Cracking the Vault: What You Can Do About Big Banks and the Financial Crisis, Part II

Banking Industry Options

Part II: Shifting the Tide

Last time, I shared some causes of the “Great Recession” and some options for consumer choice in financial institutions.

Given the very public actions of the big banks, and the subsequent fallout, is it at all surprising that people are moving their money? Or is there some safety in knowing that your bank is “too big too fail?”

As noted in Part I, famed blogger and columnist Arianna Huffington has started a campaign called “Move Your Money” ( The intention of the campaign is not just to “voice the anger and frustration of the American people” over the banking crisis, but to bring about a force of action and change. The Move Your Money campaign aims to have consumers move their banks accounts from the biggest banks to the smallest—those that did not in large part contribute to the housing or financial crisis.

According to a column on The Big Money by Martha C. White, the concept seems to be attracting attention. However, she predicts the impact of the campaign will be nominal for several reasons, at least as an effective way to punish the banks for misdeeds. And, further, people are unlikely to do so due to the “hassle.”

And, truthfully, the American public has a great stake in the well being of these banks. That is part and parcel of the reason that two different Presidential Administrations, along with Congress, approved the “bailout” tactics. Keeping these banks in business is fundamental to the economy.

In other words, is there any point, either micro- or macro-scale, to what White essentially says would be pissing in the wind?

It seems everyone might be missing one of the major benefits that such a campaign would have.

No, the Move Your Money campaign won’t entice enough of America to withdraw every penny and place it in a locally owned financial institution. Certainly not enough to satisfy any want for vindication over big bank greed and its consequences.

Does this mean for this campaign is just a waste of time? Not if you care about the state of small business in America. According to Huffington, the campaign is largely in response to the American Banker’s Association take that until there is competition in the banking sector, lending to small business will remain limited. Every economist will state that the key to lowering the unemployment rate is to drive small businesses.

Jobs. And maybe sending big banks a message. Aren’t these reasons enough for hardworking Americans to overcome the “hassle factor,” and devote time to researching which bank or credit union is best for their needs? Why should habit and proximity be the two top reasons that people bank where they do?

With all the attention this story has gotten (ABC, Colbert, etc.), it is possible that the large banks have begun to “get the message” about how we’d prefer they use our dollars in their lending programs. But the media messaging is nowhere near enough. We “boots on the ground,” must do our part as well to encourage more lending to small business, which big banks have clearly have left behind in the current economic climate. After all, isn’t that “fair market competition”?

If the general public says “no” to the big banks, perhaps they will change their policies and practices. It is our job as the public to demand better behavior of those we support, discouraging greed and encouraging small business growth. We, both as taxpayers and customers, need to demand better. If not, we must force the shift in the marketplace or run the risk of the continuing the vicious cycle and are still putting ourselves at risk.

Moving our money from one institution to the next might not solve all of our problems, it’s another potentially powerful way to send a message to those powers that be.


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