Former Senator William Proxmire used to give a monthly "Golden Fleece Award" to a government agency or official for wasting money or abusing power of position for personal gain or aggrandizement. I hope the good senator hasn't copyrighted the award because I want to give one.
My candidate is the National Credit Union Administration, which is waging a fierce campaign to keep credit unions under its purview whether they like it or not.
At issue is a regulation adopted recently by the Office of Thrift Supervision stating that thrifts can merge with institutions not insured by the Federal Deposit Insurance Corp.
The NCUA took great umbrage because the regulation might allow credit unions to convert to a thrift charter and escape the jurisdiction of the NCUA.
The agency's chairman, Norman E. D'Amours, issued a statement blasting the OTS: "The last time I checked, many thrifts were trying to escape the OTS because it was a very expensive and cumbersome agency. I find it hard to believe that OTS may be attempting to replace its lost thrifts with credit unions."
Hmmm... what is Chairman D'Amours trying to tell us? Could he be saying that credit union managers are incapable of understanding it is .not in their best interest to be regulated by an expensive and cumbersome agency? Or is he concerned they might decide the OTS is less expensive and cumbersome than the NCUA?
According to a recent report in this newspaper, the NCUA has not been satisfied with mere verbal abuse, It reportedly seized one credit union contemplating a conversion and stepped up its supervision of another.
No matter how long I observe the Washington scene, I never cease to be amazed by the extent to which government agencies confuse their interests with the public's.
It is in the public interest for financial institutions to be able to select a form of organization that allows them to best serve their customers and remain viable in the marketplace. If enough credit unions decide to abandon the credit union charter, it will no doubt damage the NCUA. But it's difficult to fathom how the public interest would be harmed.
Bankers should take note of this little turf war because a much bigger and far more important turf battle is shaping up among the bank regulators. More on that subject later.
