Gates, Buffett come to Columbia

On Thursday, the world’s two richest men visited Columbia.

Bill Gates, who founded Microsoft Corp., and Warren Buffett, investor-at-large, told students that the worst of the recession had passed. Speaking in Roone Arledge Auditorium, they shared their optimism with students in the Columbia Business School and Earth Institute. Buffett graduated from the Business School in 1951.

At the town-hall-style event, CNBC’s Becky Quick moderated a dialogue between the two billionaires and roughly 700 students. Before the discussion began, Quick noted the context of the event. “I do know that these are unsettling times in the economy and the markets and there is a lot of uncertainty in where we stand,” she said. The event was to be broadcast on CNBC as a segment titled “Warren Buffett and Bill Gates: Keeping America Great” on Thursday night.

Neither Buffett nor Gates acknowledged any of this uncertainty. “The economy is sputtering, but we are still at the beginning,” Buffett said. With his recent purchase of the Burlington Railroad, the single largest acquisition in history, Buffett put firm support behind that idea. “The railroads are cost-effective and environmentally friendly; each one supplants 280 trucks,” he reasoned. “If America has a core future, railroads have a core future, and I am willing to bet a lot of money on it—about $34 billion.”

While some are more hesitant to buy during a recession, Buffett recommended action, not restraint. “1954 was the best year in the market. The Dow was up 50 percent, but if you look at ’54 we were in a recession and unemployment peaked,” he said. “It’s a terrible mistake to look at the economy to buy stocks,” he added. “Look at the value of the company. If you wait to see the robin, spring will be over.”

Gates said he had a similar mindset, explaining that the next big industries are alternative energy and medicine. He acknowledged that the future didn’t always look immediately bright. “In the beginning there are a lot of companies and the overall return on capital is low.” When he started his own company, he said, “There were a lot of non-Microsofts.”

While his confidence in the American market remains unfazed, Gates did show one grave concern: “Long-term education, particularly K-12, is not improving,” he said. “That’s scary and needs attention.”

As students’ questions shifted from the economy in general to their own career prospects, Buffett urged students to ignore the monetary aspects of jobs, saying, “I didn’t know what I was being paid until I received my first paycheck. Money means nothing when you work for an organization or individual you admire.”

He also reminded aspiring business leaders that, “The wonderful thing is that you can succeed with ethics. It’s not a hindrance.” Students had previously raised concerns that the financial crisis resulted from the inability to check greed and corruption. Buffett responded, saying that fear is also integral to the economy and that greed will never cease to exist.

Both men, though, stressed the positives of the current American economy, including knowledge and equality of opportunity. Gates reminded students that the United States still has the best science institutions and universities. Though he is decidedly a PC, Gates went so far as to applaud rival Steve Jobs for saving Apple and making it “an incredible force” whose competition he values.

Both also dropped hints about how to emulate their success. “It took a brash self-confidence when I dropped out of Harvard and asked friends to work for me,” Gates said. Buffett likewise stated, “The mirror always agrees with me. Don’t be influenced by what others think.”

Not all students were equally inspired, however. Jessica Rosen of the Earth Institute commented, “We would’ve liked to see more in-depth questions about the world issues.”

CNBC’s “Warren Buffett and Bill Gates: Keeping America Great” will repeat on Sunday, Nov. 15 at 10 p.m.