In this historiographical essay, The Life of a Historian surveys the current scholarship of the history of black banking. In particular, this review primarily focuses on the following historians and their respective books:
Garrett-Scott, Shennette. Banking on Freedom: Black Women in U.S. Finance Before the New Deal. New York: Columbia University Press, 2019.
Henderson, Alexa Benson. “R. R. Wright and the National Negro Bankers Association: Early Organizing Efforts among Black Bankers, 1924-1942.” Pennsylvania Magazine of History 117, mo. ½ (January 1993): 51-81.
Osthaus, Carl R. “The Rise and Fall of Jesse Binga, Black Financier.” Journal of Negro History 58, no. 1 (January 1973): 39–60.
Winford, Brandon. John Hervey Wheeler, Black Banking, and the Economic Struggle for Civil Rights. Lexington: University of Kentucky Press, 2020.
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Re-Conceptualizing US Capitalism through the Histories and Experiences of Black Financiers and Institutions:
A Review of the Scholarship and Historiography of Black Banking in American History
Introduction to Black Banking Historiography:
Connecting the Histories of US Capitalism, African Americans, and Civil Rights
Although the historiography of black banking is underexplored, a few historians have pressed upon us its importance and value to American history. This essay considers a selection of published works from four of those historians—Carl R. Osthaus, Alexa Benson Henderson, Shennette Garrett-Scott, and Brandon Winford—to survey the field of black banking.[1] Moving in chronological order from the date of their respective publications, this review will focus on the methodological approaches, analytical frameworks, and arguments of each to address their commonalities, differences, and contributions to the field. Although limited in quantity, the current scholarship on black banking is not short on quality nor needs convincing of its significance. The history of black banking intersects with other historiographical conversations including those of capitalism and the civil rights movement. It also broadens our understandings of race, gender, politics, and economics. Significantly, the history of black banking suggests a need to reevaluate and redefine capitalism, and what black banking has meant for both white and black Americans.
The History of Black Banking through Biographical Narratives:
How Telling the Story of One Life Illuminates a Broader History
With “The Rise and Fall of Jesse Binga,” Osthaus investigates the history of black banking through the lens of Chicago banker and real estate mogul, Jesse Binga. Although his article is biographical in its approach—detailing Binga’s life, specifically his time in Chicago from 1900-1930—it suggests a particular relationship existed between Binga, black financial enterprise, and the black community. Relying primarily on articles and editorials from African American newspapers, Osthaus traces the success and failure of Binga to highlight his intimate relationship with Chicago’s black community. He argues that the meteoritic rise and fall of Binga symbolized and paralleled the economic growth of Chicago’s South Side black community. According to Osthaus, “Chicago in the 1920s was the Mecca of Negro business” and “no person did more than Jesse Binga…to develop Chicago’s South Side.”[2] With the construction and opening of Binga State Bank (BSB) in 1921, Chicago’s black press hailed it “as the first real bank ever constructed” by an African American, and that it “symbolized the commencement of a new era in Chicago businesses.”[3] However, as Osthaus shows, Binga’s business relationship with the South Side was one of contradiction. On the one hand, he genuinely cared about the economic progress of African Americans as shown through his philanthropy and belief that the BSB “could eliminate those ubiquitous financial parasites of the Black Belt” that preyed on the black working-class.[4] On the other hand, as a real estate developer Binga “raised rents excessively and reaped handsome profits from the black community’s critical housing shortage.”[5]
Even still, Binga “became a legendary hero” among the black residents of South Side and was known as a community institution himself.[6] As Osthaus argues, to the South Side Binga “had triumphed over all the handicaps that black capitalists reputedly faced.”[7] The reactions and responses of the black community to Binga’s dramatic fall from financial and social prominence following the closing of the BSB and his eventual arrest, conviction, and imprisonment for embezzlement further imply this sentiment. Osthaus writes that “the public reaction on the South Side was…generally sympathetic” with most associating “his imprisonment with the collapse of his bank and not embezzlement.”[8] Although sentenced to ten years, friends, religious, and “even former foes” rallied to bring about his release from prison three years later in 1938.[9] According to Osthaus, Robert Blackmon of the Defender, “voiced accurately the significance of the former financial king” to South Side and the black community.[10] For Blackmon, “Binga had prospered and had become the symbol of the Negro’s bid for power via respectability. To the South Side he was not a criminal but a victim of the white man’s system.”[11] In many ways, the idea of Binga, the story of his rise to wealth and social prominence, his philanthropy—not necessarily the actual person—underscores the importance of black business and economic success in 1920s Chicago.
