Banks

A Spiritual Glossary of Debt

Business man underwater, Minerva Studio / Shutterstock.com
Business man underwater, Minerva Studio / Shutterstock.com

Debt, multitudes think, is bad. It could be good, by helping more people manage the energy of money. The Lord’s Prayer helps the confusion along: some pray to be forgiven debts, others to be forgiven trespasses. Good debt does not trespass. Bad debt is most often done by banks, and trespasses inside people, insidiously, and shames them. Religious institutions help the shame along by mispraying the Lord’s Prayer.

Debt might be good. In his book on Debt: The First 5000 years, David Graeber opens with a story. The story is paradigmatic. A woman tells a man the story about a person who is “under water.”  “But, shouldn’t she have to pay her debt?”  Should. Have. Pay. Debt. Those four words go together. They mispray the Lord’s prayer. Instead we might pray, “forgive the banks their trespasses into our souls first and then our pocketbooks.”   

Getting Started

WANT TO PUT money to work for the common good? Your congregation—large or small—has more to invest than you might expect. Here are three questions to get you started.

1. Where does our church bank? "Many churches choose a bank based on proximity to the church or the church treasurer's home," Andy Loving says, but it doesn't have to end there. Approach the finance committee and say, "We want to put our money somewhere that has implications for what we value as a church," suggests Loving. Find a bank that empowers economically depressed areas through brick-and-mortar locations and socially responsible loan practices.

2. Does the bank we're considering provide options for the poor? Where are the branches located? Does it loan to people or businesses who typically don't get approved by mainstream lenders? One institution Loving recommends is Self-Help Credit Union in Durham, N.C., which has locations throughout the state—and also a web-based interface convenient for members outside the area. Another place to hunt for justice-oriented banking is the National Community Investment Fund website, www.ncif.org, which allows you to search by location and banking practices.

3. How can our church enact justice with the money we have?Loving recommends asking this of your church or a group within it, such as a Sunday school class, in order to start a discussion about surplus capital and investing. A good resource for discussion is Ched Myers and Loving's DVD series and study guide, From Mammon to Manna: Sabbath Economics and Community Investing , available at www.chedmyers.org.

Image: Coins and sprout, Anthony Berenyi / Shutterstock.com

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Banking For the Rest of Us

One meaning of the word “occupy” involves asserting sovereignty over a place. For the demonstrators who set up camp in lower Manhattan last fall, “occupying” was a reassertion of popular sovereignty at the very epicenter of our economic system. It was a challenge to the power that giant corporations—and Wall Street banks in particular—have amassed. It was a challenge to the way these firms have captured the levers of government and rigged policy to protect their own positions and profits at the expense of everyone else.

More than three years after their reckless greed triggered the Great Recession, the nation’s biggest banks have paid almost no penalty and are bigger than ever. In 2007, the top four banks—Bank of America, JPMorgan Chase, Citigroup, and Wells Fargo—held assets of $4.5 trillion, which amounted to 37 percent of U.S. bank assets. Today, they control $6.2 trillion, or 45 percent of bank assets, according to the Federal Deposit Insurance Corporation. For them, the recession was a brief hiccup, promptly ameliorated by a public bailout and a return to robust profitability. Last year, these four firms, together with the next two largest banks, Goldman Sachs and Morgan Stanley, paid out $144 billion in compensation, making 2011 their second highest payday ever. According to the Bureau of Labor Statistics, the average bank teller made $24,980 in 2010. Such rank-and-file employees didn’t benefit from the big bonuses and compensation packages which were heavily concentrated at the top of the corporate ladder.

Meanwhile, joblessness, staggering debt, and foreclosure have devastated countless families. Many have shared their stories on the We Are the 99 Percent Tumblr website, which should be required reading for the 1 percent. It provides a heart-breaking account of living in a society “made for them, not for us,” of drowning in debt and struggling merely to secure a means of keeping food on the table.

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Isaiah and the Foreclosure Crisis

Today’s Washington Post sits open on my desk with the headline: “Settlement launches foreclosure reckoning—U.S., states pledge relief for homeowners under deal with five big banks.” Next to it, my Bible is open to Isaiah 55. Could two descriptions of “relief” be more opposite?

In the first, Wells Fargo, Bank of America, JPMorgan Chase, Ally Financial, and Citigroup steal the homes and life savings of hundreds of thousands of people. (If you or I “robo-signed” documents, we’d be charged with forgery. It’s illegal.) But with no cop big enough to wrassle the Big Five into a noisy, urine-stained jail cell, and no judge with a gavel hard enough to thwack down a decent judgment, applying pressure for some restitution fell to grassroots groups, the states’ attorneys generals, and partisan powerbrokers—a tenuous coalition at best.

