Is Warren Buffett right about American children?
Even for America鈥檚 most economically desolate, Warren Buffett is hopeful.
In his annual letter to the shareholders of his company, Berkshire Hathaway, the 85-year-old business magnate exudes optimism, writing that the babies born today will live 鈥渇ar better鈥� than their parents and that people shouldn鈥檛 listen to the 鈥渘egative drumbeat鈥� of this year鈥檚 presidential campaigns.
鈥淚t鈥檚 an election year, and candidates can鈥檛 stop speaking about our country鈥檚 problems (which, of course, only they can solve). As a result of this negative drumbeat, many Americans now believe that their children will not live as well as they themselves do,鈥� he says in the letter.
鈥�: The babies being born in America today are the luckiest crop in history.鈥�
Using humor and lightheartedness, the billionaire goes on to cite increases in the national gross domestic product as the main indicator of economic progress for the future.
鈥淎merican GDP per capita is now about $56,000,鈥� he says.
Factoring in population growth and migration, there will be 鈥渁 staggering $19,000 increase in real GDP per capita for the next generation,鈥� Mr. Buffett predicts. 鈥淲ere that to be distributed equally, the gain would be $76,000 annually for a family of four.鈥�
But he is well-aware of the disparities in today鈥檚 wealth. Lightly alluding to the matter of inequality, he suggests that the politics of distribution will be with us forever.
鈥淭hough the pie to be shared by the next generation will be far larger than today鈥檚, how it will be divided will remain fiercely contentious,鈥� he says.
But regardless of who the winner is in this perpetual battle, he adds, everyone will be able to enjoy 鈥渕ore goods and services in the future than they have in the past鈥� because of the free market and the innovation it drives.
鈥淢y parents, when young, could not envision a television set, nor did I, in my 50s, think I needed a personal computer,鈥� he says. 鈥淚 now spend ten hours a week playing bridge online. And, as I write this letter, 鈥榮earch鈥� is invaluable to me.鈥�
On a side note, he adds, 鈥� I鈥檓 not ready for Tinder, however,鈥� referring to the popular dating app that boasts 50 million users.
The cheerful letter to Buffet's shareholders was accompanied by the fourth-quarter and annual financial results for Berkshire Hathaway. The company鈥檚 earnings rose to $24.08 billion last year from $19.87 billion in 2014. And revenue increased more than 13 times 鈥� $16 billion to $210.8 billion this past year.
While the investor certainly has reason to be upbeat 鈥� Forbes named him the third richest man in the world last year 鈥� much of the rest of America is optimistic as well. According to a Pew Research Center survey conducted in 2013, the majority, or 61 percent, of Americans said they believed that their kids would be the .
But that鈥檚 not without a caveat. When asked about the future of 鈥渃hildren today鈥� overall, they were largely skeptical. Nearly two-in-three respondents said they鈥檇 be financially worse off than their parents.
Buffett, however, is more far-ranging in his optimism.
鈥淔or 240 years it鈥檚 been a terrible mistake to bet against America, and now is no time to start. America鈥檚 golden goose of commerce and innovation will continue to lay more and larger eggs,鈥� he writes. 鈥淎nd, yes, America鈥檚 kids will live far better than their parents did.鈥�
