CCEC Blog
Search
 

“How can we create wealth, ensure social equity, and protect the environment?”  This question was posed in 2013, as CCEC hosted a Community Conversation on the BC Economy.  We were one of the 100 Community Conversations associated with the SFU Public Square project. Our blog  captured the feedback of ten CCEC members who participated in the conversation.  This blog highlights what we heard from our members as  seven years later, we are asking ourselves the same questions. 


The group first challenged the idea of a ‘BC Economy’, expressing the view that it was really an aggregation of several local and regional economies that were very distinct.  The consensus view was that the framing of the question was biased to mega-projects, large scale interventions and comparisons to global ‘norms’; a view that discounts small business and local exchange.   One voice noted that this abstraction was much removed from people’s everyday life.


Secondly, the conversation explored the term ‘create wealth’.  Harvesting natural ‘wealth’ is not creating wealth.  And GDP growth is a narrow indicator that certainly does not measure community well being.  Much discussion evolved around other more meaningful measures of community health in political-economic terms; suggestions included child poverty rates, street homelessness counts, and a happiness index.  It was observed that the ‘wealth created’ by the Exxon Valdez disaster, as an example, was not to be pursued as a ‘good thing’.

The group also wondered aloud about the waste created by industrial activity and a culture of consumption.  Why does conventional economics ignore, or downplay, the despoiled air, water and earth passed to future generations?  Why are there such inequalities with so many left in the margins?  Why do those in power deny and discount climate change?  

At CCEC, we want to encourage and foster conversations with members about our political-economy;  to foster individual agency and to explore the role of group action and projects.  

You may not know that "CCEC" was originally adopted by the credit union because the precursor organization that collected pledges to found the credit union was the Community Congress for Economic Change. 


Currently rated 0.0 by 0 people

We’ve come to a fork in the road. We need to decide if we are an ‘oil country’ or a ‘country of nature?’ Do we want the previous status quo, with its now-obvious holes in our health and social well-being nets, and its trajectory towards climate catastrophe? Or do we want to “build back better” in ways that fight climate change, inequality & injustice?


We talk about  building a healthier, fairer, greener province based on a clean economy. We want to support strong climate and clean energy policies needed to build a resilient economy. We know the projects generated from a clean energy framework can put people to work in safe, healthy, well-paid jobs. We understand that a green recovery is a  just recovery and we don’t want anyone to be left behind. 


The Premier’s Economic Recovery Task Force is scheduled to release its findings from the 6 week public consultation process this month. The report aims to provide recommendations on how the $1.5 billion fund set aside for recovery spending will be deployed.  A member of the task force,  The BC Federation of Labour, submitted, “We must make up for lost time in addressing the climate crisis, with an accelerated and inclusive path to a green economy. The global collapse of oil prices is only the latest drastic swing in the fossil fuel economy — and one more sign that a sustainable future must rely on a swift transition to cleaner, renewable sources of energy.” They continue by saying, “We must look beyond economic indicators to human outcomes — our goal entails nothing less than the end of poverty, homelessness and other inequities. And it goes deeper: a meaningful connection to the communities they live and work in and with — even in times of crisis, with no exceptions.” Reading submissions like those of the BC Federation makes it sound hopeful that the BC Economic  Recovery Plan will support a Green New Deal. 

At the same time, however, we continue to invest in fossil fuel projects. The Trans Mountain Pipeline, owned by the Canadian Government, continues to be built despite knowing there is no longer a market in Asia or in the US to sell the gas; that we publicly committed  to climate action in the Paris Agreement; we have a flawed consultation process with Indigenous communities; a  failure to consider the risks posed by increased tanker traffic; ongoing protests and other concerns.  We know that the BC Recovery Plan Task Force is represented in favour of heavy industrial business and is  lobbying to have their projects be financially supported through the Plan.  

The Report
is scheduled to be released this month.  Let’s see how well the  recommendations reflect the importance of workplace safety, strong public services, and our collective responsibility to take care of each other. We have the chance to address those gaps, and to do much more. We can build back better than before.

Currently rated 0.0 by 0 people

We all play a part to create an economy that's more just, equitable, and sustainable.


At CCEC, your funds allow us to support local, grassroots businesses and reinvest in our community. For over 45 years we have served member organizations and individuals who are underserved to meet their basic human needs and rights, for community enterprises and community action. 


