Rising From The DUST BOWL

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Jim Likens has changed his mind about exactly when his life story began. Likens used to imagine it began when he graduated from the University of California at Berkeley with a B.A. in Economics and an M.B.A. in Management (he also earned a Ph.D. in Economics from the University of Minnesota) and started his academic career in 1969 as an economics professor at Pomona College in California.

He's an accomplished man, a successful man, and a man of whom others in the credit union movement say only good things. But while he pursued a career around a life of academic achievement and a parallel path of volunteerism in the credit union world, Likens seldom spoke of the early childhood experiences that gave rise to his drive and dedication.

Perhaps receiving the Wegner Lifetime Achievement Award from The National Credit Union Foundation this week at a dinner held in conjunction with CUNA's Governmental Affairs Conference is the appropriate time for him to talk about what he kept so private. Asked what it was about credit unions that resonated with him, Likens paused, and there passed an audible rush of breath one can only associate with the recall of emotionally charged memories.

"It was my childhood," he said. "My parents were Dust Bowlers, failed farmers. My dad became an orphan at age 12 and had to quit school to support himself. My mother had to drop out of college during the Depression. Dad and Mom moved to California and started out in a tent in a government labor camp. It was my first home. I was a welfare baby and so were my sisters."

Not Quite As Steinbeck Portrayed It

Likens described the fierce pride of people used to hard labor or going in search of it. "It wasn't exactly like it was portrayed in John Steinbeck's The Grapes of Wrath," he said. "The book and the movie gave the impression that there were no jobs to be had in California," he said. "That's not true; there was work, though it didn't pay much. We weren't ignorant either, just hard up. A visiting reporter and photographer from Life magazine came to the camp where we lived. They picked the most ragtag family there to profile, which didn't go over well with the residents. Many Dust Bowlers were insulted by that book and movie because it painted us in such a bad light. But it is true that we faced discrimination from the locals."

Life gradually got better in California. After six years the Likens were even able to buy their own home, but after World War II the family went back to Arkansas and tried to farm. "When that failed, we came back to California dead broke and moved into a tent and picked cotton for three cents a pound."

This time, they stayed in California, and here is where the credit union tale begins. Likens' mother earned an emergency teaching credential and became a third grade teacher. His father left the fields and became a janitor at the local high school. As school employees they were able to join Kern Schools Federal Credit Union in Bakersfield.

"It made a huge difference in my family's life. Before that, they'd buy a lamp, say, at usurious rates and have to wait to buy the matching lamp in order to have a pair. It was the same with the furniture and so on. The credit union gave them their first new car loan and first checking account. Dad was so proud of his credit union; he'd say, 'The president of the credit union knows me, I can get a loan there.' Dad proved the point when he cosigned for me when I bought my first car with a credit union loan," said Likens.

It was the CUNA District 4 School that got Likens involved in working with credit unions when it moved from UCLA to Pomona. Asked to teach a summer course in 1972, he became director three years later. Today, it is known as Western CUNA Management School. More than 2,000 students have graduated from the school since Likens took over the reins, and many of them have moved into positions of significant leadership in the credit union movement. "They are my legacy," he says. "This school is my life work and my most significant credit union contribution."

Likens became a board member of Los Angeles County Employees No. 11 FCU in 1978, during the high interest rate environment of the OPEC crisis. He spearheaded an effort to lift the 6% dividend ceiling rate on shares set by NCUA and sought to amend the 1934 Federal Credit Union Act in order to raise the 12% usury ceiling on loans. Without those changes, Likens understood credit unions would be unable to compete, as money was pouring out to other institutions. Soaring inflation, high interest rates and strict regulations made a mix certain to fail, he believed.

He initially got nowhere with the idea, but flew to Washington in 1979 hoping to make his case at the CUNA GAC, but he was not allowed to speak. The best CUNA would do was to commission a study. Likens kept hammering, and as times worsened, the wisdom of his position became obvious to leadership. Still, it wasn't until the 1980 CUNA GAC that, encouraged by the California league's Bill Broxterman, Likens and Randy Moore held a surreptitious meeting with then-Senate Majority Leader Allan Cranston (D-RI) and convinced him to demand and achieve a significant increase in the 12% usury ceiling during a legislative conference committee meeting. According to documents provided by the National Credit Union Foundation, these private negotiations were done against the wishes of the House Banking Committee and were unknown to CUNA leadership, and Likens had never publicly acknowledged the role he and Moore played until now.

Crossing Paths

That experience was a milepost for Likens, but it wasn't the only last-chance adventure he willingly undertook on behalf of credit union solvency. On the board of Los Angeles County Employees No. 11 FCU, he and his colleagues counseled for a merger with another CU in order to strengthen the financial base, but the NCUA examiner recommend denying the application. Undeterred, Likens and Joe Melchione, the CU's attorney, made a direct appeal to the regional director Barry Jolette (now president of San Mateo Credit Union, who later became CUNA Chairman and who is now a member of the Board of Trustees of Western CUNA Management School). Eyeball to eyeball, Jolette sized up the pair and granted the request, allowing Los Angeles County Employees No. 11 FCU to prosper.

Likens' 27-year span of volunteer service at his credit union has included stints as treasurer, secretary, chairman of the Asset and Liability Management and Strategic Planning Committee, and other roles. He's been chairman of the board for the last 10 years. Seeing the credit union through some hard times and even working undercover with NCUA regulators to catch a corrupt CEO (again, never revealed until now) despite being ostracized by other board members is all part of the legacy Likens can claim. Of course, he's too modest to do so, so others must see to it. He is generous with the knowledge he has amassed; he's mentored many a CEO and is a featured speaker at credit union conferences.

Likens' current concerns are CU taxation, field of membership (he's a strong supporter of the community charter option) consolidation, outreach to underserved communities and alternative capital.

Likens is no cynic, and the insight offered by his upbringing makes his appealing, yet determined way of dealing with problems as obviously logical as Archimedes' principle is to a bather. Called the "dismal science," economics seems dull to many, but Likens says, "Unlike the Jungle River ride at Disneyland, which is repeated the same way every five minutes, economics is endlessly fascinating because it is always changing."

That kind of affection for what he does can be infectious. He's energized by the increased role credit unions play in the political arena. "We must live in our world and that includes politics. As a regulated industry, credit unions must pay attention to the influence of those who work against us, and we've no choice but to defend ourselves."

When asked if credit unions risk losing their philosophy as they get big, Likens answers with a resounding no. "Size has nothing to do with it. Nor does organizational complexity. What matters is intent. We still are structured as not-for-profits to serve our members, and we are passionate about that.

"I am deeply optimistic about the future of credit unions," continued Likens. "We are in good hands. We have more than 80-million members. Almost 10,000 credit unions. More than 100,000 committed volunteers. Our management staff is trained and capable; I'm proud to have been a part of that. Our state and national leaders have vision and courage. We face serious challenges, but we are ready for the future."

That sense of hopefulness tempered with wonderment and toil must be innate. You can only inherit it from your parents; it's what you do with it that really counts.

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