Government best when leaders lead

By DAVID MOON, Moon Capital Management
September 7, 2003

Some political/business odds and ends:

' Phil Bredesen and Mike Ragsdale are both doing a good job. Both are businessmen who exhibit leadership and practical management skills. Both appear skilled at herding cats. In Nashville, we're fighting about how best to start a lottery, not how to avoid a shut down of state services. At the local level, we've spent time squabbling about whether or not a community can have two 'mayors.' Both are improvements.

' Every time someone wants to hold a voter referendum, I wonder why we should have elected officials at all? We could all get up each morning, check our email and vote on the decisions of the day. Want to build sidewalks or plant some trees? Hold an election. Build a convention center? Hold an election. Ross Perot would love it. But that's a horrible way to run any organization. I understand the frustration of folks who oppose a city-financed hotel ' particularly when it will compete with private, non-subsidized businesses. I abhor the notion of taxpayers subsidizing any type of private business. Every time I read about a new proposal to do so, I wonder, 'when do I get mine?' But that's when I get busy contacting my elected officials, not trying to usurp their responsibility. Most of the trends that start in California are better off left to die there.

' It makes no logical sense for the state of Oklahoma to be the entity bringing criminal charges against Bernie Ebbers and WorldCom. Watching the Oklahoma Attorney General announce the charges, I wondered if he knew anything about the business issues he purported to describe. He read something about 'inflating expenses on the balance sheet.' (Expenses are on the income statement, not balance sheet.) It's downright silly for Ebbers to be charged in Oklahoma. It might as well be Tennessee or South Dakota. But if Oklahoma manages to send Bernie Ebbers to jail, that will do more to curb future illegal actions in corporate America than all of the civil and monetary fines combined. There are few things that motivate people more than money. Freedom is one.

' Our city's next mayor will face some tough early budget decisions. But much of our challenging state and local budget conditions are the result of a weak economy and sales tax collections. (Fortunately, sales taxes suffer much less than income taxes during a recession, but that's another can of worms for another column.) Unless the national and Knox county economies are going to hell in a handbasket, the economy will likely prosper again some time in the next few years. Bredesen, Ragsdale and our next city mayor will be heralded as fantastic fiscal managers. Bredesen will get the most credit, because his predecessor enacted a huge tax increase. But it will really be you - the consumer and taxpayer - who deserves the credit.

' Early voting for city council and the mayor's race starts Wednesday. If you're a city voter, you're on the board of directors. Go hire your managers.

David Moon is president of Moon Capital Management, a Knoxville-based investment management firm. This article originally appeared in the News Sentinel (Knoxville, TN).

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