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"walls of the city" logo conceptualized by Oleg Volk and executed by Linoge. Logo is © "walls of the city".

tempers are rising

I have been a member of USAA ever since I first received my commission, and Better Half and I have been remarkably satisfied with them over the years. Apart from some difficulties with our recent home mortgage (which could be indicative of the employee we had to deal with, as opposed to the corporation as a whole), their response has always been timely, their support has been unquestioning, and even in the height of the Katrina disaster, they totaled my sunken Subaru and got us the money for it within two weeks. Ever since their inception nearly a hundred years ago, they have been tirelessly supporting our servicemen and servicewomen, and their families, around the world… even when some of us do our four years and literally scamper for the hills.

USAA’s construction is… somewhat unique, though. It is not a corporation, it is not a credit union (even though I tend to think of it as one for simplicity’s sake, despite Better Half’s disapproval of this mental shortcut), and it is not publicly traded. Instead, it is member-owned, with the insurance side of the house literally consisting of every member insuring every other member – it actually started as solely an insurance organization. This has not been largely important, until the recently-revealed “Restoring American Financial Stability Act of 2010” (in essence, the misnamed “Health Care” Act, only with a search-and-replace executed for medical versus financial terms).

At this point, I am going to let the CEO of USAA speak for himself, because I am still trying to wrap my noggin around the details:

Rarely in our 87-year history have we turned to USAA members to weigh in with elected representatives on an issue of great importance. But, we are now.

The U.S. Senate currently is considering legislation (S.3217) that would impose new rules on the nation’s financial services industry, including USAA.

As the leading provider of financial services to America’s military community, USAA supports financial services reform.

However, the current Senate bill would disproportionally impact USAA because we are a unique and fully integrated association. USAA is not like the banks and other companies that helped bring down our economy, and we never took a penny of TARP funds. We do not engage in the harmful practices this legislation seeks to resolve.

If unchanged, the bill would:

– Prevent USAA from managing the association’s portfolio as we have for the past 87 years.
– Jeopardize our ability to continue offering many of our competitive products.
– Limit our ability to return money to our members. Last year, USAA returned $1.2 billion to our members in the form of distributions, dividends, and bank rebates and rewards.

So, we are asking all USAA members and employees to urge their U.S. senators to amend a portion of the bill, known as the “Volcker Rule,” to eliminate its effect on a company like USAA. Please know that this legislation does not impact individual member’s investments.

Regardless of the outcome of the legislation, USAA will remain a unique and enduring association that’s all about you — the military and their families.

Please take action on this matter by immediately contacting your U.S. senator. You may click here to access a special website that will enable you to quickly send an e-mail message to your senator.

Thank you for your help and support,
Josue (Joe) Robles Jr.
Major General, USA (Ret.)
President and CEO

Further information/explanations is available here, should you want it.

The “click here” link takes you to a page wherein you can enter your contact information, it spits out the names of the Senators it is about to email, and then provides you the below email to send with the click of a single button:

I am a member of USAA, which provides insurance and other financial products to the men and women of the U.S. military and their families. I understand that the Volcker Rule, a provision within the Restoring American Financial Stability Act of 2010 (S. 3217), jeopardizes USAA’s ability to support us in the same way they always have. Please support amending S. 3217 to correct this onerous provision.

Given the role that some banks played in our current economic problem, I understand the need to implement new rules that prevent risky business practices, but please don’t go too far and make it harder for those of us who choose to do business with a company like USAA. USAA never took a penny from TARP bailout funds, and they even gave over a billion dollars back to members last year.

I rely on USAA and as your constituent, I ask that you don’t punish USAA. Please amend S. 3217.

My only complaint is that it does not allow for inline editing of the email, but if you really want something with a personal touch, you can look up your Senator’s email addresses here, copy-paste the letter into your favorite email program, and have at it.

So, in the words of the immortal Captain Malcolm Reynolds, what does that mean? As I said, USAA’s construction is somewhat unique, in that damned near all of the products they offer (insurance, investments, banking, etc.) is all contained under one very large roof, and money from one branch (say, the insurance side) often can be invested in another branch while it is sitting around, doing nothing. The “Volcker Rule” of this misnamed disaster of a bill (and it is a disaster even discounting this particular segment of it) would stop insurers from investing internally, and limit them to only investing in government securities – government securities that do not have nearly the return rate of private ones. End result? Interest incomes will go down, premiums will go up, and services will probably go down.

And all because the gorramed federal government cannot keep their gorramed grubby paws out of our gorramed private business.

As to the bill in its entirety, I have seen it described as “about protecting consumers from predatory and dangerous banking processes”. I only have one printable response to that claim: BULLSHIT. There are no banks combing the hillsides with tommyguns forcing people to sign onto balloon mortgages. There are no roving packs of lenders holding people down and stealing people’s money to use for their own private yachts in the Caymans. People voluntarily agreed to dangerous banking processes of their own free will and by their own choices… perhaps because they were idiots, perhaps because they did not know better, or perhaps because they were not educated enough to understand the difference, but I have news for you – neither this bill, nor any other bill, will make a damned bit of difference.

This bill will not educate people (Crap on a crutch, the gorramed thing is one thousand, four hundred, eight pages long – who is actually going to read that? Certainly not our “representatives”.). This bill will not make stupid people smarter. However, this bill will give the government more control over your life, this bill will give the government more control over your money, and this bill will give the government more control over the private sector of the economy.

To frakking hell with that.

The simple fact is that our goverment caused this financial crisis that they are so very valiantly attempting to make worse, and if we American citizens allow them to do so, we are bringing our own doom upon our own little heads – a doom we are not likely to comprehend for a while to come.

So, yes, I oppose the Volcker rule, just like I oppose the entire rest of that godforsaken bill. But something tells me that no matter how many of us oppose it, it will still get shoved down our collective throats, just like the misnamed “Health Care” Bill was.

How much longer are we individual American citizens going to tolerate this authoritarian governance?

3 comments to tempers are rising

  • Gaston

    Two points:

    1. Spending $1.32 (3x $0.44) and mailing a letter to your three Congress critters goes much further than Spam (form email). If you don’t like getting it, you shouldn’t be sending it.

    2. I refinanced with USAA this year and it was a nightmare. Search on “USAA and GMAC” and find tales of financial horror. It seems that USAA and GMAC penned a nefarious back room deal. USAA Bank can rot and I wrote General Robles on this issue. Good information on the insurance side of the business.

  • 1. From my own personal experience writing to my various representatives at various levels, the only times they have ever responded to me was when I emailed them – my snailmails have been largely ignored by both local and national politicians. That said, I would be very surprised if anything sent to their public addresses is immediately viewed by them – they probably have at least one staffer filterin, collating, and counting, and form responses probably do not reach him, but numbers of them might. I will still probably follow up with a self-written email explaining my displeasure about the bill as a whole.

    2. Sounds like the GMAC side of the house was what we had the problem with… Good to know for the future, but sucks for the time.

  • [...] form letter or not, the correspondence I sent to my US Senators concerning an upcoming nightmare of a financial-control bill prompted a response from at least one of them: Dear Mr. [...]