America can learn from Communist China, says Berkshire's Charlie Munger
By Paul R. La Monica, CNN Business June 30, 2021
Berkshire Hathaway vice chairman Charlie Munger praised the Chinese government for silencing Alibaba’s Jack Ma in a recent interview, adding that he wishes US financial regulators were more like those in China.
“Communists did the right thing,” Munger, the 97-year-old longtime friend of Warren Buffett, said about the handling of Ma, who criticized officials in Beijing last year for stifling innovation.
The comments were included in a CNBC special about Buffett, Munger and Berkshire Hathaway (BRKB) that aired Tuesday night.
Ma has been largely out of the public eye since making those critiques. Meanwhile China’s government also issued new regulations on Alibaba (BABA) affiliate Ant Financial that have forced the company to delay its eagerly awaited initial public offering.
Munger said that China essentially “just called in Jack Ma” and told him “you aren’t gonna do it, sonny.”
“They said, ‘To hell with you,’” Munger added, noting that he thought Ma was looking to “wade into banking … and just do whatever he pleased.”
Although he would not want “all of the Chinese system” in the US, Munger did say “I certainly would like to have the financial part of it in my own country.”
Buffett didn’t discuss China all that much during the CNBC special. Berkshire Hathaway was not immediately available for comment when asked by CNN Business if the firm or Buffett had any clarifications about what Munger said regarding China and Alibaba.
‘Gross excess’
Munger also told CNBC’s Becky Quick that while “our own wonderful free enterprise economy is letting all these crazy people go to this gross excess,” the Chinese “step in preemptively to stop speculation.”
He also praised China’s approach to the current health crisis. As a totalitarian state, China had the luxury to “simply shut down the country for six weeks” in response to the Covid-19 pandemic.
“That turned out to be exactly the right thing to do. And they didn’t allow any contact,” he said. “When it was all over, they kind of went back to work. It happened they did it exactly right.”
It’s not the first time this year that Munger has shared effusive compliments about China.
During Berkshire’s annual shareholder meeting in early May, Munger said that “the Chinese government will allow businesses to flourish.” He added that China has “lifted 800 million people out of poverty fast. And there was never anything like it in the history of the world.”
“So my hat is off to the Chinese,” Munger said at the Berkshire meeting. “And I think they will continue to allow people to make money. They’ve learned it works.”
