Editorial
Richard Moore
Many
people, myself included, figuratively held their breath when Harlan
Boyles retired as state Treasurer after 33 years in office and was
succeeded by Richard Moore. It wasn’t that we doubted Moore’s
mental mastery of complex financial matters; after all he is an honors
graduate of Wake Forest with a graduate degree in accounting and
finance from the London School of Economics. Obviously he knows how to
balance a checkbook.
We felt trepidation because Moore was a young, handsome, glib
politician who surely had it in him to go far in politics. He didn’t
fit the stereotype of the person you want holding your money. But
mainly we withheld judgment because he just wasn’t Harlan, who, by
the way, is the only state politician in my memory universally known
by one name. Jim is a famous name in North Carolina politics, but do
you mean the governor (and which one?) or the Agriculture
commissioner?
But after holding our breath for 18 months we’re ready to exhale
because Moore has done a decent job so far and in fact has achieved a
few notable accomplishments. He did expand the Treasurer’s staff by
hiring people Harlan thought unnecessary, and he did publicly consider
— but wisely rejected — moving the Treasurer’s offices into a
swanky downtown Raleigh office tower.
He persuaded the General Assembly to broaden the Treasurer’s
discretion in investing state pension funds. He wanted the power to
invest up to 5 percent of the funds in riskier, but potentially
higher-rewarding, ventures such as start-up companies, commodities and
lower-grade bonds. Rock-ribbed Harlan would never have considered such
investments, but haven’t you always heard that it’s best to have a
balanced portfolio?
Moore also obtained legislative permission to sell state bonds at
variable, rather than fixed, interest rates. He argued that the state
would save millions by taking advantage of short-term rates on
long-term debt. Last month, when hardly anyone was paying attention,
Moore tried that tactic for the first time. He sold $355 million in
state higher education and clean water bonds at a variable rate of
1.82 percent. Although the rate can change weekly, Moore maintains the
variable rate strategy will save $45 million in interest over the life
of the bonds.
Moore also has tried other novel approaches. In March he sold $239.4
million in general obligation bonds through a competitive electronic
bidding process at a bargain-basement fixed interest rate of 4.05
percent. Moore estimates that using this new tactic will save the
state $14.7 million in interest over the life of the bonds.
Our young state Treasurer may yet stub his toe on one of these
newfangled financial ploys, but we hope he won’t. It’s our money
that’s at risk, after all.
We never had to worry much about risk when Harlan was state Treasurer.
Now we’re beginning to accept risk and learning that often it comes
with reward. -- Steve Tuttle
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