By Steven Tavares.
Big banks took a big hit in East Bay politics last week. The Oakland City Council voted to cease its relationship with JP Morgan Chase. Then quickly reversed an apparently haphazard decision after realizing, on second thought, the absence of a banking account would likely mean its 5,000 city employees wouldn’t be receiving a paycheck this month.
Meanwhile, in San Leandro, city leaders followed Alameda in beginning an early study for possible divestment from Wells Fargo and other institutions helping finance the Dakota Access Pipeline.
Oakland’s disenchantment with JP Morgan Chase Bank is deeper, though, than just the institution’s financing for projects unfriendly to progressives such as Dakota Access Pipeline, but also its poor track record in offering loans to minorities in the city. JP Morgan Chase’s contract was due to expire Mar. 17.
Nevertheless, last Tuesday’s vote to tear up its contract with JP Morgan, for the time being, was odd since a fall back plan for banking services had not been located by city staff. Even stranger, Councilmember Rebecca Kaplan, who voted to end the banking contract and who is also a strong backer for Oakland creating a public bank, facilitated the second vote. She argued Councilmember Lynette Gibson McElhaney, who was not at her seat at the time of the first vote, needed to register a decision. The vote was then reversed.
Meanwhile, the issue of divestment from Wells Fargo has hopped onto a few local city council agendas as of late. The California-based banking institution is now on the San Leandro City Council’s radar.
San Leandro Councilmember Benny Lee moved last Monday to begin a study that could eventually lead to divestment from Wells Fargo. The council voted to place the issue on the City Council’s Rules Committee agenda, in addition, later to the Finance Committee. Lee said the push for divestment, though, shouldn’t be viewed as entirely punitive.
“I think it really is incumbent on us as a council also to recognize that we want them to succeed but then at the same time if we have holdings with them, whether it’s a bank account, some investment holdings, it’s important for us to review that and bring it to our rules committee to take a look at corporate responsibility.”
Lee drew comparisons with San Leandro’s recent sanctuary city declaration, in this case, Native Americans potentially affected by the Dakota Access Pipeline. “We didn’t feel it was right for our federal government to step on people,” said Lee. “Let’s look at it from a corporate responsibility perspective.”
The Alameda City Council voted to halt all new investments with Wells Fargo while staff studied the full range of services rendered by the bank and whether another institution can suitably replicate its offerings.