By Jeremy Lybarger for High Country News – Last October, a couple from Philadelphia traveled to Sebastopol, California, a quiet outpost some 50 miles north of San Francisco, to buy pot. They’d arranged the deal beforehand, but at some point during the hourlong transaction, the mood soured. Gunfire shattered the mild night. When it was over, two men were dead, a woman was critically injured, and 100 pounds of marijuana and $100,000 to $200,000 in cash were reportedly missing. The killers remain at large. Crime haunts the edges of the cannabis industry, as it does any underground economy. Sebastopol’s local newspaper reports that seven of the 26 people murdered in Sonoma County since 2013 died during marijuana deals. “People get robbed all the time,” says Andrew DeAngelo of Harborside, a dispensary in Oakland, California. Although 29 states and the District of Columbia have legalized marijuana in some form, it’s still federally classified as a Schedule I drug alongside heroin and LSD. And that means, as Last Week Tonight host John Oliver noted in an early April show, that “legal marijuana businesses have struggled to get bank accounts because at the federal level, they are still seen as criminal enterprises.”
By David Dayen for In These Times – “Money is a utility that belongs to all of us,” says Walt McRee. McRee is a velvety-voiced former broadcaster now plotting an audacious challenge to the financial system. He’s leading a monthly conference call as chair of the Public Banking Institute (PBI), an educational and advocacy force formed seven years ago to break Wall Street’s stranglehold on state and municipal finance. “This is one of the biggest eye-openers of my life,” says Rebecca Burke, a New Jersey activist on the call. “Once you see it, you can’t look back.” This ragtag group—former teachers, small business owners, social workers— wants to charter state and local banks across the country. These banks would leverage tax revenue to make low-interest loans for local public works projects, small businesses, affordable housing and student loans, spurring economic growth while saving people—and the government—money. At the heart of the public banking concept is a theory about the best way to put America’s abundance of wealth to use. Cities and states typically keep their cash reserves either in Wall Street banks or in low-risk investments. This money tends not to go very far.
By Staff of Public Banking Institute – Alarmed by the corruption and greed of Wall Street, many US cities and states are studying the feasibility of establishing public banks. Public banks are owned by cities, states or other jurisdictions and serve to keep funds local instead of being deposited on Wall Street. The funds are then used to support local economic activities like small business loans and student loans. Washington State has already cut its ties with Wells Fargo because they funded DAPL. Now they want to get rid of Wall Street as a place to park their money making use of the local economy and profiting the people of Washington instead of the bankers of Wall Street.
By Sheng Thao for Cowboys On The Commons – The Resolution, co-sponsored by Councilmembers Kaplan, Kalb, and Guillen, directs the City Administrator to look into the scope and cost of conducting a feasibility study for public banking in Oakland and possibly the larger region. It also directs City Staff to solicit input from community stakeholders about the feasibility study, including suggestions of potential contractors and funding sources; and makes it clear that the study should cover the legality and feasibility of banking the cannabis industry. The Resolution generated support from Councilmembers and community members alike.
By Shara Smith for Public Banking Institute – In response to long-term economic instability and disappointment with the mainstream banking system, the Oakland City Council voted Tuesday to investigate a public banking feasibility study funded by money left over from the Goldman Sachs Debarment Proceedings. The resolution, co-sponsored by Councilmembers Kaplan, Kalb, and Guillen, also directs city staff to solicit input from community stakeholders about the feasibility study, including suggestions of potential contractors and funding sources.
By Kevin Zeese and Margaret Flowers for Popular Resistance. Last April after the killing of Freddie Gray Baltimore experienced an uprising. It was not what was shown on television, which highlighted a few hours of burning cars and buildings, but a week long event that brought the city together. People of all ages and races called for transformation of the city so it corrected the injustices of decades of neglect and racism in the poor black communities of East and West Baltimore. As you can hear from our first two guests the problems of police violence continue to plague Baltimore but residents or also organizing to make the call for change a reality. A year later there is a lot of community organizing going on, as you can hear from Derrick Chase and Abdul Salaam below, which will take time to show results. The city is also going through a major local election where a new mayor and city council will be elected.
