Berkshire Hathaway 2006 Annual Meeting Audience Question # 23

How illegal immigration reform would affect Berkshire and its subsidiaries

Warren Buffett:

OK. We’ll go to zone 8.

Audience Member:

Where’s the light?

Good afternoon, Mr. Buffett. First of all, I want to thank you for responding to all my letters throughout the years. I will always treasure them.

Last week, demonstrations in many cities across the United States took place on the subject of illegal immigration. Many companies want to stay in the U.S. but have grown dependent on cheap, illegal labor as a way to remain globally competitive.

A recent Businessweek article describes Shaw’s competitor, Mohawk Carpets, and their employment of illegal immigrants. If illegal immigration reform were to occur, how would you see this affecting Shaw, Clayton, and other Berkshire subsidiaries?

Warren Buffett:

Yeah. I didn’t read that, and I don’t know much about the Mohawk situation. I don’t… I don’t know anything about it.

I’m sure in Nebraska, you know, there are very substantial numbers of illegal immigrants employed. Meatpacking has been an area that a number have gone into.

And I actually was down at the Omaha airport about 2 years ago, and there was a very large plane there, and I saw these… well over 100 people that were in shackles that were being put on that plane.

I kind of wondered what they did, if they ever had some kind of emergency on the plane. But they were being deported. So there’s a lot of it goes on in Nebraska.

You know, I think it’s a problem that should be addressed and addressed promptly. I don’t believe in shipping 11 million people back away from the United States. Whatever acceptable way that the country can handle giving those people citizenship, I, basically, would support.

I think we ought to enforce the rules in the future. I think they ought to be liberal rules, but I think they ought to be enforced.

But I don’t think it would make dramatic differences. I mean, if one meatpacking plant employs people at subpar wages, you know, the rest of them are going to do the same thing.

You may end up paying a little bit more for meat in the end, but I do not think it would have a dramatic effect on the economy or even on specific industries, except to change, maybe, relative prices a bit.

But I don’t think it would have a dramatic effect on the economy if the people that are here illegally became legal in some manner.

You know, who’s to say if Charlie and I had been born into some terrible situation in some other country, we wouldn’t have tried to get into this place ourselves.

So it’s a… I’m pretty empathetic with it, but I believe that we do need to have laws that are enforced in the future. I don’t think we should send 11 million people back.


Charlie Munger:

If you don’t like the results, I think you should get used to it because we never seem to have the will to enforce the immigration laws. I just think that what you’ve seen is what you’re going to get.

Warren Buffett:

I don’t… in terms of the carpet industry specifically… you mentioned Clayton Homes. I wouldn’t… I would think the mobile manufactured housing industry… I’d be surprised if there was any unusual number at all of illegal immigrants, but I… the answer is, I don’t know that for sure.

But I don’t see any change in those industries.

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