At this time, it is even more important that we shop local and eat seasonal produce. Your independent owned or co-operative business contributes to your neighbourhoods’ arts, culture and sports. They build community, connect us to each other and form our economic activity.  


A member recently commented, “We appreciate the role CCEC plays in Community Economic Development and your roots from the Community Congress for Economic Change.”  


Community Economic Development (CED) is a core value for CCEC.  We know that CED empowers communities to shape how the local economy provides for them and how it impacts their lives.  We can ask ourselves, “What kind of community is created and sustained by the local economy, and how do we include the people who may be  left out.”  CCEC supports a Just Recovery and an economy where there is a shortening of the supply chain. 


Local businesses help our communities by:

  • Creating diverse, inclusive employment

  • Adapting to challenges

  • Being proactive, prepared, and resilient.


There is an additional economic benefit to an area when money is spent in the local economy.  Independent locally-owned businesses recirculate a far greater percentage of revenue locally compared to absentee-owned businesses (or locally-owned franchises*). In other words, going local creates more local wealth and jobs.


CCEC has always kept your money in your community to support our local economic development. We encourage our members to shop or keep shopping local to support our arts, culture, sports, restaurants, greengrocers and other neighbourhood businesses. 


Currently rated 0.0 by 0 people

Keeping your money working in your community. 

Once dubbed the “activist credit union”, CCEC has been known as one of the few financial institutions willing to do business with “fill in the blanks”.   In the past 45 years that we’ve been serving our community, we see that our conversations on community economic development, sustainable development, workplace equity, and social justice have now become mainstream.

During this time of change and uncertainty as we work towards a Just Recovery,
the values on which CCEC was founded resonate stronger. 

CCEC has kept true to the values and beliefs on which we were founded in 1976.  Now, we see that many of the issues CCEC has been dealing with at the grassroots level are top priorities for credit unions and co-operatives across the country.  At CCEC, it is business as usual as we continue to promote local economic development, and serve groups that have been excluded from the economic mainstream because they don't fit a banker's idea of a good credit risk. At one time, giving workers a stake in running the business, saving the environment and promoting community development had a flaky reputation - not something a financial institution would associate itself with. But times change.

Did you know that we have provided bike loans for over 45 years! In the past, these small loans have been shunned by other banks as they don’t make money. Now, it is trendy to lend for alternative transportation like e-bikes.  No worries, however, as you can still come to CCEC for your bike loan. We do lend for many other purposes so just ask.

At CCEC, we have always reinvested your money within the community we serve. We continue to lend to member organizations and individuals who are underserved to meet their basic human needs and rights, for community enterprises and community action. 


We invite our members to get to know us better and those who want to belong to a credit union that stands up for what you believe in, to join us. 


Be sure to share with us your favourite story about CCEC. 


Currently rated 0.0 by 0 people

We are in the same storm, not the same boat.

As we are in Phase 2 restarting, we ask ourselves: What do we want our community to look like? What did we learn from our time of self-isolation? What will be our economy?

At CCEC, we support a just recovery for all. We agree that now is the time to move forward with innovative, progressive recovery and rebuilding plans with a strong focus on social spending. Now is the time to invest in rebuilding our communities and cities based on care and compassion.

We cannot go back to the way things were. We are seeing the results of chronic underinvestment and inaction in the face of the ongoing, pre-existing crises of colonialism, human rights abuses, social inequity, ecological degradation, and climate change. We see that the people most impacted by the inequities are those living in poverty, women, BIPOC (Black, Indigenous, People of Color), racialized, newcomer and LGBTQ2S+ communities, people with disabilities, and seniors. We are seeing that the situation is forcing governments and civil society to face the inadequacies and inequities of our systems. There is no going back as “normal” caused our current situation and problems.

The recently formed Just Recovery Canada, an informal alliance of more than 150 civil society groups, have released “Six Principles for a Just Recovery.” The principles ask that all recovery plans being created by governments and civil society:

  1. put people’s health and wellbeing first;
  2. strengthen the social safety net and provide relief directly to people;
  3. prioritize the needs of workers and communities;
  4. build resilience to prevent future crises;
  5. build solidarity and equity across communities, generations and borders; and
  6. uphold Indigenous rights and work in partnership with Indigenous people.

The principles aim to capture the immense amount of care work happening throughout Canadian civil society right now and present a vision of a Just Recovery that leaves no one behind.

