At the thoughtful and timely suggestion of Mark Meyer, executivedirector/CEO of the Filene Research Institute, I reviewed PresidentFranklin Delano Roosevelt's inauguration speech. The words craftedin the early 1930s were eerily prescient on the eve ofPresident-elect Barack Obama's 2009 inauguration as I write thiscolumn.
FDR became president of the United States well after the stockmarket crash and more than three years into the Great Depression.Obama is inheriting his greatest challenge earlier in the fightwith seemingly just as ambitious a drive as FDR, each recognizingthat something must be done right away.
However, times have changed. Today's society is less patient witheverything, including government, and exceedingly more skeptical.The general population of America is much better educated thanks togreater access to information, and Obama won't enjoy the samegracious press that allowed FDR to mask his disability.
And, I am certain that true to character, he will give every bit aseloquent a speech at his inauguration as he is known for. But, heshould also heed the immortal words of FDR's inauguration speech-asshould credit unions.
One line that particularly drew my attention from Roosevelt'saddress was this: “Practices of the unscrupulous money changersstand indicted in the court of public opinion, rejected by thehearts and minds of men.”
Think about this in today's scenario. Have they? Sure people aredisenchanted every time they read about a Madoff scheme, but thething to note is whether he and others will truly be “rejected bythe hearts and minds of men.” In a time when there seems to be aJack Abramoff or Kenneth Lay lurking under every rock, today'sAmerican public has been worn down. Americans in general are toodisillusioned, not to mention tied up in their increasingly hecticdaily lives, to be outraged enough to affect change.
One way that credit unions can help their members care about thebetterment of our country is to continue being the trusted sourcefor financial services. This status is proven time and again whenthere is a so-called flight to safety, but when the coast is clear,the money runs right back out again.
Credit unions need to look at ways to make those members and theirfunds stick around long after the all clear signal. While Iunderstand that most if not all budgets are getting slashed, onemistake that probably nearly every business makes is lopping offthe 'soft' line items, like marketing (budgets that are alreadynotoriously small at credit unions). If members and potentialmembers don't know that you're there or offer a specific productthey need, they won't know you have a solution to fit theirfinancial problems, and with them go your potential profits anddeeper or new relationships.
Of the scoundrels who caused much of the problems of the Depressionera, Roosevelt said, “They know only the rules of a generation ofself-seekers. They have no vision, and when there is no vision, thepeople perish.”
Credit unions have the vision, but they need to be able to expressit more effectively. In part, this will come from marketingthemselves appropriately to their members. Also, get creative withfree or nearly free marketing, like providing financial educationsessions at a local community center or retirement savingscounseling for your SEGs. Involve your sponsors in promoting creditunion membership as an employee benefit.
“This nation asks for action, and action now,” is as true today asit was in 1933 when Roosevelt uttered the words. Credit unions aresure to feel the good and the bad that come along with this action,but hopefully the results will be a bit gentler thaninaction.
FDR characterized the resolution of the crisis he was facing thisway: “Finally, in our progress toward the resumption of work werequire two safeguards against a return of the evils of the oldorder; there must be a strict supervision of all banking andcredits and investments; there must be an end to speculation withother people's money, and there must be provision for an adequatebut sound currency.”
The time-worn saying, history repeats itself, comes to mind.Similar legislative and regulatory maneuvering toward greateroversight of financial institutions will occur. Unless creditunions rise up in the political arena to defend themselves fromunintended consequences, they will be crated up with the rest ofthe bad apples as political playmakers shake the trees to see whatfalls out; this only leaves you with bruised fruit. Credit unionsmay face a battle for their very existence if the regulatoryconsolidation recommended in Treasury's Blueprint is given credencein the Obama administration, which has already floated combiningthe Securities and Exchange Commission with the Commodities FuturesTrading Commission.
The manner in which the pendulum swings between less and moreoversight is made possible by the enabling doctrine (to borrow aphrase from my former constitutional law professor) this countrywas founded upon. As President Roosevelt said in his 1933 inauguralspeech, “Our Constitution is so simple and practical that it ispossible always to meet extraordinary needs by changes in emphasisand arrangement without loss of essential form.” Affect itsflexibility to enable, and not disable, your credit union.
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