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The Windy City in Poetry

Chicago

by Carl Sandburg

Hog Butcher for the World,
Tool Maker, Stacker of Wheat,
Player with Railroads and the Nation’s Freight Handler;
Stormy, husky, brawling,
City of the Big Shoulders;

They tell me you are wicked and I believe them, for I have seen your
painted women under the gas lamps luring the farm boys.
And they tell me you are crooked and I answer: Yes, it is true I have
seen the gunman kill and go free to kill again.
And they tell me you are brutal and my reply is: On the faces of women and children I have seen the marks of wanton hunger.

And having answered so I turn once more to those who sneer at this my city, and I give them back the sneer and say to them:
Come and show me another city with lifted head singing so proud to be alive and coarse and strong and cunning.
Flinging magnetic curses amid the toil of piling job on job, here is a tall bold slugger set vivid against the little soft cities;
Fierce as a dog with tongue lapping for action, cunning as a savage pitted against the wilderness,
Bareheaded,
Shoveling,
Wrecking,
Planning,
Bulding, breaking, rebuilding,
Under the smoke, dust all over his mouth, laughing with white teeth,
Under the terrible burden of destiny laughing as a young man laughs,
Laughing even as an ignorant fighter laughs who has never lost a battle,
Bragging and laughing that under his wrist is the pulse, and under his
ribs the heart of the people,
Laughing!
Laughing the stormy, husky, brawling laughter of Youth, half-naked, sweating, proud to be Hog Butcher, Tool Maker, Stacker of Wheat,
Player with Railroads and Freight Handler to the Nation.

(Editors note:  My hometown from 1974-1981 when working at First Chicago and then Supervisor of Credit Unions for Illinois’ Department of Financial Institutions)

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“I’ve Been Seen”

Real political rhetoric, much more than every day punch and counterpunch,  is in full season.  Last night I listened to the Obamas’ twin presentations at the Democratic national convention.  Afterwards all the TV channels offered their pundits’ assessments of the evening, especially the keynotes by the former President and First Lady.

Sometimes it is hard to know whether one’s reaction to an event is shared by others.  Or even what to think about it until we hear how others appraise their experience.

As the PBS panel went from person to person, one commentator’s reaction stood out from his colleagues’ traditional analysis of each speakers’ effectiveness.  His was a personal reaction, not a reporter’s professional assessment.

He had reached out to a colleague for a handkerchief during the former president’s speech, weeping.  The reason for his reaction was summarized in one phrase.  Reacting to Obama’s description of what America could be, he said “I’ve been seen.”

A Credit Union Counterpart?

His reaction reminded me of a conversation last week with a CEO’s who has an unusual approach to leadership.   I had reached out to learn about the credit union’s participation in an affordable housing program.  To prepare for the interview I went to the web site and looked up the June 2024 financials.

The numbers were impressive.  But the website had a different “vibe” than most.  It had a ten-minute 2010 video interview with the first president and his wife, a reminder of the commitment necessary to start a credit union in the 1950’s.  Then there was this vision: “To be member loved.”

Was this phrase just another cute PR effort?   How could an emotion be translated into a real business strategy?   Who was behind this approach to credit union leadership?

Tomorrow I will share my conversation with the CEO who developed this unique effort of “seeing others.”  It is the central tenet of the credit union’s business model and market advantage.  It takes effort, and it works.

 

 

 

 

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A Movement We Should All Know About

Christian Nationalism is an unholy union of American exceptionalism, White supremacy and Christian identity parading across stages at rallies and worship services.

Many people, especially traditional believers are confused and left wringing their hands about how to respond?   Is this just a temporary merging of the political right and politics facilitated by leaders who will leave the scene after elections are over?  Or is it something more permanent in our confused and complex American belief system.

During the past six months NPR has presented a number of in-depth stories on Christian Nationalism.  Here is a link to a 25 minute report from July 9.

This week Presbyterian Outlook told the story of three Seattle area church ministers working together to develop a faithful and reasonable response to this distortion of the denomination’s historical Christian doctrines.

How do we keep our sanity amid a chaotic political-religious climate?

