A Donald Trump presidency wouldn’t be the blow to U.S. business that some fear, according to Warren Buffett, chairman and chief executive officer of Berkshire Hathaway Inc.
“If either Donald Trump or Hillary Clinton becomes president, and one of them is very likely to be, I think Berkshire will continue to do fine,” Buffett, 85, said at the company’s annual shareholders meeting Saturday in Omaha, Nebraska.
The outcome of November’s presidential election is unlikely to change the fact that the U.S. is a “remarkably attractive place in which to conduct a business,” said Buffett, who endorsed Democrat Clinton at an Omaha rally in December. U.S. companies have enjoyed “terrific” returns on equity despite a sustained period of ultra-low interest rates, he added.
Trump and Clinton are their parties’ respective front-runners in a campaign that has exposed discontent with Washington insiders, anger over global trade deals, frustration with Wall Street and furor over the growing gap between rich and poor. At the same time, each candidate’s unfavorable rating exceeds 50 percent, a historically high figure at this late stage in the primary season.
Buffett, who has criticized Trump in the past and scorned politicians’ pessimism about the country, looked past the current voter angst for a longer view of U.S. economic prospects.
“Twenty years from now, there’ll be far more output per capita in the United States in real terms than there is now. In 50 years, it’ll be far more,” Buffett said. “No presidential candidate or president is going to end that. They can shape it in ways that are good or bad, but they can’t end it.”
Asked how a Trump presidency might affect Berkshire’s business, Buffett replied, “That won’t be the main problem.” He didn’t elaborate.
The son of a former Republican congressman, Buffett is courted by Democratic politicians who seek to benefit from his credibility among the economic elite and advocacy for the middle class and poor.
The billionaire has championed Democratic causes through his career such as abortion rights and increased taxes on the wealthy. When he threw his support behind Clinton, he praised her commitment to the less affluent, and has also helped her raise campaign funds. In his annual letter in February, Buffett said Americans shouldn’t be misled by politicians’ declarations that the nation is in decline.
“As a result of this negative drumbeat, many Americans now believe that their children will not live as well as they themselves do,” Buffett wrote at the time. “That view is dead wrong: The babies being born in America today are the luckiest crop in history.”
For years, Buffett has expressed optimism about the economic potential of the U.S. and backed up his remarks with tens of billions of dollars in investments. Most of the companies he’s acquired over the past five decades are based in the country.
The U.S. job market has emerged as a pillar of support in the world’s largest economy. New applications for unemployment benefits dropped to the lowest level in more than four decades and remained close to that level for a second week, data from the Labor Department showed this month. Corporate executives are banking on job gains to spur more consumer spending, which accounts for about 70 percent of the economy.
So far, the results have been mixed. GDP expanded at a 0.5 percent annualized pace in the first quarter, the slowest pace in two years, in part because household purchases climbed at a slower pace. Shaky global markets and oil’s tumble also hurt business investment during the period.
(Updates with GDP growth in last paragraph.)
--With assistance from Andrew Mayeda To contact the reporters on this story: Margaret Collins in New York at firstname.lastname@example.org, Noah Buhayar in Seattle at email@example.com. To contact the editors responsible for this story: Dan Kraut at firstname.lastname@example.org, Christian Baumgaertel at email@example.com, Edward Dufner
©2016 Bloomberg L.P.