Category: Observations

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Timeless Wisdom Following NASCUS’ 2020 Virtual Summit

“I think if you took the pulse of credit unions today, you would discover two feelings: worry over the growing authority of NCUA; and a desire for more flexibility than now exists under the charter options . . . The best remedy to this climate is a vigorous dual-chartering system, that is, both a vibrant federal chartering option and a vibrant state-chartering, non-federal share insurance. Danger grows if there is only one option. Such a climate breeds bureaucracy and lazy thinking.”

– Ed Callahan, May 2000

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The 19th Amendment Helps Enfranchise a Movement

The legacy of credit union pioneer Louise Herring (1909-1987) is vital to the creation of the modern day credit union movement. As summarized in her alma mater’s profile, she managed Kroger’s first credit union and founded a dozen more while helping to charter over 500 credit unions in her five decades of activity. To support these nascent charters, she formed local chapters, the Ohio League and the private insurance alternative known today as ASI.

Most importantly she was the youngest woman to attend the Estes Park Conference in 1934 which founded the Credit Union National Association.

More Than the Sum of Her Accomplishments

Through the force of her personality, she shared her passion for credit unions in all circumstances. The following is a story from the book Sharing the American Dream, published by the Credit Union Executive Society.

It is a small but typical example of how the 19th amendment created possibilities for women’s leadership benefiting all Americans far into the future.

Neither snow nor jail could stop Herring

by Louise McCarren Herring

This excerpt comes from the book “Sharing the American Dream,”  from the Credit Union Executives Society.

I almost always organized credit unions at a change of a shift or before or after working hours. One night, I went to a meeting of teachers in Columbus, Ohio. The meeting ended about 9 p.m., and since I had scheduled a meeting with the Dayton, Ohio, police for early the next morning when the late shift went off and the first shift came on, I decided to drive the 70 miles to Dayton that night. Even though it was snowing and most people would have said in those days that it was foolish to drive at night, I started out.

I got to the outskirts of Columbus and saw a streetcar parked at what I thought was the end of the line. I passed the streetcar and was immediately stopped by the police for passing a streetcar that was loading and unloading.

An officer took me back to headquarters downtown where I was told I either had to pay a fine, post bond or go to jail. Because of the snowy night, many officers were sitting around either coming off duty or waiting to go on. They listened as I explained that I could do none of these things because I had to be in Dayton early the next morning to organize a credit union for the police force there.

As I explained what a credit union was and the good it could do for working people, the officers sitting around started to pitch money up on the table to pay my fine. I made each person who contributed to my fine give me his name and address so I could repay him. Finally enough money came in to pay the fine and I was dismissed, with a date to return to organize a credit union for them.

They thought the idea was so good they were willing to pay to have a credit union organized. It gave me the opportunity to tell them, as I have told so many groups, that no one should pay to get a credit union.

(Roy) Bergengren and (his colleague Edward) Filene had secured the laws and organized the credit unions as a public service. Those who received this service without cost or obligation had a responsibility to see to it that anybody who wanted a credit union should get it just as they did — without cost or obligation.

Bergengren often paid lawyers and other local people to organize credit unions. He never paid me because I felt it was a great privilege to organize credit unions in the hours I was not working on a full-time job.

The first credit union I organized was for the members of the Brotherhood of Railway Clerks. I knew nothing about organizing credit unions so I spent the entire meeting reading aloud the bylaws and explaining the brief but exciting history of the credit union movement. Later on, I was able to cut down the time it took to organize a credit union.

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From the Field: Democratic Governance Makes a Difference

Hi Chip. I recently joined a credit union and received something in the mail I thought I’d share with you.

The following was in a welcome letter:

We want you to know that you are much more than a customer – you now belong to a family of 200,000 members who cooperatively own [credit union’s name]. Ownership gives you an equal voice to elect our Board of Directors…

How many other credit unions encourage this participation? 

 

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The Volunteer Spirit

In July, the Library of Congress finished a crowd sourced project to complete the transcription of over 10,000 documents in its collection of Lincoln papers.

Most are letters with complaints, pleas, job requests and military reports. Some are in French, German or Italian. Many are personal such as the desire of a Navy Officer to marry, to which Lincoln responded to the Secretary of the Navy: “please allow him the requisite leave of absence, if the public service can safely endure it.”

