Democrats Want To Push Banks To Do More For Social Change
RACHEL MARTIN, HOST:
In Congress, populists are in power on the committees that oversee the big banks. And as NPR's David Gura reports, that means Washington is a tougher environment for the CEOs running those banks.
DAVID GURA, BYLINE: Senator Sherrod Brown has not forgotten the housing crisis. He says that in the first half of 2007, there were more foreclosures in his hometown than anywhere else in the country. Not more than a decade later, after another recession, Brown believes too many Americans are still getting the short end of the stick.
SHERROD BROWN: They never get bailed out. They never get a second chance. They're just not in a position, in an economy like this where Wall Street writes the rules, that they can get ahead.
GURA: That has shaped Brown's approach to oversight and the country's largest financial firms.
BROWN: They did very well during the pandemic. We've seen stratospheric compensation levels. You see stock buybacks and dividend distribution. Yet wages throughout our economy are essentially flat.
GURA: In fact, banks did better at the beginning of this year than ever before. Brown is now the chairman of what's known as the Senate Banking Committee, a group that also includes Senator Elizabeth Warren.
ELIZABETH WARREN: You know, most people think about Congress in terms of passing legislation. And, yeah, that's part of the job. But the other part of the job is oversight.
GURA: At a hearing this week, Warren asked Jamie Dimon, the CEO of JPMorgan, to tell her how much money his bank made off of overdraft fees during the pandemic.
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WARREN: Do you know the number?
JAMIE DIMON: I don't know the number in front of me. But we actually - upon...
WARREN: Well, I actually have the number in front of me....
DIMON: Upon request, we waive the fees.
WARREN: It's $1.63 billion.
GURA: Later, she asked Dimon if he'd volunteer then and there to give that money back. He didn't. With Democrats in control of both houses of Congress and the White House, there's a push for the country's largest financial institutions to be agents of social change. They want banks to expand access to loans. They want fewer fees. And they want banks to invest more in green energy. They also want to see more diversity and better outreach to underserved communities across the United States.
WARREN: They have a responsibility to execute on making their banks part of the solution to our economic and racial problems across this nation.
GURA: And firms have started to confront their role in American society, to whom they lend money, their investments, where they stand on immigration and climate change. Mike Mayo is a banks analyst at Wells Fargo Securities.
MIKE MAYO: You know, banks have no choice but to address these issues because it impacts their communities, their customers and their employees.
GURA: But Republican lawmakers strongly disagree with that. They criticize executives for comments they've made about voting rights, for instance. And they're critical of companies making business decisions based on environmental considerations. Senator Pat Toomey is the ranking member on the Senate Banking Committee.
PAT TOOMEY: That ought to be left to elected lawmakers.
GURA: Bankers aren't naive to the politics at play - of the Democrats' small majority in the House, their razor-thin majority in the Senate and the 2022 midterms. In the House of Representatives, Congresswoman Maxine Waters chairs the Financial Services Committee.
MAXINE WATERS: Well, you know, what I've discovered about the banking community is that they have had a way of operating traditionally, historically. And they don't change easily.
GURA: But Waters says that community knows her. And they know she's going to push for change.
WATERS: I think that many of them have come to understand that I can be dealt with. But I cannot be tricked. I cannot be fooled. And I don't accept being undermined.
GURA: Waters says the bank CEOs should expect to see her frequently in the future.
David Gura, NPR News, New York.
(SOUNDBITE OF MATTHEW HALSALL'S "THE END OF DUKKHA") Transcript provided by NPR, Copyright NPR.