The Wall Street Journal: Rewrite of Lower-Income Lending Rules to Advance in December

The Wall Street Journal, November 14, 2019: Rewrite of Lower-Income Lending Rules to Advance in December

Community groups expressed skepticism about the OCC’s approach as well as the timing for completing the overhaul ahead of next year’s presidential election. “The timing of this proposal seems to be driven by political considerations, not substantive ones,” said Jesse Van Tol, chief executive of the National Community Reinvestment Coalition. The OCC’s approach, he said, may boil down CRA to a “dollar volume metric, easily accomplished by making high dollar loans and investments.”

First enacted in 1977, the CRA aimed to combat redlining—a practice of not lending in certain minority neighborhoods. At a time when many banking services are provided online, there is growing consensus among policymakers that the rules should be updated.

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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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