Mehrsa Baradaran is Professor of Law at UCI Law and a celebrated authority on banking law. In addition to the prizewinning The Color of Money, she is author of How the Other Half Banks. She has advised US senators and representatives on policy and spoken at national and international forums including the World Bank.
An important voice…[Baradaran’s] excellent new book, How the Other
Half Banks: Exclusion, Exploitation and the Threat to Democracy
describes how, for decades, big banks have shed their social
contract with the American public and transformed themselves into
modern monstrosities which serve corporations and the wealthy and
exploit or avoid the less affluent members of our society. Setting
the stage with this historical context, Baradaran makes a
compelling case for a postal banking system which would greatly
benefit millions of struggling ‘unbanked’ Americans.
*Huffington Post*
The title of [Baradaran’s] lean, angry book echoes the
photojournalism of Jacob Riis, whose 1890 work on the slums of New
York, How the Other Half Lives, spurred a housing reform movement…
In a society built on credit as a means to wealth, low-income
families deserve a much better deal, Baradaran argues. People do
not opt for expensive products because they do not know any better,
or are somehow reckless or irresponsible. They do so because they
have no choice. And that is a national embarrassment.
*Financial Times*
Baradaran argues persuasively that the banking industry, fattened
on public subsidies (including too-big-to-fail bailouts), owes
low-income families a better deal… How the Other Half Banks is well
researched and clearly written… The bankers who fully understand
the system are heavily invested in it. Books like this are written
for the rest of us.
*New York Times Book Review*
How the Other Half Banks is a fascinating blend of history, policy,
government, regulation, influence buying and some international
comparisons…Indispensable for any future studies of American
banking and regulation.
*Forbes*
Mehrsa Baradaran’s terrific book, How the Other Half Banks, argues
that we could and should ask banks to serve the poor and working
class once again. In particular, post office banks (with
storefronts and websites both) could provide those missing banking
services: a place to park cash, earn interest and take out small
amount loans… The idea is not hers originally, but she seizes and
expands on the idea brilliantly and at great length. In particular,
she advances the case for postal banking by reviewing the country’s
earlier experience with postal banks, and by linking that
experience to the modern problem of missing services for the poor
and working class… One can appreciate why the policy world has come
to Baradaran for her expertise, and this book will constitute a
central contribution to the debate… I will recommend this book to
all who are interested in structural racism… Baradaran demonstrates
how the the post-deregulation restructuring of banking has
disproportionately impacted communities of color, and how postal
banking and other public options might bring them back into the
fold once more. Baradaran’s revival of postal banking, and her
description of the disappearance of services in the wake of
deregulation, is fresh and engaging, and I highly recommend [the]
book for all who are interested in the structure of inequality.
*JOTWELL*
Steadily shedding low-profit clients, American banks flourished
during three decades of deregulation, but, when the crunch came
last decade, the U.S. government—spouting
we-are-all-in-this-together rhetoric—rushed to their rescue. In
good times, banks are free-market players. In bad times, they have
all the comforts of state agents. The author’s emphasis is not on
curtailing megabanks’ privileges—a reader could get the impression
she thinks that case too obvious for lengthy exposition—but on
providing secure, low-cost credit for those who need it most. Her
back-to-the-future solution is postal banking. Although the idea
sounds terribly old-fashioned—it hasn’t been seen in the U.S. since
the 1960s—more than 50 nations, including Japan and Germany,
maintain a vibrant postal-bank system, a pillar of their strong
savings cultures.
*Maclean’s*
Baradaran charges that nearly half of the American population has
been deprived of access to financial services at a fair price
thanks to financial deregulation…A comprehensive addition to the
ongoing discussions of both inequality and the financial
system.
*Kirkus Reviews*
A fascinating in-depth view of why and how so many Americans
struggle to find affordable banking services. Modern finance
provides great opportunity but also many risks, through hidden fees
or even outright deception. The crisis of 2008 was not an
aberration—and we have not fixed the deep-seated underlying
problems. A must read for anyone who aspires to build financial
security for themselves, for their family, and for the nation.
*Simon Johnson, coauthor of White House Burning and 13
Bankers*
Do banks have a public responsibility to serve the poor? This
captivating book argues that they do. A fresh and provocative
perspective on the very old problem of the poor and debt.
*Patricia A. McCoy, coauthor of The Subprime Virus*
Thoughtful and exhaustive.
*Democracy*
Important and comprehensive…How the Other Half Banks is a
fascinating read, and Baradaran has done a masterful job of turning
what could be incredibly dry material into a well-paced, accessible
chronicle of how the consumer financial services industry has
changed since the beginning of the republic. She traces the history
of the relationship between the banking industry and the nation,
and shows how banks have gained more power, leaving the less
well-off excluded and exploited…How the Other Half Banks tells an
important story, one in which we have allowed the profit motives of
banks to trump the public interest. Baradaran is right to take a
pragmatic approach to these issues, as it seems unlikely that there
is sufficient political will to renegotiate the social contract
between banks and government so that it once again favors the
public.
*American Prospect*
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