Credit Union’s Opportunity to Reconnect with their Most “Essential” Members



When the economy shut down in March of 2020 due to Covid, many office workers went home. Hybrid and remote work options were developed. However essential workers stayed on the job: the trash haulers, public transportation, police, fire, hospital, and construction workers. These blue-collar and middle-class service workers make community life possible for the rest of us.

Today the key economic question is will there be a recession? For hundreds of thousands of white-collar workers in the technology, finance, and venture capital startups the layoffs are here.

Goldman Sachs, Pepsi, Gannet, CNN, Door Dash, Carvana, Roku, Amazon, and dozens of other previously industry-high flyers are in the first rounds of layoffs.

The dominance of the four FANG (Facebook, Apple, Netflix, Google) and their stock market performance has fallen back to the mean of the rest of the market over the past five years.

The bankruptcies of the crypto, NFT industry, and its offshoots have cost investors over $2 trillion in losses with more to come.

However in almost every other part of the economy, especially the service sector, there are millions of unfilled jobs. Wages are rising from both employer demand and more aggressive employee actions.

The well-off and essential labor

America’s experience with capitalism has often been characterized as a society where the successful, the wealthy, and the better-educated have dominated their poorer classes. Here is an excerpt from a Heather Cox Richardson description of why Lincoln strongly supported universal education:

“But when they organized in the 1850s to push back against the efforts of elite enslavers like Hammond to take over the national government, members of the fledgling Republican Party recognized the importance of education. In 1859, Illinois lawyer Abraham Lincoln explained that those who adhered to the “mud-sill” theory ‘assumed that labor and education are incompatible; and any practical combination of them impossible… According to that theory, the education of laborers is not only useless, but pernicious, and dangerous.’”

Lincoln argued that workers were not simply drudges, but rather were the heart of the economy. “The prudent, penniless beginner in the world, labors for wages awhile, saves a surplus with which to buy tools or land, for himself; then labors on his own account another while, and at length hires another new beginner to help him.” He tied the political vision of the Framers to this economic vision. In order to prosper, he argued, men needed “book-learning,” and he called for universal education.

Congress passed the Morrill Land Grant College Act in 1862 to focus on the teaching of practical agriculture, science, military science, and engineering—although “without excluding other scientific and classical studies”—as a response to the industrial revolution and changing social class.

The question today: do rich people know?

Gian Carlo Menotti’s opera Amahl and the Night Visitors tells of the night the Three Kings, following the star to Bethlehem, stop for shelter at the home of Amahl, a poor, crippled shepherd boy who lives with his widowed mother. The opera was first performed in 1951 and regularly at Christmas since.

The climactic scene occurs as the three kings sleep. The mother considers if she dares take a piece of gold from the king’s treasure chest. She debates the rightness of her action:

MOTHER (thinking to herself) All that gold! All that gold! I wonder if rich people know what to do with their gold? Do they know how a child could be fed? Do rich people know? Do they know that a house can be kept warm all day with burning logs? Do rich people know? Do they know how to roast sweet corn on the fire? Do they know how to fill a courtyard with doves? Do they know… do they know? Do they know how to milk a clover-fed goat? Do they know? Do they know how to spice hot wine on cold winter nights? Do they know… do they know? All that gold… all that gold! Oh, what I could do for my child with that gold! Why should it all go to a child they don’t even know? They are asleep. Do I dare? If I take some, they’ll never miss it… (moving towards the boxes of gold…) …for my child for my child… for my child… for my child…

2023: the year of the “Essential Member”

Credit unions’ purpose was to address those in society who have the least or know the least when seeking financial services, especially credit.

The cooperative model proved that consumers are indeed a market that all financial institutions can profitably serve. Today financing options for consumers are available for those with no or damaged credit to the elite credit cards made of titanium, not mere plastic, for the most well-off.

Since deregulation the credit union system has grown, attracted tens of millions of new members, and provided ever-expanding institutional and professional opportunities for coop leaders.

Some coop executives see their opportunities in buying banks or scooping up their smaller brethren. Senior executive coop compensation routinely rewards in the mid-six figures. For the best well-paid leaders, annual compensation comes with two commas.

The challenge for co-op leaders will be the question asked by the widow in Amahl: I wonder if rich people know what to do with their gold?

Have leaders so aspired to emulate their banking counterparts that the essential members whose loyalty created the institutions they lead have been forgotten?

Yes, the white-collar tech, financial, and previously high-flying company employees now being brought back to earth by rising interest rates, will need our help as well.

But let’s never forget those who brought us to where we are today-a $2.3 trillion tax-exempt financial force with a special role in society. This institutional success has enabled many coop managers and boards to become members of the white-collar class.

Do they know that America’s essential workforce may indeed be the greatest opportunity for credit unions in this pivotal year of economic and market realignments?


  • Chip Filson

    A nationally recognized leader in the credit union industry, Filson is an astute author, frequent speaker, and consultant for the credit union movement. He has more than 40 years of experience in government, financial institutions, and business. Chip co-founded Callahan and Associates. Filson has held concurrent positions at the NCUA as president of the Central Liquidity Facility and Director of the Office of Programs, which includes the NCUSIF and the examination process. He holds a magna cum laude undergraduate degree in government from Harvard University. After being awarded a Rhodes Scholarship, he earned a master’s degree in politics, philosophy, and economics from Oxford University in England. He also holds an MBA in management from Northwestern University’s Kellogg School in Chicago.

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