Tuesday, April 26, 2011

Book Review: Crusade by Roy F. Bergengren

Published in 1952 (only three years before his death), Roy F. Bergengren's final book, entitled Crusade: The Fight for Economic Democracy in North America, 1921-1945, was written with the clear purpose of recording the legacy of his life's work as a credit union organizer. Mixing a chronological narrative of the movement's growth from his early work as the head of the Credit Union National Extension Bureau until the Second World War with countless colorful anecdotes and philosophical asides, Bergengren provides the reader with a rich textual mosaic which powerfully conveys his sense of the movement's trajectory and meaning during the years of his involvement.

As a work of history written by a participant, Crusade often reads like a book-length acknowledgements. For each event he covers, whether it be successfully lobbying for a state credit union law or organizing a speaking tour, Bergengren faithfully names all of the people whose support made the particular achievement possible. While this nostalgic style sometimes gets a bit tedious and mushy, it also means the book is an excellent place to start for anyone interested in undertaking a wide variety of credit union history-related projects. Not only will that reader emerge from Crusade with a fairly clear sense of the movement's overall developmental path, but he or she will also likely have developed a list of the names of the key players in almost any episode of that period.

Tuesday, April 19, 2011

Community Building in Credit Unions

In the American credit union movement's early years, narrow legislatively imposed field of membership (FoM) requirements functioned to limit the possible scale of cooperative financial institutions. As a result of this state of affairs, one of the major trends in the development of credit unions in the United States has been the push for the gradual loosening of their FoMs. That process culminated in the mid-1990s, when the regulatory framework was shifted to allow for "community" charters under which a credit union's FoM could consist of a region populated by millions of potential members. The results of this change have been mixed; while the number of credit unions members has grown robustly, that growth has been accompanied by a crisis in credit union identity.

This crisis, manifestations of which include declining annual meeting attendance, aging boards of directors, demutualization, and the fact that many new credit union members aren't even aware that their institution is structurally different than a joint-stock bank, was not entirely unexpected. Indeed, it had been anticipated by the debates between "traditionalist" and "progressive" credit unionists over the strategic direction of the movement in the 1970s and '80s. While the progressives advocated for the consolidation and growth of credit unions into large, technologically savvy full-service institutions with loose FoMs, traditionalists countered that the core purpose and essence of credit unionism would be weakened or even lost entirely in the course of such a transformation.

BitCoin: A Natural Experiment for Credit Union Development?

Over the course of the past few months, Bitcoin, an open source peer-to-peer on-line currency, has been quickly gaining traction and acceptance, to the point where the "Bitcoin economy" is now valued at several million dollars. A full explanation of the nature and broad implications of the phenomenon is beyond the scope of this essay (to learn more: the short version and the long version), but, while following its development, it occurred to me that the expansion of the Bitcoin economy might offer some potentially fascinating insights into the dynamics of credit union development. The sudden, almost spontaneous growth of a new monetary system and economy is not something one can observe everyday, and the ways in which forms of co-operative credit emerge within it might offer new insights into the models of scholars such as Ferguson & McKillop and Ian MacPherson.

At present, the Bitcoin economy is small enough that, as far as I can tell, credit is virtually non-existent. All transactions are made in "cash," and the "credit money" that does exist within the system was likely obtained from intermediaries in the form of Dollars, Euros, etc., and then converted into Bitcoins (btc). However, as an increasing number of providers of goods and services begin to accept btc, it is conceivable that, once all of their obligations can be met in btc, certain kinds of firms will start operating exclusively in that currency. Once that happens, demand for credit within the system will begin to grow, as btc-exclusive merchants will need short-term loans with which to cover fluctuations in their businesses, as well as longer-term credit to finance growth.

Sunday, April 17, 2011

Book Review: The Credit Union Movement by Moody and Fite

Written in 1984 by J. Carroll Moody and Gilbert C. Fite (both academic historians), The Credit Union Movement: Origins and Development, 1850 to 1980 remains one of the most essential texts for anyone interested in credit union history. Drawing on a rich assortment of primary sources, the authors exactingly trace the lineage of North America's co-operative banking movement from the experiments of Schulze-Delitzsch and Raiffeisen in mid-19th century Germany through to the challenges of deregulation and inflation at the close of the 1970s.

Given that their pioneering book was the first of its kind, Moody and Fite openly acknowledge its limitations in their Preface. It is not intended to be "an economic history of the role of credit unions in consumer finance. ... Moreover, this study is not about individual credit unions, their founding or operation, or the thousands of volunteers and dedicated leaders who worked to make the movement succeed at the grass roots. Nor does it deal in any detail with credit union chapters and state leagues, except as these facets of credit unionism illustrate the failures and successes of the larger movement." Rather, their modest goal for the book is "to trace and analyze the history of credit unionism as a national social movement."1

Thursday, April 14, 2011

Oral History: Roy Bergengren, Jr.

While recently mucking about on-line, I stumbled upon the transcript of an oral history interview of Roy Bergengren's son, Roy Bergengren, Jr., which had been conducted in 1975. At the time, the younger Bergengren was the recently retired president of a junior college in Florida, and the bulk of the interview focuses on that experience. However, the biographical background information that he lays out in the first few pages provides some intriguing tidbits for credit union historians by offering a quick glimpse at what it was like to be Bergengren's child and outlining his own brief involvement in the organized credit union movement. I've excerpted the passage in which he discusses the latter; if you want to check out the full interview, you can read it on the University of Florida's website.

