Warren Buffett on Small Business, American Optimism, and Burger King Deal

Panel discusses Goldman's 10,000 Small Businesses initiative in Detroit. Blankfein explains program helps entrepreneurs 'at the tipping point' with education, negotiation skills, accounting. Buffett emphasizes participants are self-motivated people already running businesses. Program boasts 99% graduation rate with proven job creation results. Valerie Jarrett highlights Detroit as model of private sector, civic community, and government partnership - federal government invested $300M, $12.2M in rail system leveraging 10x private investment.

Bloomberg argues every big business started small, emphasizes creating jobs matching people's actual skill sets. Critiques colleges for teaching skills that don't apply to 21st century needs - education must balance career preparation with being well-rounded. Blankfein shares McClure's Pickles case study: family business with 100-year-old recipe moved from Brooklyn to Detroit. Program taught business planning, accounting, HR - entrepreneurs used course business plan to secure bank financing, buy equipment, hire 2+ employees. 'Very virtuous circle' of education → financing → expansion → hiring.

Joe Scarborough prompts Buffett to share optimism message for influencers. Buffett declares 'the luckiest person in history being born is the baby being born in the United States today.' Since 1776, anyone betting against America made 'terrible terrible mistake.' Fall 2008 context: looked gloomy but Berkshire invested $15.5 billion in American industry in three weeks (including Goldman Sachs). Asked how that bet worked out: 'worked out pretty well thanks to guys like this.' Presents optimistic 25-year outlook if country does things right.

Interviewer challenges Buffett on Burger King/Tim Hortons deal as corporate inversion. Buffett admits 'yes it is a corporate inversion' but defends with unreported math: Burger King paid maximum $30M federal tax in any of last 3 years, yet paying $11.8B for acquisition. 'If anybody would be paying 11.8 billion to save 30 million in federal income tax they did not go to the math course that I went to.' Notes BK was 100% foreign-owned twice before (Grand Metropolitan, Diageo). Tim Hortons is 2x BK's size. Distinguishes from typical tax-driven inversions involving trapped overseas cash or intellectual property transfers - 'very hard to have transfer prices for hamburgers.' Larger company (Tim Hortons) is in Canada, Canadian government must approve.

Bloomberg asked about Detroit's future. Optimistic response: 'when people vote with their feet they come to America.' Detroit has great new mayor, governor who cares, philanthropists like Eli Broad raising money. City offers space without overcrowding/competition found elsewhere - perfect for new entrepreneurs. Critical missing ingredient: 'more entrepreneurs from around the world coming here.' Immigration advocacy: 'if we could let people from around the world come to Detroit they would help people... create more businesses, create more jobs.' Closes with 'that's what America was built for and that's what we need.'