Thanks for the link. The article is a good summary of Buffett's maneuverings, but it finds evidence of "crony capitalism" as if the summary proved the case. Any accusation of crony capitalism should, at least, provide a method for distinguishing self-interest from national interest. In this case, there should have been an argument that Buffett's proposals were NOT in the nation's interest. Instead, the author writes:
The bootlegger’s interest does not necessarily mean the Baptist’s ideas are wrong. The Treasury Department considered Buffett’s proposal, but with Paulson leaving at the end of President George W. Bush’s term, it would fall to the incoming secretary, Tim Geithner, to act on it. Geithner tweaked the plan and announced the Public-Private Investment Program in March 2009. It was largely seen as a boon to banks, especially large banks with a lot of bad debt.
The author also claims a parallel between David Sokol and Lubrizol and Buffett and the Public-Private Investment Fund. But Sokol misrepresented his position to the investment bank and to Berkshire, whereas Buffett did not. Or, as the author explains:
After the bailout bill passed, Warren Buffett sat down and wrote Treasury Secretary Paulson a four-page letter proposing a larger solution to the financial crisis: a quasi-private fund backed by the U.S. government that would buy bad loans and other rapidly sinking investments. He proposed that for every $10 billion put up by the private sector, the federal government would kick in $40 billion. As Paulson put it in his memoir, “I knew, of course, that as an investor in financial institutions, including Wells Fargo and Goldman Sachs, Warren had a vested interest in the idea.”The descriptive aspect of the article is good, but the argument can be summed as anyone who benefits from a public policy should never support such a policy.
