republicans are going to stand solidly behind it to fund government while defunding obamacare. i would hope that maybe a handful of democrats, perhaps some of those who are up for reelection in red states, might consider joining us with us as recent polling suggesting 56% of americans think something like this is what congress should do. a solid majority of americans believe this law will make their family health care situations worse rather than better. be a real opportunity. we need an up or down otay -- vote. i hope we will get some democrats joining with us. if the across in the senate upect it, they have to come with a proposal. they do not have a proposal.

we have not hold -- heard of and outline for a proposal. the onus is on them. once the house passes something to keep government funded, once the republicans in the senate have an opportunity to vote on that tom a if the request in the senate -- vote on that, they have to come up with something. when there a point real world consequences of a shutdown are too great for this particular fight? is there a point when it is too much? too much.own is we should avoid a shutdown. obamacare is a law that will harm people. it is not a good idea to shut down the government to force through the implementation of obamacare when the president has said he will not follow the law and has made substantial changes.

are nots are bad and worth it. this law is not worth causing a shutdown over. eventhave another press we need to get to. one more question. you have been very patient. >> you said a couple of times and up or down vote. most of the time we interpret up or down vote bangs as a 50% s as a 50%vote threshold. democrats killed this proposal, are you all going to line up and talk this thing until september 30. it is a 50 vote threshold and harry reid can make you lose that. that setting by referring to an up or down vote bank, i am

talking about the merits as --osed to a motion to table a non-debatable motion to table that goes straight to a vote not on the merits of it, but on the motion to table. >> thank you, everyone. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013] >> on the next "washington journal," we will talk about the

vote that will fund the government until december und the new health care law. we will talk about income and poverty with david johnson and ron haskins. is live onjournal" c-span everyday at 7:00 a.m. eastern. tell youive events to about today. the epa administrator will talk about climate change at 9:00 a.m. eastern on c-span 2. educationthe house workforce subcommittee will talk education andl training programs. president obama talks about the auto industry in kansas city and the economy. here on c-span at 7:00 p.m., the

chinese foreign minister will be at the brookings institution to talk about u.s.-china relations. c-span's student cam video competition is underway. studentcam video competition is underway. we are doubling the prize money. the videos are due by january 20 , 2014. ceoow berkshire hathaway warren buffett. he was interviewed at georgetown university by bank of america ceo brian moynihan for more than an hour. [applause] >> good evening, georgetown.

it is a pleasure to be here. for those of you who were here last year, we had bono come talk to you about what he did. year, i was thinking about who we should bring in. i talked to bono and he said if you want to bring a real rock star, ring warren buffett. buffett.warren he has done things that i could never do. last year we brought you a rock star. this year, we brought you a real rock star. [applause] i am going to ask warren buffett a few questions and then we will take your questions in the crowd. where the president left off. this is your hometown. what are your best memories of being around georgetown?

papers inered georgetown 66 years ago. i developed this affinity because in the hospital, people tipped. my regular customers, the ones who knew me, never tipped. one of the things they would do, they would give me cash checks. a woman also tell me if would give birth to a baby that was eight pounds. the numbers racket was big and they thought they were giving me this terribly valuable information. i have a lot of memories of georgetown. war ii,re during world which was a fascinating time to be in washington.

it was really a window on an extraordinary time in america. at that time, we were probably more united than anytime in my lifetime around a common goal. when people went down and enlisted when the war broke out and people did so voluntarily at a high percentage . .hey played by the rules we all bought savings bonds at schools to help out the troops. quite a time. >> somewhere along the line you started investing. i have read stories that you started investing at her team. >> 11. >> what created the fascination with investing? $120.ad to save

it took me five years to save $120. my dad originally was in the investment business. he was not interested in it. i would go down saturday morning and he had these books in the office and i had read all of them. i had read all of the books in the library on investing by the time we moved to washington. the i got here, there was library of congress. i found it fascinating. incidentally, i find it fascinating today. it is an activity. ,f you are a baseball player your legs may go. my legs have long gone, but it doesn't make any difference what i do. i have always had fun working. i have as much fun now as i have had in my life. i am doing what i love you and