On July 7, 2024 Dr. Matthew Taylor spoke on this growing influential force in our social and political discourse.  His talk was called Christian Nationalism, the Capitol Riot and the Rising Threat to American Pluralism.

It was presented as part of the summer speaker series at the National Presbyterian Church in Washington, DC.   His approach is analytical with multiple examples to document  his major points.  Because his talk is almost an hour, here is a brief outline.

  1. The Christian Nationalist presence and role in the January 6th events was neither accidental nor incidental. He provides numerous photos and videos showing this involvement.
  2. These seemingly independent mega churches and evangelical charismatic movements are networked together in an “ecosystem” of social media, round tables, and shared view of the five roles of church leaders. The prophetic and apostolic roles carry the highest authority.
  3. The churches believe in “strategic spiritual warfare” with a mandate for their followers to achieve leadership of the seven mountains of American society.

Every part of his analysis is documented including the leaders’ original outreach to Trump as a candidate in 2015 and then subsequent involvement in his administration.

Dr. Taylor’s goal is to call attention to this growing force which is counter to the historical American openness to diverse points of view whatever the topic.  He shows how the group’s symbols are becoming increasingly mainstream embraced by the current House Speaker and a Supreme Court Justice in their display of the Appeal to Heaven-Flag of Liberty- a prominent symbol seen on January 6 in the Capitol riot.

He cautions these people are “true believers” not temporary cynical hustlers after money and power.   He observes that these coordinated efforts might appear bigger than each of us, but not bigger than all of us.

I believe this factual and historical presentation of this movement is vital as it seeks to impose their vision for all of America.   Movements started with pure intent, can become distorted, even perverse.  Leaders can use their collective resources gathered for one vision, to expand to a much greater goal: power over others.

It has happened before in other countries, when democratic processes are used to support authoritarian prescriptions and then veer into fascism.

Awareness is the first goal in setting bright lines for the freedoms America provides the entire spectrum of believers or non.  Christian Nationalism is a step too far away from an open, diverse and tolerant society.

 

 

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Awakening the Members’ Spirit at SECU  (Part I-The Beginning)

Democracy is hard work.   Most people have  more urgent personal priorities than worrying about the direction and leadership of their credit union. Or for that matter even the circumstances of the many other organizations organized on democratic principles in which one participates.

However in credit union design, democratic governance–one person one vote–at the annual election of directors is the most powerful tool the member-owners have to exercise their oversight.  The reality is that contested elections are a rarity.   Most boards are self-appointed in a perpetual process of nominating just the actual number of internally selected candidates as there are current openings.

Even routine member Q&A at annual meetings rarely happens when the agenda comes to the “other business,”  item.  Comments are carefully controlled if even allowed.  “All questions must be submitted in advance.”  “Speeches will be limited to two minutes.”  etc

The annual meeting’s formal rules are controlled by the incumbents’ chosen parliamentarian who rules out of order,  any motions or conduct not consistent with the board’s intentions.

A Member-Owners’ Representative Takes the Floor

On October 11, 2022 at SECU’s annual meeting the unexpected happened. A member and  former long serving CEO, Jim Blaine, rose to make a statement about the “change of culture and new direction” the board and recently hired CEO were taking the credit union.

His statement had three parts.

  1. A history of SECU with its strategic and business priorities and overall performance since chartering in 1937.
  2. A description of six current activites for which further explanation to the membership was requested. These changes he called Open Membership, Merger with Local Government FCU, Introduction of risk-based lending (RBL) for consumers and business lending, Cancelation of the tax preparation service and Expansion outside North Carolina.
  3. Two motions were proposed after describing these initiatives. The first called for a response to specific questions about the six areas and the second: The Board update, publish, and make available to all member-owners its’ Strategic Plan for SECU no later than 90 days prior to the 2023 Annual Meeting.  

Several members spoke up in support.  Both motions were approved without any voiced opposition or objection.   Thus SECU’s member engagement and awakening began.

A New Blog: SECU-Just Asking

Blaine’s full statement given at the meeting is here.  He also posted it on his new internet blog called SECU-Just Asking.  The site evolved to become a public dialogue on the board’s response to the motions.  Almost daily updates are being posted on these topics and other events related to SECU’s priorities or performance issues.

