Lots of Omaha boys besides Warren Buffett and Charlie Munger worked for Grandpa Ernest Buffett and Uncle Fred Buffett at the former Buffett Grocery, 5015 Underwood Ave.
H. John Lehnhoff parlayed his 60-cents-an-hour store job at age 15 into a career as a clinical psychologist. His new, brief memoir tells about sweeping up, stocking shelves and delivering groceries for the historical store.
Buffett, the chairman and CEO of Berkshire Hathaway Inc., and Munger, vice chairman, had similar duties there in the 1930s and ’40s.
“My delivery job was to help the driver carry the crates to the customer’s kitchen and put the goods on the counter,” Lehnhoff wrote. “Some customers wanted us to sort and shelve their groceries, but Eddie (the driver) told me we don’t have time for that.
“However, I was able to talk friendly Eddie into stopping the truck for twenty minutes at my grandmother’s house for each of us to have a Coke from her fridge. We did that several times before Fred somehow found out and delighted in my deer-in-the-headlights speechlessness when the jig was up and I was busted.
“I never learned how he knew.”
One morning in 1960, Fred Buffett called the Nabisco supplier and got an answering machine.
“Customer service ace Fred Buffett was astonished that such a Satanic device existed, and that the Nabisco wholesaler would allow such rudeness to be dropped on him or any other client.
“So, when Fred was invited by the Nabisco machine to leave a message about his order, I heard him leave a message that expressed his disappointment, placed no order and indicated he would be calling Kitty Clover.”
Working at the store was the best job for a young man, Lehnhoff wrote. “Expectations were clear but not severe. I had to get up and do what needed to be done whether I felt like it or not, but what needed to be done was almost never too easy or too hard.
“When my first payday came, Fred pulled a crisp dollar bill from my pay envelope and asked if I wanted to frame my first dollar earned in life. I had no idea what he was talking about, but in later years I would personally thank him for giving me my first job and my first dollar.
“Other than the day he told me to get my hands out of my pockets, I recall no negative corrections from Fred, even when I messed up. He could lead and teach by example and by education.”
One Saturday evening, Fred Buffett called Lehnhoff “one of the best employees I’ve got.”
“How could he know that those words would still move me over fifty years later?” Lehnhoff wrote. “I take it as high praise from a sacred source.”
Attorneys representing clients injured by asbestos criticized Berkshire, Buffett and insurance chief Ajit Jain for what they said is a deliberate tactic of delaying payments from claims and court judgments, according to a story in the Corpus Christi (Texas) Caller-Times.
Scripps News reporter Mark Greenblatt wrote about people who contracted asbestos-related cancer and who won court judgments but faced lengthy delays to collect, a strategy called “delay, deny until they die.”
By assuming insurance liability for asbestos-related illnesses, Berkshire has become the likely opponent in such lawsuits, the story said, with courts and arbitrators ruling that its subsidiaries, including National Indemnity Co. of Omaha, “wrongfully delay or deny compensation to cancer victims and others to boost Berkshire’s profits.”
Jain said in an email to Greenblatt, “I do believe we have the largest single exposure to asbestos and pollution claims of any insurer today.”
A National Indemnity spokeswoman told The World-Herald the company had no comment on the story.
The Scripps story quoted George Washington University law professor Lawrence Cunningham as cautioning that float is an “inherent feature” of insurance and that it’s not unusual for policyholders to complain of delayed payments.
He said Berkshire has an “unwavering commitment to integrity” and it would be “antithetical for the company to jeopardize that reputation by wrongfully delaying or denying claims or acting in any way inconsistent with faithful administration and payment of claims.”
The Scripps story quoted Texas attorney Louis Accurso, who represented a woman who died before receiving her court judgment, as saying, “Whenever there is a concentration of power like that you have enormous potential for abuse.”
National Indemnity also is being sued by Ford Motor Co., Estee Lauder Inc. and other companies that bought commercial insurance policies, alleging delays in reimbursement of fines, legal fees and payments of injury claims, the story said.
The delays add to Berkshire’s “float” — money from insurance premiums that Berkshire can invest until it pays claims — at the expense of people who should receive the money in court judgments or negotiated settlements, the story said.
Jain said in an email to the newspaper that “few insurance organizations have a higher reputational concern than we do. In administering these books (of insurance business), then, we need to be vigilant to pay valid claims, protect valid insurance policy defenses, and in the many instances where reasonable minds differ, seek to achieve reasonable compromises where possible.”
The Learning by Giving Foundation, which offers an online course on philanthropy with real money at stake, said it has awarded $130,000 to 40 nonprofit groups, including one from Nebraska, chosen by its students.
Chairman of the foundation is Alex Buffett Rozek, grandson of Warren Buffett’s sister Doris. Her Sunshine Lady Foundation supports the Giving With a Purpose classes, which were created by the foundation and by Rebecca Riccio, director of Northeastern University’s experiential philanthropy education program.
The first massive open online course (or MOOC) on philanthropy attracted thousands of students from all 50 states and 110 other countries, Rozek said.
Students nominated 700 organizations, with the winners selected by peer review. College Possible, a program in Lincoln that provides coaching and support for low-income students who want to attend a university, is receiving a $3,000 grant.
In other Buffett philanthropy news, Warren Buffett and George Kaiser were in Tulsa, Okla., last week for a meeting with 70 wealthy men and women who have signed the Giving Pledge, a nonbinding agreement to donate at least half their wealth to charity.
Those who sign the pledge, which was started by Buffett and Microsoft co-founder Bill Gates, meet occasionally to discuss philanthropy, said Ken Levit, executive director of the George Kaiser Family Foundation, according to the Tulsa World, which, like The World-Herald, is owned by Berkshire Hathaway.
There’s no free lunch, no pot of gold at the end of the rainbow and no 20 percent discount on Berkshire stock, no matter how much we might wish.
But Richard Evans wrote in the London Daily Telegraph that he found a cheaper way to invest in Berkshire.
Instead of owning shares, Evans said several American investment trusts hold Berkshire stock and their shares trade at a discount to the market value of the assets they hold.
Investment trusts have lower costs than some competitors, such as unit trusts and open-ended investment companies, he wrote.
As an example, he cited Boulder (Colo.) Investment Advisers, which has $406 million in assets, 42 percent of it in Berkshire shares, and a share price 21.2 percent below the market value of its holdings. Boulder Growth & Income and Denali Trust have similar discounts, Evans wrote.
The catch: The funds charge fees and also own non-Berkshire shares as well, so the price per share isn’t linked exactly to Berkshire. Could be a big difference.
Buffett in midcareer?
So said Veryan Allen in a blog called Hedgefund that discusses the investment records of Buffett and George Soros.
“Absurdly, some people insult Warren by claiming he isn’t even a hedge fund manager!” Allen wrote. If Berkshire isn’t a hedge fund, “then there are no hedge funds.”
Both Buffett, the Oracle of Omaha, and Soros, the Brain of Budapest, are 83 and doing well, Allen wrote. “Midcareer professionals like Warren and George are thriving while hedge fund managers aged under 80 gain experience.”