it does not get any better than that. >> do you tap dance to work everyday? >> to demonstrate. >> it was nice to get that round of applause at the start. i am 83 and they are not sure if i will be around at the end of the talk. >> you have more energy than anyone i know. talked about the giving pledge. how did you come up with the idea and how are you doing on it? or four yearse ago. bill and melinda and i were in california talking. we decided to call david rockefeller and asked if he would host a dinner in new york for about 16 or 18 people to talk about philanthropy. oprah winfrey came and mayor bloomberg was there. i started having these people

talk around the table as to how philosophyped their on philanthropy. people were really interested in it. there would bee a possibility of taken this -- taking this passion people have shown an going to other people who have a great deal of money to see if we could develop something where people would pledge at least half of their net worth. we now have about 115 people. i have been dialing for dollars. i call these billionaires up. sometimes, they tell me how they cannot do it. i tell them i will write a book .n how to live on $500 million they cannot seem to figure out how to do it. they need help. it has been very rewording. i received a letter from one woman. she and her -- it has been very

rewarduing. said they had not really faced it. changedher husband had things. over half of that $10 billion was going to go to philanthropy. they do tend to postpone decisions. will ishem the last what counts. i am talking to a 70-year-old you reallythem, do think your decision-making ability will be better with some blonde on your lap? let's get on board now. [laughter] bill has gotten people around the world because he travels more than i do. what we are hoping is that people pick up on norms. when i was young, i read about

carnegie and rockefeller. you pick up the savior from those who come before. from those who come before. we have the letters that are up on the website and they are pretty remarkable. we want to get the young people like arc zuckerberg to join us. he will a -- like mark zuckerberg to join us. he will appeal to a younger group. we hope it will become this gospel of wealth that andrew carnegie came up with. we have got better stories than that in these letters. i will emphasize one thing. has givenour group away a dollar that anyway affects how they live. i have greater admiration for

the person who robs one dollar or five dollar -- drops one dollar or five dollars in a collection plate. they are giving up something that has utility to them. i am giving up nothing that has utility to me. i have everything i wanted that could be bought by money. of stockshole lot that have no utility to me. they could have utility to other people. people who give up something that actually can have utility to their family and give that to some other person so that it has utility, those are the people who deserve the kudos. it is still nice to go where the money is, though willie sutton approach. if we can work on polio, something that takes contributions, we will go after it. thing you have

done is bill and melinda gates and the foundation. of other thing is almost all your wealth. talk about the gates foundation as opposed to your own foundation. >> originally, my wife and i planned when we were in our 20s that when we had everything we needed, we would give the rest to society. i thought she would outlive me because women live longer. she died in 2004. i had to come out -- come up with a different plan. if you are good at one thing, you are not necessarily good at another. and giveto get someone where your talents are more useful. when my wife had babies, i went to an obstetrician. i did not deliver them myself. i wanted to go to people who were good at giving away money ,nd who were younger, energetic

smart, and had the same of captives in philanthropy. the basic principle is that every human life has equal value. if you start with that as your basic assumption, a lot of things flow from that. i have foundations for each one of my three children that are a significant size. you can read the letters that i wrote them on the berkshire hathaway website. succeed at if they everything they do in philanthropy, they are doing the wrong things. the important ones are the tough ones and you are going to fail at some of those. , have very energetic people common objectives, and they work for nothing. that is not a bad deal. >> that stretches the money a long way. what i read is that you require them to move the money out. >> they have to spend it. money has, all of the

to be spent within 10 years after the estate is closed. out some great, great grandchild. you have to be born. bestwill be the facilitators. i won the money to get spent properly. too not -- want the money get spent properly. i do not believe and controlling beyond the grave. i can't think outside the box, but inking outside that particular box about -- [laughter] recently, i read an article about eastlake. j. finishes his term at eastlake, a golf course in atlanta. there is development work that he does with communities. talk a little about that.

