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Labor & Economy

Dollars and Sense: Panel Takes on the Banking Industry

With the failings of large banks in the news, Capital & Main assembled a panel of bankers and advocates last week to discuss an alternative vision for an industry that affects the lives of nearly everyone in the country — at a time when the Republican Congress is stripping away consumer protections at every turn.

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With the failings of large banks in the news, Capital & Main assembled a panel of bankers and advocates last week to discuss an alternative vision for an industry that affects the lives of nearly everyone in the country. That industry has been responsible for what panelist Kat Taylor, co-CEO and co-founder of Beneficial State Bank, described as a “train of misery” that took the country into the worst economic crisis since the Great Depression.

Banking was once a conservative business built on trusting relationships, noted Amalgamated Bank CEO and president Keith Mestrich. But the banks that dominate the industry, he added, have now become trillion-dollar profit-maximizing institutions divorced from the concerns of the people they were meant to serve.

The consequence: Subprime lending, terrifyingly complex financial instruments and a fiscal mess that has disproportionately left Latinos, African-Americans and many in the Asian community “deeply stripped of wealth,” said Paulina Gonzalez, the California Reinvestment Coalition’s executive director. Gonzalez is an advocate for communities that have historically suffered from both bank redlining and predatory lending practices.

None of the panelists expected allies from a Republican Congress anxious to strip away consumer protections at every turn, as evidenced last week by attacks from the House Financial Services Committee on the head of the Consumer Financial Protection Bureau. That Obama-era creation has been responsible for returning $12 billion to consumers.

Each of the speakers promoted another model for banking that aims to restore relationships of trust, make banking services more broadly available and set criteria for investments, such as refusing to support fossil-fuel production. “Banking is not finance,” said Taylor. “It’s how we want to build the world we live in.”

Aspiration CEO Andrei Cherny suggested that power lay in harnessing the $36 billion consumers spend every day online and at the mall, in support of a set of progressive values. “If progressive financial institutions can help people make better decisions on which companies they are supporting,” said Cherny, “we can truly have an impact on forcing companies to change.”

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