Medium: Bank Lobbyist Act makes it easier for banks to discriminate in lending

Medium, March 6, 2018: Bank Lobbyist Act makes it easier for banks to discriminate in lending

Banks are rolling in it these days; between record profits in 2017 and the windfall from the December Republican-backed tax cuts, banks have rebounded from 2008’s financial meltdown, and the Dodd-Frank reforms passed in the aftermath of the Great Recession have prevented another crash. So why is the banking industry seeking to undo this progress?

Nicknamed the Bank Lobbyist Act, the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) advanced through a procedural vote in the Senate this morning with 67 votes (16 of them Democrats), and is expected to clear the Senate in the coming days. This Act is a banker’s wishlist. Bank lobbyists have descended upon Capitol Hill in recent days, clearly ignoring lessons from the 2008 financial crisis. There are many disturbing aspects of S. 2155, which is part of a larger Trump-backed effort to deregulate the banking industry. One of the most troubling of these is the bill’s rollback for new Home Mortgage Disclosure Act (HMDA) reporting rules, which would exempt 85% of all banks from these important reporting requirements.

Discrimination in lending is still happening: The question is if Congress will move towards legalizing discrimination, in spite of clear opposition of the public, while taking away HMDA and other tools that have worked to promote fair lending and ensure that everyone has access to the American Dream.

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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