thing about same loving people who are putting in their own time and energy and are successful into a project that is worthwhile. he is an extraordinary man. he took this terrible neighborhood called eastlake in ofanta and against a lot community opposition -- it was heme-ridden and he decided had to apply a holistic approach to it. he could not just attack this thing or that thing. developd 10 years to this entirely new community out of this total disaster. said,ked about it and he everybody is going to say that can only be done because you are tom cousins and you live in atlanta. robertsonnd julian

couldd to see if we replicate this in other communities. a great way to do it. they have been harassed by katrina and other things. we took it to new orleans, where we had hundreds of people. -type a mixed income community. we do not want to have it with everyone subsidize. we want to create a new kind of community were different races and different people work together. we went to indianapolis and it has been successful there. has come up with something. he had an op-ed in the wall street journal about a week ago. when you get a chance to join forces with somebody who is as high quality as that in

energetic and smart and putting his own funds in it, you have to jump at the chance. >> we will switch from philanthropy to the economy. you can do these wonderful and great things. what do you see in your operating companies from an investor's point of view? wellsiness has come out from five years ago and the panic. right on the edge of the cliff. credit to bens bernanke and hank paulson and frankly, evennd though i did not vote bank for him, president bush. and, frankly, even for him,did not vote

president bush. he really came out with a great economic insight and he did it with 10 words in september of 2008. money doesn't loosen up, this sucker could go down. [applause] and he backed up those fellows. we have come back from it. this news has come back. a lot of companies are having record profits, including a lot of hours. the american populace has not come back. the forbes 400, which just came out, showed aggregate wealth of $2 trillion.0 of $2 trillion.to

the median income is in the same place in terms of real purchasing power. has not changed. inequality is getting wider. the rich are doing extraordinarily well. this is profit margins are terrific compared to the record, historically. is this returns on equity are terrific. a great many people in our the bottom 20en %, 24 million households -- 20 %, 24 million households, live on $22,000. -- an economyeed

that is delivering $50,000 on gdp. how to havelearned everyone share in the bounty we have. >> do you think we just have to grow out of it? >> we are growing. if you think about it, people are still unhappy with two percent a year. the population rose one percent a year. 20% gainrs, that is a in gdp per capita. that is not bad in a generation. the question is how it gets distributed. this system works. 19 30.orn in i was conceived in 19 -- i was born in 1930. i was conceived in 1929. after the stock market crash, he did not -- my father did not have anything to do.

i look back with great fondness on the 1929 crash. since i was born in 1930, real gdp has increased f sixor 1. since i centuries- -- was born in 1930, real gdp has increased 6 for 1. it is a fabulous country. in my view, we have to make sure aerybody participates to reasonable degree. we do not want to eat quality of results -- equality of results. about the george bush economic statement about it could go down. what do you think the lessons are from the last couple of cycles? we have a lot of young kids out there. you have lived through a lot of cycles in the 50 or 60 years you

have been investing. >> 70 years. >> what should young people take away? are people will continue to make the same mistakes they have made. it does not correlate to iq. we havey get greedy and this huge bubble in the most --ortant asset in housing you had a huge bubble in something you could borrow heavily against. lax.onditions got very , peoplet bubble popped came into that gradually. when they get fearful, it at once.ll we had them all leave at one time. that will happen again with a different set of circumstances. the human animal will keep behaving pretty much the way it has in the past.

periodic recessions. we have the occasional panic. all recessions do not come from .anics if you look at the 20th century, in the 20th century we had two world wars. we have the great depression, the flu epidemic, the cold war, the atom bomb. the dow jones average went from 11,497 with all of these terrible things happening. america works. when i bought my first stock when i was 11, that was in the spring of 1942. that was a few months after pearl harbor. we were getting clobbered in the south pacific. and the dow was about 100. look at where we are now.

it seems to me the obligation of --ix i.t. as diverse obligation of a society as diverse as ours is to see that no one gets left behind. year, bono's speech was one of the best speeches about american optimism that you could have by a person who is not an american by birth. what makes you optimistic about the next decade in america? >> imagine 1789. go back a few hundred years. there was nothing here. the guy who designed st. paul's cathedral is buried there. there is a plaque that says, if -- we had monument,

less than 4 million people when we became a country. china had 300 million people at that time. a were just as smart as we were. they had natural resources similar to ours. we end up with a quarter of the world's gdp. we have got something that works and we do not want to mess that up. we want to figure out what to do with it. you do not have to worry about the system working. you will have periodic recessions and occasional panic brought on by something and who knows where it comes from. i wrote an op-ed piece in the new york times in the fall of 2008. i said the country will come back. it will go through a recession and it will come back and it is coming back. don't ever worry about america. you are in the right place. >> you have been famous about your investment strategy.