 

Now is the time to get involved and fight for a Just Recovery. We need to be on the path toward an equitable and sustainable future. 

Currently rated 0.0 by 0 people

“We can focus on the “well-being” of citizens, rather than on traditional bottom-line measures like productivity and economic growth”, says, NZ President, Jacinda Arden. As we RestartBC and reopen the economy, will we go back to what was “normal” or will we use the opportunity to forge a New Way Forward? 

For example, New Zealand is proposing a budget where all new spending must advance one of five priorities: improving mental health, reducing child poverty, addressing the inequalities faced by indigenous Maori and Pacific islands people, thriving in a digital age, and transitioning to a low-emission, sustainable economy.

Naomi Klein with The Leap has started the project, BAILOUT FOR PEOPLE AND THE  PLANET:  A Crisis Response that Builds from Emergency to Transformation. They advocate for a recovery where  stimulus spending builds the scaffolding for a zero-carbon, full employment economy; and re-imagining where we  transform the economy to prioritize safety and stability for all, not just the 1%.  The Leap is working with partners to advance urgent demands around Housing, Health Care, Work and more.

Our response to this period of converging crises is a once-in-a-lifetime opportunity for the federal government to initiate a reset of our economy and society, putting Canada on a path toward zero emissions, and bringing immediate material benefits and enhanced, 21st century universal public services to everyone – prioritizing Indigenous, racialized and working class communities – that is, the people who need them most.

In other words, this is the ideal moment for the Green New Deal. Essentially, it recommends an unprecedented public investment in a justice-based transition that creates well-paying jobs, solves our crises in housing, crumbling infrastructure, health and education, inadequate transit, and deep inequality. This kind of public investment would vastly expand the tax base and stabilize the economy at the same time.

Learn more. Get involved. Like, follow, sign up to support The Leap’s People’s Bailout, Progressive International, and a Green New Deal Canada.

Currently rated 0.0 by 0 people

Invest in you and your future with an RRSP.  RRSP’s continue to be a good investment fit for many of our member-owners’ financial plans and lifestyles.


There are two main reasons our members invest in an RRSP:  to reduce taxable income (paying less tax in that year); and to be saving tax-free as (taxes are payable later on withdrawal in what would be a lower income year).  At this time, you can contribute up to 18% of your 2019 earned income, to a maximum of $27,230 plus any carry-forward contribution room that you may have until the year you are 71 years of age. 


If you would like to contribute, ask us about an RRSP loan so that you can maximize or top-up your RRSP contribution (before March 2, 2020).  You may be able to save tax dollars by investing the funds from the loan into your RRSP. By starting a monthly contribution plan, you can earn compound interest making more than if you contribute a lump sum. 


RRSP’s are considered longer-term retirement investments. However, you can withdraw funds,  for use towards the Home Buyers’ Plan or the Lifelong Learning Plan; which must be repaid within a specified time.  A word of caution before you resort to withdrawing from your RRSP - look for alternatives and talk to us. 


Are RRSPs worth it in the long run? Even though you have to pay the tax back when you withdraw the funds, yes, they are worth it. They are a valuable tool to reduce your tax burden and save for the future. Be sure to include an RRSP as an investment option in your financial plan. And, be sure to review your plan each year.  


Need a plan?  We can help you with that.


Call us today to speak with one of our investment specialists. 

Pick up the leaflet, Your Guide to Understanding RRSP’s in the branch or visit the CRA website for more information. 


A Registered Retirement Savings Plan (RRSP) is a retirement savings and investing vehicle for employees and the self-employed in Canada. Pre-tax money is placed into an RRSP and grows tax free until withdrawal, at which time it is taxed at the marginal rate.

Currently rated 0.0 by 0 people

At this time of year, we are encouraged to “Create Memories Not Garbage”.  We are reminded that we all should be doing our part to make less waste. Our awareness level  has increased about food waste, single use plastics and taking our own bags when we go shopping. However, we need to be doing much more.  

We need to adopt an economy that operates within planetary boundaries and focuses on keeping materials in circulation (and out of the landfill). We need to be designing products that can be 'made to be made again' and powering the system with renewable energy. This is the circular economy.  

A circular economy “offers a solution to the growing problem of waste, generates economic growth, increases the number of local green jobs, and encourages  innovation.” The BC Minister for the Environment and Climate Change at #COP25Madrid discussed the circular economy and how the way we use waste and resources impacts climate change. 