One of the most stunning messages for me was a letter from a 65-year old would-be Army volunteer from western New York. He wrote in March 1864:

Father Abraham

I am 65 years old am able to do a fair days work (not the hardest kind of work) day after day am willing to go to the army, or rather into some fort or Garison, where there will be no long marches, was never a good traveler but worker will help you work out our national salvation will go free of any charge to Government except travel and rations Avery Coon is a stout man of about my age will go too to a Fort or Garison he may need the usual pay will be a good hand

We have Faith in God and dry Powder

Truly Yours Daniel Edwards

The question for credit unions: What is the belief and “dry powder” motivating your volunteers?

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From the Field: A CEO’s Budget Review Message

“Later next week we will finalize the [financial] report book and publish. I wanted to send this summary out to you and the team to see the tact and our confidence about the future based on traditional thinking. Our numbers are GREAT! But not for the right reasons. 

We are doing the right things. But what are we risking in just doing the right things for now, and not the right things for the coming post-COVID future? COVID is not unprecedented, it’s just another year after year revolving pressing issue. We knock down the pressing issue of the year, every year – chaos is constant, and adjustments are forever needed.

Remember: to see COVID as simply another challenge to success is not dismissing COVID, it simply is recognizing that as cooperative business people, we have the means and the skills to endure and prosper. When you read this financial update, I hope that is what you infer between the lines. Take care, stay safe.”

The Key CEO Question: What are the right things we should be doing now for the post-COVID future?

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One Credit Union Blog Ends: Another Enters Stage

Friday, July 31 was the final post for Dr. Keith Leggett, who was an economist at the American Bankers Association.

From June 2009 thru last week, he wrote over 11,000 entries. He never joined a credit union. He was an industry skeptic who often highlighted bankers’ concerns with the industry. Most of his columns were reprints of stories or events which he believed justified his disbelief in the cooperative model.

His point of view will be missed. Credit unions value relationships and are reluctant to challenge the errant behaviors of their own. And without critics, a show can get off track so that it becomes too late for the audience to save it.

A New-Old Kid on the Credit Union Beat

Last week I read a new blogger’s article about the ongoing fate of the taxi medallion borrowers whose loans NCUA sold to a private hedge fund, Marblegate Asset Management.

The story was written by David Baumann, a reporter for Credit Union Times who had been recently laid off due to COVI . Using his knowledge and contacts in the industry, he started a blog to produce original stories: https://washingtoncudaily.com/

He focuses on events in DC that could affect credit unions. He does his own leg work with interviews and follow ups.

His approach could provide new insights over the next year as the prospect of wholesale political change looms over the country and with it, at Congress and NCUA.

The blog is well designed, latest stories up front, with searchable “topics” of past articles. It’s free. I signed up.

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Another Tastee Diner Lesson

Readers of this blog may recall the first time I wrote about Bethesda’s oldest, continually operating restaurant. In it I asked the question how this old fashioned restaurant model, serving comfort food, open 24 hours a day could survive in the affluent, high-end dining market now dominating Bethesda. Moreover, the new 27 story international headquarters of Marriott International is going up cheek and jowl on three sides. Why didn’t they just move out? The owner’s answer was simple: “We own the land.”

Normally the diner closes only one day per year, Christmas. But when Maryland went into a state-wide stay-at-home order, the diner closed just as every other retail establishment. Two weeks ago, Maryland entered Phase 2. The diner reopened following the state’s covid guidelines.

I visited Sunday morning to see how they were doing. Was there another lesson for credit unions from this locally owned business landmark?

The Menus: Phase 2, Printed on Paper, Used Once , and Thrown Away

Construction work continues on Marriott’s new headquarters. Eleven stories done, sixteen more to come:

Covid warriors/waitstaff clean every table and benches after each customer. Every other booth is closed. Nothing on tables except napkin holder and sugar packets.

Approximately twelve employees: cooks, wait staff, clean up, owner and cashier. Only four customers at normal peak breakfast time. Covid’s seating capacity is 75 socially distanced.

Tastee Diner’s Challenge is the Country’s

When will guests return? Being open is not sufficient. Customers must feel safe to venture out. That is something Tastee cannot control, but requires consumer confidence in their public officials. Only then can the economy become self-sustaining.