Director General Paul P. Schmitz, to the 1956 International Convention:

‘I know many of us remember when gasoline was nine and eleven cents a gallon, against thirty cents a gallon and more today... There is no emergency today. But just as sure as you are sitting in this Convention hall, you are going to have one a year from now if we don’t do something about it... We should be men enough to...

‘Find The Way To Pay For The Things We Are Doing’

Explaining the coming increase in every member’s per-capita

By KURT WEHRMEISTER

The following is excerpted from a statement by Director General William B. Airey and Grand Chancellor Janet Fregulia, posted since Feb. 11 on the Members Only home page of www.mooseintl.org:

• “As of member-renewals payable Sept. 30, 2008, the per-capita assessment--or “ABCD” amount--for each member of the Loyal Order of Moose, will rise from its current $16 per year, to $28 per year; then will increase a minimum of $2 each year for the next five years.

• “As of member-renewals payable Sept. 30, 2008, the Per-Capita Assessment for each member of the Women of the Moose will increase from its current $12 per year to $20 per year.

“We wish to stress that, while the officers of each Lodge and Chapter may respond to these per-capita increases by asking the Lodge and Chapter membership to approve increases in overall annual dues amounts--such a decision rests entirely with the voting membership of the Lodge and Chapter. What the Supreme Council and Grand Council have done is ONLY to increase the per-capita amounts coming from each member’s total dues amount.”

> On Monday morning, August 20, 1956, Paul P. Schmitz stepped to the lectern at the opening business session of the 68th International Convention of the Loyal Order of Moose, to give the third of what would be 20 annual reports on the state of the fraternity during his tenure as Director General from 1953-74. Schmitz and the 3,000-plus Moose members seated before him were gathered in the Grand Ballroom of what was then known as the Sherman Hotel (now the Hilton Chicago) on South Michigan Avenue.

Most of those men had spent the night in the guest rooms in the 25 floors above--for nightly room rates ranging from $6.45 for a single, to $13 for a luxury double room. (In 2008, the same rooms go for nightly rates of $120 to well over $200--roughly 20 times their prices in 1956.)

Among the topics in Schmitz’s script that morning was one that had not been addressed for 27 years: an increase in each Moose member’s “ABCD” amount--the portion of each member’s dues coming to Mooseheart to fund operations at Mooseheart and Moose headquarters. He proposed to raise it from $4 to $5 per year.

The Moose fraternity’s reference to our annual per-capita assessment as “ABCD” is a long-outdated acronym for “A Big Charity Dollar”--$1 per quarter; $4 per year when it was instituted in 1929. That figure had remained steady through the Great Depression, through World War II and fully 11 years after that.

Schmitz made reference to inflation since the Depression, and especially during the postwar years. He noted that a daily newspaper costing 2 cents during the Depression was now up to 5 or 7 cents. (In 2008, an average price is 50 to 75 cents.) And, “I know many of us remember when gasoline was 9 and 11 cents a gallon, as against 30 cents a gallon and more today.” (In ’08, as we all know, it’s more than $3.)

The Director General emphasized that “there is no emergency today” that made the increase to $5 immediately imperative. “But just as sure as you are sitting in this Convention hall today, you are going to have one a year from now if we don’t do something about it. Surely, we are not going to go into the reserves that have been set aside of the past many years as a contingency to assure the perpetuity of our program in all of the tomorrows ahead . . . We should be men enough to find the way to pay for the things we are doing, and the benefits and privileges we are enjoying . . . it would appear to me that someway, somehow, we have the ability, ingenuity and the sincerity of purpose, here in this session . . . and we will have the courage and the foresight within ourselves, here to set the stage for its financial security in the tomorrows ahead . . .”

Schmitz’s words were met with applause, and the $5 ABCD was enacted that fall. With Moose Endowment Funds untouched and growing, he didn’t feel it was necessary to have the ABCD keep pace with inflation. For the $4 of 1929 was equivalent to $6.36* in 1956. Without really knowing it, our leaders had begun a dangerous pattern.

Inflation of the late 1940s and early ’50s was, unfortunately, nothing compared to the 1960s and especially the ’70s. By June 1977, Director General Herbert Heilman stated the obvious: “Inflation and the attendant spiral of higher prices makes it impossible to balance our budget with the insufficient funds provided through ABCD income.” And the annual per-capita amount was raised to $6. Problem was, by then, the $4 of 1929 equated, in 1977 dollars, to $14.18.

Then, some of the worst inflation years of the 20th century immediately followed; in 1978 and ’79, national inflation in the U.S. topped 10% both years. Price increases moderated during the 1980s--but in the Moose, by 1990, the ABCD was still $6. That year, Director General Paul O’Hollaren proposed a first-ever $2 increase in the ABCD, to $8. “In the last 13 years,” he said, “economic conditions in both the U.S. and Canada have undergone tremendous change and volatility . . . there has been an 84% increase (in inflation).” According to the U.S. Dept. of Labor, it was even worse than that: By 1990, the $4 of 1929 had ballooned to $30.57. Even with the rise to $8, the ABCD had lost roughly 70% of its original 1929 value!

