What the Election Means for Credit Unions
by Henry Meier
Now that the elections are over, it’s time to get back to governing, at least for the week or two before the cable news networks start speculating as to who is positioning themselves for a possible Presidential run in 2016. The best thing about American politics is becoming one of its most overlooked facts: the system is not designed to create dramatic changes but to make them difficult. This means that many of the same issues that were around before the election still have to be grappled with and that each of the elected officials, be they a Congressman or the President, can point to their election mandate to justify their position. That being said, there has to be movement on key issues if only because the clock is literally running out.
Fiscal Cliff
Everyone knows about the fiscal cliff, which is the combination of tax increases and automatic spending cuts scheduled to take effect on January 1st unless Congress and the President can come up with a compromise on a deficit reduction package. Well before the election, Obama advisors were publicly saying that the pressures of the fiscal cliff would be the best leverage they have to get Republicans to the table so the gamesmanship is already starting. Wall Street tanked yesterday, in part because of fears that the President’s victory made it more likely that we will go over the fiscal cliff. I think this is nonsense. House Speaker Boehner signaled his openess to revenue enhancements so the debate might come down to when is a tax increase a tax increase. For all the disagreement in the campaign, if you listen closely, both sides thought there was merit to the idea of closing loopholes. No one is seriously talking about ending the credit union tax exemption, but credit unions have to keep an eye on the negotiations so that whatever grand bargain does emerge doesn’t destroy the industry in the process.