Just Economy Conference – May 4, 2021
Senator Sherrod Brown, (D-OH), Chair the Senate’s Banking, Housing & Urban Affairs Committee
NCRC video transcripts are produced by a third-party transcription service and may contain errors. They are lightly edited for style and clarity.
Welcome back for another great day at NCRC’s Just Economy Conference. Yesterday, we had some great conversations about the need to support Black and Brown wealth building to entrepreneurship, affordable housing and home ownership. We heard from Jerome Powell, chair of the Federal Reserve about the role the Fed can play in monitoring the economic recovery through a racial equity lens and how the Fed is approaching reforms to the Community Reinvestment Act. And we heard from U.S. Housing and Urban Development Secretary Marcia Fudge, providing us with a sermon, affirming her commitment to push to address systemic racism and America’s housing. If you missed those conversations, don’t worry, you can still check out the recordings, just go to the agenda and click on the session you want to hear and even look at it again for a second time. It was a great event yesterday.
I have been a member of the National Community Reinvestment Coalition for about a decade, first in my role as the executive director of the city of Dayton Human Relations Council, and now in my role as Chief of Staff for the city of Toledo. At both of those roles, NCRC support and partnership has been invaluable. NCRC has afforded me access to individuals that are developing cutting edge policy that has informed my work at the local level. Thanks to NCRC and the hard work of our member organizations, I’ve been able to advocate for resources and my community and work with financial institutions to develop products that meet the unique needs of the residents I serve every day. NCRC involves members and conversations with financial institutions and an advocacy work to protect and strengthen the Community Reinvestment Act and other laws through public comment letters and more. Working closely on these campaigns has helped us understand bank self-interest, how to benefit low- and moderate-income communities and how to help banks connect the dots to expand services and provide more capital to communities that we represent. As a member, I’ve also been able to take advantage of NCRC research like the fair lending tool. Their research has helped me to understand the long-term impact of discriminatory policies such as redlining. This information has allowed me to provide recommendations to local jurisdictions on how to remove barriers to fair housing. It is often impossible to keep up with all of the federal policies and they impact our lives and our stakeholders. Participating in the legislative regulatory meetings with NCRC staff to stay informed beyond the local level has helped me to understand how these policies impact everyday residents. And of course, we welcome and of course, we come to the just economy conference, one of my favorite events of the year, where we meet passionate advocates like you and participate in Hill day or this year advocacy week. This gives us an opportunity to hold our elected officials accountable to passing policies that benefit the constituents that elected them to serve on their behalf in their best interest. Just last week, NCRC members met with their congressional representatives, helping to build the skills to create strong partnerships with Capitol Hill long term. Becoming an NCRC member is worthwhile for any nonprofit, educational institution or local government agency that wants to be on the forefront of creating a just economy. Individuals can also join and support NCRC and benefit from the many resources that we have to offer like the newly Just Economy Club. NCRC has strengthened my voice locally by providing a nationwide family of economic justice advocates sharing practical recommendations on how to get a job how to get to a just economy with NCRC membership really does have its privileges. You’re here today because you believe in a just economy. Join us and make that happen. Now for a few housekeeping rules. As we get into our first session of the day, a few reminders. Please use the chat to interact with your fellow attendees and pose any questions you may have. If you have technical difficulties, you can reach the support team through the support button on the navigation bar on the left side of your screen. Please share what you have learned on social media Facebook, Twitter, Instagram, and LinkedIn and make sure you use the hashtag just economy on whatever platform you choose to use. New this year we have a conference game, check out our event game in the navigation bar to see more details and to compete against your fellow attendees for a chance to win awesome prizes just by participating in the conference. Once again, we want to thank all of our conference sponsors for their support of a just economy. And thank you to our Platinum diamond and gold spark sponsors: Morgan Stanley, Truist Financial Corporation, Citibank, Goldman Sachs, JPMorgan Chase, Aquin Financial Corporation, Santander bank, Wells Fargo, Bank of America Corporation, PNC Bank, and Quicken Loans, LLC.