By Nichoe Lichen for Green Fire Times – The crash of 2008 just keeps on giving. We didn’t make it happen, but somehow it’s ours to fix. Historically, governments look to raising taxes and cutting jobs and services to “fix the problem.” So it goes in the city of Santa Fe this year. This may be a short-term necessity, given the city’s current financial crisis, but Banking on New Mexico believes the time is right for a better long-term strategy that includes a public bank that will invest our public funds—interest earned from those taxes, fees and fines we all pay—back into our community.
By Stephen J. Butler in Occupy – I personally think the time has come to set wheels in motion to organize a state-owned bank here in California. North Dakota has operated its own bank since the early 1900s and it has made money for taxpayers while strengthening the state’s own regional banks. The net effect has been to keep bank profits in North Dakota. The only losers have been the “too-big-to-fail” banks that would otherwise have enjoyed making the spread on money borrowed by, and throughout, the state. Of course, there is little political will to organize anything this effective in California because the banking lobby deploys too much money throughout the political process. However, our state’s initiative process offers voters an option to do an end-run around elected officials.
By Anna Bergren Miller for Shareable. Seattle, like other cities, is strapped for money. We’re the fastest-growing city in the country, and we need to build infrastructure to support that growth. We would also like to build more affordable housing, and create good family-wage jobs. We are close to our debt limit. Because Seattle and Washington state have the most regressive tax systems, we’re constantly having to go to the levy system to get more money, or borrow it. We’ve borrowed [billions of] dollars. Big banks, mostly, have bought those bonds—they loaned the money to us. So even though Seattle is prosperous compared to Detroit, or Baltimore, it still has a lot of needs. To start a public bank in Seattle, we would need a capital investment. We see that coming from the investments that Seattle already makes, mostly in savings treasury bonds and CDs. I think [they are valued at] about $800 million. We’re only getting 0.67 percent [interest] on those investments right now—that’s not much of a return. We’re thinking some of that investment money [could be used to start the bank]. It takes at least $100 million—but the more robust, the better. We could get a much higher rate of return through our own bank.
The Bank of Canada was nationalized in 1938 and is wholly owned by the Canadian people. Between 1938 and 1974, the federal government borrowed at low or no interest from the bank. But all that changed. In 1974, Canada turned to monetarism, a paradigm holding that expansion of the money supply is inflationary, and a partner to neoliberal economic policy. This shift compelled the federal government to borrow from private foreign banks to finance Canada’s pension plan and a whole host of public projects from transportation to health care, airports, seaports and more. In the 40 years since, Canada’s privatization of finance has led to an unprecedented level of public debt. It has commodified and effectively privatized the “human capital expenditures” originally articulated in the Bank of Canada’s charter.
Right before 2014 came to a close, Wall Street won an enormous victory in the year-end spending bill. The so-called “CRomnibus” bill, which included language written by Citigroup lobbyists, gutted a key piece of Wall Street reform meant to prevent future bailouts of big banks with taxpayer money. This win came after the financial industry spent years chipping away at the Dodd-Frank Wall Street Reform and Consumer Protection Act, which passed in 2010. Wall Street lobbyists gained little victories along the way, but never stopped asking for more. By making bold and ongoing asks, Wall Street was able to win, even when lawmakers sought a compromise.
Seattle is at the forefront of cities taking back democracy. Seattle’s city council knows that the antecedents of democracy are material — the ability to provide services, the ability to absorb the impact of economic shifts, the ability to make citizens feel invested in their communities. But one way the city can finance even more audacious and prosperous democratic participation, housing, social services and mass transit is with a public bank. The Wall Street Journal, the New York Times,Salon, and other national publications have recently touted the benefits of public banking; even the conservative Wall Street Journal admits that the Bank of North Dakota (the nation’s only current public bank) outperforms “too big to fail” Wall Street banks.