that has served you well. time youour favorite are able to accomplish that? >> i would say my favorite time is going to be tomorrow. it has always been fun. there is a company here in washington called geico. i first got exposed to that in 1950. it was 1951, i am sorry. i was 21 years old. i came down on a saturday because i learned that my professor was the chairman. i got down there in the door was locked. it was a saturday and i pounded on the door and a janitor let me in.

there was someone who spent four hours with me. my age, you to be realize all of the help you have received from other people. obama got in trouble when he said that on the campaign. nobody does it by themselves. we all sit in the shade of trees planted by others. to plant a few trees ourselves if we have had good luck. it has been a great ride, but it is not over. >> when did you actually geico? -- buy when did you invest for the first time? aliceent out to my aunt and she would have bought anything from me. she bought 100 shares of stock from me. the first stock i ever sold. a lot of years past and mr.

davidson was kind to me in a variety of ways. i went in different directions. in 1976, he got into a lot of trouble. they miscalculated their reserves and they were going broke. i came back and bought a third of the company in a short time. in 1995, one third had become a half because they had re- purchased their shares. mr. davidson had a bunch of stock in geico. i said, if i make an offer for this company for cash, you are going to pay a big tax. i am not going to make this offer unless it is alright with you. i have offered this all my life. so we bought the rest of the company. over to some it

student questions. they will put a microphone out here and we will have you queue up if you have questions for warren. all right. let's take the first question. tell us who you are and ask away. >> i am a senior. i was wondering if you have any stock tips for the students. we are trying to make a little living. i didn't think they taught that at georgetown. in 1949 called

the intelligent investor. i do not remember what i paid. aside from what i paid for my two marriage licenses, that was the best investment i ever made. it is very important to have the right framework. you need to have an approach to investing that is sound. the graham approach is simple. to it, which ipt did immediately, and most people do not. if you have the right philosophy, you will find opportunities as you go through 30, 40, 50 years. you are more likely to find them in times like five years ago when we were having the panic. stocks sell at silly prices from time to time. most stocks will sell at silly

at some point. it does not take a high iq to figure out that they are cheap. it does take a temperament that is willing to step up. i tell people, if they are going into the investment business and they have 160 iq, sell 30 points to someone else because you will not need it. you do not have to be that smart in this business but you have to have the right temperament. it have to be able to ignore what other people are saying and simply look at the facts and decide, is this stock selling for x with 2x? that is my generalized stock tip. no names. >> i will make it simple. us by bank of america. america -- bnk of

of america. >> good afternoon. my name is nicholas -- bank of america. >> good afternoon. my name is nicholas walker. are you tempted to venture into the brazil market next? nz deal.id the hei the question is, are you going to invest in brazil next. >> i do not know where i will invest next. if you went out and laid golf and every drive when in the hole, you would give up. the game would not be interesting. i love the fact that i do not know what you'll sway going to do next. in 2000 -- i love the fact that i do not know what i will do next.

2006, someone said, i want to tell you a little bit about my company. his family sold his company, the only company they wanted to sell it to was berkshire hathaway. they would come over from israel to talk to me. i e-mailed them and they came over very shortly and we bought the business. we handed them $4 billion for 80% of the company. i said, i do not go to council bluffs iowa. i am doing fine in omaha. he said, you have to see it. i said, we can make a deal without seeing it. we bought the company and i went

over there and it is true. i had never seen plants like this. imeone said to me, that's why wanted you to come over. had seen them, i would have paid more money. we have a wonderful partnership with the people in israel. our partnership with the people in brazil -- they are sensational people. of gillette.board the opportunity to buy into a --derful business like heinz they do all of the heavy lifting. it is a great opportunity for us. i do not know what the opportunity will be tomorrow. last december, i was going out colorado.,

he said, i have an idea that might interest you. as i came back on the plane, he said,, i'm in. that, he sent me a one-page governance description of how it would work between the two of us. he sent me a brief description of what he thought would be a fair deal between us. i did not have to change a word. that is the kind of people you want to work with. >> you mentioned that people will make the same mistakes in boom-bust cycle. there have been recent developments, such as the creation of derivatives that hasn't -- have exploded recently. he once called derivatives weapons of mass destruction. trillion are a 700 dollar industry. $700 trillionis --

dollar industry. do you see this as where the next crash will be? >> they enacted. frank. frank.y enacted dodd- intopoured $485 billion aig. hank paulson guaranteed money market funds at a time when 30 million americans with money market funds were panicking. billion in three days had gone out of the non-government market funds. re-hundred billion dollars. that was almost equal to the deposits of wells fargo or wachovia.via -- i do not think they can do that under dodd-frank.

