in the spring of 1942. I was 11, and we were getting totally creamed in (World War II) in the south Pacific, and the Philippines fell, and the death march at Bataan. I was optimistic on the country then, and I’ve been optimistic on the country ever since. Incidentally, the Dow Jones average then was 100 and now it’s at 17,000. No one has ever been a success betting against America since 1776, and they’re not gonna be a success in the future doing it either.
Encouraging moral behavior
Every two years, I write a very simple letter. It’s a page and a half. I don’t believe in 200‑page manuals because you put out a 220‑page manual, everybody’s looking for loopholes. I tell them that my reputation and Berkshire’s reputation is in their hands, and (although) we’d like to make more money, but we’ve got all the money we need. We don’t have an ounce of reputation beyond what we need, and we can’t afford to lose it. We never will trade reputation away for money. They’re the ones that are the guardians of that.
How the media looks at business
I want our employees to judge every action by how it would appear on the front page of their local paper written by a smart but semi‑unfriendly reporter who really understood it to be read by their family, their neighbors, their friends. It has to pass that test. I tell them I don’t want anything around the base lines. I tell them there’s plenty of money to be made in the center of the court. I’m 84, and my eyes aren’t that good anymore. I can’t quite see the base lines that well, so just keep it in the center of the court, and if they have any questions, call me.
How a CEO should handle bad news
The first is that when you find out bad news, correct it, and if it’s necessary to report it to the authorities, report it immediately. You’regoing to get bad news. I’ve got 330,000 people (as employees of Berkshire Hathaway). You can’t have a (the equivalent of a) city of 330,000 without an occasional crime of some sort. It’s going to happen, and you’ve got to do something about it fast when it does.
Biggest sin in journalism
As a CEO, I have spent more time talking to journalists than perhaps any CEO in the country. Partly that’s because I’m 84, but it’s partly because I like to talk to journalists. The greatest sin they commit—You’re looking into something because you have a working hypothesis, but you have to give up that hypothesis if it turns out not to be correct or if it’s misleading. Once you’ve invested a lot of hours, and your editor knows you’ve invested a lot of hours– now you got to go back and tell him he or she is wrong. There’s a lot of momentum toward a bad story…but you have to be able as a writer to say, “My hypothesis is no longer correct.” But it’s hard to do.
JP Morgan and the Department of Justice
Most of the things that JP Morgan got penalized for were acts that WaMu or Bear Stearns, which they took over—at the time, the United States government was on its knees begging them to do it. They were doing a public service. That were following through on something that the government wanted to happen very badly. Unfortunately, they picked up the sins of those organizations which they had nothing to do with. When the government wants to levy a fine, you just salute. That’s just the way it is. Jamie Dimon has done a terrific job of running JPMorgan. It was very fortunate for the United States citizens that Jamie Dimon was running JPMorgan during the financial panic. Believe me, the panic of 2008 would have been far worse if JPMorgan hadn’t been there and Jamie Dimon hadn’t been running it.
The abstention heard round the world
I disagreed with the level of options being authorized, which the Coca‑Cola Company stated in the proxy material would be issued within four years. I thought it was excessive. I abstained from voting. I announced my abstention after the vote. I did not want to be leading a proxy contest or anything of the sort. I think the management of Coca‑Cola is first‑class. I thought if they were reasoned with they might well change things, and they have. They’ve dramatically changed that plan so that instead of over four years, it’ll be over 12 years. That’s cutting it by two‑thirds. The chairman of the compensation committee is a very first‑class person, very smart. She picked up on all the points on it, and they made the changes. The abstention accomplished something very significant for Coca‑Cola shareholders.
Bankers, crime and punishment
I think that there have been individuals that do things in business that they should go to jail for, and they have, and sometimes, they should, and they haven’t. You just have to make a determination. When the activity of some individual is criminal, I think that they should be prosecuted. But every time something goes wrong at the corporate level—(it is not necessarily criminal). I will promise you, in the next five years, something will happen at Berkshire that will be the wrong thing for somebody at the corporation to do. We’ll correct it, but it’s going to happen from time to time. I don’t think I should go to jail if one of our 330,000 people does something they shouldn’t do.
Does the media understand business
Mickey Mantle once said, “it’s amazing how easy this game is once you get up in the press box.” Of course, it isn’t necessary that you have experience in everything in order to write about it, but if you’re going to be a business journalist or a political journalist, you really should understand business. Going back to our boardroom, I can tell you that most journalists probably, and most Americans, really don’t understand the dynamics within a boardroom. But it’s a little hard for journalists to be planted in boardrooms around the country.
The best business journalist
The best business journalist I’ve known has been Carol Loomis. She didn’t start out knowing about business, but she wanted to learn. She is smarter at the end of every day than she is at the start of the day. Not very many people you can say that about. She learned accounting. She learned all aspects of business. As a result, she became the best business writer in the United States or maybe the world.
Social media, technology, and journalism
Everybody’s a reporter. It’s really changed the world and you can see it in daily newspaper circulation in the United States. I used to have to wait until the next day to look at the box score of what the Cardinals did the night before and find out how Musial had hit. Now I can go to ESPN.com and I’ll get a play by play. The world has really changed, and people demand instant reporting. That means that they get a lot of stuff before the facts are out, but it means they get the facts very quickly too. There will (still) be first‑class journalism in publications devoted to that. There is a big enough market for that. It’s not where most of the money will be, and money will drive what the public sees.
Advice to future business journalists
If I didn’t do what I do in my life, I would have wanted to be a journalist. I consider myself a journalist, to some extent. I assign myself a story. I say, is the Washington Post company worth $22.00 a share in 1973? I say, is the BNSF Railroad worth us paying $34 billion? I assign myself the story. It’s my working hypothesis that it is, but then I go and look for the facts, and I try not to be selective about the facts that I use as input. Journalism is fascinating. I love it.
I would say that you should always observe that rule about not letting the hypothesis determine the story. You’ve got to learn about how business works. You can always get smarter. If you do the right kind of a job, you will attract the right kind of sources. I’m a source for certain journalists, and the reason I am is because I admire their work. The others get no place with me.
It’s very important—if you want to become a great journalist, then you want to have a curiosity about business. There are so many good stories that haven’t been written yet, and a few of them which I know. Business is always going to be important to the body politic as well as interesting to a lot of readers, and if there are so few that are good you’re going to stand out if you really work at it.
Comments and questions: @IconicVoices