Blaine’s writing style is forceful and creative relying on logic and data to support his positions.  He is an ardent advocate for his views.  He is committed to the daily task of presenting observations and alternative views to prevailing priorities.  The blog has become an open forum for multiple member comments.

As of now some of these six topics have been put on hold: the proposed merger with LGFCU, the change in FOM and expanded operations outside North Carolina.  Tax preparation services have been discontinued.

The most significant issue remaining at the forefront of current posts is the impact of  RBL and the financial performance of SECU.

Jim Hayes the CEO resigned in mid 2023 to become CEO at State Department FCU .  He was succeeded by longtime SECU senior executive and Chief Operating Officer Leigh Brady.  She has continued the RBL and other internal projects initiated by Hayes.

A First Takeaway:  What  Democratic Practice Entails

Most CEO’s to whom I spoke about this event were critical of Blaine’s 2022 spokesperson’s role in challenging the credit union’s direction.   Most asserted he had ended his tenure at leadership.  Now it was time for him to be silent and give the new CEO and the board who chose them, the freedom to take the credit union in whatever direction their collective judgement decided.

For Blaine this was not a solo exercise.  His statement distributed at the Annual Meeting was prompted by numerous calls from current and former employees, members and others who were deeply concerned about the direction and new “culture.“ They asked that because of his standing in the cooperative community, he take the floor to articulate their worries and seek public dialogue between the  credit union leadership and the member-owners.

Blaine’s presentation-request is the first lesson in member governance.  Democracy is a public, not a private event.  It entails open meetings with points of view which may challenge current wisdom or practice.  Such public dialogue is often uncomfortable for those in authority.

From the annual meeting video, the moderator seemed surprised at Blaine’s ask  on behalf of the owners.  The  members quickly approved the two motions made under the regular rules order for the meeting.

The first condition for democratic government is public “speech,” ideally full and open to all points of view.  It is no accident that the 1st amendment to the Constitution was for freedom of speech. Or that the public press in America is called the fourth estate, a necessary parallel to the proper functioning of the executive, congressional and judicial branches of government.

Uncomfortable in Public

For those in positions of authority, public dialogue can seem threatening to their prerogatives and assumptions about leaders’ roles.  The response to critics is often PR or marketing campaigns designed to overwhelm one side of an issue.  Sometimes even special crisis managers or experts in publicity are hired to promote the message.

For those in positions of public service, direct dialogue with constituents can be uncomfortable.  Written statements are preferred sometimes with FAQ’s attached, or “no comments” issued about key events.  Public board meetings are carefully controlled and sometimes cancelled.   Speeches by principals to their audiences are made over zoom avoiding live in-person contacts.

Democracy depends on public expression.  Whether it is public rallies to oppose a dictator’s rule as in Venezuela, or the weeklong public conventions shows by the two parties, democracy is best served by open meeting spaces.

The Next Event in Democracy’s Awakening at SECU

Readers can follow the details about the Board’s response to these two 2022 motions by going to Blaine’s blog.   I will pickup the story further down the road  when the board decided that this exercise in member democracy was too unsettling to be left open ended in future annual meetings.

The SECU board’s surprise to this event is itself instructive. Most persons in elected or appointed positions of responsibility believe in their presumed authority.  “I was chosen to make these decisions based on my personal ability.” Or just the explanation, “I’m in charge now.”

An outsider might ask of SECU’s leaders as they would any group in this situation: Were   there no ears to the ground?   Did the board and executives truly grasp the scope of the changes they were introducing?  Were the strengths and advantages of the previous SECU model and its decentralized leadership understood?

As one watches this two-year-old drama unfold, look around and assess one’s own awareness of the organizational environment in which one navigates.   Is there open dialogue on critical issues—or just public posturing?   Are leaders approachable or hiding behind a veil of press releases and written speeches?   Do boards actually meet and discuss vital issues, or just keep the group consensus intact to avoid personal controversy?

Democracy is hard work. It takes practice.  It entails public events.  Many are uncomfortable taking this role; but we can learn from those who do, whether we agree or disagree with their positions.

