WASHINGTON–CUNA CEO Jim Nussle and NAFCU CEO Dan Berger have jointly published a rebuttal to an op-ed in the Wall Street Journal that called credit unions “profit-seeking enterprises masquerading as tax-exempt nonprofits.
As CUToday.info reported here, that initial opinion piece was published by Scott Hodge, a senior policy advisor with the Tax Foundation. Nussle’s response also appeared in the Journal.
“The Tax Foundation’s Scott Hodge wrongly claims that ‘Credit Unions Stray Far From Their Mission’,” wrote Nussle and Berger. “While banks leave communities behind, credit unions step in to fill those voids. Is that a bad thing? Unlike banks, credit unions share their member-owners’ goals of financial security and empowerment, and work to help all Americans.
The ‘Reasons’
“The credit-union tax status—estimated by the Joint Committee on Taxation to be $2.5 billion in 2022—provided benefits for credit-union members totaling $13.9 billion that year. They deliver profits in the form of lower interest rates, higher savings yields and fewer or no fees. Data from the 2022 Home Mortgage Disclosure Act shows credit unions made a larger share of their mortgage loans than banks to black, Hispanic and low-to-moderate-income borrowers. These are a few reasons lawmakers have kept this tax status in place for decades.
“While Mr. Hodge is concerned about credit unions buying banks, Frederick Polling found that, of banks selling to credit unions, half cited keeping local branches open and preserving community service as reasons for the sale, and another 89% said it would mean more local employees keeping their jobs,” Nussle and Berger continued. “A recent voter survey also shows that credit-union members view the institutions much more favorably than nonmembers across all demographics, including women, people of color, lower-income consumers and those in urban and rural areas.
‘Credit Unions Will Never Apologize’
“In response to one example cited by Hodge—that of Congressional FCU’s FOM being open to employees of Legal Sea Foods-- to make his point credit unions have strayed beyond their original intent,” Nussle and Berger wrote. “Lastly, Mr. Hodge should know that in 2022 Congressional Federal Credit Union ‘stretched’ its charter to encompass additional underserved neighborhoods in Washington—an extension of its philosophy to increase service to its community. Credit unions will never apologize for living their mission by putting people and communities first.”
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