Financial Justice and Financial Citizenship

Lisa J. Servon, professor and chair of city and regional planning, was awarded a 2018 grant by the New York Community Trust to study the intersection of financial justice and mass incarceration.

On a lecture tour for her recent book, The Unbanking of America: How the New Middle Class Survives, Servon spoke at Bonne Terre, a maximum-security prison outside of St. Louis, Missouri. Servon was floored by the specific issues and questions of the 60 men in the audience: Would they still need to pay off old community college loans when they were released? How could they build a credit score when they got out of prison? Why were they paying so much for things they needed while in prison? The experience brought home the fact that a financial justice problem is embedded within the larger issue of mass incarceration in the United States. Although this problem lacks broad recognition and has not been sufficiently studied, it affects large numbers of people.

Servon’s project aims to understand how the following trends intersect and affect the people who are directly involved in the criminal justice system as accused criminals, incarcerated people, or formerly incarcerated people, as well as their families and communities:

• The growing importance of “financial citizenship”—credentials like a good credit score that are increasingly important for individuals’ full functioning in civil and economic life;
• Skyrocketing incarceration rates (at the same time that it has become more difficult for people to attain financial citizenship;
• Increasing use of cash bail practices, which results in incarceration for people who have not been convicted of a crime;
• Municipalities’ increased levies of fees and fines as a way to increase the revenue of local and state governments;
• Increasing financial instability due to declining wages, increasing income volatility, and the shifting of risk from the public and private sectors onto individuals.

Servon will examine the intersection of these trends and their impact on families and communities, with a particular emphasis on race and gender. Through interviews and data/policy analysis, she aims to move beyond the statistics in order to obtain a fine-grained understanding of the ways in which people involved in the criminal justice system navigate new demands for gaining “financial citizenship.” Servon also hopes to understand the ways in which community-based actors—public, private non-profit, and private for-profit—are confronting the issue of lack of access to financial services, and are working together and/or at cross-purposes. Finally, Servon will make policy recommendations that can improve, and lessen the cost of, financial services for low- and middle-income people in order to facilitate asset-building.

Funder

New York Community Trust