Now, I’d like to welcome you to the second half or to the second day of our conference. And I’m pleased to start today’s programming by introducing our first keynote speaker at the day. If we were in person, you would hear me say, oh, i o h, and the crowd would affectionately respond with IO. You might even hear me mention the land a few times. Yesterday, we had Secretary Fudge. And now I have the opportunity to introduce Senator Brown, both from my hometown of Cleveland, Ohio. I remember first hearing Senator Brown speak about 20 years ago, his message then it’s the same message today. He believes in the dignity of work, that people should receive a fair wage and that families should have access to the resources they need to live. His message resonated with me then and it still resonates with me today. Senator Brown has been a well-respected member of the Senate since 2007, and a committed supporter of the NCRC mission. He’s now chairman of the Senate Banking Housing and Urban Affairs Committee. After his remarks, NCRC CEO Jesse Van Tol will join the senator in conversation and to moderate questions from the audience. Welcome Senator Brown.
Katy, thank you. Good to be on. Sorry, I’m a little late. I was in an urban farm up in my home county of Richland County where I grew up and they’ve done some really pretty remarkable things on urban farming. So thanks. So again, sorry for being a little bit late. Katy, thank you, Katy has been a stalwart in this state fighting for justice fighting for fair housing, and Toledo and Dayton, where she grew up in Cleveland and thrilled to be introduced by her and Jesse, I love working with Jesse and the work that he’s done for all of you. So thank you for the work that everybody in this call does to invest in communities of color that have been left behind and all communities that have been left behind by and in my state by a competent or Ria and reactionary state legislature, and they’ve been left behind far too often in Washington and Wall Street. People, we all remember the 2008-2009 awful economic times. And we also remember that corporations recovered from 2008-2009. Many SWAT large swaths of the country including where I live in Cleveland, really have not recovered from that, and continue to be left behind these, these are the same communities. The place that my wife and I live in Cleveland zip code 44105. This had more foreclosures leading into the financial crisis of 2000, 892 1007 had more foreclosures than any zip code in the United States. But it was a debt year after year after year of foreclosures. You know, in a, you know, as we’ve seen decades of factories closed that investment drying up and storefronts or and over they, they’re often places have never had the investment they should, because of discrimination because of the black codes. And then Jim Crow and then redlining because of decades of policy, government policy, assisted by big banks or big banks policy, assisted by government, I’m not always sure which that funnel resources and jobs away from entire neighborhoods and towns we need to invest everywhere in the places that have seen investment dry up and in places that were overlooked, discriminated against or outright preyed upon to begin with. You all know how much work we have to do to help all communities recover from this pandemic. And to build something better this past year. Add a limb to say this has been the hardest for many people on this call. And for the people who you serve the hardest of their lives. one in eight workers lost a job. 10s of 1000s small businesses closed. As you know, half a million Americans, our friends or neighbors or colleagues risked their lives to resolve this pandemic. And you know that it was pretty evident early in the pandemic this pandemic has been the great revealer and accelerator it’s made the disparities that much of America particularly people that look like me, hadn’t didn’t really understand what what what this can what was revealed in this pandemic, until they thought up closer the disparities and the problems we had in health care, access to credit life expectancy, maternal rates of maternal and child mortality, such a difference between whites and people of color in this country. And before the pandemic minority-owned small businesses had a much harder time getting access to credit to start and grow. Last year we saw where their biggest franchises get help from big banks, while small businesses were so often left behind in black and brown businesses far less likely than white-owned business to get loans at all, or to get grants before the pandemic started. As many of you know, one in four renters one in for renters, I spent more than half their income and housing so one thing goes wrong. Their car breaks down their child gets sick there. They miss a few days of work from an injury on the job. And never one thing goes wrong in like that their life turns up time to potential eviction, all the things that can happen. That was that one in for renters was before the pandemic. The black ownership rate now is as low as it was when housing discrimination was still legal. Back to 1968. As you issue probably know, when Dr. King was assassinated, the Senate finally in the house finally passed the open housing fair housing law, we made progress and then slid back on. And as you know, during this pandemic people of color, homeowners and renters are more likely to say they fall behind in their bills, putting them at risk at higher risk of eviction or foreclosure. We recognized all that in the American rescue plan. When Joe Biden became president, we provided some $45 billion to pay back rents to help people through the homeowner Assistance Fund stay in their homes another 10 billion and more than $100 million for a home for constellate. For people that to figure out how to get on with their lives in the midst of the threat of foreclosure and eviction. We restarted the state small business credit initiative to provide more relief to truly small businesses. But the rescue the rescue plan was just that. Keep that in mind. It’s a rescue to mobilize our resources to get us through the emergency. Returning to the same broken system, where hard work wasn’t paying off isn’t good enough. I might it might have been when Joe Biden announced for president two-three years ago, he might have thought I just want to return America to pre-Trump normalcy. While pre-Trump normalcy isn’t