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Banking Berkshire's Munger wants 1% to take pay cut

Berkshire’s Munger wants 1% to take pay cut

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Robert Francis
Robert is a Fort Worth native and longtime editor of the Fort Worth Business Press. He is a former president of the local Society of Professional Journalists and was a freelancer for a variety of newspapers, weeklies and magazines, including American Way, BrandWeek and InformatonWeek. A graduate of TCU, Robert has held a variety of writing and editing positions at publications such as the Grand Prairie Daily News and InfoWorld. He is also a musician and playwright.

Paul R. La Monica

OMAHA (CNNMoney) — Charlie Munger has a reputation for being brutally candid. Throughout the Berkshire Hathaway shareholder meeting on Saturday, he continuously referred to things he disapproved of as “crazy,” “insane” and “stupid.”

The 90-year old vice chairman of Berkshire was still in a feisty mood when he sat down to chat with CNN’s Poppy Harlow shortly after the meeting ended. In a wide-ranging interview, Munger discussed business, the economy, sports and politics … in his own inimitable way.

Time to raise the minimum wage

While Munger is known to lean more to the right politically than Berkshire Chairman and CEO Warren Buffett, Munger still said that he thought it was time for a minimum wage hike. He even suggested that President Obama’s plan to boost the federal minimum wage to $10.10 an hour would not “ruin the republic.”

He conceded that there could be some job losses, but also said that “the country can easily stand $10.10 an hour.”

It’s interesting that Munger is taking that stance considering that Buffett has said publicly that he’s still not sure if the minimum wage should be that high.

The 1% needs to stop whining

Munger said he did not think that super-wealthy types like investors Tom Perkins and Sam Zell should be complaining about feeling persecuted because they are rich.

He said that taxes on the affluent are not as onerous as they once were.

“The taxes on wealth were much higher when I was much younger. So for somebody of my age, I don’t think they’re ruining the world because I’ve lived through way more punitive taxes on the rich than we have now,” he said.

Instead of complaining, Munger said some corporate executives should willingly decide to work for less money.

“I don’t think everybody who’s been especially favored should take the last dollar that he or she should get. I think we all have an obligation to dampen these fires of envy,” Munger said.

Corporate directors shouldn’t get paid either

When asked about why Berkshire Hathaway does not pay its non-executive board members like most other companies, Munger went on a rant about executive pay in general.

It was a much stronger indictment than Berkshire’s decision to publicly abstain from a recent shareholder vote on Coca-Cola’s executive compensation plan. After the vote, Buffett said he felt the program was “excessive.”

“You start paying directors of corporations two or three hundred thousand dollars a year, it creates a daisy chain of reciprocity where they keep raising the CEO and he keeps recommending more pay for the directors,” he said.

Munger, whose net worth is estimated at more than $1 billion thanks to his Berkshire stake, is paid an annual salary of $100,000 by Berkshire … just like Buffett.

Both men have not gotten a raise in more than 25 years, according to the company’s latest proxy statement for shareholders. Munger said it is “insane” to suggest that CEOs would not be as good at their jobs if they made a little less money.

“Does the Supreme Court work less hard because they don’t get paid like corporate executives? We have some corporate directors who draw more pay than members of the Supreme Court. That’s crazy,” Munger said.

Munger’s definition of technology is a little dated

Berkshire Hathaway famously does not invest in many tech stocks. But Buffett hangs out with Microsoft co-founder Bill Gates and said Saturday that he thought Facebook CEO Mark Zuckerberg is a “remarkable” man.

But Munger doesn’t get the appeal of Facebook.

“It just doesn’t interest me at all to gab all the time on the Internet with people and I certainly hate the idea of young people putting in permanent form the dumbest thoughts and the dumbest reports of action that you can ever imagine,” he said.

Still, Munger claimed that there are some forms of technology he really does appreciate. Munger’s favorite tech gadget, however, was something that was last considered truly innovative in the “Mad Men” era.

“I’m in love with the Xerox machine,” he said.

Donald Sterling is a ‘peculiar’ man

Munger is an icon in Omaha. But he lives in Los Angeles. And while he said he’s never met embattled L.A. Clippers owner Donald Sterling personally, Munger doesn’t like what he’s heard about him.

“He’s a peculiar man. He’s past 80. His girlfriend has had so many facelifts she practically can’t smile,” he said. “This is not the noblest ideal of what the American businessman should be.”

Munger also said he agreed with the NBA’s decision to ban Sterling for life due to his racist comments.

“I think he has deeply offended practically everybody and that there’s nothing inappropriate about forcing him out of the game,” Munger said. “I live in the same town as Donald Sterling. I’ve never heard anybody say anything nice about him. None. Ever.”

No problem with President Hillary Clinton?

Many Republicans, to put it mildly, do not like Hillary Clinton. But Munger said he would not have as big of a problem with her winning the race for the Oval Office in 2016 as he would have two decades ago.

Munger said he respects how Clinton, former President Bill Clinton and even liberal California Gov. Jerry Brown “have learned a lot since they were young.”

But Munger was not endorsing Clinton, or any other Democrat, for that matter. As for who he would like to see win? Munger didn’t have a pick.

He said he doesn’t know former Florida Gov. Jeb Bush and he thinks New Jersey Gov. Chris Christie now has no chance due to the George Washington Bridge traffic scandal.

“It may be unfair but he was at the top of a culture that went a little crazy,” he said.

There’s that word again. Crazy. You have to love Charlie Munger.

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