Date: 1981-04-27
Speaker: ST GERMAIN (democrat)
Chamber: H

Mr. Speaker. earlier this year. a series of pronouncements coming out of the Office of Management and Budget cast a cloud over the National Consumer Coopertive Bank. but I am happy to report that there have been some encouraging developments in recent days. First. the Comptroller General. who is given a mandatory review function under the Budget and Impoundment Control Act. ruled on April 13 that the administration had exceeded its authority In impounding funds previously appropriated for the purchase of stock in the bank. Following the language of the act creating the bank. the GAO found that such purchases of stock by the Treasury are mandatory if the funds have been appropriated. After the GAO opinion. the $60 million previously appropriated for stock purchases was released to the bank last weeka giant step toward assuring that the institution will be able to meet its purposes of providing loans to consumer cooperatives across the Nation. While the transfer of the funds by Treasury to the bank is indeed good news. there Is still need to free up funds which have been appropriated for fiscal year 1981 for the selfhelp development fund and technical assistance program. The GAO did not question the administrations power to impound these funds. but it Is important that the Congress see that this part of the program continues. The selfhelp fund provides loans primarily for newly developing cooperatives whose membership must be predominantly lowincome. This is a particularly costefficient means of developing economIc activity in innercity and depressed rural areas and should not be curtailed. The funds in dispute for fiscal year 1981 are $29 milliona sum not calculated to upset the budget calculatLions. Mr. Speaker. I hope that the transfer of the $60 million to the bank will help clear the air and allow this institution to proceed with Its primary functions as a lending institution. It was the. Intent of Congress that the bank move as rapidly as possible with efforts to raise funds in the private markeL This can be done only i the bank is allowed to operate as its charter specifies and free from unnecessary Interference and unsupported attacks on Its performance. Before the budget excercises began. the banks management had approached Wall Street investors and received very favorable responses. This reflects well on the management of the bank and on the markets judgment of the institutions viability. Mr. Speaker. I am hopeful that this administration will eventually support efforts to meet the original commitment to the bank for Its full capitalall of which will be repaid with Interest to the Treasury. Frankly. I think it is time to let the bank get on with its business. It needs stability. not threats. In this regard. Mr. Speaker. I was happy to receive a response from OMB Director Dave Stockman on April 3. assuring me that OMB was using only legislative approaches and had not attempted to interfere with the management of the bank. I realize there are some who cannot accept the cooperative structure as part of our economy despite the fact that such institutions have been around as long as we have been a Nation. Some oppose all types of cooperativesbabysitting cooperatives. farm coops senior citizen cooperatives.-the whole range of selfhelp entitles. This is regrettable because I am convinced that cooperatives can be Important tools for consumers. a chance to create mechanisms that can help people shape decisions of choice and price in the marketplace. Our economy is strong and this Nation Is strong because we do allow freedom of choice. and there is no reason why anyone should try to dictate what types of businesses are created. whether they be stock companies. partnerships. family enterprises. or cooperatives. Some of the budgetcutting efforts are designed to limit and dictate choices in the marketplace. Mr. Speaker. I am convinced that there is bipartian support for cooperatives. I am also hopeful that there are those within the administration who do support selfhelp programs and will not allow the administration to impose an "anti coop" label on Itself. As a former high White House staffer in the Ford administration stated: Cooperative action is as American as the the Boston Tea Party. the winning of the West and rural electrification. . . . As one who grew up around coops. I can attest to their ability to aid the development of communities Ignored by commercial banks. to keep prices competitive and to give consumermembers more bargaining power In the marketplace. Mr. Speaker. again It is encouraging that part of the immediate struggle to assure continuation of the program has ended happily with the stock purchases by Treasury. While I know this administration holds to Its original positions on the bank. It is an excellent sign that the fiscal year 1981 funds. already duly appropriated. have been allowed to be transferred to the bank in keeping with the mandatory nature of the statute governing the stock purchases. While we may continue to debate the merits of the bank and other funding. we must commend the recognition of the law and congressional Intent in regard to these funds. Mr. Speaker. I want to place in the RECORD a COpy of my letter of April 16 to Secretary of the Treasury Donald Regan concerning the opinion of the Comptroller General and the release of title I moneys: Counrrrz ox BANKING. FINANcE