The Myth of Capitalism

Chapter OneWhere Buffett and Silicon Valley Billionaires Agree

There's class warfare, all right, but it's my class, the rich class, that's making war, and we're winning.

—Warren Buffett

Warren Buffett is an icon for Americans and capitalists everywhere. For decades, his annual letters have taught and educated Americans about the virtues of investing. In many ways, Buffett has become the embodiment of American capitalism. He's called the annual meetings of his investment firm Berkshire Hathaway a “Celebration of Capitalism” and has referred to his hometown of Omaha as the “cradle of capitalism.”¹ Yet Buffett is the antithesis of capitalism.

He has become a folk hero because of his simplicity. Even as he became America's second wealthiest man, he has lived in the same home and avoided a lavish lifestyle. He makes billions not because of dirty greed but because he loves working. Books about him, such as Tap Dancing to Work, capture his jaunty ebullience.

As a person he is remarkably consistent. His daily eating includes chocolate chip ice cream at breakfast, five Coca‐Colas throughout the day, and lots of potato chips. His investing is as consistent as his eating. For decades, he has recommended buying businesses with strong “moats” and little competition.

The results have shown how right he is. Warren Buffett gained control of Berkshire for around $32 per share when it was a fading textile company, and turned it into a conglomerate that owns businesses with little competition. ...