P: What did you do after [graduating from Dartmouth in 1936].

B: After that, I went to work for my father, who was at that time, head of the Credit Union National Association in Madison Wisconsin. And the National Organization of Credit Unions was just starting, and they had a very small staff, and they needed somebody to edit their little monthly magazine [ed. note: the Credit Union Bridge]. So I started editing a monthly magazine for $15 a week. I kept that for about three years, and I decided that it wasn't the best thing in the world to work for your father, despite my respect and love for him, so I went to work on a newspaper in Madison, Wisconsin... (Page 2)

Sunday, April 10, 2011

Book Review: The Credit Union Lady by Paul Thompson

For those seeking an introduction to the origins of the credit union movement, the general dearth of contemporary literature on the topic can be quite frustrating. Given the available resources, it is often necessary to either settle for the overly-simplistic thumbnail sketches that can be found in CUNA publications such as People, Not Profit, or commit to the dense and slightly out-of-date academic histories of Ian MacPherson or Moody & Fite. Fortunately, retired CUNA speech-writer Paul Thompson's recently published book, The Credit Union Lady, offers a new medium through which prospective students of credit union history might become acquainted with the field: historical fiction.

Thompson's novel traces, from 1927 to 1956, the experiences of three generations of a German-American family in the fictional industrial town of Brighton Falls, Wisconsin, whose lives are intimately bound up with the development of the credit union movement. Over the course of these decades (and in less than three hundred pages), Thompson weaves a truly impressive depth of historical information into his narrative. Not only does he get the "big stuff" such as the emotional and populist atmosphere of one of Roy Bergengren's rallies in the 1930s, but The Credit Union Lady also teases out some subtle dynamics (such as the importance of payroll deduction for early credit unions) that only became apparent to me as significant after many hours spent poring over credit union board of directors meeting minutes from the 1940s and 1950s.

Wednesday, April 6, 2011

Input for Oral History Template

In order to maximize the usefulness of the Credit Union History oral history project's interviews, I'm currently working on developing an "interview template" which will help ensure that certain types of information are collected in all of the conversations. The idea is not to only ask the questions on the template, but, rather, to provide a "skeleton" that might serve as a jumping-off point for the discussion of a great deal of interesting material. I plan on continuing to develop and tweak it over the next month or two before beginning the first round of interviews, and so I figured that I'd post some initial ideas for commentary and suggestions. If you can think of any questions that you'd like to ask of elder credit union volunteers, feel free to leave them as comments on this post, or send me an email. A few of the questions that I've been considering are below; critiques and suggestions are extremely welcome!

  • When were you born and where did you grow up?
  • What did your parents/caregivers do? Where were they from?
  • What schools have you attended and what kinds of work have you done?
  • What was your earliest encounter with a credit union? Why did you join one initially? What was its common bond?
  • What was your early understanding of what a credit union was? How did you learn about it?
  • [For volunteers or staff members] How and why did you take on an active role in your credit union?
  • What role(s) have you played in your credit union? How have the responsibilities of those roles changed?
  • How have credit unions changed in the time you've been involved with them? Why do you think those changes have occurred? What do you think the effects have been?
  • What do you believe to be the essential characteristics of a credit union? What makes it different from a bank?

Saturday, April 2, 2011

Book Review: I Speak for Joe Doakes by Roy F. Bergengren

When one first picks up Roy Bergengren's I Speak for Joe Doakes, it is immediately apparent that the book stands apart from the bulk of his oeuvre. To start with, having been written in 1944 and published a year later, the realities and implications of the Second World War loom large and extend even to the book's physical form. Immediately below the copyright information, the reader is informed that the text is "manufactured in strict conformity with Government regulations for saving paper," and it is dedicated to "SERIAL NUMBER 0-560627 and SERIAL NUMBER 0-1289910 [presumably his enlisted sons] With All My Love." Unlike the rest of his books, which focus primarily on the credit union movement that he founded and led, I Speak for Joe Doakes has a much grander purpose: namely, to argue for a post-war international and economic order rooted in co-operation.

As its title suggests, the book is framed as Bergengren's advocacy for the interests of "Joe Doakes," his "symbol of the common man, the worker, the great mass of people." In general, Joe Doakes is not a man of expensive tastes or voracious appetites. Rather,

He is most vitally concerned with any circumstance which affects his opportunity to work at a fair wage ... it is essential to him that there be a lasting peace. He has no wish that this war shall end in futility as did the war which his father fought. He is interested in co-operation as a possible contributing factor in the creation of the great new world which might evolve from this war if his rights and hopes and aspirations are adequately recognized in the peace.1

The validity of these insights, Bergengren argues, is rooted in his decades od criss-crossing the United States for the purpose of helping thousands of "Joe Doakes" from all walks of life to organize credit unions. That experience, he believes, provides him with a unique vantage point into the interests and desires of the inarticulate "common man," who he declares to be his "client." Thus, according to Bergengren, what "Joe Doakes" desires above all else is to avoid a full replay of the great traumatic episodes of Bergengren's generation: the First World War and the Great Depression, or, to put it more abstractly, to secure lasting peace and economic prosperity.