The circular economy is also about sharing, focusing on positive society-wide benefits. As we welcome 2020, let’s do our part to support a circular economy and community economic development.

So, if you could do just one thing differently to create memories and reduce waste, what would it be? Visit the Metro Vancouver website for ideas! 

Learn more about how to accelerate the transition to a circular economy with best practices, case studies and worksheets from these websites: 

https://ceaccelerator.zerowastescotland.org.uk/ - exists to create a society where resources are valued and nothing is wasted; to influence and enable change. 

https://www.ellenmacarthurfoundation.org/circular-economy/concept - works with business, government and academia to build a framework for an economy that is restorative and regenerative by design.
Currently rated 0.0 by 0 people

Who Controls the Economy’s Money Supply?

www.positivemoney.org  

Submittted by CCEC member Joan Woodward

Most of us have been led to believe that the boom-bust cycle is inevitable.  We have been sold vague notions about “business confidence”, “herd psychology”, and best of all, “mysterious market forces”.  We are expected to have blind faith in the “crumbs from the table effect” (alternately know as the trickle-down effect) and to immediately genuflect in the presence of the banker priests of our economic destiny. 

While a great many of us intuitively feel that there is something wrong with the economic structures that direct our collective destiny, we find ourselves unable to define the precise changes needed.  This is the result of a great many oft repeated myths about who, or what, controls the money supply and how the money supply machine works. 

In an effort to clarify and debunk many of the commonly held beliefs about how the banking system works, a small group of people founded an organization in Britain with the ambitious objective of bringing about monetary reform.  This organization quickly blossomed into a group of 30,000 plus members and followers and now has affiliates all across Europe. 

To begin with, Positive Money surveyed the ways in which people typically view the role of banks. 

About a third of those surveyed believe that the bank is like a piggy bank which keeps money in a safe place on behalf of the saver.  In other words, no one is using the money while it is sitting the bank. 

The other two thirds had a slightly more sophisticated understanding of the banking industry.  They believe that banks are an intermediary between savers and borrowers.  Savers deposit money which can then be lent out to borrowers.  This implies that the amount of money available for loans is dependent on the amount of savings that have been deposited in the banks.  It also implies that reckless lending would cause the banks to run out of lending ability.  A third assumption is that governments control the amount of money circulating in a given country through institutions such as the Royal Mint, where coins are punched out of metal and bank notes are printed. 

Those who have studied a bit of economics in school typically understand the creation of money through classical economic theory.  This theory teaches that a bank won’t need to keep all its depositors’ money on hand at any given time.  Instead, the bank keeps back a small reserve, of say, 10%, and lends out the other 90%.  If a bank had a $1000 deposit and lent out $ 900 of that, the $ 900 would probably be deposited into a different bank, from which deposit, the bank could lend out 90%, or $810. Supposedly this cycle continues until almost all of the original money is lent out which would be about 200 cycles. The sum total of all these loans would add up to about $10,000 dollars.  This implies that the reserve ratio dictates how much money can be circulating in the economy at any given time.  If the 10% reserve ratio were increased, less money would be available for lending: if the reserve ratio were decreased, more money would be available for lending.  This also implies that the money supply is finite and has natural limits based on the reserve quota, or base money in the banking system. 

Unfortunately, the reserve ratio is an antiquated notion.   According to Chris Ferreira who writes for   http://www.economicreason.com , the reserve requirement for Canadian Banks is zero and has been for many years.  Unfortunately, many people who hold influential positions in the Canadian economy still cling to these outmoded economic theories. 

The money supply is therefore, not finite, and can be expanded or contracted at the will of the banks.  In order to better understand this, we need to have a look at the three forms of money circulating in the economy.   These are:  inter-bank settlement money (central bank reserves); cash; and electronic bank deposit money.  Interbank settlement money is an electronic system designed to cancel out payments that the banks owe to each other.  At the end of a business day, the amount of money not cancelled out by the debts individual banks owe to each other is infinitesimally small.  The term “fractional reserve banking’ come from a time before computers when banks were required to have a percentage of their holdings at the ready for inter-bank and other liabilities at the end of each business day.   Thus, there are only two forms of money that really matter in today’s world. They are the 97% of all money used by the public in the electronic (based on deposits) money and the 3% constituted in cash.    

