Boston pols bail on Bank of America

Published June 10, 2010 at 1:52 a.m.
Locovore Banking Dept...
In this time of political stridency, where everything is either red or blue, Boston City Councilors have found a potential purple issue that everyone can stand behind, be they radical lefties or Fox News worshippers.

In this time of political stridency, where everything is either red or blue, Boston City Councilors have found a potential purple issue that everyone can stand behind, be they radical lefties or Fox News worshippers. The city pols even have a surefire slogan to reel in widespread support: "Invest Boston money in banks that invest in Boston."

"No one can deny that," says Councilor-At-Large Felix G. Arroyo, who, along with Councilor-At-Large Stephen Murphy, is drafting "community reinvestment agreement" legislation. "If your bank doesn't lend to people here, then they shouldn't be able to make money off of our money."

Along with community activists from groups including Jobs With Justice, councilors recently introduced their ideas at a rally inside City Hall. Though specifics have not yet been hammered out, the action is intended to ensure that Boston's "significant resources" are invested in banks that "fund small businesses, foreclosure-prevention programs, private ventures, home-ownership opportunities, and other programs and investments that foster economic growth in the city of Boston." According to the Wisconsin-based Center for State Innovation, the transfer of funds from "out-of-state multinational mega banks" to "smaller in-state banks" could create and retain approximately 4500 small-business jobs in Massachusetts.

Theirs is not a pie-chart-in-the-sky proposal, as there are recent precedents right here in the commonwealth. This past April, current state treasurer and independent gubernatorial candidate Tim Cahill transferred more than $230 million in state funds out of Bank of America. The withdrawal, which was the result of that institution's refusal to cap credit-card interest rates for Massachusetts customers at 18 percent (as state and local banks must do), also hit Citigroup and Wells Fargo, which collectively lost $12 million in accounts.

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