Henderson adopts a similar methodological approach as Osthaus both in terms of source material and her decision to study black banking through the lens of one individual. However, she shifts the focus to Philadelphia’s Richard R. Wright to explore the history of the National Negro Bankers Association (NNBA) between 1924-1947. But like Osthaus, Henderson suggests a particular relationship existed between black financial leaders and institutions and the black communities they served. In “Richard R Wright and the National Negro Bankers Association,” Henderson argues that Wright believed in cooperation over competition among black financial institutions and businesses to achieve economic empowerment and independence for African American communities. Furthermore, as the co-founder of the reorganized NNBA, his “ideas provided fodder for its formation” and his “leadership was central to its development.”[12]
Following his retirement from education as Head of Georgia State Industrial College at the age of 65, Wright moved to Philadelphia to start a career as a banker. In Philadelphia, along with his son, Wright founded the Citizens and Southern Bank and Trust Company.[13] According to Henderson, Wright “viewed the necessity of acquiring and maintaining the confidence of the black community as paramount to a successful banking operation.”[14] Initially, for Wright, this meant proving the legitimacy of Citizens and Southern Bank and Trust Company within his community of Philadelphia. Through sound business decisions and professional and personal relationships with prominent local black leaders and organizations, Wright earned the trust of the black community. By the end of the first year, “deposits in the bank aggregated over $100,000 with more than 4,000 depositors.”[15] With this success, Wright continued to advocate for cooperation over competition and set about re-establishing the NNBA during the mid-1920s. In 1926, the NNBA officially recognized and elected Wright as its president. Under Wright’s leadership, the NNBA worked towards realizing his vision of black financial “cooperation and racial progress.”[16]
Through their respective surveys of Jesse Binga and Richard R. Wright, Osthaus and Henderson identify and address significant connections between black banking and larger historical processes and themes. However, and in addition to the imposed page limitations of a journal article, their interpretive framework and biographical approaches prove too restrictive, and prohibit a prolonged analysis. Furthermore, as Henderson acknowledges in her work, most black-owned banks were in the South. When the NNBA formed under Wright’s leadership, “it was reported that there were in existence seventy black banks” throughout the United States with fifty-seven of them in the South.[17]
A More Expansive and Malleable Biographical Approach and Interpretive Framework:
Exploring the South, Gender, US Capitalism, and the Civil Rights Movement
With their respective works, Winford and Garrett-Scott build on the scholarship of Osthaus and Henderson by expanding their interpretive framework and biographical approach to include new regions, voices, and themes. In John Hervey Wheeler, Black Banking, and the Economic Struggle for Civil Rights, Winford “explores the black freedom struggle through the lens of John Wheeler.”[18] Like Osthaus and Henderson, Winford employs a biographical approach. However, Winford freely and deftly wanders away from his central actor to investigate the world around Wheeler. This allows Winford to thoroughly elaborate on his argument “that if we are to fully understand how central economics was to the civil rights movement, we must consider black business.”[19]
This interpretive technique proves most effective in Winford’s earlier chapters when he examines the generation of black business leaders in Durham and at the Mechanics and Farmers Bank before Wheeler. From these observations, Winford makes a significant contribution to the field with what he calls “black business activism.”[20] During the ‘Golden Age of Black Business,’ from 1900 to 1930, Durham became known as the ‘Capital of the Black Middle Class.’[21] For Winford, “black Durham became a training ground” for black business activism.[22] “Schooled in the racial etiquette” of “progressive southern race relations” and “community leadership,” Wheeler and his generation felt empowered to use “their ‘economic independence’ as a ‘launching pad into civil rights.’”[23] Winford argues that Wheeler’s brand of activism “in many ways rejected racial uplift.”[24] Winford calls Wheeler’s economic vision “New South prosperity.”[25] Working within an integrationist framework, Wheeler called for an end to Jim Crow segregation and “institutional forms of racism” to “give African Americans complete ‘freedom of movement’ in every area of American life.”[26] With racial equality and full citizenship secured, black economic power would follow leading to “widespread prosperity in the New South.”[27]
Additionally, by following Wheeler throughout his life, Winford’s study “considers the framework of the long civil rights movement.”[28] This expansive timeframe helps Winford further illuminate the relationship between black financial leaders and institutions and the black community first expressed by Osthaus and Henderson. Winford highlights this relationship well through Wheeler’s involvement in each of the three phases of the civil rights movement: legal phase, direct-action phase, and implementation phase. Wheeler throughout the 1940s, 1950s, and 1960s wielded his influence as a black power broker and banker to ensure racial equality and black economic power. This included his legal battles for educational equality and his political interventions in “reform and policymaking at the local, state, and national levels.”[29] With a chapter on urban renewal, Winford also explores the more contentious aspect of this relationship. In doing so, he shows that “the goals of civil rights and black economic power did not always mesh with black capitalism.”[30] Wheeler, as a member of the Durham Redevelopment Commission and advocate for urban renewal, became a target of black Durham. For many displaced black residents, Wheeler sold “‘out the black community.’”[31]
