Know your Enemy

Most Gen X and Y-ers will probably understand the reference in the title of the post.  With my formative years taking place in the early 90’s it was almost impossible to escape the auditory onslaught of the band Rage Against the Machine.  But for those not as familiar, a more classical and resonant reference may be taken from Sun Tzu’s The Art of War.  Often appropriated by business consultants for its insights on strategy, “know you enemy” was expressed by Tzu and essentially says the same thing as the band:

“Knowing the enemy enables you to take the offensive, knowing yourself enables you to stand on the defensive.”

The use of the word enemy in the context of this post is admittedly a bit much and I think opponent is far more appropriate.  Of course the opponent I am referring to are the bankers during the taxation debate.  Recently, a “report” was issued by Kenneth J. Kies and Bert Ely, which I think illustrates my point and explains the title of the post.

First, I’d encourage everyone to read the report.  It’s only about seven pages, and it offers up many of the same worn out arguments the bankers have thrown around for years.  However, in the current climate credit unions shouldn’t take anything for granted.  Remember, this isn’t the same Congress from 1998 and the state of the country and economy look very different from that time as well.  It is in our best interest to make sure we know the arguments well and are ready to counter them when necessary.

Second, I did a bit of quick checking, which any member of the public can do by reviewing the House Clerk’s lobbying disclosure site.  It seems that one of the authors, Mr. Kies, is a registered lobbyist for the American Bankers Association.  He has also represented various interests within the banking industry off and on since 2002.  But that doesn’t automatically destroy the credibility of him and his colleague’s report.  He is quite well known on the Hill, especially among tax writers.  From 1982-1987, he served as Chief Republican Tax Counsel on the Ways and Means Committee and from 1995-1998, he served as the Chief of Staff for the Joint Committee on Taxation.

So as we head into what seems to be a heated debate on tax reform, we must make sure we are prepared, know all of our talking points, and all of the players.  Only by knowing our opponents and ourselves can we effectively protect the credit union tax exemption.