Sometimes, life gets harder—and there's no bailout coming. That was the message Charlie Munger delivered to a room full of students in 2010, long before "stimulus checks" became a household phrase.
Munger, the billionaire vice chairman of Berkshire Hathaway and longtime business partner of Warren Buffett, was speaking at the Ross School of Business at the University of Michigan in a conversation moderated by CNBC's Becky Quick. The country was still reeling from the 2008 financial crisis, and public anger over Wall Street bailouts hadn't faded. But Munger didn't shy away from defending them—and drawing a firm line on who should not get rescued.
"You should thank God" for the bank bailouts, he said. "Hit the economy with enough misery and enough disruption, destroy the currency, and God knows what happens."
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He pointed to post–World War I Germany as a cautionary tale. "We ended up with Adolf Hitler," Munger said.
But while he believed saving the financial system was necessary, he rejected the idea that the government should keep shoveling out money every time people face hardship.
"There comes a place where if you just start bailing out all the individuals instead of telling them to adapt, the culture dies," he said. "I don't know where it is, but at a certain place you've got to say to the people, ‘Suck it in and cope, buddy. Suck it in and cope.'"
He described how families during the Great Depression made do by moving into the same home and wearing the same clothes. "That was part of how the civilization got through," he said. "We do not want a civilization where with every hardship we go to the government and say, ‘Give me some money, the world's not what I expected.'"
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Munger's message was blunt: hardship is part of life, and expecting the government to cushion every blow can lead to cultural decay. "Of course it's a little harder than it used to be. This is normal worldly life," he said.
"I think it is very dangerous to assume that what people did—to say the whole banking system was wrong, and that it is clearly right to shovel out a lot of money to people who are now short of money—I think we come to a place where everybody has to suck it in and cope."
When a student asked if homeowners should've been bailed out instead of bankers, Munger cut in: "You've got it exactly wrong."
He also argued that private enterprise can do more for society than top-down philanthropy. "I believe Costco does more for civilization than the Rockefeller Foundation," he said.
Munger died in 2023 at age 99. But his words from that day in Michigan still circulate — especially in moments when the country is once again debating who should get help, and who should simply endure.
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