If you were to turn to the dark side and decide to destroy the credit union movement, here is how you would do it. Simply put, you would do nothing. You would smile, pat the credit unions on the back and tell them what a great job they are doing, and encourage them to relax and enjoy the warm fuzzies of being part of the cooperative community. With a sense of security and success and by doing absolutely nothing, the credit union movement would almost certainly be dismantled.
You may rationalize inaction by recalling that in the past few weeks a key member of the House and the Senate both assured the national credit union movement that their tax exemption would be safe. Additionally, several other members of Congress have “promised” that no legislation eliminating credit union taxation will pass. So of course it is easy to sit back, relax, feel safe and secure and do absolutely nothing.
I do not like to be the one to burst your bubble but that attitude is the surest way to guarantee taxation of credit unions. Make no mistake about it; there will be tax increases in the future. The government is gasping for revenue.
Last week, credit union trades along with approximately four hundred other not-for-profit entities were told that the tax writing committee is starting with a “blank sheet of paper” as they look at various tax expenditures (i.e. tax exemptions). This means every one of those entities, including credit unions, will need to prove why they should not be on the list to be taxed.
I have heard a number of excuses as to why credit unions, their CEOs and their Boards may not want to get involved. One reason given is that CEOs are worried they might offend their members if they ask them to reach out to their Senators and Members of Congress. This reminds me of the statistics that indicates the large number of people who choked to death in a restaurant because they don’t want to create a scene by asking for help. If this analogy seems extreme, I would only add that I believe that the current potential threat of the taxation on credit unions is the highest it has ever been in my 20 years that I have been involved in the movement and I believe that taxation of credit union would be the end of the credit union system.
CUNA, the Leagues and other trades and cooperatives have posted a call to action asking all credit unions and their 96 million members to contact their Members of Congress both at home and on the Hill with the message, “Do not tax my credit union!” Every single day the bankers are pressing for taxation of credit unions. Every single day until the issue has been resolved in our favor all those who believe in the credit union movement should be shouting, “Do not tax my credit union!”
On the other hand, if you want to destroy the credit union movement. Do nothing.