who will speak for credit...
TRANSCRIPT
10/10/2013
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Who Will Speak for Credit Unions
The Case for Member-Supported Advocacy at the Federal Level
Community Credit Union and Growth Conference October 10, 2013
What Can Credit Unions Learn From Prohibition Era Advocacy?
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Focus on the Long Game.
A minority of the public can defeat a majority of the elite.
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The group seeking change is always more passionate and
motivated than the group protecting the status quo.
How do we apply these lessons?
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Congressional Gridlock: Legislation Enacted As a Percentage of Legislation Introduced
80th - 112th Congresses
7.49%
2.20%
4.20%
6.32%
4.31%
3.49%
4.67%
3.28%
2.80%
1.95%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
0
5000
10000
15000
20000
25000
30000
35000
80th
Congress
(1947-1948)
83th
Congress
(1953-1954)
86th
Congress
(1959-1960)
89th
Congress
(1965-1966)
92nd
Congress
(1971-1972)
95th
Congress
(1977-1978)
98th
Congress
(1983-1984)
101st
Congress
(1989-1990)
104th
Congress
(1995-1996)
107th
Congress
(2001-2002)
110th
Congress
(2007-2008)
Productivity of Congress Through July 2013• Four Reauthorization Acts
– Violence Against Women Reauthorization Act– Animal Drug and Animal Generic Drug User Fee Reauthorization Act– Pandemic and All-Hazards Preparedness Reauthorization Act– Consolidated and Further Continuing Appropriations Act
• Technical Corrections– Amend the IRS Code to increase tax on certain flu vaccines.– Modifying the Stop Trading on Congressional Knowledge Act
• Law to Undo an Existing Law– Reducing Flight Delays Act
• Miscellaneous Laws– No Budget, No Pay Act– District of Columbia Financial Officer Vacancy Act– Stolen Valor Act– Freedom to Fish Act– Award Congressional Gold Medal to the 16 Street Baptist Church bombing victims– Disaster Relief Appropriations for Hurricane Sandy– Ordering the Secretary of State to endorse Taiwan’s attendance at an international aviation
regulators meeting– Mint coins for the National Baseball Hall of Fame– Name the new bridge over the Mississippi River the Stan Musial Veterans Memorial Bridge
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Contributing Factors
• Constitutional Structure.• Experienced legislators have retired, been
defeated or died.• The public is sharply divided politically and
the moderates in Congress have been eliminated.
• Tools of compromise have been eliminated.
Source: Washington Post (October 7, 2013)
The Senate spent more time breaking filibusters in 2009 and 2010 than in the 1950s, 1960s, and 1970s combined.
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Tenure
0
50
100
150
200
250
300
350
400
450
Serving Since
Seniority of the Members of the House of Representatives
113th Congress
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Tenures in the New House of Representatives
42%
29%
12%
17%
Members of the House by Tenure112th Congress
6-11 Years
18+ Years
48%
24%
11%
17%0-5 Years
Members of the House by Tenure113th Congress
12-17 Years
6-11 Years
18+ Years
12-17 Years
0-5 Years
Tenure for the 112th Congress is computed considering tenure up to the present. Tenure for the 113th Congress is computed considering tenure as of January 2013. Source: National Journal, 2012; GovTrack.us, 2012; Congressional Research Service, 2012.
Average: 8.1 years Average: 8.9 years
0
50
100
150
200
250
300
350
400
450
Serving Since
Seniority of the Members of the House of Representatives
113th Congress
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Sharp Political Divide and Gerrymandered Districts Have
Emboldened Extremes Wings of Both Parties
Charlie Cook Rates the Districts
Source: Cook Political Report, 2013.
Analysis• According to the Cook Partisan Vote Index, the number of swing seats in the House has dropped 45%, from 164 in
1998 to 90 in 2014• Fewer swing seats means more polarization in Congress• As district populations grow increasingly liberal or conservative, incumbents fear radical primary challengers
House Makeup by Cook Partisan Vote Index
In House, Fewer “Swing” Seats, More Polarization
Numberof Seats
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Polarization Still Acute in the House
Source: Congressional Budget Office, Historical Tables; Congressional Budget Office, “The Budget and Economic Outlook: Fiscal Years 2013 to 2023,” February 5, 2013. 19
AnalysisIn 2012, 13 congressmen were rated between the most conservative Democrat and the most liberal Republican in the House, up from 8 congressmen in 2010
*National Journal’s Vote Ratings scores members of Congress on selected roll-call votes from the previous year. Members are compared to each other on an ideological scale, from liberal to conservative
National Journal Vote Ratings in the House1994 – 2012
Most liberal Republican House member
Most conservative Democratic House member
Tools of Compromise Have Disappeared
• Never ending campaign cycle – Keeps Members from moving their families to
Washington.– Eliminates the time Members had to get to know
each other.
• Rule changes– Elimination of earmarks and other projects.– Too much transparency?– Hastert Rule
• Who are the negotiators?
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If Congress cannot get anything accomplished, why bother
engaging?
This has actually increased to 90% in recent polls.
The level of disapproval is unsustainable and a reflection on both parties.
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Prior to Shutdown, There Were Signs of Progress in the Senate
• Farm Bill• Immigration• Student Loan Deal• Cordray Nomination Approved• Tax Reform Process is Bipartisan
The pressure continues to mount on the House to come to the table and engage in serious lawmaking.
The table is being set.
