The more things change, the more they are the same. “Banks want new
powers. But they want credit unions to remain under the same restraints imposed
in the 1930s,” wrote Ed Callahan, former Patelco CEO, in 1998.
Ed Callahan stated that credit unions need to push for legislation to make
them less vulnerable to attacks by banks and safeguard their core values. The
following observations from his Feb. 1998 article of “The
Callahan Report” still ring true today.
Time for a Credit Union Modernization Bill
Banks want new powers. But they want credit unions to remain under the same
restraints imposed in the 1930s. Their view about us might be summed up as,
“Credit unions are all right so long as they do what they were created
to do, which in our opinion is:” and then espouse a very strict interpretation
of the 1934 Act. They know they are dead if they do not change, and they know
we are dead if they can keep us frozen in 1934.
Of course, they have had quite a bit of legislative and regulatory reform over
the past few years and we have had little. And what little we have had, they
have used to roll back other prowers.
If we were to be content with incremental regulatory improvements, we would
be continuous targets of future banking litigation and obfuscation. Better to
take the bull by the horns...so that banking lawyers can’t challenge the
rights we believe credit unions and credit union members should have in the
What We Should Ask For
1. Primarily, we want the freedom of Americans to choose a credit union as
a financial services provider.To us, this seems inalienable. It would improve
the lives of millions of Americans and strengthen the American economy.
2.We also want the freedom of credit unions to provide the services that
their members need for more prosperous financial lives.
This, of course, includes non-insured products such as insurance, annuities
and mutual funds.
3. We also want the freedom to organize ourselves to the betterment of the
members. The restrictions now placed on us keeps us in a 1930s environment,
exactly where banks want us to remain.
Unshackle Our Chains
Credit unions for too long have been considered second-class citizens in the
financial services world. Outsiders have regarded us as afterthoughts, as places
for the destitute. This has infected our own members with a sense of second-classness
and our regulators and Congress with myths that have retarded our movement.
We have been second-class citizens long enough.
If given the kinds of freedoms we want, we will act for the improvement in
the lives of our members...If we are to improve the lives of our people, we
have to have the ability to organize to their benefit.
To learn how your credit union can act effect legislation attend our webinar
this Thursday, Oct. 7 on Mobilizing Membership
to Get Out the Vote.