i do not think burning he did and i do not think hank paulson could do what he did. , the only is a panic thing that will stop it is when somebody who has the ability and am going to doi whatever it takes. bernanke and paulson and congress said to the american public. if bernanke said, i will do , he did it.takes called it the change stabilization fund of the treasury. it was enacted in 1934. strong characters who had the ability to print money. they said, we will do whatever it takes and the president was behind them.

that is the way to in the real panic. congress does not like to give anybody that kind of authority. i tip my hat to them. will be another panic. where it comes from, who knows? when that time comes, the will thewill be, people who caused the economic engine to stop come back and be doing something? i am not sure what has been enacted is a plus or a minus. willdless, the country come through. it is hard to write regulations that will keep people from acting foolishly, particularly when acting foolishly has been proving -- has been proven

profitable. humans all think they are cinderella at the ball. as the night goes along, the music it's better and the drinks -- the music gets better and the drinks flow. there are no clocks on the wall and they are still dance in. it will happen again. buy when it happens. i will be buying. >> my name is john ross. i am from georgia. incomek little bit about inequality. you look at class mobility rates and average household income for measuredass families with inflation. a lot of these rates have been trimming down since the 1970s. some would argue that it is harder today for the middle class than it has been in 30 years. i was wondering if you have any

thoughts on how a rising tide can it all holds -- boats. that is what john f. kennedy talked about, a rising tide lifting all yachts. problem asstructural the market system gets more structural lies. agrarian back to an society, most people fit most job requirements. the world has become more and more specialized. we keep moving away from that. the market system will not pay well significant percentage of society. gdp are not needed to keep itself. government has to entrust that.

i sometimes tossed out to students this proposition. 24 hourshat it is and you arere born sitting there, johnny or joni, and you are in the womb, and a comes and says, you strike me as a remarkable human being. i am going to give you an enormous responsibility. i will let you decide how the world is going to work into which you are going to emerge you can decide on the economic system, the social system, the political system. whatever you design, that will be the system in which you live, your children live, your grandchildren live. sou are wise beyond your minu

24 hours of age. you say, what is the catch? just before you emerge, having designed the system, you are going to go over that there'll -- barrell-barrekk that has a slip for every person on the planet. states or itited may say bangladesh. knowing which ticket you were going to pull out, which -- what kind of world do you want to design? you want to design a world that produces lots of business services. you want a lot of stuff around. it could be the world's terrorist society, but if it is on a barren island, it does not work.

you certainly want something that it laminates fear from everybody's life. that means fear of old age, fear of health, all of those problems. want a system that takes care of the people who do not .urvive in that market system i think we have done a wonderful job at the first stage. we have turned out lots of stuff. this country has developed in thinking how a rich family has behaved. we need to focus more on making sure that people who get the bad tickets do better than they are. blacks or slaves were 3/5 of a person. we said all men were created

equal but then we said blacks were 3/5 of a person. it was 1920 before we passed the 19th amendment for women. we treated women as an essentially different class all of those years. we have gone significantly in the right direction in terms of behaving as a society. i think we have to a dress the question of how do you treat the people left behind in -- address the question of how do you treat the people left behind. i am in the school of foreign service, first year. you are an outspoken fan of ben bernanke. he will be stepping down in january of next year. whomever takes over the position, should they continue

the controversial buyback program and if so, for how long? >> they should take bernanke's approach. it means more improvement in the economy. am not hugely disappointed, but mildly disappointed in the rate of improvement in the economy in the last few years. just the other day, he said he would extend it further. pre-judging exactly when it is going to happen. he is telling the conditions under which it will change. the economy is getting better. that has an experiment not been tried before. a 3.5 trillion dollar balance sheet. buying securities is usually easier than selling securities.

