Moore's Speech at the 2006 Economic Forecasting Forum
Remarks for NCCBI Annual Economic Forecast Conference
State Treasurer Richard H. Moore
January 3, 2006
Thank you for that kind introduction.
From a budget standpoint the upcoming year looks to be pretty good for state government.
North Carolina’s revenue picture continues to improve as the economy continues to grow:
Through the end of November, total revenue collections are 6.6 percent ahead of last year.
Tax revenue to this point is 8.5 percent ahead of last year.
In total, actual revenue collections are $96.4 million dollars ahead of schedule in the budget.
The budget passed last summer put $199 million in the Rainy Day Fund, $100 million in repair and renovation, and left $112 million unspent.
The state’s debt picture also continues to remain healthy.
Over the five years that I have been in office, North Carolina has issued $4.2 billion dollars of general fund supported debt.
This money has gone to improve our universities and community colleges, hospitals, natural resources, and public schools and has been a great investment.
Along the way we have maintained our triple A rating and continued to receive extremely low interest rates when we have brought these bonds to market.
I am particularly proud of my staff’s work to refinance our existing debt. Through their efforts, we have saved the state over $325 million dollars and given it back to the legislature to use for other important needs.
By the measures commonly used to establish a state’s relative debt burden, North Carolina continues to have a low level of debt – even for other triple A states.
Assuming continued economic growth, we will have capacity for increased capital investment in upcoming years.
While our overall direction is positive, one area that greatly troubles me is the status of our lowest income workers. The costs of health care, gasoline, and housing are increasing rapidly. You know that—these expenses affect the bottom line of your businesses. But for North Carolina’s low-income families, these costs are all too often a crushing burden. When the door to advancement and opportunity is closed to our people we all suffer and it can have a huge impact on the bottom line.
North Carolinians who work hard and play by the rules should be able to make ends meet. More than that, they should have the opportunity to improve their situation and that of their families. We can help them do this -- we can raise the minimum wage by at least one dollar.
While there has been bipartisan support in Congress for several years to raise this rate, it does not seem likely that it’s going to pass. Besides, should we really wait for Congress and Washington to do what’s right? In areas from education to lending practices this state has not hesitated to move ahead of the country to expand opportunity for our people when we saw the need and we should move ahead on this important issue.
When you adjust the current minimum wage for the rise in prices since 1997, it’s actually worth less than it was before the last increase. In fact, when you look at a longer time horizon, the minimum wage is at its second-lowest point in the last fifty years. In other words, while the cost of just about everything else has been going up, the value of the minimum wage has actually gone down to historic lows. A minimum wage worker in North Carolina who works 40 hours a week for all 52 weeks of the year would earn $10,712 a year before taxes.
I believe that raising the minimum wage is a pro-business and pro-family measure that will greatly benefit all of us. Raising the minimum wage by one dollar would benefit more than 100 thousand North Carolina workers. More than half of them are over the age of 25, and three quarters are over the age of 20. Overall, almost a third of minimum wage workers in our state are full-time employees. Raising the minimum wage will also help thousands of teenagers and college students. One of the most troubling statistics I’ve heard recently is that more students drop out of college because of financial reasons than because of grades. So it certainly won’t hurt to put a bit more money in the pockets of our students who deserve to be rewarded for juggling work and school.
Right now, seventeen other states have a minimum wage higher than the federal wage. The state House of Representatives passed legislation calling for an increase in the minimum wage that, unfortunately, was not taken up by the Senate. People in North Carolina are starting to realize it doesn’t make sense to have anyone working 40 hours a week, 52 weeks a year make $893 dollars a month.
Raising the minimum wage is a pro-business policy. Study after study has shown that in the periods after a minimum wage increase, the labor market shows few negative effects. In fact, some studies have even shown that the labor market improves for low-income workers. This is because businesses actually start to do better when consumers have more money in their pockets. Lee Scott, the CEO of Wal-Mart, has expressed support for raising the minimum wage for exactly this reason. He knows that increased wages will ultimately improve his bottom line.
One of the strongest business arguments I can think of for NCCBI and the North Carolina Bankers Association to embrace this increase, is that the current minimum wage may very well put you at a competitive disadvantage. I have talked with several of you about this. Not only were you shocked to find out that the minimum wage was so low, but you said that you pay well above it. However if your competition pays only the bare minimum, their employees are almost forced to use public programs paid for by your tax dollars to get by. You are subsidizing your competitors business.
Ask yourself these questions. Isn’t it worth a dollar an hour to ensure that the children of minimum wage workers show up for school well fed, healthy and ready to learn? And if they don’t, who pays for that?
Isn’t it worth a dollar an hour to help minimum wage workers to have at least a fighting chance to get ahead, pay their bills on time, and invest in their future? And if they don’t, who pays for that?
I think we all want a North Carolina where the education system produces internationally competitive graduates. We want an economy where existing businesses thrive and new businesses grow. And we want our citizens able to support their families through hard work.
Raising the minimum wage will help us achieve these goals. Our workers deserve it. Our morals demand it. And our state’s economy will be better off for it.
###
State Treasurer Richard H. Moore
January 3, 2006
Thank you for that kind introduction.
From a budget standpoint the upcoming year looks to be pretty good for state government.
North Carolina’s revenue picture continues to improve as the economy continues to grow:
Through the end of November, total revenue collections are 6.6 percent ahead of last year.
Tax revenue to this point is 8.5 percent ahead of last year.
In total, actual revenue collections are $96.4 million dollars ahead of schedule in the budget.
