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By Root 3351 0

the premise for buying it—the uniqueness of its franchise—was looking less unique. Other people who forgot to call the Air-aholic hotline kept setting up businesses to compete with NetJets, even though the economics of the fractional aviation business were unattractive. Buffett now realized that it was testosterone that caused Air-aholism. “If only women could be CEOs of companies that flew planes,” he said, “I think it would be a lot better. It’s like sports franchises. If only women could own sports franchises, they’d sell for one-tenth what they sell for now.” He told the shareholders that NetJets would return to profitability and would dominate its market. He did not point out, however, that it might not earn the margin on capital he had hoped, at least not any time soon. It was a letdown, but still a lot better than a money-losing textile mill. Besides, NetJets was fun. He knew mountains of minutiae about how the planes were purchased, managed, scheduled, routed, maintained, insured, piloted, crewed, and even how the pilots were trained. NetJets was cool. He did a lot of elephant-bumping at NetJets events. He would never sell it, even if the world’s other mega-billionaires tried to arm-wrestle him for it.

The more serious, if smaller, problem was Dexter Shoe, the modern equivalent of the textile mill. Buffett would later say it was the worst acquisition he had ever made, quoting Bobby Bare’s country song: “I’ve never gone to bed with an ugly woman, but I’ve sure woke up with a few.”24 He changed the management. Frank Rooney and Jim Issler, who ran Brown Shoe Company, a more successful operation, eventually shut down Dexter’s U.S. operations and moved them overseas.25 For every dollar they were paying workers in the U.S., it cost a dime to hire employees to make shoes elsewhere.

“I was wrong about the economic future of that one. The people working in the town of Dexter, Maine, were wonderful people who were very good at what they did. But even if they were twice as good as the Chinese, the Chinese would work for a tenth as much.”

Yet even with all this money-spinning activity, Buffett felt that the most important opportunity given him in the aftermath of 9/11 had nothing to do with business. Rather, he now had both the privilege and the responsibility to use his pulpit to influence events and ideas. After the bubble of hubris that had enveloped the financial community for the past several years, America had become more sober-minded, and less blind to the corner-cutting in the name of greed that had gone on in the late 1990s. Buffett thought the time was right for him to speak up about the rapacity of the rich and the way it was being validated by fiscal policy.

His sense of justice was particularly inflamed by a proposal that was a centerpiece of President Bush’s new budget—a plan to gradually repeal the decades-old federal estate tax, which took for the government a slice of the largest inheritances. Supporters of the plan referred to the estate tax as the “death tax,” which had an ominous sound. The mantra was that death shouldn’t be a taxable event. They called the estate tax a barrier to the ambitions of hardworking entrepreneurial people. They cited a proverbial family that would have to sell the family farm to pay the tax when its patriarch died. Undoubtedly, there were some such families. Buffett argued that the suffering of those few was far outweighed by the effect on everybody else.

The estate tax was technically not a death tax; it was a gift tax. Anytime someone gave a large gift of money, he paid a gift tax.26 All gift taxes were a blockade against the return of the robber barons, who controlled so much of the nation’s riches through gifts and inheritance in the nineteenth century that they became like a government unto themselves—a plutocracy—a ruling class based on wealth. The estate tax, however, was paid at a lower effective rate than the tax imposed on gifts from living persons, allowing relatively large posthumous gifts to go untaxed. Buffett used his preacher’s pulpit to point out that of the