After RedliningThe Urban Reinvestment Movement in the Era of Financial Deregulation

After RedliningThe Urban Reinvestment Movement in the Era of Financial Deregulation

Rebecca K. Marchiel

Print publication date: 2021

ISBN: 9780226723648

Publisher: University of Chicago Press

Abstract

After Redlining explains the changed relationship between urbanites and their banks during the last third of the twentieth century, and argues that an urban social movement drove the change. In so doing, it explores how the U.S. financial system shaped and was shaped by the community organizing of ordinary urbanites from 1966 to 1989. The book charts the activism of the urban reinvestment movement whose members blamed anti-urban, bank-friendly policies for the decline of American cities—not riots, white flight, or deindustrialization as current scholarship and popular memory suggested. Drawing on the unprocessed archive of the reinvestment movement’s lead organization, National People’s Action, as well as Congressional hearings and banking trade publications, the book spotlights the impact of this multiracial coalition of low-and moderate-income city residents on urban redevelopment and American politics. The movement’s crowning legislative achievements—the Home Mortgage Disclosure Act of 1975 and the Community Reinvestment Act of 1977—created a unique role for community organizations as grassroots financial regulators who policed urban redlining at the street level. Yet the 1970s economic downturn narrowed the scope of urban reinvestment in practice. Policymakers rejected ambitious urban initiatives out of fear that increased spending would worsen the era’s persistent inflation, making bank-financed reinvestment all the more important. At the same time, financial deregulation—wherein policymakers gave banks untested privileges to lend and manage wealth in new ways—shifted the ground beneath activists’ feet. By decade’s end, “reinvestment” referred largely to something that banks did, and banks had changed dramatically.