The average family earning $25,000 a year in the U.S. spends about $2,400 on financial transactions. Whether it’s the astronomical interest rates of a payday loan or the costs that come with being unbanked, the extractive practices of the financial services industry are effectively keeping the poor in poverty. Lawyer and author Mehrsa Baradaran and economic mobility expert Cate Blackford join Nick and Steph this week to explain why banking while poor is so expensive, and what states can do to rein in the people who profit from it. 

Mehrsa Baradaran is a professor of law at UC Irvine. She writes about banking law, financial inclusion, inequality, and the racial wealth gap. Her scholarship includes the books How the Other Half Banks and The Color of Money: Black Banks and the Racial Wealth Gap. 

Twitter: @MehrsaBaradaran

Cate Blackford is the Director of Outreach and Donor Development at the Bell Policy Center, where she leads the Financial Equity Coalition to eradicate systemic discrimination and hold financial predators accountable. She was the Co-Chair of the 2018 Proposition 111 campaign in CO to limit the interest lenders could charge on payday loans and eliminate fees from payday lending products, which passed with 75% of the vote. 

Twitter: @catetiller @BellPolicy

Further reading: 

How the Other Half Banks: https://www.hup.harvard.edu/catalog.php?isbn=9780674983960

The Color of Money: https://www.hup.harvard.edu/catalog.php?isbn=9780674237476

If the U.S. Government Treated Poor People as Well as It Treats Banks: https://www.theatlantic.com/business/archive/2015/10/if-the-us-government-treated-poor-people-as-well-as-it-treats-banks/410614/

CO’s Prop 111 explained: https://coloradosun.com/2018/10/22/proposition-111-colorado-2018-explained/

Briefed by the Bell - Predatory Economy: https://www.bellpolicy.org/2018/09/10/predatory-economy/

How Do Payday Loans Work? https://www.incharge.org/debt-relief/how-payday-loans-work/

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