Skip to main content

Everybody’s Favorite S&l Movie

March 2023
2min read

The film maker Frank Capra once summed up his optimistic outlook by stating flatly: “People’s instincts are good. Never bad. As right as the soil.” None of Capra’s films expresses this sentiment more forcefully than It’s a Wonderful Life . The popular 1946 fantasy tells the story of George Bailey (Jimmy Stewart), the benevolent owner of a small-town building-andloan company who rediscovers his self-worth with the help of a guardian angel.

One wonders how Capra’s faith in the fundamental goodness of the people would square with the behavior of George Bailey’s professional descendants, the S&L bandits of the 1980s. The answer is easy. It lies in Capra’s definition of “the people.” Capra did not mean the population as a whole; he championed “the little man,” the hardworking, virtuous middle class. George Bailey is the quintessential “little man"; Charles Keating is not.

The S&L thieves of the 1980s bear a greater resemblance to Henry F. Potter, the villainous banker played by Lionel Barrymore in the film. Potter, “the richest and meanest man in the county,” schemes to take over Bailey’s small business, the only institution in town on which he doesn’t have a financial strangle hold. Not surprisingly, Potter has connections on Capitol Hill. In one scene he keeps a congressman waiting outside his office while he plots a real estate scam with his sleazy rent collector. George Bailey’s only contact with the federal government comes when his soldier brother Harry wins the Congressional Medal of Honor.

George Bailey’s father started his building-and-loan company for the same reason that many S&Ls originated: to help friends and neighbors build decent homes. After inheriting the business, George struggles to keep it away from Potter, who will no doubt use it only to enrich himself and his very different sort of friends. George is not entirely above thoughts of wealth; he often wishes he were a millionaire and could ditch his family’s “cheap, penny-ante” operation. But he cannot bring himself to abandon his townspeople. He passes up a prime investment opportunity in plastics to continue waging his fight, and he even lends his depositors money out of his own pocket to stave off a panic that threatens to shut his doors forever.

Potter, meanwhile, steps up his campaign to crush George Bailey, finally framing him for stealing money. Driven to the depths of despair, George attempts suicide, only to be saved by his guardian angel. The angel takes him on a guided tour of the town, showing him how bleak life would have been had he never been born. Spiritually redeemed, George returns home to find that all his friends have tossed their spare money into a hat to make up the amount that Potter has stolen. The S&L crisis will be resolved in a similar fashion—except that each one of us will have to chip in two thousand dollars.

The 198Os S&L thieves resemble more the evil Mr. Potter than George Bailey, the building-andloan-owning hero of It’s a Wonderful Life .

It’s a Wonderful Life did poorly at the box office upon its initial release in 1946, and though it was nominated for several Oscars, Capra’s film threatened to fade into obscurity as the years passed. In 1974 its corporate owners failed to renew the film’s copyright. With the movie now in the public domain, television stations and video companies seized the opportunity to exhibit it free. In the 1980s it became, ironically enough, a perfect norisk, high-yield investment.

Americans responded to the film’s newfound visibility and adopted it as a traditional holiday tale rivaling A Christmas Carol in popularity. Frank Capra began to keep files of the thousands of letters he received from fans of the film. Only one aspect of the story seemed to displease its legion of admirers—the fact that Henry Potter is never punished in the end for his misdeeds. Capra once addressed this criticism: “We did try to find out some way in which we could get this old crusty guy to suffer a little. But the only way to make him suffer was to take his money away, and we couldn’t find a way to take his money away. … We just let him go on about his business.”

Maybe that could have been dealt with in a sequel. But if a sequel were made today, it might have to face up to a bitter lesson of the S&L crisis: In the 1980s the story had no heroes.

We hope you enjoy our work.

Please support this 72-year tradition of trusted historical writing and the volunteers that sustain it with a donation to American Heritage.


Stories published from "February/March 1991"

Authored by: Morley Safer

A civilian adventurer gave us the best artist’s record of America in Vietnam.

Authored by: Richard Sloan

When William Withers, Jr., stepped up to the conductor’s podium at Ford’s Theatre that April evening, he believed the greatest triumph of his career was just a few minutes away

Authored by: John Steele Gordon

At its roots lie fundamental tensions that have bedeviled American banking since the nation began

Authored by: Roy Hoopes

In a classic model of government corruption, the promoters placed shares of the company's stock “where it will do most good"—in the pockets of key Congressmen


Authored by: Sharon Kay Skeel

In an age when the best black artists were lucky to exhibit their work at state fairs, Henry Ossawa Tanner was accepted by the most selective jury in France

Authored by: T. H. Watkins

Ninety years ago a highborn zealot named Gifford Pinchot knew more about woodlands than any man in America. What he did about them changed the country we live in and helped define environmentalism.

Authored by: Jack Waugh

The short, loud death of Canaan Valley

Featured Articles

Rarely has the full story been told about how a famed botanist, a pioneering female journalist, and First Lady Helen Taft battled reluctant bureaucrats to bring Japanese cherry trees to Washington. 

The world’s most prominent actress risked her career by standing up to one of Hollywood’s mega-studios, proving that behind the beauty was also a very savvy businesswoman. 

Often thought to have been a weak president, Carter was strong-willed in doing what he thought was right, regardless of expediency or the political fallout.

Why have thousands of U.S. banks failed over the years? The answers are in our history and politics.

In his Second Inaugural Address, Abraham Lincoln embodied leading in a time of polarization, political disagreement, and differing understandings of reality.