After 16 months of posturing, the “principalities and powers” behind the Big Banks agreed to let some artisan bread crumbs fall from their private-dining, Madison Avenue tables. Now, the 750,000 people whose houses were stolen at pen-point can sign up to get approximately $2,000 each in restitution. As blogger David Dayen put it, it’s the equivalent of the banks telling their victims, “Sorry we stole your home. Here’s two month’s rent.”

The banking settlement “forces” the lenders to give some money back. Forty-nine states will get a much-needed trickle of cash and cash-like substances. And they’ve agreed to reduce the principal on mortgages with “negative equity” to the tune of $17 billion over three years. However, that amounts to about 2.4 percent of the $700 billion needed to bring borrowers’ noses to the surface, according to Capital Economics’ Paul Diggle. The fine doesn’t nearly match the crime. And the banks have been tucking this money away in slush funds in preparation for the settlement. They are paying out of their excess—not until it hurts.

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Why I Love Credit Unions

I finally “moved my money” from Wells Fargo to Lafayette Federal Credit Union. It’s local. It’s half a block from work. Charlotte, the branch manager, already knows my name.

Mind you, I never actually opened an account at Wells Fargo to begin with. I opened my account 20 years ago with a regional bank. But it was bought by Bank of America. I then switched to another regional bank. But it was bought by Wachovia. Last year, Wachovia was bought out by Wells Fargo. I’ve never been a big fan of the mega-money institutions. But ever since they drove our economy into a ditch and did it, in part, by taking the homes of poor people and minorities, I felt the biblical prophets giving me a kick in the pants. Hence, the next stage of my financial pilgrimage.

Credit unions, as we know them today, originated in Europe in the 1800s as financial self-help cooperatives among small business owners and farmers in particular locales, geared toward providing for and protecting their economic sovereignty. Eventually credit unions came to be organized around seven principles: 1) voluntary membership, 2) democratic governance, 3) member control of capital, 4) autonomy and independence, 5) education of members and public in cooperative principles, 6) cooperation between cooperatives, and 7) concern for the local community.

“If love is wise,” wrote Pope Benedict in his 2009 encyclical Charity in Truth, “it can find ways of working in accordance with provident and just expediency, as is illustrated in a significant way by much of the experience of credit unions.”

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Foreclosure Resistance: A Prayer

Foreclosure image via Shutterstock (http://www.shutterstock.com/pic-32385181/sto
Foreclosure image via Shutterstock (http://www.shutterstock.com/pic-32385181/stock-photo-home-for-sale-price...)

The question is, are we listening? For God, who hears the prayers of God's people, is calling us to listen as well. God's justice is a collective project.

But when we listen, we hear stories of oppression, corruption, and injustice, in the face of honesty and hard work. But listening is not enough. When we listen, God calls us from the quiet of prayer to be a healing presence in the world.

"She looks well to the ways of her household, and does not eat the bread of idleness." - Proverbs 31:27

Where to Move Your Money

While moving money from megabanks (“Time to Move Your Money?” by Jim Wallis, March 2010) is worth doing, where the money is moved to is critical; the “move your money” Web site noted in the editorial is not discriminating enough. One suggested bank in my hometown provided loans to payday lenders until a government agency strongly encouraged them to stop. The bank then teamed with a major tax preparation company to make refund anticipation loans, which are documented to be predatory upon poor tax payers.

Banks, credit unions, and community development corporations designated as Community Development Financial Institutions (CDFIs) by the U.S. Treasury focus their loans and outreach efforts in poor communities. And then there are a special group of community development credit unions (CDCUs) that serve very poor but resourceful communities. A Web search for these terms, or a visit to www.communityinvest.org, is a great place to start.
Andy R. Loving
Louisville, Kentucky

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Sojourners Magazine July 2010
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Move Your Money

I very much appreciate Jim Wallis’ commentary (“Time to Move Your Money?” March 2010). There are, however, better reasons for moving money than anger (much as it’s warranted) at the traditional big bank crowd.

Though their work is still woefully underreported, quite a few people have pioneered the work of community funding and microfinance investing. In my previous work with the Baptist Peace Fellowship, we initiated an effort called the Gleaners’ Project to encourage individuals and congregations to place at least part of their savings in institutions that provide working capital in poorer communities here in the U.S. and abroad. We set a goal for the initial year of redirecting $100,000 to alternative economic institutions. Imagine our shock (not to mention joy) when the total exceeded $1 million. It is a relatively simple, safe, and productive way to allow gospel values to guide decisions about money.

Ken Sehested
Asheville, North Carolina

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Sojourners Magazine June 2010
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