(Archived Content)
FROM THE OFFICE OF PUBLIC AFFAIRS
JS-1900
Thank you so much for having me here today. It's always great to come home to Ohio, and I always appreciate the chance to meet with credit union managers… you are such an important partner, such a valued member of the financial community.
It's wonderful to be here with my good friend Mike Oxley. Chairman Oxley is someone I regularly turn to for insight and counsel on a broad range of matters impacting the Treasury Department. I consider him to be a leader of great substance; the Financial Services Committee clearly benefits from his leadership, and the people of Ohio are lucky to have his representation in Congress.
I appreciate that credit unions are in business to do good, as well as to do business. That's clear from your motto: Not for charity, not for profit – but for service. So before I go any further today, let me say to you: I value the fact you are for service. Which is the fundamental reason why talk of taxation of your industry, and what you do, is something the Bush Administration opposes. We know that you always get less of anything you tax. And we don't want to get less of what you do.
We have a lot of things to talk about today, but I wanted to make that point clear up front.
Americans know and trust their credit unions, and this makes your role in our country's economic growth especially important. You're there for your customers whether they are opening a checking account or a small business. Whether they're saving for extra holiday spending or their child's education, you've been there.
And while our nation's economy is doing quite well – and enormously better than it was just a few years ago – there is still much to be done, and much that credit unions will be doing to help.
Your dedication to small-business lending is one of the major reasons why I say that.
Small business is at the foundation of this great economy, and credit unions have been there for entrepreneurs when they needed you the most.
As of 2003, under the leadership of SBA Administrator Hector Barreto, credit unions were welcomed into the SBA lending programs for the first time. I hope that has helped out both you and America's entrepreneurs as much as this Administration hoped it would.
You know as well as I do: small business is where the jobs come from. We estimate that between two-thirds and three-quarters of recent net new jobs are coming from that sector.
That's why we want to make small business tax cuts permanent, and that's why I want to commend the credit union community for financing America's hard-working small-business owners!
In addition to providing your small-business customers with the capital they need to start and grow, there is a new product that I would encourage you to market to them, and that's what we're focusing on here today: Health Savings Accounts (HSAs).
The recently enacted Medicare prescription drug bill created HSAs, an innovative new program to empower consumers to make better health care choices. HSAs are really super-charged IRAs that put patients back in charge of their health care. You own it, you control it, you can leave it to your heirs.
It's a new option for health coverage that is good news for individuals and employers who are struggling with their health-care costs.
I have good news for Credit Unions when it comes to offering this new product. First, insured credit unions are automatically qualified to handle HSAs.
Second, the reporting on these accounts is minimal. You only need to report on them once a year – to the customer and the IRS – one form to report contributions to the account and another form to report the amount that has been taken out of the account.
Best of all: you won't need any new forms. Treasury has model forms that you can use, or you can adapt the forms you use for IRAs for HSAs.
In terms of the market for this product, I believe the future is bright. As small-business customers research the services you offer, adding HSAs to your portfolio are bound to make you more attractive as the small-business financial service provider of choice.
Federal employees will also be a rich market for HSAs. Soon, they will have the option of opening HSAs and they are likely to come to their credit unions for that service.
I believe the business opportunity for you is great. Just ask the Mid-American Credit Union in Wichita, Kansas or HealthAmerica Credit Union in Jacksonville, Florida – both of whom have gotten into the HSAs business early!
And I know that you also appreciate that HSAs are good policy, a mechanism that will bring more Americans into the ranks of the insured. This speaks to your motto… not for charity, not for profit, for service. And affordable health insurance is a service the American people need.
HSAs are a critical step toward increasing the availability and affordability of health insurance for all Americans. They are also helping to put individuals in charge of their own health care… and that's something that is good news both for the American family and for the American economy as a whole.
Rising health-care costs are one of many factors that can act as a drag on our economic health. And while our economy is the strongest and most resilient in the world, it is important that we keep the burdens on free enterprise as light as possible.
We want fairness and freedom for America's small-business owners. It's not fair to add additional burdens to their already-heavy load. Lightening those burdens gives them the freedom they need to open a business, expand it... or, if an entrepreneur wants to... to close the doors and go fishing.
Lower costs for health insurance reduces one of the top burdens on America's smallest employers – the employers who are also creating most of the new jobs.
Lowering their tax burden is critical for their health as well, and that's why the President's tax cuts paid particular attention to small business.
The President's tax cuts allowed well over three-quarters of a million small-business owners to keep more of their business income, and encouraged them to invest in the growth of their companies. For example, nearly 860,000 business taxpayers here in Ohio will save money on their 2004 taxes.
Similarly, the tax cuts have allowed individuals to keep more of their income. More than 4.4 million Ohio taxpayers will have lower income tax bills in 2004 thanks to the tax relief. Those tax cuts helped to offset the serious blows to the U.S. including in rapid succession the bursting of the stock market bubble back in March of 2000, the economy in steep decline which President Bush inherited, the terrible behavior by high ranking corporate executives who forgot their duties to shareholders, workers and pensioners, and of course September 11 th which took such a toll. President Bush saw the urgent need to act, to put oxygen into the economy and because of his leadership the American economy is now getting back onto a good course.
