New Report Says More Than Half of U.S. Credit Unions Run Risk of Climate Change-Related Losses
More than 60% of all U.S. credit unions — representing at least $1.2 trillion of assets — are at risk of climate-related damage and losses, American Banker reports. The finding comes from a report called The Changing Climate for Credit Unions, published last month by researchers at the Filene Research Institute and the Boston-based Ceres Accelerator for Sustainable Capital Markets.
The report’s authors note that credit unions have an essential role to play in addressing the financial challenges created by climate change, as well as the transition to a net-zero carbon economy. However, credit unions themselves are not immune to these challenges. From the report:
“Thousands of credit unions (as well as many of the 100+ million people that utilize them) have significant and to-date unaddressed risks arising from the changing climate. … There are growing risks from increasingly extreme weather (fires, floods, hurricanes and more) and increasingly important transitions (such as changes in regulation, technology and other factors,) as well as legal and reputational risks, to credit unions across the nation.”
The report also offers advice to credit unions on building resiliency through how they operate, serve their customers and collaborate as an industry to “leverage influential networks for change.”
As Next City has reported, credit unions have become an increasingly integral part of the U.S. consumer finance system, in large part because they serve a very diverse population who may not otherwise have access to affordable financial services. Per the report, there are now almost 5,000 credit unions across the country serving more than $130 million people and representing more than $2 trillion in assets.
First Study to Analyze 160 Years of Racial Wealth Disparities Finds the Gap Between Black and White Americans Is Widening
Despite the progress made by Black people through the 20th and early 21st centuries, the racial wealth gap in the United States has not only failed to close since 1950; since the 1980s, it’s actually grown wider. That’s among the findings of a recent report that, for the first time, looks at the historic patterns of racial wealth disparity from 1860 to 2020.
Ellora Derenoncourt, founder and director of Princeton University’s Program For Research On Inequality, spoke with NPR about the research she and colleagues conducted on racial income inequality in the United States. According to the data gathered by Derenoncourt, wealth inequality between white and Black Americans fell dramatically between the late 19th and early 20th centuries. However, the wealth disparity between Black and white Americans has remained generally the same since 1950. Today, the average Black American holds about 17 cents of household wealth for every $1 held by the average white American.
Derenoncourt and her colleagues created a “dream simulation” experiment to envision what the racial wealth gap would have looked like if Black Americans had been allowed to accumulate wealth at the same rate as white Americans after Emancipation.
The experiment shows that for Black Americans to be in the same income bracket as white Americans, they would have had to overcome structural barriers such as segregation, labor discrimination, trauma resulting from slavery and extreme poverty, exclusions from social welfare programs, financial and zoning barriers to purchasing homes in desirable neighborhoods, and difficulties obtaining bank accounts, loans and stock portfolios.
Congressional Study Highlights the Benefits of Unions
Want a 10% pay bump? Consider finding yourself a union job. A study released by the joint economic committee of Congress and the House education and labor committee on June 10 detailed the major economic benefits of unions to American workers. Among the most significant findings:
Unionized workers earn 10.2% more than their non-union peers, but also raise wages and benefits industry-wide, including for other workplaces that are not unionized.
Unions also have a role to play in helping narrow the racial wage gap: Unionization increases wages by 17.3% for Black workers and 23.1% for Latino workers.
Unions are also good for healthcare. Unionized workers are 18.3% more likely to receive employer-sponsored health insurance, and employers pay 77.4% more per hour worked toward the cost of health insurance for unionized workers compared with non-unionized workers.
In an interview with The Guardian, education and labor committee chair congressman Bobby Scott said he hopes the report will motivate the Senate to pass the Protecting the Right to Organize Act. “I am committed to addressing the decades of anti-worker attacks that have eroded workers’ collective bargaining rights,” Scott told The Guardian.
This article is part of The Bottom Line, a series exploring scalable solutions for problems related to affordability, inclusive economic growth and access to capital. Click here to subscribe to our Bottom Line newsletter. The Bottom Line is made possible with support from Citi.
Shania DeGroot is an Emma Bowen Foundation Fellow with Next City for summer 2022.