good enough. Joe Biden now understands that we need to go big. That means we need to go big on housing, it means we need to go big on recognizing that, that that race is a public health crisis. It means we need to go big in raising wages. That means we need to go back on our tax system, all of those things and that’s fundamentally the work of the committee that I now Chair of the Senate Banking, Housing and Urban Affairs Committee. This committee, I think, says it all in this way. This committee has been known by the media and by those around the Senate is just simply the banking committee or Senate Banking. Well, this committee has been all for years has been all about Wall Street, not very much of the full name banking, Housing and Urban Affairs. It’s been all about Wall Street, not much about housing, and damn near nothing about Urban Affairs. The committee, the committee has simply not addressed issues that matter of people’s lives. But that was then this is now we’ve confirmed Secretary Marcia Fudge to be head of HUD. She’s read to restore the Fair Housing rules that the Trump administration got it. Marcia Fudge was my member of was my Congresswoman until we confirmed her to be our Secretary of HUD. We’ve held hearings on how financial system built for the benefit of Wall Street hurts the very workers. It depends on last week, we held the first the committee’s first in its history. its first-ever worker listening session. One woman looked into the camera from Southern West Virginia from the coal mine from coal fields, where she’s survived over the years and she said they call me working poor but working in poor shouldn’t be in the same sentence. We started fighting climate change. First time this committee’s ever had a hearing on climate in sensing it is the opportunity in one sense that it is to create jobs to bring down people’s utility bills to create healthier neighborhoods. We held the committee’s first hearing in nine years on the state of housing to examine the impact housing has on the school district you grow up and the opportunity or as your kid that your child has. Recognizing where you live has a whole lot to do with how you eat or good grocery store nearby. Recognizing where you live has a whole lot to do with public transit, you know, a transit stop so you can get to work, recognizing where you live as a whole lot to deal with the air you breathe and the paint in your home and the quality of the soil in terms of: was it a toxic, does it have toxic chemicals or toxic substances that was from a local foundry, things like that. So we understand that in this committee. That’s why we’re moving on with something moving forward. We also did the first hearing ever in this Medi, the history of the structure to examine the structural racism and housing, as I said earlier, from black codes to Jim Crow, to redlining to have the Trump administration locking in too many of those housing discriminatory practices. So it’s the beginning of building back a better financial system a better housing system, we need to rescind the harmful Community Reinvestment Act rule that the Comptroller of the Currency put in place last year, we need to build on the work the Federal Reserve is doing. You get all three regulators on the same page and strengthen the Community Reinvestment Act that includes finally explicitly ensuring that banks are serving the communities of color whose deposits they profit off of. We need to strengthen protections for consumers in credit reporting and mortgage lending and so much more. We’ll see. We’ll soon have Rohit Chopra, and the Consumer Financial Protection Bureau at a time and the agencies needed more than ever to help struggling families. Whether the economic fallout from COVID-19 we should also be cracking down on predatory lending, not encouraging it. That’s why I’m supporting and I know that’s why you all are supporting the effort to overturn the comptroller the currencies, some so called True lender rule. Thank you for your support on this, we’ll continue to work together to close the IRC and OCC chartering loopholes. We can’t let fintechs play by different rules, and put consumers and communities at risk. And we’ll get to work investing in our nation’s housing because housing is infrastructure. You see how important this is, you see what a difference it can make for a neighborhood when they can get financing for homes and grocery stores and health care they need. When they have a say in how their community develops. I’ll close with a story. I’ve begun working with a former colleague of mine, Doug Jones, began a tradition this set of of once a year, coming to the Senate floor bringing three republicans i invite three republicans and three democratic senators to join me. we devote we read the Dr. King’s 1963 letter from the Birmingham jail now, I assume most of you because you care so much about justice and civil rights and human rights and voting rights that you’ve read this letter. But go back and read it again. It was written by Dr. King to admonish moderate moderate white pastors who are saying, you know, Dr. King, we support voting rights, we think everybody should vote. But don’t move too fast. We’ve got to slow down in this we’ve got to be patient. Dr. King wrote this letter to these most an open letter mostly to the moderate white, quote-unquote allies in Birmingham and around it and throughout the South. On when voting rights and we divide this letter up in one one line in this letter I particularly my favorite Dr. King line, but he said progress never rolls out on wheels of inevitability. Progress never rolls in on wheels of inevitability. And you are you wouldn’t be doing this you all NCRC recognizes Jesse recognizes that Katy Crosby recognizes it that you’re all in this kind of work, this kind of activism, this kind of public service, because you know that progress doesn’t just happen. It just doesn’t roll out on the wheels of inevitability it comes because you’re activists and you make it in your unrelenting and you never give up in the darkest years of the Trump years to a much lighter time now, when Joe Biden and all of us understand we need to go big on all issues of justice, from voting rights, to homeownership to anti discrimination to climate change to clean air and water and all the things that that families all over our country should be able to enjoy. So I will stop there. And Jesse, I guess you’re on so go for it.