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Creating Community with Shared Joy:  The Pub Choir 

There is a unique singing/sharing experience traveling across America and Europe this summer. It is the opposite of a Taylor Swift concert.  In these events, the audience is the show.

These ad hoc communal sings are led by an Australian musician, director and composer Astrid Jorgensen.

Her one night gatherings are called The Pub Choir.   It demonstrates the capacity of one person to help people discover and express their collective joy.

Learning to Sing Together

Here is how one person described her experience:

A few weeks ago, I walked to a small neighborhood arts venue and sang along with 250 of my neighbors at the sold-out event called “Pub Choir.” It was not in a pub, and we were not in a choir, but all in attendance now feel famous because the performers recorded it and put it on the internet. Even months later, I am still bubbling from the collective effervescence of learning a three-part harmony version of “The Best,” famously covered by Tina Turner.

(It’s not about you, but about us)

“Australian choral director Astrid Jorgenson set the stage by telling us to put our phones away. They would be filming us. We were the show. She had us belt out the chorus from “What’s Up,” by 4 Non-Blondes to figure out which voice part to stand with. Before she told us what song we would be singing and recording that night, Astrid said, “You might not know this song. You might not even like this song. But tonight, it’s not about your preferences. This is about us, singing together.”

“Astrid taught everyone their lines with a glorious low-budget PowerPoint presentation. We were instructed to follow our color-coded lines that were accompanied by memes to remind us of the style we were going for.  . .Astrid would sing the line for us, then have us sing it back to her.

(a holy call. .. and response)

“It was a holy call and response with subtle correctives like, “I see you moving a lot and working hard. I like your version, but I am wondering if you might want to try my version?” When she heard that a few of us “got it,” she winked at us saying, “I see you elementary school music teachers out there! Fabulous! Now squeeze the hand of someone near you and whisper to them, ‘We’ve got this’ and make sure they follow you for the slippery part.”

“. . .she moved us into three voice sections telling us we could check in with our friends during the bathroom break. We were not to stand with the section where we might have been placed in other choirs in the past, but where we felt most confident belting it out.

“Singing passionately was the goal. When we sang the line, “Tear us apart? Nooo … ” we were to look like our heart was being poured out like a waterfall. To direct us she danced across the stage, flipping her hair, shimmying, and occasionally pausing the rehearsal to have us all erupt in cheers for one section that finally got the slippery part right.

My friend Julianna and I squeezed hands with our neighbors, poured out our hearts, cheered, and shimmied on command. When Pub Choir ended, we hugged strangers while complimenting them on their passionate singing and practically skipped home.”

Creating Community with a Sense of Unity

I love this example of creating a community of shared effort from complete strangers.  The result is  a moment  of pure joy.   Ok, it is only for 90 minutes and maybe just one or two songs.  But it shows the power of leadership in a common effort-even when some believe they have no singing voice at all.

This is an example of a Seattle video from a Pub Choir singing Tina Turner’s The Best.  Makes you want to skip out of work and go sing.    Singing makes you feel awesome.

(https://www.youtube.com/watch?v=xlc7sHBQ4Oo)

Music at This Year’s Political Conventions

Music is at the center of many communal events. At the Republican convention last month, the following musical motivators were part of the experience:

Among the offerings: Kid Rock performed his 2000 song “American Bad A–”; “Real American” by Rick Derringer; and Lee Greenwood performed “Holdin’ a Good Hand” in person.

Here is my suggestion for the Democratic convention taking place next week.  It is the 1971 release byThree Dog Night- Joy to the World:

(https://www.youtube.com/watch?v=M9uoq9gfeL0)

 

 

 

 

 

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Democracy Takes Work-Especially in a Cooperative

President Eisenhower:

“Dictatorial systems make one contribution to their people which leads them to tend to support such systems—freedom from the necessity of informing themselves and making up their own minds concerning…tremendous complex and difficult questions. But while this responsibility is a taxing one to a free people it is their great strength as well—from millions of individual free minds come new ideas, new adjustments to emerging problems, and tremendous vigor, vitality and progress…. While complete success will always elude us, still it is a quest which is vital to self-government and to our way of life as free men.”

