Bill Gates, Charlie Munger, Warren Buffett on the socialism versus capitalism debate

gentlemen we've talked an awful lot on our air recently about socialism vs. capitalism defending capitalism all of the different political pressures that are kind of being brought as we get into another election year and I thought maybe we could talk about that this morning - over the weekend several questions came up about defending capitalism in Warren you you did step out and and say that you're a card-carrying member a card-carrying capitalist in front of everyone what do you think about the attacks that we've seen to this point on capitalism well I think I don't think people exactly even know what they're talking about it isn't the capitalism it's perfect but if you look at what was here in 1776 and look at what is here now this country is an incredible job in terms of the deployment of resources and and and and human ingenuity and that is a product of a system and now does that mean that every decision should be made simply by open market determinants that there's need for regulation obviously and there are things that have long-term costs and might not get built in but the idea of people unleashing their potential using the resources they have to create what we have now from what was here 240 some years ago it's absolutely a miracle and what all three of us have seen during our lifetime and if you compare that with any centralized planned economy I you know I think we win hands down and I I think I think we've just started with what capitalism could produce in the United States but I do think it obviously it it needs her rules and regulations well you did an interview in Davos with someone and I you made a pretty innocuous statement that you looked around you thought capitalism was the best system and you got attacked online from all these people who came up with these crazy statements about how could you say things like that I mean what do you think about the climate when you see things like that well that some people think when you defend capitalism you're defending the tax rates we have today and saying that higher absolute tax rates are more progressive tax rates that you disagree with them in I I don't think Warren and I are disagreeing that you could make the taxes more progressive in fact we've been very explicit in some areas like the estate tax and saying we think that would be a good thing socialism you got your where she came back socialism used to mean that the state controlled the means of production and a lot of people who are promoting socialism actually aren't using that classic definition so what we're gonna have is capitalism with some level of Taxation most people really aren't arguing against capitalism there may be a few but most people are just saying that the taxes should should change although you do have someone who I think is pulling the second-highest and the Democratic Party right now who was a socialist until very recently Bernie Sanders well whether or not he was a socialist by the full term about now there there is some money areas when you start to say there shouldn't be any billionaires that you have some cap on wealth or something like that that goes beyond what I think and and you could say I'm self-interested the present government needs to reallocate some resources I mean extreme case would be in World War two I mean that's the closest we've come to socialism you had an office of Price Administration you had a war production board yeah I mean but during peacetime you're always prepared for war Nia does that through government government government needs to reallocate some resources but the the market system which exists under capitalism is an extraordinarily effective way and is proven it of of using resources human and other kinds to produce incredible goods and Henry Ford could learn a devise a system that could turn out a couple million cars a year but he could only use half a dozen himself for his whole family could use 50 I mean he had to turn out a couple of million cars that other people got to use and that that would not have in my view I think if you'd set up a government Bureau in 1850 and given them a hundred years you'd have ever come up with anything like the assembly lines of Ford and all of the things that have happened human ingenuity is incredible and you want something that maximizes its use and and then curbs a few of the people may have this or that but for all for themselves Charlie you've made the great proof of how capitalism works is China when China copied Singapore and let the farmers on their own plots and let the manufacturers on their own businesses and so forth China's productivity increased many times and they went from rural poverty to modern extreme wealth and they did it by adopting a fair amount of capitalism no the Democratic politician doesn't understand that he's nuts you've made the same point though Charlie that you think private sector does it much better than the government sector however a lot of these people who are running also want to make government much bigger did you have a quarrel with that or now well as they say if you love your post office you're gonna love socialized medicine want to make it bigger in terms of redistributing they may want to the market system is brutal and it leaves behind people who are perfectly wonderful people who don't have market related talents and who are just unlucky yeah just plain unlucky and in a rich society believe me if we have a war or something like that but we call on those people and I'll pay them practically nothing to go fight for us and it and it we want goods slowing but it's going to displace the textile worker that we use happens on so so the the function of government is not necessarily to get bigger it may be in an important way to take care of people who for one reason or other get left behind in a market system that you also regarded as the is essentially this huge source of wealth and goods and services so how do you fix the problems or at least the perception of problems which there's a huge perception out there and the American bloating right now obviously would help of our government we're wiser and it would be wiser if the two sides didn't hate each other so much anger drives out reason and there is absolute cold fury between politicians on one side and politicians on the other it's quite counterproductive for that reason I don't allow myself to get angry at politicians how would you fix it well I just don't let myself get that angry politicians I don't expect them to Bursar's work better because Charlie and I've never been that each other yeah it just does I mean way better we got mad at each other I'd you know I try and kill his deals he'd try to help my deal off it just doesn't work that way we don't need a couple of alpha males bluster handling or this stuff just cooler them take a little reputational hit and get get the feathers but we Otto down we ought to worry about the people that don't then end of the system but we want the system and a lot of people are getting left further and further behind because as capitalism gets more advanced it gets more specialized and there actually is greater difference between the haves and the have-nots and the haves could take care of the have-nots that means both parties and basically agree on that they just yes how you get there it comes I'm tax credit it can make a huge jump in that direction I mean no Social Security all that we've done various things over the years we have improved we've improved the public school systems we've improved things that do give people more of an equal chance and take care of people who fall by the wayside we just got to keep doing it you

Channel: CNBC Television

Views: 1,883,760

Keywords: Squawk Box U.S., CNBC, business news, finance stock, stock market, news channel, news station, breaking news, us news, world news, cable, cable news, finance news, money, money tips, financial news, stock market news, stocks

Id: s9ovOwl5Cns

Length: 9min 26sec (566 seconds)

Published: Mon May 06 2019

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[u/mermrth1111]

Next on CNBC:

"Fish: Should they be eaten? We'll ask 3 cats"

[u/Mungologist]

This just in, Nazi sources have proven how European jews are actually the bad guys - More at 8.

[u/SpaceBollzz]

Are they oblivious or in denial?

Last thing buffett says is "we just gotta keep doing it"

He will probably be gone before the wheels finally fall off but I wish he could see it

[u/musicofspheres1]

Obsolete infinite growth acquisition paradigm. No regard to biosphere or natural regeneration rates. Just infinite cyclical consumption. Motivational gurus are the priests and the billionaires are the gods

[u/Cute-Football-6108]

Imagine the smell. I bet it smells like sulfur.

[u/Cautious-Sundae-8831]

Insurance company and patent rent seeker.

[u/Basic-Philosopher-36]

Should we bomb brown people, Lockheed Mart says YES

[u/koinaambachabhihai]

WTF is this?

And other than the fact it is not a debate, like, can someone tell me why should I care what 3 80+ old farts think? Because they have billions of dollars, ohh, got it.