Van Tol 18:52
Yeah. Thanks, Senator, thanks so much for joining us, and great to see you. And we’ve got just a little over 10 minutes for questions. So we’ll get right into it. So there’s over 2,000 people registered for this conference. And last weekend, CRC members went to the Hill did over 100 meetings with members of Congress and senators and of course, the tie that binds are the common interests for all of us CRA. You mentioned it in terms of the OCCs rule. But also when I ask you know, since CRA was enacted the financial marketplace has changed. Most mortgages are made by nonbanks today. You know, lots of ways in which financial services have diversified. Chair Powell said yesterday, “like activities should have like regulation,” in a question about expanding CRA to other types of entities. We have advocated for fintechs, mortgage companies, investment banks, broker dealers and larger credit unions to be covered. Do you agree that a broader set of financial players should have a CRA obligation or a duty to serve given what’s happening in communities given we now know, literally the entire financial system is backstopped by the federal government, we experienced that during the recession, we’ve experienced that during COVID, should more players be covered by CRS?
Yeah, of course they should. And I mean, I look at where we’re going on duty to serve, where we’ve done, we haven’t done nearly what we should be doing there. I look at that, more and more. One of the ones, I think, connected to your question Jesse is, is the number of people that are unbanked in this country. And I want the Fed to play a role. And I’ve met with a couple of fed people, including Jay Paul about this. I think they will be more enthusiastic if they see Congress move on this. But I think Congress has a duty to engage with, with the Fed, with the Postal Service, with credit unions, with small community banks, that we can entice for a variety of ways to get into communities to bank the unbanked. We see more and more of the big national banks pull out offices, branch offices, they have an underserved area, not just inner-city, Cleveland, but also rural Appalachia and Southeast Ohio and other places. But I think that as this financial system is moved, and more and more people are writing mortgages and more and more people want to benefit from low-income people as they have that duty to serve. So we are interested in climate students chairing this committee and in closing those loopholes, whether it’s IRC or whether it’s fintechs. But I want the duty to serve to be front and center in whatever we do with CRA. I’m hopeful is that Biden people get people in place for all of these jobs. And we’re not there yet. It’s still a bit of a cumbersome, arduous process that we need to get them in place, get them moving on a much better CRA, where there is consensus. And I don’t exactly know what the future of the Federal Reserve is seeing light, light jobs, light touch of regulation. But I need to have that prove to me that we should go in that direction. I’m not inclined to.
Van Tol 22:39
You brought up administration jobs. And of course, I have to ask about the comptroller. Early on, it seemed like Michael Barr might be the nominee to lead the OCC. Then, Mehrsa Baradarana, I know a candidate you favored, seemed to be the leading candidate. Now she seems to have stalled out. Other names have been mentioned. Meanwhile, you know, several mergers have been announced and are pending review. CRA reform process is going through the paces and not having a comptroller may begin to slow that up. We heard some news reported yesterday that appears Treasury has picked an acting comptroller but you know, has this become urgent at this point. And in your view, you know, what are the characteristics or qualifications for comptroller.
