Felix Salmon

The upside of the Move Your Money campaign

By Felix Salmon
January 8, 2010

I’m puzzled by Yvette Kantrow’s supercilious dismissal of Arianna Huffington’s Move Your Money campaign. Kantrow paints the campaign as being about “optics” over substance, and complains that “it emphasizes symbolism over reality and feeling over fact”. And she does so with no hyperlinks at all, which means that when she says the campaign “promises to help you ‘stick it’ to big banks”, it’s impossible to fact-check her. (That phrase certainly never appears on the initial blog entry which launched the campaign.)

Instead, the campaign was much more than an attempt to stick it to the man: it was an attempt to get people to do the right thing with their money. Here’s what Huffington actually wrote:

We talked about the outrage of big, bailed-out banks turning around and spending millions of dollars on lobbying to gut or kill financial reform — including “too big to fail” legislation and regulation of the derivatives that played such a huge part in the meltdown. And as we contrasted that with the efforts of local banks to show that you can both be profitable and have a positive impact on the community, an idea took hold: why don’t we take our money out of these big banks and put them into community banks? And what, we asked ourselves, would happen if lots of people around America decided to do the same thing? Our money has been used to make the system worse — what if we used it to make the system better?

Kantrow says that Huffington is “turning the decision on where to bank into a moral choice, like being green or buying organic” — and she’s right about that, but in a good way. People think long and hard about where and how they spend and give their money, and they — rightly — consider it very important that they do so in a manner that’s consistent with their broader beliefs. The big four banks, however, expanding across the country by acquisition, have simply taken over millions of consumers who never particularly wanted to bank with them and who are now giving them billions of dollars in fees and trillions of dollars in virtually zero-interest-rate deposits.

As Huffington says, there’s no doubt that community banks and credit unions generally have a positive impact on their communities, while the too-big-to-fail crew have had an inordinately negative impact on the entire country. If you continue to bank with the big four, you only serve to perpetuate that dynamic. On the other hand, if many people start moving their money into community-based financial institutions, those institutions are likely to be able to do much more good in their communities than they’re doing already. (If you live south of 14th Street and east of the Bowery, I’m on the board of one such institution which would love to put your deposits to good use locally.)

The point here isn’t to bring the big four to their knees: it’s not a negative boycott, in that sense, aimed at the destruction of something you hate. Instead, it’s a much more positive thing, telling people that if they move their money to community institutions, then they themselves will be better off financially (friendlier bank managers, lower fees, etc) and so will their community more generally. It’s a win-win proposition.

11 comments so far | RSS Comments RSS

The notion that small banks are good and big banks are bad is a delightful fantasy, tailor-made for simpleminded leftist bumper sticker sloganeering: “Think globally, bank locally.” There are valid reasons for people to choose different sizes and classes of institutions; hopping on board that megalomaniac’s latest campaign to draw attention to herself shouldn’t be one of them.

Posted by RobSterling | Report as abusive

so then shouldn’t we do our banking in community banks in poor neighborhoods?

Posted by q_is_too_short | Report as abusive

I’m employed by a TBTF bank, so it would not be in my best interest to bank elsewhere.

Posted by drewbie | Report as abusive

Bottom line is that people ought to pick banks that suit their interests, not some larger societal goal. You could slide the GDP of France under the “making the world a better place” limbo bar.

Posted by RobSterling | Report as abusive

“The notion that small banks are good and big banks are bad is a delightful fantasy…”

…that happens to be supported by the evidence. (http://delong.typepad.com/sdj/2010/01/t en-economics-pieces-worth-readings-janua ry-4-2009.html; see my graphic at #3)

Posted by klhoughton | Report as abusive

Kloughton, perfect!
I dumped my TBTF bank 4 years ago and went with my local credit union. Haven’t looked back, I get better interst rates, better credit card and loan terms and outstanding customer service.
I feel good about where I bank and feel good about what they give back to the community.
Kantrow and the other naysayers want consumers to believe they do not have a choice and that it makes little difference where you bank.
It does make a difference, bank someplaces that wants and appreicates your business and actually demonstrates that with actions, not words.
Find out what your bank pays it executives, what it gives back to the community, what it will charge you for its services. Educate yourself and make an informed choice, you will not look back either once you dump your TBTF bank that does not give a rats a** about you.

Posted by bikebrainiac | Report as abusive

If you want a movement to STICK IT TO THE BIG BANKS …

Just start a “WALK AWAY IF YOU CAN! WALK AWAY WHILE YOU CAN” Movement and see what happens to the BIG BANKS….

I sure would like to watch this show …

Posted by killben | Report as abusive

“Bottom line is that people ought to pick banks that suit their interests, not some larger societal goal.”

Please… the larger societal goal IS in our interest. Individuals and small businesses are fed up with being used and abused by the bailed out mega-banks who treat them like commodities, steal them blind, and then recieve a tax-payer bailout in order to continue doing same. Local banks and credit unions treat their customers like human beings. If nothing else, I sleep well knowing that my money is with with a credit union where the greedy buggers can’t get at it.

Balk now, thank Huff Po later. Move Your Money!

And thanks for this article. Pass it on…

Posted by kfreed | Report as abusive

We’ve used a credit union for personal banking since my Taft-Hartley admission to my union gave me access. They know my name and never treat me like a pariah when I have a question or concern.

It may seem a small thing, but I closed my small business B of A account when they began to charge my employees for cashing their paychecks. When I write a check, I expect it to be treated as a bearer document… not a chance to fleece the people who work for me for a point or two of their income. Do they charge other banks 5 bucks off of every check? If it’s not criminal extortion, it should be; and aren’t the betrayal of American ideals not ensconced in the relationship defined by B of A’s treatment of their customer’s employees?

Posted by Shantyhag | Report as abusive

If you are interested in keeping your money in your community, look into a credit union when you move your money out of the big banks. As nonprofit institutions, credit unions are champions of their members’ needs and give back through lower fees, higher dividends and lower loan rates, and community service. Plus, most credit unions offer the full range of services you need for personal and business banking.

Posted by JenC | Report as abusive

“I’m employed by a TBTF bank, so it would not be in my best interest to bank elsewhere.”
Haha, yeah and if you were employed by Hitler it would be in your best interest to continue incinerating Jews.

Posted by zylstra | Report as abusive

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