The budget passed last summer put $199 million in the Rainy Day Fund, $100 million in repair and renovation, and left $112 million unspent.
The state’s debt picture also continues to remain healthy.
Over the five years that I have been in office, North Carolina has issued $4.2 billion dollars of general fund supported debt.
This money has gone to improve our universities and community colleges, hospitals, natural resources, and public schools and has been a great investment.
Along the way we have maintained our triple A rating and continued to receive extremely low interest rates when we have brought these bonds to market.
I am particularly proud of my staff’s work to refinance our existing debt. Through their efforts, we have saved the state over $325 million dollars and given it back to the legislature to use for other important needs.
By the measures commonly used to establish a state’s relative debt burden, North Carolina continues to have a low level of debt – even for other triple A states.
Assuming continued economic growth, we will have capacity for increased capital investment in upcoming years.
While our overall direction is positive, one area that greatly troubles me is the status of our lowest income workers. The costs of health care, gasoline, and housing are increasing rapidly. You know that—these expenses affect the bottom line of your businesses. But for North Carolina’s low-income families, these costs are all too often a crushing burden. When the door to advancement and opportunity is closed to our people we all suffer and it can have a huge impact on the bottom line.
North Carolinians who work hard and play by the rules should be able to make ends meet. More than that, they should have the opportunity to improve their situation and that of their families. We can help them do this -- we can raise the minimum wage by at least one dollar.
While there has been bipartisan support in Congress for several years to raise this rate, it does not seem likely that it’s going to pass. Besides, should we really wait for Congress and Washington to do what’s right? In areas from education to lending practices this state has not hesitated to move ahead of the country to expand opportunity for our people when we saw the need and we should move ahead on this important issue.
When you adjust the current minimum wage for the rise in prices since 1997, it’s actually worth less than it was before the last increase. In fact, when you look at a longer time horizon, the minimum wage is at its second-lowest point in the last fifty years. In other words, while the cost of just about everything else has been going up, the value of the minimum wage has actually gone down to historic lows. A minimum wage worker in North Carolina who works 40 hours a week for all 52 weeks of the year would earn $10,712 a year before taxes.
I believe that raising the minimum wage is a pro-business and pro-family measure that will greatly benefit all of us. Raising the minimum wage by one dollar would benefit more than 100 thousand North Carolina workers. More than half of them are over the age of 25, and three quarters are over the age of 20. Overall, almost a third of minimum wage workers in our state are full-time employees. Raising the minimum wage will also help thousands of teenagers and college students. One of the most troubling statistics I’ve heard recently is that more students drop out of college because of financial reasons than because of grades. So it certainly won’t hurt to put a bit more money in the pockets of our students who deserve to be rewarded for juggling work and school.
Right now, seventeen other states have a minimum wage higher than the federal wage. The state House of Representatives passed legislation calling for an increase in the minimum wage that, unfortunately, was not taken up by the Senate. People in North Carolina are starting to realize it doesn’t make sense to have anyone working 40 hours a week, 52 weeks a year make $893 dollars a month.
Raising the minimum wage is a pro-business policy. Study after study has shown that in the periods after a minimum wage increase, the labor market shows few negative effects. In fact, some studies have even shown that the labor market improves for low-income workers. This is because businesses actually start to do better when consumers have more money in their pockets. Lee Scott, the CEO of Wal-Mart, has expressed support for raising the minimum wage for exactly this reason. He knows that increased wages will ultimately improve his bottom line.
One of the strongest business arguments I can think of for NCCBI and the North Carolina Bankers Association to embrace this increase, is that the current minimum wage may very well put you at a competitive disadvantage. I have talked with several of you about this. Not only were you shocked to find out that the minimum wage was so low, but you said that you pay well above it. However if your competition pays only the bare minimum, their employees are almost forced to use public programs paid for by your tax dollars to get by. You are subsidizing your competitors business.
Ask yourself these questions. Isn’t it worth a dollar an hour to ensure that the children of minimum wage workers show up for school well fed, healthy and ready to learn? And if they don’t, who pays for that?
Isn’t it worth a dollar an hour to help minimum wage workers to have at least a fighting chance to get ahead, pay their bills on time, and invest in their future? And if they don’t, who pays for that?
I think we all want a North Carolina where the education system produces internationally competitive graduates. We want an economy where existing businesses thrive and new businesses grow. And we want our citizens able to support their families through hard work.
Raising the minimum wage will help us achieve these goals. Our workers deserve it. Our morals demand it. And our state’s economy will be better off for it.
###
posted by One Dollar More Coalition | 9:37 AM
1 Comments:
I can not agree more that the minimun wage needs to be raised. The gap between rich and poor, CEOs and layman keep getting wider, with the working poor struggling with real life decisions. But I have often wondered if we should not have two minimun wage scales. One for those 18 and under, so that they understand that age and wisedom makes a difference; and seasonal needs and fill-in can stay reasonable.
And another minimun wage for 18 years old and over, this is the age of adulthood, when child support in divorce stops, when they can sign for themselves. 18 and above is when individuals are trying to continue their schooling, deciding whether to go into the armed forces or work, or getting kicked out of their homes.....$6.15 is to low.
I worry that the greedy CEOs, board of directors, are so worried about the bottom line & not willing to close the gap by reducing upper end salaries.
I worry that politians see "black and white". Raise minimun wage or not....... Let's raise it for those that need it and keep the amount worth working for.
I also think the tax system is way too complicated.
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