Thursday, February 12, 2015

National NCUA Standards.....Flights of Fantasy.

Among citizens, there appears to be a growing belief that a centralized, prescriptive government is no longer efficient nor effective.  The strongest critics are harsher, and claim "the system is broken".

Personally, not ready just yet to "take up tea", to "occupy" anything, or to "move up into the mountains with an AK-47".  Think we have a very resilient "system" that has proved adaptable to change over the centuries - but there clearly is a need for reform.

Despots and...?
It's counter-intuitive perhaps, but the larger and more complex a project, an idea, a government, a society - or a credit union - becomes; the greater the necessity for decentralized management, control, and decision making.  Better and fairer decisions are made; responses are both quicker and more timely; and the risks of mistakes, corruption, and failure are significantly reduced.  Despots and entrenched bureaucrats of course do not agree with this view. 

NCUA's past humiliation with the largest corporate credit unions is an excellent example.  NCUA centralized regulation, monitoring, and control of corporates in Alexandria.  NCUA had full control and responsibility with direct "C-suite" NCUA leadership involvement, and with NCUA anointed "specialists" in-house, on-site, endorsing and second-guessing corporate management decisions and corporate Board governance.

With the corporates, NCUA's leadership failed.  They failed dramatically; they failed catastrophically; they failed financially; they failed "regulatorily"; they failed publicly; they failed abjectly; they failed.... thoroughly.

Same old, same old...
Yet NCUA seems to believe, as Larry Fazio's testimony before Congress yesterday indicated, that they can make their very public, very costly failures - including the recent, rank, "dead skunk" RBC proposal -  "go away". How?   By increasing centralized regulation, control, and monitoring over the surviving elements of the credit union movement - and now even "third party vendors" where NCUA clearly has less than no expertise.

Natural person CUs are being "bullied and
I am smiling and I am listening...
thrashed" to standardize, to centralize, and to adopt NCUA's national guidance - the very same "failed plan" which NCUA used to embarrass itself - and all credit unions - with its corporate self-destruction.  

NCUA seems to believe that if credit unions can be made to repent for NCUA's sins, all will be forgotten and forgiven.  NCUA should think again....

Credit unions might just take off if we could get some failed folks and failed ideas out of the way....  

And, you can be sure these two guys never asked for Federal permission to fly...
 Man, they didn't even have a pilot's
... but they were Wright!

(... and that's no "larry"!)

1 comment:

Anonymous said...

One can only believe that things must be wrong at NCUA having watched the RBC fiasco, the pettiness of the Chairman, the "it wasn't our fault" security breach and the continuous mess ups by the general counsel.

If you truly believe that NCUA has failed as a regulator and there is no sign of improvement, then action must be taken.

If you truly believe that the only solution is ation by Congress then you must vigorously pursue that course.

The problem is compounded by the fact that the trades have a good day on the Hill and then relax for six days. They have got it wrong. You work for six and relax an the seventh.

And what about the trade publications. Have you read their interviews with Congressmen or the NCUA Board? What ever happened to pursuing the issue with tough questions? All they ever do is throw powder puffs.

The GAC is around the corners. CUNA will ope the conference by singing "How Great We Are". That will be followed by the NCUA Chairman taking credit for everything good in the world and telling those gathered she is the best thing since sliced bread. The Vice Chairman will do his best to entertain ala Jay Leno. Then the Professor will will try to bring the audience back to reality by telling them things need to change. Following him will be one Congress person after another telling the credit unions that they love them, that they are the best financial institutions and they are behind them 1000%. You doubt that? Just watch.

As an aside, you mention you are not ready to head up to the mountains. I suggest you pull out your back pack as the time is near.

As to the tea, everyone knows you have been on that for awhile as you have been living in the woods for years,