(Fwd) Congressional Assault on TIAA-CREF and credit-unions

Lyn Gerry (redlyn@loop.com)
Sun, 3 Aug 1997 08:34:55 +0000

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------- Forwarded Message Follows ------- Date: Sat, 2 Aug 1997 20:44:43 -0700 (PDT) From: MichaelP <papadop@peak.org> Subject: Congressional Assault on TIAA-CREF and credit-unions

Spread the word

Subject: It's not just the Credit Unions! From: phssra@physics.emory.edu (Scott Anderson) To: cooperative-bus@relay.doit.wisc.edu (Multiple recipients of list) Date: 97-07-31 02:33:33 EDT

If you think it's just the credit unions which are under attack by America's Republican congress and their capitalist supporters, think again.

The NCBA Cooperative Journal recently reported on a congressional committee hearing in which agricultural cooperatives were attacked by a competitor who felt they had an unfair advantage because they didn't have to pay taxes on declared patronage refunds. This is the same argument that bankers are using against credit unions, as has been noted on this list several times.

The fact that these are *refunds* rather than *profits* is an unimportant distinction to those who complain about excessive taxes on the rich but are quite happy to increase taxes on mainstream Americans.

One battle is, unfortunately, about to be lost! TIAA-CREF, the nonprofit mutual insurance organization which provides pension investment services to colleges, universities, and nonprofit research organizations across the country, will have its pension tax exemption removed by the "tax cut" bill which may come before Congress today, where it will likely pass and be signed by the president.

"TIAA-CREF is in the insurance business and competes with taxable entities," according to the House committee which wrote the provision. "It is unfair that this insurer's tax-exempt status gives it a competitive advantage in the marketplace." Never mind that the for-profits are in it to make money off other people, while TIAA-CREF is a collective enterprise operating in its members' interests.

What this means is a new tax on university faculty and staff, all the way from the lowest-paid custodian up to the highest-paid administrator. Pension benefits for retirees will be reduced in the years to come as the government takes a cut at the source.

Credit unions and cooperatives may well be next; the principles are the same, and the first step in casting them aside is almost completed.

Scott Anderson President, Board of Directors Sevananda Natural Foods Cooperative Atlanta, Georgia, USA (404) 727-4089 phssra@physics.emory.edu

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