Through his biographical approach and narrative of John Wheeler, Winford highlights important connections between black banking and business and the civil rights movement. Moreover, his work repositions the history of black banking in the South where it was most prevalent and influential. Before Winford’s intervention, John Wheeler eluded scholarly discussions on black banking and the civil rights movement. With John Hervey Wheeler, Black Banking, and the Economic Struggle for Civil Rights, such omissions will no longer be possible as Winford clearly and persuasively illustrates the importance of Wheeler’s activism, one “grounded in economic black power,” to the civil rights movement.[32]
Even more than Winford, Garrett-Scott maximizes the utility of the interpretive framework and biographical approach set forth by Osthaus and Henderson. In Banking on Freedom, Garrett-Scott not only anchors her narrative to the life of Maggie Lena Walker but also focuses on the Independent Order of St. Luke (IOSL) and the St. Luke Penny Savings Bank of Richmond. By grounding herself primarily in the life of Walker and her contributions to the ISOL as Right Worthy Grand (RWG) Secretary and St. Luke Bank as founder and president, Garrett-Scott ably “considers the black women who created webs of formal and informal banking and savings institutions.”[33] In doing so, Garrett-Scott illustrates the significant financial roles of African American women not only within their households and families but also within their larger communities. Banking on Freedom, however, does more than simply “locating women” within the history of capitalism and US finance.[34] It demonstrates how “gender and race shaped and were shaped by finance capitalism.”[35] Black women formed and supported their own financial, political, and social networks and institutions within and in opposition to existing racial and gender power dynamics and norms. Thus, African American women “forged their own definitions of economic opportunities and citizenship.”[36]
With Banking on Freedom, Garrett-Scott intervenes and offers significant contributions to the field of black banking and the historiography of capitalism. By investigating the experiences of African American women well before Walker, the ISOL, and the St. Luke Bank, Garrett-Scott reveals the myriad of ways black women overcame racial paternalism and gendered economics to exert their financial autonomy and participation within US capitalism of the postemancipation era. As Garrett-Scott shows, black women continued to redefine how race and gender norms and identities affected their financial opportunities and economic power into the twentieth century. As president of St. Luke Bank, Walker adopted non-industry strategies like a reliance on the politics of respectability to mitigate risks and financially serve black working-class women who, because of their gender and race, were marginalized by US capitalism and therefore, left financially vulnerable. Although, as Garrett-Scott notes, much has been written on US capitalism, historians have neglected the role of gender in the development and practice of capitalism. Banking on Freedom addresses that omission with Garrett-Scott effectively illustrating the need to include discussions of gender within all surveys of US capitalism. Furthermore, like Winford, Garrett-Scott highlights the value of investigating the impact of black financial institutions outside of economics. By recognizing St. Luke as “also a political institution for black communities,” Garrett-Scott shows how Walker and St. Luke helped mobilize black women as voters and political actors to challenge Jim Crow.[37]
Conclusion
Although the historiography of black banking is underdeveloped, these works underscore the value of black banking to broader fields of history and larger historiographical conversations. Black-owned banks not only represented financial opportunities and black economic power but also provided African Americans with a vehicle and means for political and social change. Furthermore, black banks illuminate the racial and gendered economic practices and values that characterized much of the history of US capitalism. Together, the scholarship on black banking suggests—and begins—a much-needed conversation on reevaluating and broadening our current historical definitions and conceptual frameworks for US capitalism and citizenship.
[1] Carl R. Osthaus, “The Rise and Fall of Jesse Binga, Black Financier,” Journal of Negro History 58, no. 1 (January 1973): 39–60; Alexa Benson Henderson, “R. R. Wright and the National Negro Bankers Association: Early Organizing Efforts among Black Bankers, 1924-1942,” Pennsylvania Magazine of History 117, mo. ½ (January 1993): 51-81; Brandon Winford, John Hervey Wheeler, Black Banking, and the Economic Struggle for Civil Rights (Lexington: University of Kentucky Press, 2020); and Shennette Garrett-Scott, Banking on Freedom: Black Women in U.S. Finance Before the New Deal. New York: Columbia University Press, 2019.
[2] See Osthaus, “The Rise and Fall of Jesse Binga, Black Financier,” 46 and 39.
[3] Osthaus, 43.
[4] Ibid., 44.
[5] Ibid., 53.
[6] Ibid., 39.
[7] Ibid., 49.
[8] Ibid., 59.
[9] Ibid.
[10] Ibid.
[11] Ibid.
[12] Henderson, “R. R. Wright and the National Negro Bankers Association,” 52.
[13] The bank, Citizens and Southern Bank, opened in 1920, and on January 19, 1926 “they formally organized the Citizens and Southern and Trust Company of Philadelphia. It became the first trust company organized by African Americans.” Henderson, 56.
[14] Ibid.
[15] Ibid.
[16] Ibid., 59.
[17] Ibid.
[18] Winford, John Hervey Wheeler, Black Banking, and the Economic Struggle for Civil Rights, 1.
[19] Winford, 2.
[20] Ibid., 4.
[21] Ibid., 4.
[22] Ibid.
[23] Ibid., 33.
[24] Ibid., 2.
[25] Ibid.
[26] Ibid., 3.
[27] Ibid., 2.
[28] Ibid, 8.
[29] Ibid., 9.
[30] Ibid., 6.
[31] Ibid., 202.
[32] Ibid., 2.
[33] Garrett-Scott, Banking on Freedom, 4.
[34] Garrett-Scott, 8
[35] Ibid., 194.
[36] Ibid., 4.
[37] Ibid., 6.