This year’s election cycle is putting the issue of what American democracy means front and center.  Some believe it is about majority rule-the winner calls all the shots.  Others have a more nuanced view of participation, diverse representation and compromise.

One of the ways citizens in America learn about democratic practice is its use in the many civic and public organizations in which we all participate:  churches, local elections, volunteer and nonprofit groups.

Credit unions are designed to be democratically governed.  One person, one vote. The primary means for how this is process is exercised is at the members’ annual meeting and the election to fill board openings.

Practice Without Substance

In a conversation yesterday with a long-time credit union member ( joined at age 5 in 1966) he said he never saw an actual election.  Instead, as he learned,  the Chair would appoint a nominating committee led by the Vice Chair.  That committee selected just the number of persons as there were open seats. The candidates were all familiar faces from the existing board or “associate board” members.   The test was loyalty-would they “go along to get along” with the rest of the board.   The tenures of several of these board members extended over three and four decades.

This description would be familiar to many credit union boards.  The election process is managed so as to perpetuate the incumbents or their fellow travelers.   It is democratic in neither practice nor theory.  In the end the credit union is led by persons who believe in their special skills to remain in office for as long as they wish.

The justification for this self-perpetuating board selection is the idea of a “leadership class” like trustees, that should not have to answer to voting owners, let alone face a contested election.  This is especially so when external factors suggest satisfactory organizational performance.  Why tinker with success?  Aren’t we doing what is expected, and leading successfully?

However when a minority, no matter how talented, takes control of a credit union board and the selection process, the responsiveness and accountability of the institution to its member owners is at risk.  Which means the future of the credit union is not in the hands of the members, but of a small group who eventually may tire of the task and decide to merge—not find new leaders.

A Case Study of a Contested Board Election

Breaking this cycle of self-appointment without member choice is tough.  Democracy is not easy.  However there is an example unfolding at State Employees Credit Union (SECU) in North Carolina now it its second year of a contested board election.

In later posts I will cover the election procedures and efforts to provide alternatives to the traditional board self-nominations and election by acclamation.

The future of credit unions may depend on recovering their democratic roots and practices.  SECU is an example that even very large and powerful cooperatives can change when members engage.

Without the annual accountability of true elections, the “leadership class” will be tempted to just continue on its chosen course and priorities.  That isolation is one reason why the number of credit unions has fallen from 6,000 to 4,600 in just the past seven years.

These are not “safety and soundness” failures.   They are failures of leadership and morale.   And it all depends on having a passive, uninvolved member that will act as a customer and not an owner-especially at the annual meeting.

The Ultimate Goal of Democracy

Democracy is about something more than  elections.  Elections ultimately undergird freedom.  As Richard Rohr has stated in another context: But it’s a freedom we must choose for ourselves. It is almost impossible to turn away from what seems like the only game in town (political, economic, or religious), unless we have glimpsed a more attractive alternative. It’s hard to imagine it, much less imitate it, unless we see someone else do it first.

Future posts will report on how this effort is proceeding at SECU.

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Transparency: An Advantage When Properly Understood

Spent time earlier this week talking with people who work with a DC non-profit 501 C 3.  It is called Everyone Home DC.

It was incorporated in 1967 by an interdenominational group of religious leaders called the Capital Hill Group Ministry.  For almost six decades the organization has focused on the housing needs of those at the bottom of the socio-economic ladder.

Its Vision:  We support the holistic needs of individuals and families at risk of, or experiencing homelessness.  Housing is our starting point

The group’s website has five components, similar to many credit unions’ content, in an About Us section:  Our Story, Board, Staff, Careers and Funding and Reports.

I clicked on the Funding and Reports tab and found links to the latest five years of Annual Reports, complete external CPA audits, and the IRS 990 filings for nonprofits.  These reports provided an open and full picture of the group’s financial status, trends, how they are funded, and objective measures of their  community impact.

Overcoming shortages of shelter for low income individuals is one of the most intractable problems for every major city in America. The group’s reporting and disclosures give the reader confidence that the leaders know what they are doing and are accountable for their outcomes and responsibilities.

