I don’t belong to AARP, although I more than qualify and they’ve been sending me membership forms for years. Sure, I’d probably benefit from their myriad discount deals, but AARP is also involved in politics, using the muscle of its nearly 50 million members to influence laws and regulations in Washington and around the country. Yet, its positions aren’t the result of any formal democratic process and often don’t reflect my view of what is good for us seniors or what is good for the country as a whole (sometimes self-interest isn’t the best basis for political decisions). If an organization is going to have that much power in my name, I’d at least like to have a say in how they use it.
My feelings about AARP came to mind when I read the July 18 press release by the FPA about the debt ceiling debate that was then raging in Washington, D.C. By the time you read this, the U.S. debt ceiling will undoubtedly have been raised, and the debate over skyrocketing federal spending temporarily postponed. The FPA’s decision to stray from its long-standing precedent of not wading into political issues, however, appears to signal a real policy change—one that could have long-term consequences that are historically fraught with danger. In fact, both the release and the new FPA position would make a case study of why good PR professionals are worth their weight in gold.
Of course, the FPA, through the Financial Planning Coalition, was involved in the writing of the Dodd-Frank Act and the SEC’s deliberations about how to implement it. This was simply business as usual: There is a long precedent for the FPA, the CFP Board and other advisory organizations playing a role in the writing and applying of laws and regulations that govern the conduct of financial advisors. While the positions they advocate may ultimately be supported or opposed by one party or the other, the positions they take have been grounded not in politics per se, but by what’s in the best interest of financial consumers, which is a hard-to-argue-with position for professional organizations to take.
Macroeconomic issues such as the current national debt do not fit so neatly into professional concerns, and consequently run the risk of spilling over into partisan politics. In a recent conversation, Paul Auslander, FPA president-elect and one of the driving forces behind the release, assured me that the organization’s intent was addressing “the looming crises of Federal default” without taking a partisan position. But their press release itself reads anything but, particularly the headline: “FPA Calls on Congress to Raise Debt Ceiling.”
One can only assume that the folks who wrote this release were unaware of the situation in Washington, which has resulted in disagreement over the future of the debt ceiling (not a good sign for people dabbling in politics). As with many disputes, admonitions to simply “settle it” often play into the hands of one of the parties involved. This reminds me of arguments one not infrequently has with a spouse, where one spouse wants to “talk about it” while the other simply wants the issue to go away (I’ll leave it to you to fill in the genders here). Suggestions from an outside party such as a counselor to “just settle it,” clearly would favor the go-away party.
In the case of the debt ceiling issue, the “go-away party” was clearly the administration: The Republican Congress threw a monkey wrench into business as usual by not simply raising the limit on federal debt without assurances that additional spending would be controlled. To be fair, the FPA release did also read: “But Congress and the President should take serious and substantial steps now to address our nation’s grave fiscal imbalance. No financial planner would advise a client with a debt problem to get a larger line of credit without having a commitment and a plan to address the underlying problem.”
Unfortunately, that admonition was buried in the copy, which then went on to echo the administration’s predictions of doom and gloom should the debt ceiling not be raised. In the communications biz, we call this “burying the lead.” Rather than blindly jumping on one side of the issue and running the risk of alienating half of their members (and probably a lot more than that), the FPA had a legitimate tie-in here, in the idea of debt management.