IRC

LAUNCHING THE CREDIT UNION MOVEMENT

by Gabriel Kirkpatrick, CUNA Archivist

"Get the laws." The mandate stood at the head of Edward A. Filene's list of directives with which Roy Bergengren was to launch the work of the Credit Union National Extension Bureau (CUNEB).

By 1921, the credit union movement had passed the experimental stage in Massachusetts. The basics for credit union legislation and organization were laid. Credit unions operating in the state were confirming Filene's conviction that the average man had the ability to control his own economic destiny. It was time to move forward, to squelch the loan shark, and to bring the credit union to the country and ultimately to the world. Ever practical and decisive, Filene established the Credit Union National Extension Bureau to provide a framework for the spread of credit unions.

In July 1921, Filene hired Roy Bergengren to head the project, and together they examined and discussed the mandates which to Filene seemed the most practical method of establishing the movement on a firm basis. First, the enabling legislation must be put in place, state by state. Then, organization of a few credit unions in every state would demonstrate that the credit union works. When a significant number of credit unions were in operation, state leagues and finally the national association would complete the structure.

In some ways the personalities and backgrounds of Filene and Bergengren complemented each other. The practicality and business acumen of Filene kept the objectives on target, and Bergengren's idealism, energy and enthusiasm gave the project its momentum. But their differences caused major difficulties between them as well. They clashed frequently over method and cost. Filene was an exacting employer, and he expected regular reports and accountability. Bergengren sometimes had difficulty reining in his fervor to deal with the practical aspects of launching credit unions.

In his office in Room 23, 5 Park Square, Boston, as executive secretary of CUNEB, Bergengren said he had little notion of how one went about drafting bills and pushing them through state legislatures. There were already credit union laws in four states: Massachusetts, New York, Rhode Island and North Carolina. Bergengren began what he called his "Crusade" by studying these laws in depth and by researching the political climate and pattern of legislative sessions in each of the states in order to decide where to begin. Many questions surfaced. What was the most appropriate time to introduce a credit union bill? How would he find sponsors? How did one persuade legislators to support such a bill?

The way to find out, he decided was "to go there." With his wife Gladys, he started on a tour of the eastern seaboard states from New Jersey through Washington, Virginia, the Carolinas and Georgia. In each state, they studied the legislative process, made contacts with local politicians, and tried to find at least one person with a deep interest in cooperative credit. Bergengren knew that key people in each state could serve as spokesmen and organizers for the movement. Hopefully, they might eventually serve as field men. Ideally, they would know the political climates in their states and would be able to identify sympathetic sponsors for credit union bills.

Filene, through his business and cooperative interests, was able to give the Bergengrens the names of some contacts, among them, Richard Carrington and C.H. Morrissett in Virginia. These two men had drafted the credit union law that passed in that state in 1921. Bergengren also met with John Sprunt Hill who had studied the problems of rural credit in North Carolina for years and was well known and respected throughout the rural South.

In state after state, Bergengren added names to his cause: E. Marvin Underwood in Georgia, E.E. Miller in Tennessee, Leo Kaminsky in Indiana. With the tentative groundwork laid, he returned again and again to key states helping to draft laws, to organize credit unions, to make speeches, to take on the opposition in debate, to confront the vagaries of weather and travel.

Always conscious of history, he collected and preserved photographs, various drafts of state laws, and other documents as the beginning of the movement's historical record. Each state had its own story, and before the realization of the Federal Credit Union Act in 1934, Bergengren was involved in the legislative efforts in each state and most of the Canadian provinces.

When the organization of credit unions began in earnest, the common bond requirement of the credit union laws lent itself neatly to the process. Bergengren and his volunteer force targeted industries, unions, parishes and professional associations to meet Filene's second objective - organize. From factory to factory, from parish to parish, from brotherhood to brotherhood of unionized industries, education and fraternal organizations, he carried the credit union message. Working with personnel directors, plant managers, priests and ministers, teacher, lawyers, musicians, and any other group that could sponsor a credit union, he got one started. Between 1921 and 1926, during what he called the "incubator period," the number of credit unions increased from 190 to more than 900, and the number of members from 72,000 to more than 200,000. The loan sharks were not eliminated, but they were in a corner, loud in their opposition to the credit union laws.

Grassroots rallies and credit union political campaigns were still far in the future in 1926, but the solid groundwork for the credit union success was laid. Roy Bergengren was largely responsible for that groundwork. Through great personal effort and with the aid of hundreds of volunteers, he had managed to "get the laws" and to extend the movement into most states by 1930. Ahead lay the completion of Filene's objectives ---the state leagues and national association. But, Bergengren felt he had already fulfilled his own major objective for credit unions: "to prove in modest measure the practicality of the brotherhood of man. "

Copyright © 2008 - Credit Union National Association, Inc.