Buffett Calls Debt Ceiling Politics a ‘Nuclear Bomb’

by Christopher Freeburn | October 7, 2013 12:54 pm

Warren Buffett Smile 630 300x210 Buffett Calls Debt Ceiling Politics a 'Nuclear Bomb'[1]In an video interview with Fortune magazine, billionaire investor Warren Buffett decried attempts to link raising the nation’s debt ceiling to other demands[2]. He said that it makes “absolutely no sense to let it be used as a lever” for political negotiations.

The head of Berkshire Hathaway (BRK.A[3], BRK.B[4]) likened threats not to raise the debt ceiling to the use of the atom bomb. “This may be like after we dropped a couple of atomic bombs,” he observed. “We saw that we didn’t want to do it again.”

Buffett said the notion of a debt ceiling itself “doesn’t really make any sense,” since the government already spends more than it takes in, making debt ceiling increases mandatory.

“It should be banned,” he said, describing efforts to link raising the debt ceiling to other spending issues. “It should be like nuclear bombs, basically too horrible to use.”

The U.S. government has been shut down since last Tuesday as congressional Republicans face off with the White House[5] over funding of President Barack Obama’s Affordable Care Act, otherwise known as Obamacare. Fear is rising that the political standoff could lead to a historic U.S. default on its debt payments.

Lawmakers in Washington D.C. tussled over raising the debt ceiling earlier this year[6], but eventually came to a compromise.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/08/Warren_Buffett_Smile_630.jpg
  2. decried attempts to link raising the nation’s debt ceiling to other demands: http://money.cnn.com/video/news/2013/10/04/n-warren-buffett-charlie-munger-debt-ceiling.fortune/index.html
  3. BRK.A: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRK.A
  4. BRK.B: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRK.B
  5. as congressional Republicans face off with the White House: http://investorplace.com/investorpolitics/4-government-shutdown-side-effects-you-probably-didnt-realize/
  6. tussled over raising the debt ceiling earlier this year: http://investorplace.com/investorpolitics/the-debt-ceiling-debate-worst-case-scenario/

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