That confidence is vital.  For this nonprofit’s modest budget relies on government grants and private donations.  It is vetted by its funders. In 2023, the organization announced that the Bezos Day 1 Families Fund had granted them their first-ever multi-year, multi-million dollar funding.

Trust from Transparency

Transparency is critical to Everyone Home’s credibility.  it is a non-profit, totally dependent on external funding and engaged in an area of social need where work is never finished and endgame always distant.

It is an example credit unions who are dependent on member and community support might learn from.  Especially the posting of the latest five years of IRS filings, CPA audits and Annual Reports.

A  long-term practice of open and full communication with a group’s supporters is vital when hard times or unexpected challenges arise.  A foundation of trust is built through transparency.  It becomes the intangible capital (goodwill) that can be the difference between a successful recovery or a demise.

Sweeping a Problem Under a Cobalt Rug

Contrast this expectation with the events in an August 7th  Credit Union Times story of the recent merger, without a member vote, of the $67 million Creighton FCU (Omaha) with the $1.2 billion Cobalt Federal Credit Union in Papillion, Neb.

The Times’ story reports the credit union’s net worth ratio went from 9.09% at March 2024 to a negative 10.95% three months later at June’s quarter end.

In announcing the merger Cobalt’s explanation for the consolidation, per the Times, was the July 31 retirement of Creighton’s President/CEO Thomas C. Kjar.

One does not have to be a financial analyst or even a credit union member to know there is something dreadfully wrong for a deterioration of almost 20% of a credit unions assets in just 90 days.

Creighton was a federal charter, filing four quarterly reports per year and presumably subject to NCUA’s annual exam oversight.  It was organized in 1951 and operated five branches with 20 employees.

At June 30, 2024 its balance sheet of $43 million in loans and $23 million of investments appears normal, and not much different from a year earlier.  The allowance for loan losses is just $277K.

The one unusual item is a $12.5 million under miscellaneous expense (compared to $15K a year earlier).  This one time significant amount suggests a newly discovered financial hole due to misappropriation or other sudden loss event. That one entry accounts for most of the $13.5 million YTD loss, which eliminated all of Creighton’s net worth.

How can such a catastrophic loss occur under the agency’s supervisory nose?   I can find no NCUA announcement of this forced merger.  Silence undermines confidence in the NCUA’s examination and supervision competency.  It suggests there is something to hide.

When problems of any kind are swept under the rug, there is no learning by either credit unions or the agency from whatever went wrong.  This forced merger transaction deserves more explanation  than the FAQ’s of Cobalt FCU, the rescuing party.  An accounting is due for Creighton FCU’s members and to the credit union community about what happened and NCUA’s role.

Now Creighton’s 10,000 member-owners are left in the dark about their institution’s oversight and why NCUA  ended its existence.  Such an abrupt, unilateral and forced action can only increase  skepticism of a government agency about  its openness and responsibility to the public.

In the example of Everyone Home, transparency is critical to carrying out its mission.   At NCUA the opposite seems to be the norm.

NCUA has an obligation in  its supervisory role to provide its funding constituents the circumstances about any major failure.  This is the kind of event the agency is supposed to prevent.

The published call reports are the only “facts” available on this $67 million credit union’s closing. They scream for an explanation of this sudden 90-day catastrophic loss.

The agency’s failure to address its actions at this most critical junction in a credit union’s life, poses basic questions about its competence, not just its transparency.

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How to Start Riots Throughout a Country

You may have read about the multiple riots in Great Britain following the stabbing deaths of three children in Southport.  How did this horrible crime lead to instant countrywide rioting and attacks on mosques, immigrant shelters, minority shops and stores, and ultimately the police?

The Five Minute News is a free daily pod and YouTube broadcast by Anthony Davis, a British journalist who lives in the US.

This episode is a case study of how disinformation is created and then spread by both foreign media (Russian  Today-RT) and domestic extremists.

Disinformation is intentionally designed to spread anger, fear and chaos.  It is false.  The initial creator in this instance is quickly identified and the post taken down in an hour.  But it had already spread throughout the world by social media provocateurs in Britain and elsewhere with this completely made up, totally false, account of the person in custody.

