Rewarding Hard Work

In this section:
Raising the Minimum Wage
Responsible Corporate Governance
Tying CEO Pay to Performance
Earned Income Tax Credit


Raising the Minimum Wage

By 2006, it had been nine years since the last increase in the North Carolina minimum wage.  It stood at just $5.15, or $893 per month before taxes for a full-time worker. The buying power of the minimum wage was at its lowest point in the past 50 years. 

Richard knew it was time for a change.  He called on the state’s business leaders to support raising the minimum wage by at least one dollar.  He founded the “One Dollar More Coalition,” set up a website to collect petition signatures, and gave dozens of speeches across the state to build public support for the effort.

Before long, our state’s political and business leaders heeded Richard’s call.  The Charlotte Observer wrote that, “Richard Moore has shown considerable leadership in broaching a subject not many politicians want to talk about: raising the state minimum wage.”  In the summer of 2006, the General Assembly passed, and Governor Easley signed, legislation raising the state’s minimum wage by one dollar. And nearly one year after Richard’s initial speech, more than 100,000 North Carolina workers received a much-needed and well-deserved raise.


Responsible Corporate Governance

Following corporate scandals at Enron, Worldcom, and Tyco, Richard Moore led a movement among public investors to reform the financial system that produced them. Former California State Treasurer Phil Angelides called Richard “the catalytic force behind the pension fund alliance. . . . It was his idea, and he got everybody together.”

Together, Richard and his colleagues threatened to boycott investment firms unwilling to scrutinize the companies in which they were investing.  The firms gave in.  Richard’s coalition then fought for greater transparency and sunshine from mutual fund companies, including disclosing how much of our money they used to lobby against corporate reform.  The funds complied. 

His actions won widespread praise.  Governing Magazine recognized him as a Top Public Official of the Year in 2004. US News & World Report called him a “Corporate Change Agent.”  Robert Monks, founding Trustee of the Federal Employees’ Retirement System, said, “Thank God for this guy. . . . What Moore is doing is a lot more creative, imaginative and aggressive than anything else that’s been done before.  You’re going at these firms where they eat.”  The News & Observer wrote that “All investors will owe Richard Moore and his colleagues a debt of gratitude” and the Wilmington Star-News said Richard’s “message is simple and powerful.”  As a result of his efforts, Richard was named to the Executive Board of the New York Stock Exchange and he now sits on the board of NYSE Regulation.

More recently, Richard launched the Mortgage Protection Principles, eight basic standards of transparency and fairness that should become the new standard for responsible and respectable mortgage lending. These common-sense principles are supported by a national coalition and will help to prevent future mortgage meltdowns.   The News & Observer applauded Richard’s leadership on the subject.  Calling him “a strong advocate for consumers,” the newspaper said Richard “has seized a live [issue] with some helpful recommendations.”

Richard has also gone after unscrupulous companies that make their profits by taking advantage of working families already struggling to make ends meet. As chairman of the State Banking Commission, Richard was a leader in the state’s fight to shut down the operations of payday lenders in North Carolina. Payday lenders advance small loans to individuals with future paychecks serving as collateral for the loan. With fees and interest, borrowers can end up paying interest rates as high as 400 percent. 

Additionally, Richard took on H&R Block over their controversial tax refund anticipation loans (RALs). RALs work by advancing tax filers their refunds minus fees that can translate into triple-digit interest rates. After Richard threatened shareholder action on the issue, H&R Block significantly lowered interest rates. He also called on the State Banking Commission to complete a full investigation into RALs activity in North Carolina. The results were startling. More than 80 percent of RALs filers are in low-income families. The interest rates on these loans can exceed 800 percent in some cases.   Ultimately, they cost North Carolina taxpayers more than $44 million each year.  Lucy Gorham, director of the EITC Carolina’s Initiative, wrote that “Richard Moore took an important step toward protecting the hard-won assets of working families. . . As Moore advocates, not leaving North Carolina families prey to predatory tax refund loans is another important step towards helping them build a more solid financial future."


Tying CEO Pay to Performance

Thirty years ago the average real annual compensation of the top 100 chief executives was 39 times the pay of the average worker. Today it is over 1,000 times the pay of the average worker.  Richard Moore believes the amount you are paid should be tied to your performance.  But in far too many cases, companies are paying hundreds of millions of dollars to executives who are not creating long-term value for shareholders. In some instances, they have decimated the company’s value even as they have collected obscene paychecks.  Such practices are not only fundamentally unfair; they are also bad for business.  Paying out unwarranted funds to CEOs creates a poor incentive structure that is bad for businesses, their employees, and North Carolina’s retirees.

As state treasurer, Richard Moore has taken a number of actions to address this problem.  For example, he:

• Called for an SEC investigation into the sale of stock by Countrywide CEO Angelo Mozilo.  Countrywide, caught at the center of the subprime meltdown, routinely took advantage of its customers by qualifying them for loans they were unable to pay back.  Mozilo cashed in $145 million worth of stock options just before his company’s stock went into a tailspin.  Richard called for an investigation into whether the CEO’s claim that it was for “retirement purposes” holds water.  Subsequently, major news outlets confirmed that the SEC opened an investigation on Mozilo.  Mr. Mozilo recently announced that he would give up $37.5 million in compensation.

• Voted against five ExxonMobil directors who designed the outrageous $400 million compensation package given to former CEO Lee Raymond. Defending themselves against accusations of price gouging, oil company executives testified before Congress that they owed their record profits entirely to rising oil prices that were out of their control.  Nevertheless, they then gave this outrageous pay package to a CEO, who by their own admission to Congress, did nothing to bolster the company’s profits. The Asheville Citizen-Times wrote, “We commend Moore for looking beyond profits to the larger issues Exxon Mobil’s actions raise.”

• Rejected a vote of confidence for Michael Eisner, former chairman and CEO of the Walt Disney Company, and three audit-board committee members up for re-election. Over the previous six years, Disney’s stock dropped off 25% while Eisner collected hundreds of millions of dollars in pay.  During Eisner’s tenure, his friend Michael Ovitz received a $140 million severance package despite failing as a Disney executive and leaving only 15 months after joining the company. The Winston-Salem Journal wrote, “Richard Moore and his counterparts in other states exercised sound judgment last week in rejecting a vote of confidence for the chairman and chief executive of the Walt Disney Company. . . demand[ing] better treatment, and better returns, for shareholders."

Earned Income Tax Credit

Following his successful campaign to raise the state’s minimum wage by one dollar, Richard worked to enact a state Earned Income Tax Credit (EITC) to help working families. With the cost of health care, food, and gas on the rise, too many families continue to struggle to make ends meet. Our newly enacted state EITC will reward North Carolina values – hard work, family, and playing by the rules. The EITC will work hand-in-hand with the increased minimum wage to help North Carolinians provide opportunity for themselves and their families.
 
The federal EITC was created in 1975 to offset the effects of federal payroll taxes on low-income families. It is administered through the personal income tax and is based on the individual’s income, filing status, and number of dependents, encouraging work and responsibility. Research shows that the credit has contributed to a significant increase in labor force participation among single mothers and that many recipients use the refund to reduce debt, invest in education, or pay for housing.