Maybe The Missing Outrage Should Be Refocused

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Where was the outrage? Or at the very least, a nice, visible sign or two of irritation?

You couldn't find it among that pretty happy bunch last week in Washington, those 4,000 or so folks CUNA brought together for its annual Governmental Affairs Conference. The big question is why? I have an idea-and a proposal.

Credit unions were in town asking for relief on the MBL cap (again), and this time thinking this is their year. But as Credit Union Journal was first to report, on the same morning the Marine Band was playing the traditional, patriotic opening to GAC, Sen. Harry Reid bowed to bank pressure and agreed not to attach an increase in the MBL limit for CUs to the JOBS Act, which has strong support in Congress

Not that anyone inside would have known anything about it. Instead, CU speakers took to the big stage in the Washington Convention Center to extol all the growth credit unions have seen in the past six months. Improved ratios. Lots of new members. Loan growth trend numbers that appeared in black, not red. Kristen Christian, the woman whose Facebook posting led to Bank Transfer Day, came out and took a bow.

It goes without saying there was plenty of applause and good cheer.


No Rest In The Restroom

As all that was occurring, more than 1,100 bankers were converging on the Hill as part of their own Government Relations Summit. CUNA was forced to push GAC back this year by several weeks, leading to the overlapping meetings. Members of Congress and their staffs must have loved learning that the two long-time rivals would be in town doing their arm-twisting on the same week. (One person shared with me that some credit unions in his state had by chance run into their senator and immediately began to make their pitch. In a Washington restaurant. In the men's room. Perhaps they were taking the "relief" part of the message a bit too far.)

While DC insiders among CUs were aware of the move by Reid, the bulk of outsiders were blissfully unaware. Maybe it was due to the blooming cherry blossoms, blue skies and warm weather creating postcard vistas no camera phone could do justice.

Or maybe, just maybe, credit unions aren't as engaged in the Biz Loan cap issue as their trade associations paint them as being.

When Credit Union Journal interviewed attendees on their priorities when hiking the Hill and meeting with Congress, it didn't take long to get the impression many were parroting what their state associations had told them, and not really expressing something they felt in their hearts.


Bankers With Bullet Points

That's too bad, because the banking industry had done its homework and had honed its message to bullet points. In fact, the bankers give the impression they know the issue better than credit unions. With radio and newspaper ads running in conjunction with their visits, the ABA delegations told Congress that it's just a small group of a 100 or so CUs that are driving the issue. The head of the ABA took to the airwaves and the hallways to argue that just 96 CUs out of 7,000-plus are even within 80% of the cap.

And, of course, as Credit Union Journal reports on page 1, the bankers did pause for a moment or two to mention the tax-exemption so often it's hard not to imagine a frothing banker or two unable to help himself and picking "Tax Exemption" to go all the way in their March Madness brackets.

Last week I noted in this space it's the 15th Anniversary of 1997, the first of two consecutive years in which credit unions showed a passion and a spirit and a unity that hadn't been seen or heard in decades (or seen or heard since) as they fought for the passage of the CU Membership Access Act.

Feeling that your back is against the wall and there's no place to turn will do that to you. Right now, it seems there just aren't enough credit unions that really feel their backs are anywhere near that wall.

Maybe the trade groups' efforts would be better focused, instead, on fighting full-time the redundantly redundant and ridiculously ridiculous regulatory overload from NCUA, Congress, and whichever new agency has introduced a raft of new rules this week. Credit union leaders feel like they're barely treading water while holding the anchor that's been forced upon them, and along comes someone from Washington who says, "Here, hold this anvil, too."

It isn't that the reg burden hasn't gotten attention from the trades; it just hasn't been the issue. But ask any CU exec, which do you find more aggravating and frustrating, every single day, the MBL cap or dealing with the reg burden? Do you really need to guess?

And credit unions are hardly alone here. Banks, especially community banks, are neck deep in the same overlapping and interwoven thicket of rules.


What Could Be Done

Why not a joint, year-long effort to clearly identify all the unnecessary redundancies, the small forests of paper, the man-hours (sorry, man-years) that go wasted, and the wrong jobs being created as a result of Washington's good? intentions, and then take all that back to Congress with specific recommendations that make the federal government more efficient, and banks and CUs better citizens in their communities.

Want to see credit unions really energized? Let's have Sen. Reid put that to a vote.

Frank J. Diekmann can be reached at

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