The Role of Musk and X

This broadcast also documents Elon Musk’s role in spreading the false information and augmenting it with other fake documents.  He ultimately adds his prediction of civil war in Britain.  The country’s far right extremists all amply these apocalyptic predictions.

This is the full broadcast, ten minutes rather than five!

(https://www.youtube.com/watch?v=uEuJ3V1yzzQ&list=PLGNXhNKeaOmWgTQ3T7oA5ioACZvSB5cRC&index=2)

It should be a mandatory watch for anyone concerned about the state of public discourse and the role of social media in the US and around the world.  And the malicious intentions of Elon Musk.

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NCUA’s Spreadsheet Merger FORM: What the Agency Gets and Member-Owners Don’t

NCUA has published a dynamic excel spreadsheet to be used with merger applications. It is titled Merger Related Financial Comparison.

Its purpose as stated in the first sentence: This comparison form can assist you in determining if you are required to disclose any increases in compensation due to the merger in the member notice. You are not required to submit this form in your merger application; however, you are encouraged to do so. The information you provide may help NCUA process your request more efficiently.  (underlining added)

Here is a copy of the form.  If it is too small to read, this is a link to a PDF.  There is no NCUA number on the form or other information, such as when issued.

What the Form Says

The instructions about  what compensation must be disclosed in the Notice of merger is answered with a question: Would the payment have occurred if the credit union were not merged?

The Form’s directions and simple examples plus the Agency’s encouragement to submit illustrate its intended use.  The spreadsheet is a tool to help credit unions game the system to conform with NCUA’s requirement that only increases of 15% and greater from all compensation need be disclosed to members in the official meeting Notice.

This limitation is completely contrary to the intent of Chairman McWatters’ when proposing the rule in 2017:

“the agency should require all merger solicitation documents to provide, without limitation, a discussion of any change-in-control payments and other management compensation awards and agreements, and that such disclosures are written in plain language and delivered to voting members in a reasonable time prior to the scheduled merger vote”  (Source:  Time to Talk about an Ugly Truth in Mergers.)

In virtually all mergers when  the institutional’s legal charter ends, all existing employment contracts, benefits, retirement plans will cease to exist.  Change of control clauses or immediate vesting options may occur in benefit plans.  The continuing credit union will rewrite employment contracts and conditions, including bonuses, responsibilities, incentives and benefit packages.

To fulfill McWatters’ intent, all of these renegotiated terms should be provided to owners whose approval is required for the changes to be effective.  The logic is simple.  NCUA requires this information for its due diligence and approval, shouldn’t the persons who own the assets and must vote on their future  management, also have this same data?

The Data NCUA Receives

The form requires that all current compensation  indirect compensation, leave, deferred compensation and early payment of retirement benefits and other financial rewards be entered on the form for the CEO and four highest paid managers.

Member owners receive none of this data.

NCUA requires that all these same areas be reported post merger.  The Member-owners receive none of this detail.  The only required disclosure per this Form is a single dollar amount if all these post-merger payments exceed 15% of the executive’s total prior to the merger.

Take the example of CEO compensation already entered on the form.  The CEO’s salary increases from $760K to $850K after the merger.  (A typical CEO merger salary?!) Adding more leave, this total increase of $92,500 (12.17%) does not have to be disclosed to members.  It is below the 15% threshold.  The member-owners receive none of this calculation or data.

Another completed example is directors’ and supervisory members’ compensation .  In this case the directors received $1 before the merger and $10,000 post.  But this change does not have to be reported. It falls below the minimum change of $10,000.  Another executive example shows a 400% change that is not given members,  but a 21% increase that must be.

In all these examples, the member-owners receive none of these calculations.

The form states clearly what is required and highly recommended  to be sent NCUA:   

“Required per Part 708b of the NCUA Rules and Regulations: Board minutes for the merging and continuing credit union that reference the merger for the 24 months before the date the boards of directors of both credit unions approve the merger plan.“

“Highly Recommended: This comparison form and any employment contracts, retirement contracts or documents, executive session minutes, presentations, or any other documentation supporting the compensation amounts entered in the form.

