The Future of Community Reinvestment:Challenges and Opportunities in a Changing Environment

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Abstract
John Baeder's image, painted from a 1973 photo, shows an inner-city neighborhood in Pennsylvania. This was the kind of neighborhood that was severely affected by discriminatory banking practices before the advent of the community reinvestment movement discussed by Peter Dreier in this Longer View. A photorealist known for his paintings of American diners, Baeder attended Auburn University in the 1950s and worked for New York ad agencies from 1960 to 1972. Since 1980 he has lived in Nashville, Tennessee. More of his work can be seen on his Web site at http://www.johnbaeder.com, and he is represented by O. K. Harris Works of Art in New York City. Since Congress passed the Community Reinvestment Act in 1977 to combat mortgage discrimination (redlining) by banks, the law has resulted in more than $1 trillion in private investment being channeled into urban neighborhoods. This article examines the history, current status, and future prospects of the community reinvestment movement. It explores the ingredients for its success as well as its limitations. It also explores how broad economic, political, and demographic trends—as well as changes in the finance services sector—will require the movement to adjust its strategies and coalition efforts if it is to continue to be effective.