we do not know how this game plays out. just the announcement a few months ago that the tapering a significantd market reaction, probably 100 basis points. what will happen if they actually deleverage the fed? if the fed deleverage is that in a big way, that -- deleverages that in a big way, it will be a big deal. the peace people do not take into account is that they will people don't piece take into account is that they will stay there. about 1.8 trillion

dollars. the fed is the fourth largest contributor to the united states government's revenues that there is now. pressure.r no if you have somebody wise, and i think bernanke is wise and i expect his successor to be -- it can be handled. it is something that has not been done on this scale. we have seen the market moving ahead and back based on the last few days. we will take one more question. i am from china. i am a graduate student at georgetown. friends and i are a big fan

of you. we read your book and you had a system of criteria on how to evaluate a company. -- confusing but you said we are always staying away from an industry we do not know. the world is changing. we are living in a new era. the business models are changing. everybody is shopping online. in a few years, maybe everybody will pay with their iphone. non--profit is a new model. non-moffett is a new model. non-profit is a new model. >> he has a flip phone he wants

to show you. lex i just turned in the one alexander graham -- the onet turned in alexander graham bell gave me. >> in the venture capital industry, what is the most important thing in evaluating a company? doingot asking about average, but about excellent or remarkable. name one aim. -- thing. the most important thing is to be able to define which one you can come to an intelligent decision on and which ones are beyond your capacity to evaluate. i met bill gates in 1991.

he said, you have to have a computer. i said why and he said, you can do your income tax on it. i said, i do not have an income. he said you can take -- you can keep track of your portfolio. he said, i only have one stock. he said, it is going to change everything. said, will it change whether andot people will chew gum, he said it will change the kind of gum that people chew. there are all kinds of use.esses people i am able to understand some given percentage. there was a book called the science of hitting. and the a diagram

strike zone is divided into 77 squares. he says, if i only swing at pitches in my swing zone, it shows what the batting average will be. he said, the most important thing in hitting is waiting for the right pitch. he was at a disadvantage. even if he was only going to bat -- 230. he still had to swing. only get a strike called if i swing at a pitch. thousands of companies day after day. only when i see something i understand and when i like the , it is aat are selling

strike. it is an enormously advantageous thing. it is a terrible mistake to think you need to have an opinion on everything. you only have to have an opinion on a few things. i have told students that if they got a punchcard with 20 punches on it and that was all of the investment decisions they had to make their entire life, they would hit very rich because they had to think about each one. you do not need 20 investments to get rich. 5 would be enough. if you understand some of these businesses coming along and you -- amazon is a tremendous accomplishment. i tip my hat to him. he is a wonderful businessman and a good guy. anticipated he would

be the success and 10 others would not be? i am not good enough to do that. i did form an opinion on bank of america and i formed an opinion on coca cola. are 1.8 billion eight ounce servings of coca-cola products sold every day. and getake one penny one penny extra at $18 million a 365 is 18 million times annually sixlion annually, $6- billion. are the kind of decisions . like to make

you might have an entirely different field of expertise you can get very rich if you just understand a few of them. intoheinz -- nz and we looked at people pouring ketchup on hamburgers. some products do not travel well. cap berry bars in england, -- england do not sell very well here. >> thank you. [applause]

warren, i want to thank you for taking the time to work with the students today. passiona person with a he still has an 83 to make right investment decisions. the ability to try to do something with all of that wealth that will help a near- term set of goals in society. you will find few people in the that able to do things well. thank you. [applause] >> several live events to tell you about today on our companion 2.work, c-span be epa administrator will talking about climate change.

the house education work for sick -- subcommittee will talk about technical training and education programs. president obama will be in kansas city to talk about the auto industry. , a look atments today's headlines and your calls and tweets followed by "washington journal." we will be live at 7 p.m. is -- eastern from the brookings institution for a speech by the chinese prime minister. in a half hour, we will talk with a congressional reporter for the washington post and we will talk more about the upcoming house vote.

we will look at this week's ensus bureau-- c report on income and poverty. a train wreck. >> and dealing with the funds of obama care is deader dead. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013] host: good morning. in two hours house makers will be speaking on and later voting on funding the president's health care law it will be tied into a resident thrution keeps the government running and that known as the c.r. or