The member-owners receive none of these required and highly recommended submissions of compensation and board minute details.

Why There Was a Merger Rule

When proposing the rule in 2017, NCUA staff analyzed many recent mergers and concluded that a significant portion were influenced by incentives paid to executives.

It is a human reality that those in charge of managing money can be tempted by self-dealing.  In the early years of state charters, prior to passage of the FCU act, some state laws prohibited managers and boards from borrowing from their own credit union.  Instead “central credit unions” were organized to meet those needs.

The NCUA call report today collects the aggregate number and amount of  Loans outstanding to credit union officials and senior executive staff (Account 956).  Section 4 Investments paragraph 11 shows the total of the credit union’s securities to fund employment benefit and deferred compensation plans including SERPS and other insurance.

Finally all state chartered credit unions are required to file IRs form 990 annually which details all executive and board compensation.  Federal charters have no such requirement-yet.

These disclosures are all  efforts for transparency about the compensation executives receive as stewards of others’ financial assets.

Smoothing the Paths to Temptation

Transparency in total compensation is critical to preventing the ever-present danger of acting in one’s self interest versus that of the member-owners

NCUA now withholds from member-owners, who must approve the life or death their chater, the most critical information NCUA requires for its approval in the first place.

Denying Members The Rights of Ownership

NCUA has taken over the role of the member owners.  Members are left totally in the dark about the scale of compensation commitments being entered into.  Instead of providing members with this same vital information, NCUA offers a spreadsheet to enable  credit unions to manipulate the very minimal disclosures now required.

NCUA is explicit about the facts it requires to allow the transaction to proceed.  But the members receive none of this vital information.

NCUA has preempted members’ right to make an informed choice.  The merging credit union does not have to “sell” its compensation plan outcomes to the members.  It just has to “sell” the terms to NCUA in private.

The credit union self-dealing that brought about the 2017/2018 merger rule update has not ended.  It has just been totally obscured and more critically, facilitated by NCUA.  The Agency seems powerless to understand and correct its supervision deficit over what is taking place.

But the credit union industry sees clearly.   When nothing meaningful is required to be disclosed, nothing is forbidden.  The members are kept in the dark. The ever-present temptations to cash out will only grow.

In case after case the member-owners lose control over their enormous financial legacies; they also have lost all their future choices.

These combinations will inevitably short change the credit union system’s options going forward.  They are wounds on the soul for why credit unions were created in the first place.

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Friday Outtakes

Ukrainian refugee professional artists, living in Wales, received a small grant to present this puppet and shadow theater show in England.

(photos by Nadiia Khomaziuk)

A 2026 National American Celebration-How Will Credit Unions Participate?

This historical milestone may be a perfect opportunity for credit unions to celebrate their contribution to the creation of economic democracy in the United States.

The America 250 Celebration’s mission is “To commemorate and celebrate our 250th anniversary with inclusive programs that inspire Americans to renew and strengthen our daring experiment in democracy. The shared experiences of America 250 will have ignited our imaginations, elevated our diverse stories, inspired service in our communities, and demonstrated the lasting durability of the American project.”

The five themes suggested for this commemoration by cities, towns and organizations are: The Unfinished Revolutions, Power Of Place, We The People, American Experiment, and Doing History.

All five are certainly illustrated by the cooperative system’s role in America.

The Skill to Listen in Public Debate

Silence involves listening, for one cannot argue without first listening to one’s opponent. As the writer of Ecclesiastes reminds us, “The words of the wise are heard in silence, more than the cry of a prince among fools.”

Thankfully, Solomon has not yet called and asked for his wisdom back.  (Frank Bruni)

An Upside Down View of the Economy

. . .maybe the economy isn’t booming despite higher rates but rather because of them. It’s an idea so radical that in mainstream academic and financial circles, it borders on heresy. But the new converts (along with a handful who confess to being at least curious about the idea) say the economic evidence is becoming impossible to ignore. By some key gauges—GDP, unemployment, corporate profits—the expansion now is as strong or even stronger than it was when the Federal Reserve first began lifting rates. So, with that in mind, here’s how the theory works.  (From Bloomberg)