I am often asked: what is the most important thing I can do, as Treasury Secretary, to strengthen the American economy? And I think that people appreciate the economic significance of tax cuts... that is the obvious answer. But it strikes me that this question is even better answered by Education Secretary Rodney Paige. For nothing will have a bigger, more lasting impact on the American economy than educating and preparing America's workforce for the jobs of today and tomorrow. Primary, secondary and continuing education - for generations to come - are by far the most important efforts toward achieving continued economic prosperity.
While recent economic recovery and growth has been impressive – with 1.7 million new jobs created in the last year, strong GDP growth, and homeownership at an all-time high – we are not satisfied, and we must always seek ways to increase growth and job creation.
You have lost jobs here in Ohio. No one knows the value of new jobs better than the people of this state.
Ohio's is an economy grounded in manufacturing, and recent years have been hard. I know what you are going through, what you have been through, and I know that it hasn't been easy. I grew up less than 100 miles from here - in Toledo, another heavily industrial town.
The people of this state have lost jobs; getting them back to work is a top priority for President Bush, and for me. We understand that the manufacturing recession that began in 2000 hit Ohio hard. And the effort to get the economy of the state on solid footing, to a place where Ohio businesses can expand, grow and create more jobs, is awfully important.
Some things we know for certain – like the fact that new jobs cannot come soon enough for the people of Ohio. The question is: where will those jobs come from?
While no one can really predict what the next high-growth industry will be, in a country where innovation is so wonderfully strong we know there will be plenty of jobs for our families. The state of Ohio overall has had some good news recently on jobs, with 3,400 new jobs created in July.
But much remains to be done. We need to return Ohio to its rightful prosperity. I remember when Ohio was a Mecca for jobs and it drew people from all across the country. I want those days to return.
I am optimistic that times will get better in Ohio. You will not be left behind; the U.S. economy is too strong for that and Ohio's workers and businesses have a long tradition of excellence and success. We're going to keep growing as a country, and Ohioans will be part of that growth.
And I know that Ohio's credit unions will be helping, every step of the way.
You understand the value of working together to achieve important goals. This quality makes you valuable to your customers, and makes you valuable to your country. More valuable because we are working together to fight the war on terror. Because while hatred fuels the terrorist agenda, money makes it possible.
As we mark the third anniversary of September 11 th, I am once again reminded of the tremendous resolve in the financial community that came out of that day… resolve to cut off the terrorists' lifeblood: their money.
Institutions large and small have committed themselves to the task.
America's credit unions have done everything that the Treasury Department has asked of you during this fight, and I want to personally thank you for your efforts.
Your compliance with Section 314 of the Patriot Act – which requires everyone to share information – has been exemplary.
We've asked that you cross-check a list of terrorists and their partners, sent to you by Treasury's Financial Crimes Enforcement Network (FinCEN), every two weeks, against your customer databases.
It's a big job to keep up with these lists, and it's one that is never finished. You're doing it, and our country is safer because of it.
The list that comes to you from FinCEN is an important tool… but it would be useless without your partnership. We're in this together.
We've also asked you to comply with Section 326 of the Patriot Act, which has to do with record keeping. And I want you to know that you do have flexibility under those regulations… we've worked hard to make sure that your customers are able to use as many forms of identification as possible under those rules. We hope the flexibility makes it easier for you to be vigilant.
And we're always looking for ways to provide you with more and better information about our regulations. So let's keep up the dialog… let us know when we're confusing you, or when we can do better – because the better our regulations are understood by you, the more successful our critical enforcement efforts will be.
I know that complying with the regulations is burdensome, but it's for an important cause. We want to work with you to ease the regulatory burden while tightening our grasp around terrorist financiers.
Working together, we have accomplished a lot on this front of the war on terror in the last three years. The United States has designated 383 entities as terrorists or supporters of designated terrorists and frozen nearly $142 million in terrorist-related assets. More than $37 million has been frozen in the United States.
The U.S. has also identified and frozen over $4.5 million in al Qaida-related funds. In addition, almost $72 million has been frozen by other governments worldwide.
Almost 1500 terrorist-related accounts and transactions have been blocked around the world, including 151 in the United States.
Our efforts are making a difference. So please know that we appreciate our working relationship on the war on terror, and that we view you as a partner in other critical ways, as well.
You're also a partner in the effort to increase financial literacy and protect our citizens from identity theft. Both programs are critically important to the citizens of America.
For many Americans, credit unions are successful gateways for people to enter the financial mainstream through their relationships with employers, schools, community groups and other affiliations.
I want to commend you for your terrific support for financial literacy.
The Department of the Treasury has awarded the John Sherman Award for Excellence in Financial Education to several credit unions for their innovative financial education efforts. For example, in June 2003, we presented a certificate to the Ohio Credit Union League's Latino Financial Literacy Program, which provides financial education for Latino immigrants in the Columbus area. We understand the importance of your efforts.
The National Credit Union Administration also plays an important role on the Financial Literacy and Education Commission along with the Department of Treasury and 18 other agencies. This Commission is working to coordinate the federal effort on financial education and will soon be launching a web site and toll free hotline to provide Americans with a central source for federal financial education information.
You do so much for your customers, and for your country… I'm thrilled to be here with you today, and thrilled to have you as a partner in so many efforts.
I look forward to continued work with the credit union community on all fronts, and am pleased to share with you an optimism and enthusiasm for the future of the American economy. We have a shared belief that our best days are ahead of us. I am pleased to be working toward that future together.
Thank you for having me here today.