Published Wednesday, October 16, 2013 at 7:08 am / Updated at 3:05 pm
Warren Buffett: Allowing U.S. default would be idiocy

OMAHA (AP) — Billionaire Warren Buffett said Wednesday it would be idiocy for the nation's leaders to allow the United States to default on its bills.

Buffett, the renowned investor who leads the Berkshire Hathaway conglomerate, appeared Wednesday on CNBC.

Buffett said he thinks it would be absurd for American politicians to do anything to damage the country's reputation for paying its bills that has been established over the past 237 years.

"I don't think it will happen, but if it does happen, it's a pure act of idiocy," Buffett said about the possibility of default.

Congressional leaders were still working Wednesday on a deal to end the partial government shutdown and prevent default. Buffett said both political parties should agree not to use the debt limit as a bargaining chip in the future because it is "a political weapon of mass destruction."

"Credit worthiness is like virginity. It can be preserved but not restored very easily, so it is crazy to play around with it," Buffett said on CNBC.

But Buffett said he hasn't changed Berkshire's spending because of the budget battle, and it didn't factor in his decision to complete a $1.1 billion acquisition.

Berkshire said Wednesday it will buy the beverage dispenser business from Britain's IMI PLC on behalf of its Marmon Group subsidiary.

"I wouldn't have changed the price a penny based on what's happened," Buffett said.

The deal is relatively small by Berkshire's standards. The company spent $12.25 billion earlier this year to acquire half of ketchup maker H.J. Heinz Co. in a $23.3 billion deal. Buffett said Wednesday that another similar-sized deal recently got away from Berkshire.

Buffett also said he hasn't yet seen an effect on consumer spending in the reports he gets from Berkshire subsidiaries like its furniture and jewelry stores, but that would change if the government defaults.

Buffett said he hasn't sold off any of Berkshire's short-term treasury bills because of the budget battle. He said he's not worried about the government paying those.

Berkshire Hathaway Inc. owns about 80 subsidiaries, including clothing, brick, carpet and paint firms. Its insurance and utility businesses typically account for more than half of the company's net income. It also has major investments in such companies as Coca-Cola Co. and Wells Fargo & Co.

The Omaha World-Herald Co. is owned by Berkshire Hathaway Inc.

Copyright 2013 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Grace: Your older self has a request — use sunscreen
Quilt created by Karen refugees in Lincoln showcases memories of homeland, dreams for future
At NU's helm, J.B. Milliken built the university by building relationships with state leaders
Kelly: Huskers' glory days of '80s live on — on the small screen and on stage
Video: Stothert says Crossroads project is 'full speed ahead,' but she won't support bond issue
Omaha Hall of Fame inductees share stories of their lives in business
Agreement reached to end dog racing at Bluffs Run at end of 2015
Beau McCoy calls Pete Ricketts a 'convenient conservative' for immigration stance
Omaha's Eppley Airfield sees increased demand — and that means more fare options for travelers
Doug McDermott heads for Chicago to begin preparations for NBA draft
Shatel: Herold thinks big and dreams big when it comes to UNO baseball
Lab-grown vaginas among 'cutting edge' advances in sexual health
Warren Buffett says Coca-Cola pay plan 'excessive'
Earnings roundup: Apple plans more stock buybacks, will split stock in June
200 people registered for 5K in memory of Omaha oncologist
7 common myths about the pill
Omaha's dive-iest dive bars
In brief: Postal workers to protest at Staples stores
Annie, I ditched my sister and, for some reason, she's mad at me
Why is ketchup so hard to pour?
Opera Omaha's 'Cinderella' is a little different, but story is still universal
Dining notes: Famous Dave’s moving to new spot
Live Music Calendar
Country music's six biggest threesomes
Big weekend ahead for Nebraska Wind Symphony
Deadline Deal thumbnail
7M Grill
Half Off Delicious Comfort Fusion Food & Drinks!
Buy Now
PHOTO GALLERIES »
FROM THE BLOGS »
Nancy's Almanac, April 17, 2014: Trees save money Nancy's Almanac, April 17, 2014: Trees save money
By Nancy Gaarder / World-Herald staff writer • Apr 17 at h:nn am/pm
Nancy's Almanac, April 16, 2014: Yes, it's been drier and colder than normal Nancy's Almanac, April 16, 2014: Yes, it's been drier and colder than normal
By Nancy Gaarder / World-Herald staff reporter • Apr 16 at h:nn am/pm
Jump to a blog:
< >
SPOTLIGHT »
Omaha World-Herald Contests
Enter for a chance to win great prizes.
OWH Store: Buy photos, books and articles
Buy photos, books and articles
Travel Snaps Photo
Going on Vacation? Take the Omaha World-Herald with you and you could the next Travel Snaps winner.
Click here to donate to Goodfellows
The 2011 Goodfellows fund drive provided holiday meals to nearly 5,000 families and their children, and raised more than $500,000 to help families in crisis year round.
WORLD-HERALD ALERTS »
Want to get World-Herald stories sent directly to your home or work computer? Sign up for Omaha.com's News Alerts and you will receive e-mails with the day's top stories.
Can't find what you need? Click here for site map »