Competitive Enterprise Institute | 1899 L ST NW Floor 12, Washington, DC 20036 | Phone: 202-331-1010 | Fax: 202-331-0640
December 23, 2008
The Honorable Barack Obama President-Elect 451 6th Street N.W. Washington, D.C. 20004
Dear Mr. President Elect: We are a diverse group of organizations with very different views about the wisdom and potential onsequences of the economic stimulus package you intend to propose. We do, however, wish to speak with one voice on a proposal we think will play a modest but important role in getting the economy moving again. In particular, we believe you should strongly consider measures to make it easier for credit unions to expand lending to their business members.
As you know, current regulations limit credit unions to lending 12.25 percent of total assets to businesses. The Credit Union National Association has estimated that its proposals for lowering the cap ill inject $10 billion into the economy. We do not endorse this particular figure but do know that anything that frees up capital for lending to businesses is a good idea that will have consequences similar to what you hope a government-induced economic stimulus will accomplish. Consider the following facts:
Easing reserve requirements for credit union member business lending will not cost taxpayers anything. In fact, it will increase revenues since loan recipients and credit union members pay taxes on the revenues that result from the lending. Quite simply, expanding credit union business lending is a no lose proposition: it will get the economy moving at no cost to the taxpayers. We urge you to support it. Yours truly,
Eli Lehrer Senior Fellow The Competitive Enterprise Institute Brent A. Wilkes National Executive Director League of United Latin American Citizens Grover Norquist President Americans for Tax Reform