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Buffett to Uncle Sam: Thanks

By Charles Riley, staff reporter


NEW YORK (CNNMoney.com) -- Financial titan Warren Buffett praised the U.S. government's response to the financial crisis Wednesday, writing in an open letter addressed to "Uncle Sam" that Washington responded well to a "destructive economic force unlike any seen for generations."

"People will second-guess your specific decisions; you can always count on that. But just as there is a fog of war, there is a fog of panic -- and, overall, your actions were remarkably effective," Buffett said in an op-ed published in the New York Times.

After describing corporate America in September 2008 as a series of dominoes "ready to topple at lightning speed," Buffett paints the U.S. government as the backstop preventing collapse.

"Only one counterforce was available, and that was you, Uncle Sam," Buffett wrote. "Yes, you are often clumsy, even inept. But when businesses and people worldwide race to get liquid, you are the only party with the resources to take the other side of the transaction."

Members of both the Obama and Bush administrations earn specific praise from Buffett.

"In the darkest of days, Ben Bernanke, Hank Paulson, Tim Geithner and Sheila Bair grasped the gravity of the situation and acted with courage and dispatch," Buffett writes. "And though I never voted for George W. Bush, I give him great credit for leading, even as Congress postured and squabbled."

And for critics who blame lax government oversight and regulation for the collapse of the housing market, Buffett again defends "Uncle Sam."

"In truth, almost all of the country became possessed by the idea that home prices could never fall significantly," Buffett said.

"That was a mass delusion, reinforced by rapidly rising prices that discredited the few skeptics who warned of trouble. Delusions, whether about tulips or Internet stocks, produce bubbles," he added.

Berkshire Hathaway (BRKA, Fortune 500), Buffett's company, might have been the last to fall, "but that distinction provided little solace," he said. To top of page

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