Monday, March 27, 2006

Banking on Minorities and the Poor

In the documentary film, New York: City of Tomorrow, we saw how banks helped to create the conditions for the emergence of slums in NYC. By providing better lending terms to people living in racially homogeneous neighbourhoods, banks essentially provided a structure of economic incentives that led whites to move to the suburbs and blacks and latinos to stay in increasingly segregated neighbourhoods in the inner city. In the post-War period, the system changed, but American banks continued to be roundly criticized for their failure to provide adequate lending to poor and minority groups. Lest we think this is merely an American problem, the Toronto Star showed last week that a similar phenomenon is evident in Toronto communities like Regent Park where banks have abandoned the poor. The problem might not always be abandonment, however. The Christian Science Monitor reports on a change underway in cities like Boston where banks increasingly see poor neighbourhoods as "the promised land - or at least the land of promises. Their airwaves are jammed with commercials urging residents to refinance and "cash out;" their telephone poles are papered with ads luring first-time buyers to apply for loans..." Needless to say, this binge is driven by a desire for profits and is being accompanied by increased numbers of foreclosures. How that will alter the spatialization of povery in the city remains to be seen.


Blogger MORGAN said...

This comment has been removed by a blog administrator.

3/27/2006 11:15 PM  
Blogger MORGAN said...

In Parkdale - right near Queen and Landsdown - the Royal Bank opted to open up a version of a check cashing store, a "CASH AND SAVE". Originally they ran a full service branch. 'Oddly' enough any references to it being owned by the Royal Bank are hard to spot (although to be fair I have not stepped inside.)

Here is the offical word -repackaged as "social responsibility". A promised land of service fees it seems.

3/27/2006 11:23 PM  
Anonymous Anonymous said...

If you're having trouble finding the link above, here it is again (in 2 pieces).

It's a creepy article.

3/28/2006 12:16 AM  

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