If there were a reserve ratio, a fraction of the bank’s assets held back immediate payouts would constrict the amount of lending a bank could do.  A reserve ratio of 10% would mean that the same money could only be lent out again ten times over.  This would limit the extent to which the banks expand the amount of money present in the economy through the creation of loans.  In the modern era, the fractional reserve system has been partially replaced by the capital adequacy requirements.  This buffer of financial assets is meant to absorb unexpected financial losses by the bank.  This buffer is not intended to limit the amount of reckless lending the banks can engage in.  It only ensures that when a financial crisis hits and everyone else is going under, the banks will not.  The only thing that really reigns in the amount of capital created through loans is the willingness of the banks to lend.  This business confidence of the banks is bolstered when banks are not held responsible for reckless and immoral banking practices. 

Now there some who argue that banks create credit and not money.  Credit implies risk, so if a bank grants a customer a loan, it creates that loan in figures on the customer’s bank statement.  The amount of money in the customer’s account is then guaranteed by the government of Canada.  The customer’s bank account has now become risk free for the customer.  In this way, banks are creating money (no risk) not credit. 

When more businesses and individuals are borrowing money, more money is created by the banks.  More money is circulating, more people are employed, and the economy is said to be doing well.  When people choose not to borrow, or worse yet, to save, the amount of money in circulation is reduced.  Given that the banks’ ability to loan is in no way connected to the level of bank deposits, so is there any inherent social value in saving?  What is good for an individual does not seem to coincide with what is good for the economy as a whole.    What can we do as individuals to improve the amount of money in circulation for everyone?  

At present, the successes of the banks result in house price bubbles and gambling on financial markets.  What can we do to see that money comes into the real economy before it goes into gambling on real estate and financial markets?  In other words, can we take the power of money creation away from the banks?  Under a transparent and accountable form of democratic process, newly created money could be used to refurbish public infrastructure and raise the incomes of ordinary people.  Could this be done under a politically non-partisan government body at arm’s length from the government of the day?  These are question posed by Positive Money, a European group presently looking at a change in the economic paradigm.  For more information, please refer to www.positivemoney.org  

Currently rated 3.0 by 5 people

Credit unions are consumer owned enterprises that represent a fundamental challenge to conventional capital corporations.  Credit unions do not exist to generate profits, but to provide services to member-shareholders.  Recent published documents raise some interesting questions about the future of our credit unions.  

Consolidation and amalgamation over the last thirty years has drastically reduced the number of credit unions in BC (and elsewhere).  In the mid-eighties there was 120, now there are 43.  And the two largest credit unions comprise @50% of the deposits and almost 50% of the memberships in BC. Two papers submitted to the provincial government review of credit union legislation were made public online and provide pointed criticism of the erosion of member democracy in large credit unions. Submissions are public and the papers from Bruce Bachelor and Mark Latham both argue for enhanced democratic practices. Also, governancewatch.ca  provides an excellent overview of difficulties at Coast Capital Credit Union. 

But beyond that, credit union members also own "second tier" enterprises, or are the beneficial owners of these; Central 1, Co-operators Insurance, CUMIS Insurance, etc.  Since credit unions control these businesses, consumer owners rarely consider their stake in them.  But a recent paper from Central 1 provides a great overview, and a discussion of a 'restructuring' of these entities - Future State. But this paper fails to recognize consumer ownership as the key 'uniqueness' of our credit unions.

Over time the radical idea of consumer control has been down played.  More emphasis has been placed upon marketing smarts and service. Indeed, co-operative democratic governance has been under-represented and eroded.  Members are no longer encouraged to take active interest in the affairs of the credit union, unless there is a merger proposal. This is unfortunate, as the price of democracy is vigilance.  Our credit unions not only manage our savings, but also control substantial accrued 'wealth'; retained earnings is an asset held/owned in common by all members. This is community property.  

Our organizations do not 'belong' to the managers and directors. When there are big choices to make members should be consulted. Members must not only think about their own accounts and transactions, we all have a stake in the community organizations that we have jointly created over time and organizations that ought to be looking out for us as we move forward. 

CCEC welcomes input from our members on the evolution of the credit union system and how we may play our part.  Feel free to listen into this podcast with Ross Gentleman and Tammy Lea Meyer. 

Currently rated 0.0 by 0 people

Search

home | memberdirectprivacy policy | contact | site map
© 2015 CCEC Credit Union. All Rights Reserved.