Charlie Rose: 
Are you approving of what has been taking place along the stages that got us to where we are now, whether it's Bear Stearns or Lehman Brothers or AIG, Freddie Mac and Fannie, or what you've done with Goldman Sachs and the rest?

Warren Buffett: 
Yeah, I think basically the right things have been done.  But no one saw the tsunami coming fully.  And so when Bear Stearns came along, it looked like if you stopped the flood at that point, you didn't have to worry about being downstream from it.  And I think the Fed did the right thing there.  And I really thought that would probably halt runs on other major institutions, but it didn't.  We have seen wave after wave.  And admittedly, there's been somewhat of an ad hoc response.  I'd rather have an ad hoc response than no response at all.  And I don't think -- I don't think the treasury could remotely have gone to Congress three or four months ago and laid out that scenario of what's happened and been credible and gotten the necessary tools.  I think it took a crisis like this --

Charlie Rose:
And asking for the power he is asking for and the level that he was asking for.

Warren Buffett:
No, they wouldn't have gotten it.  So I think it's been, you know, kind of like a tragic play to this point.  But at this point, I think it's clear, and will be clear to the majority of the Congress.  I think it's clear to the American people that there is only one countervailing force to a world where financial institutions are trying to sell instruments every day and where credit has dried up, and that's the United States Treasury.

Charlie Rose:
But at the same time, there has been, and Congressmen and women will tell you this, a resistance across the country because they think, as you well know, it's a bailout of Wall Street and that they are sitting there in their own economic life, and nobody's coming along to say, We're here to help you.  We're from the government.

Warren Buffett:
Well, the patient that's on the floor with the cardiac arrest is not Wall Street.  It's the American economy.  I mean, that's --

Charlie Rose:
Do you think they understand that yet?  Because that's --
[talking simultaneously]

Charlie Rose:
-- communication.

Warren Buffett:
Yeah.  I think they probably don't.  And I think any time you couple the term "Wall Street" with "bailout" or something like that, you know -- I don't like what's going on in Wall Street.  I don't like what's going on with the executive compensation.  You know, but I don't want to give a lecture to this body that's out there.  You know, I mean, having had the heart attack, I want to get it back functioning.  And as a practical matter, I mean if you were Bear Stearns, and you were a shareholder, you know, you lost 90 to 95 percent of your money.  A good many lost their jobs.  They lost very cushy lives, many of them.

Charlie Rose:
Right.

Warren Buffett:
If you were at Lehman, the same thing happened.  If you were at AIG, the shareholders are getting creamed on these things.  And those shareholders are not just a bunch of big shots in Wall Street.  Those are pension funds, and those are investors all over the country.  I wouldn't worry too much about that.  Justice won't be perfect on it.  I mean, you may be very mad at some guy that walked away with a huge golden parachute, but that really isn't the important thing.  I mean, if Pearl Harbor came along, you could have said the planning was wrong by the military ahead of time or maybe the battleships shouldn't have all been in the harbor and all that kind of thing.

Charlie Rose:
Right.

Warren Buffett:
It doesn't make any difference.

Charlie Rose:
It's Pearl Harbor.  [unintelligible]

Warren Buffett:
I mean, the job is Pearl Harbor.  And you better not spends weeks and weeks and weeks trying to assign blame or deciding on a complete plan for fighting the whole war, you know, and letting a committee decide where the battleships should go and all of that.  You better spring into action with the best people you have.

Charlie Rose:
You have never seen anything like this in your life.

Warren Buffett:
No, I haven't.

Charlie Rose:
There are those who argue that we are headed for a recession, you know?  And they look at depression as the great fear.

Warren Buffett:
Sure.

Charlie Rose:
Is that a possibility if this plan doesn't work?

Warren Buffett:
Yeah, it's a possibility, yeah.  We have about 6.1 percent unemployment now.  I mean, we've been in a recession, by any common sense definition, because if you look at the American public, they've got 20 billion -- 20 trillion, I should say, worth of residential homes.  They've got 20 trillion worth of stocks, very roughly.  Those are the two big assets of American families.  They are both down dramatically for different families.  But 95 percent of the people at least are worse off in terms of their residential wealth plus stock wealth from a year ago or two years ago.  That is bleeding into the real economy.  I mean, that's bleeding into auto sales and jewelry sales and furniture sales and all that.  But that wave is just starting to hit.  And if the paralysis we have in the credit markets, if every company continues to feel all we want to do is get our balance sheet down, sell assets, you know, it's just the start of what can happen.  Unemployment's going to go up under any circumstances.  I mean, it's the 6.1 is going to go higher.  But whether it goes and quits at 7 or whether it quits as 10 or 11 or 12 depends on, among other things, the wisdom of Congress, and then the wisdom of, in terms of carrying out the plan that Congress authorizes.

Charlie Rose:
Would you say that this plan which you have argued very strongly the Senate ought to pass and the House ought to pass is simply the plan that we have, and I don't have a better idea.  But it's essential for the confidence of the nation and the system?

Warren Buffett:
Yeah.  I just worry about whether it's enough.  But I think it is --

Charlie Rose:
Enough what?

Warren Buffett:
Every day that goes by, I mean, if you don't react to Pearl Harbor for a week or two weeks or three weeks, you're behind in the war that you otherwise would have fought.  But it's very important that the determination of the US Congress to do what is is needed be made evident this week and by the actions of most of the members.  I mean, you're not going to get total assent.

Charlie Rose:
What makes you confident that this plan will work?  I mean --

Warren Buffett:
Well, I think you've got -- I don't think you can have a better secretary of the Treasury than Hank Paulson, you know.  I mean, he is in there at the wrong time, probably shouldn’t have taken the job.  He’s a friend of mine.  But he knows markets, he knows corporations’ work, he knows money, and he’s got the interests of the country at heart.  And so, you’ve got the right -- you’ve got a wonderful person with Sheila Bair, most of the viewers have never heard of Sheila Bair. Sheila Bair, in the last two weeks, has taken eight percent of the deposits in the United States and seamlessly moved those over to sound institutions which in turn have gotten more capital, ended up, it’s been a magnificent job.  Eight percent of the deposits in the United States, 10s of millions of depositors.  And nobody’s ever heard of her.  She’ll never get a golden parachute or any severance pay or anything.  She’s done a great job.  We’ve got some great public servants.  We have I think the right people in there to get the job done, and then they need more tools.

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