Although you wouldn’t think that the history of banking would be exciting, much less the stuff of a musical, Baradaran presents a compelling narrative about how and why we got to the place where we are so far from the democratization of credit that our founders envisioned (and pretty much enacting the fears they anticipated). It boils down to mission drift or, better yet, mission abandonment. Initially, banks were conceived as a public service institution, assigned to serve everyone. At some point in the 70s, the mission shifted to profit, and Baradaran demonstrates how this hybrid – a private profit making institution supported by the government is just not sustainable.
Various alternatives have emerged – the credit union, in its original form, seems to have had some success. But it, too, had its mission corrupted. Baradaran sees some possibilities in postal banking, but her endorsement is far from passionate.
And the question of what comes next (there’s that musical again) is essential. J.D. Vance of Hillbilly Elegy fame talks about how his family relied on payday loans. And The Atlantic also wonders what would replace them.