New Economy Project report uncovering disparities in banking prompts calls for public banks in New York City
A recent report has shed light on major disparities in banking practices within New York City, revealing that big banks holding public money have been investing unfairly, particularly leaving neighborhoods of color behind.
"Redlining is alive and well in New York," said Andy Morrison, associate director of the New Economy Project, the group that produced the report. "In terms of mortgage lending, we found that since 2018, these banks invested just 25 cents in neighborhoods of color for every dollar they invested in other neighborhoods, and we found similar disparities in terms of the distribution of pay protection loans during the pandemic to small businesses, as well as the distribution of branches."
This analysis was outlined in the nonprofit's December report. Morrison said it challenges the practice of the city depositing large sums of money in public funds into banks such as Bank of America, JPMorgan Chase, Citibank, and WellsFargo.
"A private bank is accountable only to its shareholders. The practice of putting public dollars in private banks doesn’t make sense, it's not in the best interest of the city. So what we propose is that the city create its own bank - a public bank," said Morrison.
The New Economy Project, along with state and local coalitions, have been actively educating the public on the benefits of a public bank, even posting content on social platforms like YouTube.
“Redirect all those billions of dollars in public deposits from the banks that aren’t serving neighborhoods, put them in a public bank that would serve communities and leverage those deposits towards things like affordable housing, small business development, could help expand access to credit and financial services,” said Morrison.
This solution, according to Morrison, has garnered substantial support in the City Council, the comptroller's office, and even broad support in the state Legislature. However, he emphasized the need for a larger community push to overcome opposition from Wall Street.
"People power – that's why we’re encouraging folks to get involved in the campaign, which people can learn more about at publicbanknyc.org," Morrison concluded.