All dollars, no sense

By DAVID MOON, Moon Capital Management, LLC
May 20, 2007

What happens to people when they start dealing with other people's money and think they are in charge of the economy? Strange things.

Consider the luck of New Jersey Governor John Corzine. Three weeks following a horrific automobile accident in which he almost died, Corzine returned to part-time work a few days ago.

He held a series of television interviews on his first day back on the job ' interviews that were high-profile media events in the populous, media-saturated Northeast.

You might have expected Corzine to use this opportunity to extol the importance of seat-belt use. (He wasn't wearing one at the time of his accident.) He might have made general comments about highway safety. It would have been a great opportunity to give a speech about equal access to health care; everyone should have the same quality of medical services as a multimillionaire governor.

Instead, Governor Corzine used this valuable platform to float the notion that certain business segments in New Jersey weren't paying enough taxes.

I wonder when he had this revelation? Was it as his Chevy Suburban was careening out of control, tossing him about the interior?

Or did the governor ' previously an incredibly accomplished person in the private sector ' gestate this idea for months, and only after meeting with his own ghost of Christmas future realize that this was the most important issue in his political life?

Similar questions occur when you ponder a Republican-controlled Congress and White House. For seven years the GOP had the opportunity to offer citizens smaller government, more focused on the Framers' intent.

For most of the seven years tax revenues rose, thanks to the long economic expansion.

Guess what else rose? Pork-barrel federal spending.

We may think that the president's popularity ratings collapsed because of Iraq, but the collapse is probably at least equally due to the Republicans' handling of fiscal policy.

If they'd done what they promised about taxes and spending, more voters might have given them significant leeway on foreign policy. Americans usually do.

When it comes to money, people do and say strange things.

Did you read John Edwards' comments about his temp job at a hedge fund between his last run for the White House and his current one?

The former North Carolina senator, a champion of the underclass and former director of the Center on Poverty, Work and Opportunity at the University of North Carolina, worked for the Fortress Investment Group for a year.

When asked about it, he said he took the lucrative position primarily to learn about financial markets and their relationship to poverty.

Please don't tell us that you have to work for a hedge fund to learn about the relationship between financial markets and poverty.

For a simpler explanation, guess who was the single largest employer of donors to the Edwards campaign in the first quarter of 2007.

Answer: Fortress, which produced more than $100,000 in the three months.

There are no records of gifts to the Edwards campaign from poverty-stricken areas of Appalachia.

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

Add me to your commentary distribution list.

MCM website