And you’re right, I mean I like Michael Barr. I had no objection to Michael Barr but I was very publicly and privately directly with the administration pushing for Mehrsa Baradaran, and I was both inspired and taught a lot by how the Other Half Banks and the Color of Money, her two books. I don’t remember which order I read them in but I just reread the color of money. And I think that the way she thinks about the world and the way she thinks about banks makes a lot of sense. So for whatever reason the administration seems to be not certain. I don’t know who is likely to be chosen. I think they made the right decision to put an interim person in because they haven’t been able to fill this for a whole host of complicated reasons that I don’t second guess. I mean, I never really demand you pick this person but I give names regularly to them of people that I know will not be captains on wall street that will fight for justice in the way that, Jesse that you define it and that I define it that will side with local homeowners and local renters and communities have been left behind and I think most of the President’s nominees have been those people. But I I don’t know how to answer, who’s it’s going to be at OCC. I do think though, as I said that the decision to have an acting controller makes sense, because the mischief still, there are Trump nominees, still Trump appointees to run the social care administration. Still Chairman Wyden and I, and others are trying, you’re asking him to quit or trying to get him fired. The head of the Consumer Bureau, I called her three times between the election and Inauguration Day and told her she had to quit. And finally she did. But it’s dividing people can put somebody on a little faster than same with OCC. And so putting in somebody that’s acting as exact right move, and I applaud that. But we’ve got to get somebody in place there that’s progressive and smart and, and ready to serve in the ways that the voters want them to.
Van Tol 26:00
And we look forward to talking more about that. I think, you know, the concern that and the lack of consensus around a progressive that could result in someone else getting named. I’m going to move on to one more question because we’re tight on time, and that’s around overdraft fees. You know, we saw banks take in millions of dollars of overdraft fees during the pandemic. And for that matter before that it’s a significant source of revenue in many banking institutions. And yet, we’ve started to see that the tide turn here in 2021. Recently, PNC Bank, for example, announced something they called low cash mode, which I believe they estimate will reduce overdraft fees at their institution by two thirds that we’ve heard others are looking at and examining this practice. Is this something that is a good development? Is it something that you know, industry can be relied on to move away from or does Congress need to act? Does it need to be addressed by the regulator?
Good question, Jesse. The answer is Congress need to in many of us in Congress need to make our feelings known whether we could actually move on that, as legislation is not clear to me, but part of my job is I call banks and I call bank I mean, I’ve had several conversations with CEO of banks of all sizes, on the importance of diversity, the importance of climate that that their underwriting standards be reflect the risk of climate not just the most obvious, you know, you underwrite you, you finance of a mortgage in South Florida. And clearly climates going to affect the 30 years of that mortgage, but also what they do on fossil fuels what they do generally on considering factoring and risk on climate. I’ve worked a lot with Senator Whitehouse, who was probably the number one he had senator shot. So the number one into perhaps climate people in the Senate and how we how we need to think more about this. But your question sort of beggining of begs two things. One is that Roy chopper needs to be engaged in this when he said to the CFPB, in second, I think about overdraft fees, I also think about check cashing fees and all the things, how much it costs to be poor in this country. Part of the part of the solution to that is, is to get the unbanked in the banking system. And do that through the fed through post office through credit unions through small banks through a whole host of ways, but at the same time making sure they’re protected on things like overdraft fees. I think that all goes together. And I would take your question there, Jesse that I see more interested in first from some banks in pulling back on overdraft fees and not doing that. It’s still not widespread enough. But we need to we need to sort of work on on all parts of that with getting people in the banking system. So they don’t pay the check fashion cashing fees, they don’t have the kind of hits they get from being poor in this country.
Van Tol 29:14
Great, thank you. Lots more we could cover from antitrust and public benefits during mergers, public health, racial equity, affordable housing, but, but we’re out of time, I just want to thank you, Senator Brown, for your leadership. I’m sure we will be working on all of those issues together. And I know the NCRC members were thrilled to hear from you today.
NCRC has been so helpful to our staff and to this committee. And with the Democrats in the majority, you know, we’re going to count on you to continue to fight for these issues and teach us and shed light on issues that matter to so many people’s lives. So thanks. Thanks to you, Jesse. And thanks to the people at NCRC for the work you’re doing. That’s just Also important to our country. Best wishes.
Van Tol 30:03
Thank you, Senator. Take care. And now folks, we’re going to quickly transition to our next session, which is a fireside chat with John Taylor, our president, founder, and PNC Bank CEO, build them, check the join us there, you’ll want to go back to the agenda and navigate the next session. We’re not taking a break. We’re gonna roll right into it. So please navigate out of this session, click on your agenda and click on the next session. We’ll see you there. In just one minute. Thank you.