Anti-Bailout Drumbeat Echoes Across Cable TV, Videos, Internet
The industry's campaign to keep a lid on "credit union bailout" headlines expanded last week with a TV cable show, more online messaging and release of FoolProof literacy packets to more than 1,100 high schools.
In an interview of CUNA CEO Bill Cheney on a popular business cable show, he offered a safety-soundness message and reassurance that there was no federal bailout money.
And the FoolProof financial instruction packet, called "Burning Money," began attracting wide interest among teachers after it received a large AOL audience stemming from a syndicated Chicago Tribune column.
In the Cheney interview, appearing on CNBC's "Squawk Box" with guest host Steve Forbes, the CUNA CEO again emphasized that "taxpayers will not lose a dime" from the NCUA restructuring since CUs will absorb the costs.
Asked whether a worst-case scenario could trigger government guarantees behind the securities under the legacy assets plan, Cheney said that even if the costs reached the high-end estimates of $15 billion, CUs have the capacity to pay that off through the year 2021. "We know the costs are sustainable, we've run the models, and the taxpayer won't be impacted," Cheney explained.
On the educational FoolProof videos distributed free to CUs after the Sept. 24 NCUA action, one Wisconsin CEO praised that effort as worthwhile in helping the public understand the CU business.
"We're glad to see FoolProof keeping the focus on credit unions' commitment to consumer advocacy when so much of the discussion in the press around the country right now is about the corporate takeovers," said Eugene Szymczak, president of the $1.2 billion Educators CU in Racine.
Though its timing wasn't planned, the operators of the Melbourne, Fla.-based FoolProof said they were glad to help out in supporting the anti-bailout publicity.
FoolProof noted also that in little more than two weeks 1,100 high schools in 20 states have signed up for its "Burning Money" instruction aimed at teaching financial literacy. The show was aired on social networks early in October.
FoolProof said also its series received a boost from the National Education Association, which reprinted a Chicago Tribune syndicated article on the topic in its daily NEA bulletin to teachers.
On the CNBC show, the attention at one point turned to problems at Fannie Mae and Freddie Mac. Asked by Forbes if CUs were affected by the failure of Fannie Mae and Freddie Mac preferred securities and trust preferred, as smaller community banks were, Cheney noted that CUs don't issue trust preferred securities and most CUs did not invest in Fannie and Freddie Mac preferred.
Cheney also stressed that most CUs remain in good financial shape.
"Our regulator worked with the Treasury to come up with a plan that does not burden the taxpayers but actually allows CUs to pay for this over a long period of time," Cheney told the CNBC interviewers.