The pending charter of a credit union for professional athletes demonstrates that the credit union tax exemption no longer serves its original purpose, ABA President and CEO Frank Keating wrote in an op-ed published in The Hill newspaper this morning.
“Why should pro athletes benefit from tax privileges that Congress intended for America’s low-income citizens?” Keating asked. “The inherent trade-off in the law making credit unions tax-exempt is that they are intended to serve low-income individuals who don’t have other financial options.”
Keating called on Congress to rein in credit unions that abuse their tax exemption to serve the wealthy, finance luxury goods like boats, make jumbo mortgage loans and buy stadium naming rights. “Are all credit unions earning their tax exemption by serving people of modest means? The existence of a credit union for pro athletes makes it clear that the answer is no.”
Read the op-ed.
Credit unions were founded in the early 20th century when banks did not want to serve the common person. Nowhere have credit unions been limited to serving "low-income individuals who don't have other financial options."
ReplyDeleteMaybe credit unions should start publicizing that most, if not all, consumer protection laws (including Truth In Savings, Consumer Privacy) came about because of bad banking practices. Dodd-Frank did not come about because of credit unions or community banks.
Obviously Governor Keating has not been in California. Try getting a small house in a decent area in the Bay Area, Southern California, or San Diego that does not require jumbo financing. Maybe he needs to return to Oklahoma.
ReplyDeleteI know this will come as a shock to someone as learned and educated as you claim to be. Not all athletes make A-Rod money. As I understand it, all pro athletes, which includes those in the less wealthy sports of bull riding and figure skating, will also be able to join this credit union. Of course, in your mind, if those individuals make more than a lowly economist who could only get a job with a bankers trade association, they must be wealthy.
ReplyDeleteThe median annual salary for a professional athlete in the U.S. is $31,525 and on average, their career is over by the time they're 33 years old. Apparently, this isn't modest enough?
ReplyDeleteI wonder with all the expanded FOM (Field Of Membership) issued by both the NCUA and the the more liberal FOM issued to state chartered credit unions - can't these athletes find an existing credit union that is already open, with the lights on, and all the services up and operational? With all the community chartered credit unions there is I dare say a credit union for everyone - even an economist on the ABA payroll.
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