For Immediate Release
Date: January 21, 2021
Racial Wealth Gap Expert Mehrsa Baradaran is an Alternative to Michael Barr, a Wall Street and Big Tech Ally.
The Wall Street Journal reported that President Biden is expected to tap Michael Barr as Comptroller of the Currency, a position that would make him one of the most influential regulators of financial institutions. The American public has learned the hard way what happens when captains of the financial industry post up in the Treasury: Hank Paulson rescued his former colleagues at investment banks; Tim Geithner gave financial institutions a do-over and blocked efforts to support homeowners. Barr’s appointment to comptroller of the currency would be a move from the same Paulson-Geithner staffing playbook — and one that would undermine the agency’s ability to perform one of its core responsibilities.
Luckily, the Biden administration doesn’t have to look hard for an alternative candidate who shares the values and priorities President Biden outlined in his inaugural address: Mehrsa Baradaran. Baradaran is a fierce advocate for everyday Americans, has a battle-tested track record fighting for people who just want a fair shot, and is fearless in the face of financial institutions that build racial discrimination into their business models.
“We need to keep FinTech from securing the commanding regulatory heights available through the OCC,” said Revolving Door Project Executive Director Jeff Hauser. “Because Michael Barr has chosen to enmesh himself deeply within FinTech, we cannot trust him to ensure these companies don’t defraud the public. We would be very disappointed if Biden protected FinTech, the progeny of Big Tech and Big Banks, by choosing Barr.”
“The selection of Michael Barr as the next Comptroller of the Currency would be a major victory for Wall Street, and its child with Silicon Valley — the nascent FinTech industry,” said Demand Progress Executive Director David Segal. “Joe Biden has asserted racial and economic justice as central pillars of his agenda, and the OCC provides a huge opportunity to pick a leader who is deeply committed to addressing the power of banks, and the inequities and systemic risks they’ve perpetuated.
“Black, Brown and Native communities are often the first victims of predatory banking and financing,” said Vasudha Desikan, Political Director of the Action Center on Race & the Economy (ACRE). “This is why we need a long-time advocate for racial and economic justice, like Mehrsa Baradaran, who understands this and can close the deepening racial wealth gap. Our government needs leadership that fights for strong regulation against banks and financial institutions, not industry insiders who will just perpetuate the status quo. There is no better choice to lead OCC than Mehrsa.”
A CLEAR CHOICE
Personnel decisions are always nuanced and inevitably involve tradeoffs. But with this appointment, the contours of the decision are straightforward. As the country looks to pull itself out of our second “once-in-a-generation recession,” who will deliver for everyday Americans: someone who regularly puts profits over people, or their professional counterfactual who always puts people first?
THE BOTTOM LINE
Mehrsa Baradaran is a leading expert on banking law and history who literally wrote the book on how the financial system contributes to the racial wealth gap. No one is better positioned to tackle the issue, which Biden has emphasized repeatedly, and Baradaran’s scholarship and values make her the right fit for this moment.
Michael Barr was the right-hand man to Wall Street ally Tim Geithner in 2008, and now he wants to do for “FinTech” apps what he did for the banks back then. He’s an advisor to FinTech-funded political groups, venture capital funds, and more.
Baradaran is a leading expert on the racial wealth gap and banking. She is the author of The Color Of Money, an exhaustive and innovative history of redlining, Black banks, and the policy choices which have led to the median Black family owning just 2 percent of the wealth of the median white family.
Baradaran supports postal banking. In fact, she’s one of the most knowledgeable experts on the policy. She’s testified before Congress on the subject, written papers for academia and think tanks, and even delivered a TED Talk.
Baradaran is an expert on the Community Reinvestment Act, which the Comptroller helps administer. The CRA is one of the federal government’s strongest tools for extending financial support to struggling communities, but Trump’s Comptroller Joseph Otting worked hard to gut its power. Baradaran, who has testified and written on the CRA and other programs extensively, would be ideal for not only revitalizing but strengthening CRA enforcement nationwide.
Baradaran would also bring much-needed diversity to the financial regulatory system. Baradaran came to America as an Iranian refugee. She has been called part of “a powerful cohort of Mormon women of color scholar-activists … who are powerful critics of racism, colonialism, and economic exploitation
Barr is deeply embedded within FinTech. He served as an advisor to two scandal ridden firms, Ripple and Lending Club, and currently advises the Alliance for Innovative Regulation (AIR), a fintech-funded group trying to overhaul financial regulation.
Barr is aligned with supporters of a Big Tech surveillance state. AIR and other OCC-focused fintech trade groups hope to allow these firms to use surveillance technology as a replacement for important Know Your Customer regulations. If appointed, Barr would be well-positioned to grant them permission to use facial recognition or other biometrics for regulatory compliance, opening unprecedented corporate tracking of financial activity.
Barr was a key architect of the maligned Home Affordable Modification Program (HAMP), a foreclosure mitigation program which failed to meet any of its stated goals.
Barr is connected to the cryptocurrency firm Ripple, which wants to be “the Amazon of Payments.” Barr advised the company beginning in July 2015, and they are major funders of AIR. Trump’s SEC sued Ripple in a case that could designate cryptocurrencies as securities. Ripple has called the case “an all-out attack on the crypto industry” and claimed “we are not only on the right side of the law, we will be on the right side of history.”
You can read the full blog post from the Revolving Door Project on Michael Barr here.
About Demand Progress
Demand Progress and our more than two million members seek to protect the democratic character of the internet – and wield it to make government accountable and contest concentrated corporate power. For more information, visit: https://demandprogress.org/.
About Revolving Door Project
The Revolving Door Project (RDP), a project of the Center for Economic and Policy Research (CEPR), scrutinizes executive branch appointees to ensure they use their office to serve the broad public interest, rather than to entrench corporate power or seek personal advancement. For more information, visit: https://therevolvingdoorproject.org/.