But, figured O’Hollaren and the Supreme Council, with men’s and women’s combined Moose membership at an all-time high of more than 1.8 million--nearly double that of 1956--the ABCD’s worsening shortfall against inflation wasn’t critical; the burden could indeed be “borne lightly by many.”

However, by 1995, that rationale was becoming troubled. Total men’s and women’s membership had slipped to just a bit over 1.7 million, interest on investments was falling, and expenses were rising--especially at Mooseheart, where trained professional caregivers had become the required norm, as opposed to mothers who had come to live at the Child City with their children. Director General Frank Sarnecki informed that year’s International Convention of an ABCD rise to $10--though keeping pace with inflation would have dictated $35.65.

By mid-2000, this twofold problem became a threefold one for Director General Donald Ross. Not only was the disparity between ABCD and inflation growing (the $10 level had now fallen to less than a quarter of the $40.28 that inflation would have dictated), and not only was Moose membership continuing to drop (though the pace was slowing to less than 2% per year)--now, on top of those two challenges, the investment income that had sustained the fraternity through much of the previous dozen years, dried up with the “dot-com” collapse of the stock market. After peaking in early 2000, equity markets lost more than a third of their value by late 2002, and didn’t really recover until 2004. (With somewhat more conservative holdings, Moose investments, including the Mooseheart-Moosehaven Endowment Fund, performed somewhat better.)

But, for an organization that had lost membership, and had let a primary income source fall so short of inflation--and therefore had become so dependent on investment earnings to operate – suddenly, when there essentially weren’t any investment earnings for roughly three years, the effect was traumatic. Expenses and staff were cut drastically in 2002 and ’03; Moose International, Moose Charities, Mooseheart and Moosehaven together had nearly 800 full-time employees in the mid-1990s; today there are 454.

The Numbers Are Clear
For clarity’s sake, this chart only shows the Loyal Order of Moose annual per-capita amounts against inflation over the same period. (Inflation numbers are taken directly from the U.S. Dept. of Labor.) For purposes of space obviously the intervals of years aren’t proportional--but the rising dollar amounts are. The men’s “ABCD” amount was set at $1 per quarter, $4 per year, in 1929. When Schmitz announced the increase to $5 in 1956, the shortfall against inflation had already begun. Inflation skyrocketed in the 1970s, but increasing member numbers led Moose officials to view the growing shortfall against inflation as acceptable. Now, an ABCD at $16/year is not even worth one-third what the original $4 was worth in 1929.

Ross became the first Director General in the fraternity’s history who felt it necessary to enact more than one increase in the ABCD rate during his tenure--up $2 to $12 in 2000; and, in 2002, another $2, to $14. Ross noted that the 2000 Convention was his 30th as a Moose, and that he had only seen three per-capita increases during that time.“Can you imagine,” he asked from the lectern, “anyone else operating a business where one of their primary sources of income was increased only three times in 30 years?!”

In 2005, Ross oversaw what was a necessary--and unavoidably tumultuous--transition to a modern centralized dues system for the fraternity. By late 2006, after Moose International staff worked plenty of unpaid overtime sorting out and rectifying literally thousands of inaccurate records, it resulted in the first exact and truly accurate count in decades--perhaps ever--of paid-up, active Moose members. Those numbers were down to fewer than 1.1 million men and women, taken together.

And though by spring 2007 those numbers had jumped up an impressive 9 percent for both the Loyal Order of Moose and Women of the Moose--the Supreme Council authorized an ABCD increase to $16.

But as of the beginning of 2008, that $16 was still less than one-third of the inflation-adjusted $49.37 that the original $4 ABCD of 1929 would equate to. Inflation was worsening, and investments remained flat. The “Gimme Five” program, introduced at the ’07 International Convention in Orlando, is an effort that, if successful, will rebuild the principal of the Mooseheart and Moosehaven Endowment Funds for the 21st century--it is NOT a program to generate needed ongoing operating income (see more details).

So in early February, Chief Operating Officer Leonard Solfa presented the Supreme Council with a plan to address the shortfall against inflation, once and for all, of the Moose Per-Capita Assessment (permanently retiring the long-outmoded term “ABCD”). His proposal was prepared by a committee representing six different Moose International departments. It outlined much of the history you have read here, and came up with a recommendation to fully bring Loyal Order of Moose Per-Capita in line with inflation--a level of at least $45.

The Supreme Council disagreed, and moderated the number to $28--but did authorize an increase in that figure by at least $2 per year for each of the next five years; or a minimum of $38 by Mooseheart’s 100th anniversary in 2013.

Meanwhile, at the same early-February meeting, the Grand Council of the Women of the Moose voted unanimously to raise Women of the Moose Per-Capita from $12 to $20. The Supreme Council ratified that move. Both increases become effective with Moose dues renewal that are payable Sept. 30, 2008.

The Supreme Council fully realized that its actions will require creativity, hard work and struggle among Lodges and Chapters to make the necessary adjustments. But, they were mindful of Paul Schmitz’s words of 52 years before:

“It would appear to me that some way, somehow, we have the ability, ingenuity and sincerity of purpose. . .to know that we have the greatest fraternal program under the sun, and we will have the courage and the foresight within ourselves, here to set the stage for its financial security in the tomorrows ahead.”