COMMUNITY CAPITAL

A pair of insiders explore the complex racial and class dynamics of the credit union movement.

Credit unions first emerged in the early 20th century as an alternative banking option for low-income communities and nonprofits; they now serve more than 130 million members with more than $2 trillion in assets. Rosenthal and McCray assert that credit unions are unambiguously the “good guys” in a fiscal system plagued by greed, predators, and unethical leadership. Their book, which is divided into four parts, starts with 11 chapters by Rosenthal, who provides a historical overview of community development and credit unions. If anyone knows this history, it’s Rosenthal, who served for years as the executive director of the National Federation of Community Development Credit Unions in the 1980s and wrote Organizing Credit Unions: A Manual (1995). Rosenthal’s chapters also explore his own personal journey as a white man who led an organization whose largest stakeholders were people of color; there is also commentary on how the banking system has perpetuated racial disparities into the 21st century. While Rosenthal is the credit union’s “historian,” according to the text, coauthor McCray is the movement’s “whistleblower.” As a graduate of Georgetown University Law School and a public policy expert, he centers his chapters in Part II on in-depth look at his role in the defense of the Kappa Alpha Psi Federal Credit Union (KAPFCU), organized by a historically Black fraternity, against the federal government. In an extended metaphor based on Alice in Wonderland, McCray highlights the surreal absurdities of the National Credit Union Administration capriciously closing and liquidating KAPFCU, due in part to policies that unfairly target institutions that serve low-income communities.

The book’s more hopeful third part emphasizes the ways that Black churches and other organizations can navigate a treacherous banking system and find ways to provide capital access to their communities. In the book’s final section, McCray provides readers with a nearly 80-page collection of original documents written by the NCUA and other parties during their case against the KAPFCU. Both authors are impassioned regarding ideals of Black self-sufficiency and the need for community-centered credit unions, but their differing perspectives and approaches create a well-balanced, thoroughly convincing book. Rosenthal, who also served on the Consumer Advisory Council of the Federal Reserve Board, effectively provides an insider’s account of the industry with an emphasis on historical context, whereas McCray, whose activism includes work with the Association of Community Organizations for Reform Now, provides an engaging grassroots perspective on the ways in which Black communities and organizations are victimized by a regulatory system that disregards their needs. Both men are experts in their fields, but the book’s intended audience aren’t only fellow insiders, but also lay readers; Rosenthal and McCray are both careful to provide consistently accessible descriptions of the intricacies of the financial sector. This effort is assisted by the inclusion of ample textbox vignettes, graphs, charts, and other visual aids, and the authors’ firsthand perspectives are helpfully accompanied by more than 100 research footnotes.

A hard-hitting and persuasive indictment of the American banking system and a compelling defense of credit unions.