US banks are sacrificing poor communities to the climate crisis | Ben Jealous and Bill McKibben
The collapse of Silicon Valley Bank will bring many forms of fallout. One of the most obvious consequences is that the biggest banks – Chase, Citi, Wells Fargo, Bank of America – will probably get even bigger. That is why we’re joining protests across the United States outside hundreds of those banks’ branches on Tuesday, 21 March: if they’re going to hold that much power over the planet’s economy, we need them to recognize and help with our great crises. We need them not to do what they did last century, which is to ignore or exacerbate our deepest troubles.
Beginning in the 1930s, the federal government mapped America, grading neighborhoods to decide which ones were worthy of investment, literally drawing red lines on maps to make it crystal clear. Many mainly Black and Brown neighborhoods ended up with low grades, and most US banks made sure money didn’t flow in their direction. Nearly a century later, these neighborhoods still suffer. Lacking trees and parks, they are degrees warmer than nearby leafy communities. Their residents are condemned to a myriad of health issues, from asthma to kidney stones.
Beginning in the 1970s, US banks pledged to do better, though several have been forced to pay fines in recent years for continued discriminatory lending practices. Those practices persist today – they’re just less obvious.
The four biggest banks in America are the four biggest financiers of fossil fuel expansion in the world. These banks didn’t need Donald Trump’s help to sabotage the Paris climate accord: since 2015, they have provided well over $1tn in lending and underwriting to the companies building new coal plants, pipelines, fracking wells, gas export terminals, and more.
This polluting infrastructure is designed to last decades – long past the point at which science tells us we need to wean off fossil fuels. We can’t shut off all oil and gas overnight, but we can, and must, call on these banks to keep it from expanding, to move money out of dirty energy projects and finance more clean energy instead.
It’s entirely clear who is hit the hardest by the impacts of climate crisis. Both in the US and around the world, the poorest and most vulnerable people disproportionately suffer the effects of a warming planet, despite having done the least to cause it.
The carbon pollution these four US banks pour into the air via their fossil fuel financing is, in effect, redlining US cities and the world. The pollution affects low-lying Asian deltas in Bangladesh and Vietnam, and drought-afflicted African nations like Sudan. It ensures high asthma rates around Gulf Coast refineries and unprecedented floods in places like Pakistan. Global temperature rise is systematically reducing the number of places where humans can thrive.
For US banks, the people in these places apparently aren’t worth worrying about, just as their predecessor banks didn’t care about inner-city communities.
Make no mistake, banks play a huge role in this process. New data published last year shows that for many companies and individuals, cash stored in banks is their single biggest source of carbon emissions. That’s because banks use peoples’ money to provide loans to fossil fuel companies to expand. For companies like Google, Apple, or Netflix, their cash can produce more carbon pollution than any of their own business activities.
We can solve this problem. If Chase, Citi, Wells Fargo and Bank of America no longer fund new fossil fuel expansion, it makes the climate fight easier. There’s no reason they can’t: in December, Europe’s biggest bank, HSBC, announced that it would no longer directly finance new oil and gas development. Many other global banks have stopped funding coal.
So far, American banks are headed in the opposite direction. Despite commitments to zero out the emissions resulting from their financing activities by 2050, they’ve continued with business as usual. At global climate talks in 2021, the big US banks joined an international alliance of “net-zero” financial institutions. So far, that initiative has been an exercise in greenwashing. In fact, some US banks threatened to quit if the alliance adopted any rules with real teeth.
It took decades of campaigning and litigation to force the US financial system to abandon racist redlining. We don’t have decades to avert catastrophic climate ccrisis and further impacts to vulnerable communities. That’s why we are pushing as hard as we can, with the nationwide demonstrations on 21 March as the next big step. In cities across America, people will join sit-ins and pickets at Chase, Citi, Wells Fargo and Bank of America branches. In homes, schools and even underwater, people will cut up their credit cards from big US banks.
These demonstrations are only the beginning of what each of us can do to hold banks accountable for their role in the climate crisis. After that, we’ll move on to organizing the banks’ biggest clients and shareholders, state and city treasurers and major companies with climate pledges of their own, to add their weight to this fight.
The redlining of America was one of the ugliest chapters in our nation’s history. We must stop our nation’s banks from doing the same to our communities and the planet.
Ben Jealous is the executive director of the Sierra Club, the former executive director of the NAACP, and the author of Our People Have Always Been Free
Bill McKibben is the founder of Third Act, which organizes Americans over the age of 60 for action on climate and democracy