Pub. 2 2014 Issue 2

www.uba.org 4 I have been searching for an analogy that Congressman Dave Camp will un- derstand. This is what came to mind. In the bottom of the eighth inning of game six of the 1984 World Series, baseball’s premier reliever and San Diego Padre, Goose Gossage faced the Detroit Tiger’s Kirk Gibson with two men on and first base open. Anyone in their right mind would have walked Gibson. But Gossage had no respect for Gibson; he was confidant he could strike him out. He even used the words, “I own him.” Tiger manager Sparky Anderson couldn’t believe it. He kept telling Gibson over and over, “he don’t want to walk you!” The message was clear – Gossage isn’t afraid of you – then he gave him the sign to “Swing Away.” Gibson took the challenge and proceeded to hit one of the longest home runs I have ever seen in Tiger stadium. The Tigers won the game and the World Series and one of the best relievers in the game will forever be remembered as an overconfi- dent fool. For the past year, Dave Camp, Chairman of the House Ways and Means Commit- tee, has been working on Tax Reform. Reforming our tax code is critical to getting our economy back on track and the federal budget under control. It is one of those every half-century exercises that will dictate the fate of the American economy for the next 50 years. If done correctly, it is an opportunity to fix poli- cies that have become unfair or inefficient over time. But like Goose Gossage, Dave Camp has made a horrible miscalculation. His proposal does not afford bankers even the slightest amount of respect. In fact, his proposal is intended to wipe banks out. His long awaited contribution to tax policy reform is nothing more than a politically motivated extermination order on the banking industry. The proposal violates the first principle of tax policy – Horizontal Equity – the equal treatment of competitors. The power to tax is the power to destroy, es- pecially when government uses its taxing power to give favor to one taxpayer over another, to pick winners and losers in the marketplace. It’s hard to get bankers excited about things. They pride themselves on being able to adapt and succeed regardless of what the government dishes out. But Dave Camp’s tax reform proposal is not just another misguided regulation, it is a death sentence for traditional banks. There is simply no way they can survive over the next several decades if they are forced to compete with tax-exempt insti- tutions 10 and 20 times bigger. But here is the most important thing for bankers to understand. Tax reform is not an academic process. If it were, tradition- al banks would be just fine. Tax reform is a political process, and politics is driven by fear - fear of losing power. So just like Goose Gossage and Kirk Gibson, first base is open, there is absolutely no tax policy justification for exempting the largest credit unions, but Dave Camp isn’t afraid of us. Why should he be? We are the nice guys. We volunteer in the community, we contribute to charities. We take time to carefully explain issues to our Congres- sional delegation. But when it comes to war, and make no mistake, Camp’s tax reform proposal is a declaration of war on small banks, we are not well armed. That’s why we have created Friends of Traditional Banking. We have identified over 4,500 Friends of traditional banking in all 50 states who are ready to make a direct, personal contribution into two Congressional races this year. Our goal is to identify more than 10,000 Friends by this June. Think of that, if each Friend contributes just $100 dollars into the same race this November, we could drive $1 million into a single Congressional race. In fact, I believe that in time, we will identify up to 100,000 Friends of Traditional Banking! Now that’s a game changer, kind of like a three run homer in the bottom of the 8th inning to win the World Series. So what are bankers going to do? Sit back, play nice and pretend that the Chairman of the House Ways and Means Committee didn’t just try to wipe us out? Or are we going to step up to the plate, “Swing Away” and make some mem- bers of Congress regret their disrespect? America needs strong banks; American Families need good jobs that come from a strong economy. That can only happen when our tax policy promotes growth and fair competition. Traditional Bankers need to rise up and demand better from tax reform; step up and “Swing Away!” n T he B ottom L ine By Howard Headlee, President, Utah Bankers Association Our goal is to identify more than 10,000 Friends by this June Tax Reform... Rise Up and Swing Away