Preserve the Credit Union Tax Exemption
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The Threat to the Tax Status
Federal Government Budget Crisis
– $14 trillion debt– Annual budget deficits– Demand to make tax
code fairer to promote growth
– Need to raise revenue to cover costs
– Everything is on the table
Banking Trade Associations
– Credit unions present unfair competition to banking industry
– If they want to act like a bank, they should be treated like a bank
Banker Threats at the State Level
• Banking Trades introduced tax legislation in Illinois and Oregon
• Radio ads ran in Missouri, Illinois and Washington DC
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Upcoming ActivityHouse• Instructions Possible in Debt
Ceiling Resolution.• Draft expected to be released in
this Fall.• Committee consideration of a bill
in November.• Possible House consideration be
end of the year.
Senate• Draft expected to be released
after the House draft.
• Committee and Full Senate consideration of tax reform could come later in the year.
• Proponents of tax reform want to complete the process by the end of the year, but this will likely drag on into next year or beyond.
• Early legislative drafts will likely be the starting points for future tax reform efforts.
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Magnitude of Response• Our response will need to be greater than
anything we’ve ever done.– We are competing against over 400 groups with tax
preferences.– Many groups are better funded than we are.– None of them have access to 96 million potential
advocates.
• We need millions of contacts to the Hill over the next several months.– Just over 500,000 contacts in the first two
months.
Duration
• Our action will need to be sustained at least through the end of the year, perhaps longer.
• There have been and will be several short term mileposts but the tax status will not be secure until the process is complete.
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Ramp Up
• There is no light switch to turn on 96 million activists.
• The conversation with them needs to begin now.
• Those most invested in the success of credit union are the members. If the tax status is worth keeping, it is worth enlisting them in the fight to keep it.
CEO: “Very Willing” to Engage Members for Grassroots
Q. 7
CEO-BoardSurvey
2013
27%
29%
28%
33%
15%
14%
9%
13%
19%
52%
0% 10% 20% 30% 40% 50% 60%
Legislation that explicitly benefits banks
Expansion of CRA to CUs
Increased regulations for ODP
Restriction of credit card interchange fees
Removal of tax exemption status
Very willing
Somewhat willing
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BOD: “Very Willing” to Engage Members for Grassroots
Q. 7
41%
38%
33%
38%
23%
11%
10%
22%
15%
39%
0% 10% 20% 30% 40% 50% 60%
Increased regulations forODP
Expansion of CRA to CUs
Legislation that explicitlybenefits banks
Restriction of credit cardinterchange fees
Removal of tax exemptionstatus
Very willingSomewhat willing
CEO-BoardSurvey
2013
Steps to Turning Members into Active Grassroots Participants
Affinity
Education
Activation
Follow-up
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If a legislative battle broke out between credit unions and banks, with whom would you agree?
-40-2 -28
48
93
64
Sample CU Member /Primary
CU Member / Notprimary
Side w/ Banks
Side w/CU's
Voters Don’t Know CUs are Tax Exempt
Do credit unions pay taxes or not?
86%
7% 7%
Don't Know
Do Pay Taxes
Do Not Pay Taxes
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Very short copy
List of items
Etcetera in
This curved color block
When appropriate
What We Need You To Do
Rallying 96 Million Credit Union Members
� Email your members (sample on the tool kit)
� Ask them to go to www.DontTaxMyCreditUnion.org
� Download the CUNA Advocacy App
� Reach beyond our National/Digital Campaign
� Ask your members to contact their Representative and Senators
� Work with CUNA and Your league to set up Vine Campaigns in your credit union (information available on the tool kit)Radio Ads:
� Link to Video� Tax Campaign FAQs� Graphics and Email headers� Radio Ads� Print Ads� Digital Ads� Banner Ads� Don’t Tax My Credit Union Gear,
Buttons, Banners, & More � Don’t Tax My Credit Union Statement
Stuffers, Posters and Drive-Up Envelopes
� Short Newsletter Articles
CUNA’s Don’t Tax My Credit Union Toolkit
Pro-CU Ad Banker Response Ad
Two Track Approach
NationalCampaign CU Activation
� Execute National Online/Digital Campaign (28 million impressions to likely CU supporters).
� Produce video for online campaign to educate and activate.
� Promote & track social media.
� Communicate outreach efforts to leagues and CUs.
� Stock Tool Kit with educational information for CU members.
� Develop Activation Mobile App.
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New Advocacy Mobile App….
Google Playfor Android
App Storefor Apple
Search for “CUNA Advocacy”
at:
Gesa CU Home Page – Pop-up
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Steps to Turning Members into Active Grassroots Participants
Affinity
Education
Activation
Follow-up
DTMCU Research
� 64% to “strongly agree” they’d contact Congress to protect CUs (90% total agree)
� 65% strongly agree they’d be “more likely to do a greater share of my personal banking with a Credit Union” (86% total agree)
Member Exposure to pro-Credit Union messaging about CU structure and tax threat generates overwhelming interest, desire to act, and stronger loyalty to th e Credit Union.
Not-for-profit/member benefits/no taxes/different from banks all combine to generate both a greater bond with Credit Unions and a desire to act to protect the special relationship.
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Credit unions need to engage in grassroots because we fight to
exist in the first place.
Those who are most invested in the success of the credit union need to be asked to engage in
grassroots.
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Very short copy
List of items
Etcetera in
This curved color block
When appropriate
What We Need You To Do
Rallying 96 Million Credit Union Members
� Email your members (sample on the tool kit)
� Ask them to go to www.DontTaxMyCreditUnion.org
� Download the CUNA Advocacy App
� Reach beyond our National/Digital Campaign
� Ask your members to contact their Representative and Senators
� Work with CUNA and Your league to set up Vine Campaigns in your credit union (information available on the tool kit)
Thank you!