The Public Bank Option – Safer, Local And Half The Cost

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By Ellen Brown For The Web of Debt – For those few politicians who are aware of the banks’ magic money tree, the axiom that the people should own the banks – or at least some of them – is a no-brainer. One of these rare politicians is Phil Murphy, who has a double-digit lead in New Jersey’s race for governor. Formerly a Wall Street banker himself, Murphy knows how banking works. That helps explain why he has boldly made a state-owned bank a centerpiece of his platform. He maintains that New Jersey’s billions in tax dollars should be kept in the state’s own bank, where it can leverage its capital to fund local infrastructure, small businesses, affordable housing, student loans, and other state needs. New Jersey voters go to the polls on November 7. That means New Jersey could soon have the second publicly-owned depository bank in the country, following the very successful century-old Bank of North Dakota (BND). Other likely contenders among about twenty public banking initiatives now underway include Washington State, which has approved a feasibility study for a state bank; and the cities of Santa Fe in New Mexico and Los Angeles and Oakland in California, which are exploring the feasibility of their own city-owned banks.

Newsletter - From Neoliberal Injustice To Economic Democracy

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By Kevin Zeese and Margaret Flowers. This week, we will focus on positive work that people are doing to change current systems in ways that reduce the wealth divide, meet basic needs, build peace and sustainability and provide greater control over our lives. The work to transform society involves two parallel paths: resisting harmful systems and institutions and creating new systems and institutions to replace them. Throughout US history, resistance movements have coincided with the growth of economic democracy alternatives such as worker cooperatives, mutual aid and credit unions.

New Rules Are Killing Community Banks, Public Banks Can Revive Them

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By Ellen Brown for Web of Debt Blog – At his confirmation hearing in January 2017, Treasury Secretary Stephen Mnuchin said, “regulation is killing community banks.” If the process is not reversed, he warned, we could “end up in a world where we have four big banks in this country.” That would be bad for both jobs and the economy. “I think that we all appreciate the engine of growth is with small and medium-sized businesses,” said Mnuchin. “We’re losing the ability for small and medium-sized banks to make good loans to small and medium-sized businesses in the community, where they understand those credit risks better than anybody else.” The number of US banks with assets under $100 million dropped from 13,000 in 1995 to under 1,900 in 2014. The regulatory burden imposed by the 2010 Dodd-Frank Act exacerbated this trend, with community banks losing market share at double the rate during the four years after 2010 as in the four years before. But the number had already dropped to only 2,625 in 2010. What happened between 1995 and 2010? Six weeks after September 11, 2001, the 1,100 page Patriot Act was dropped on congressional legislators, who were required to vote on it the next day.

Newsletter - Mobilize For System Change

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By Margaret Flowers and Kevin Zeese. Decades of neo-liberal economic policies in the United States and debt, which is required by the bottom 90% to survive, have fanned political unrest and the call for revolution, rather than reform. Just as Obama and the Democrat’s populist façade disintegrated under a growing wealth divide, worsening climate change and militarization of our communities and woke many self-described progressives up to the need for systemic changes, the Trump presidency could have similar effects on conservatives. Voters who thought they were ending the status quo, “draining the swamp,” by voting for Trump may find that loss of health care, trade deals that drive a race to the bottom and tax cuts for the wealthy move them to be open to solutions they may have once rejected.

Forum In Oakland Brings To Light How Public Banks Can Fund Renewable Energy

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By Staff of Public Banking Institute – September 25, Friends of Public Bank of Oakland organized a public forum to hear Wolfram Morales of the German Sparkasse (East German Savings Bank Association) explain how Public Banking works in his country to fund renewable energy development. The East Bay Times as well as Oakland North covered the event and connected it to how Public Banks here could do the same thing in the US that Sparkasse do in Germany: offer low-interest rates to companies providing solar and wind resources, driving development. “Though public banks are a fixture in Europe, the only one that exists in the United States is the Bank of North Dakota, Morales said. There are more than 600 in Germany, most of which are county-level, putting billions into renewable energy development. Those banks are able to offer interest rates as low as 1 percent on loans, which is much lower than what commercial banks offer. “Speakers at the forum talked about how a public bank can help give the community more control over its energy sources.”

Los Angeles Public Bank Effort Gains More Steam

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By Staff of Public Banking Institution – Strong steps taken by LA City Council toward a Public Bank for Los Angeles have drawn a good deal of media attention, including coverage by the local CBS affiliate. The Ad Hock Committee on Comprehensive Job Creation Plan began to debate the issue last Wednesday, Oct 4. Following the successful Sept 29 meeting that took place between interested Councilmembers, legislative directors and Public Banking experts, Ellen Brown was invited to attend the Ad Hoc Committee and explain how a Bank of Los Angeles can be feasible, profitable and beneficial for the city’s residents. The Ad Hock Committee panel included the City’s Attorney Office, City Administrative Officer, Chief Legislative Officer, and PBI’s Ellen Brown. As a result of the discussion, Chairman Krekorian moved to instruct the City Attorney’s Office and the CLA to report back on

What A Public Bank Could Mean For California

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By Ellen Brown for The Web of Debt Blog – California is the eighth largest economy in the world, and it has a debt burden to match. It has outstanding general obligation bonds and revenue bonds of $158 billion, largely incurred for infrastructure. Of this tab, $70 billion is just for interest. Over $7 billion of California’s annual budget goes to pay interest on the state’s debt. As large as California’s liabilities are, they are exceeded by its assets, which are sufficient to capitalize a bank rivaling any in the world. That’s the idea behind Assembly Bill 750, introduced by Assemblyman Ben Hueso of San Diego, which would establish a blue ribbon task force to consider the viability of creating the California Investment Trust, a state bank receiving deposits of state funds. Instead of relying on Wall Street banks for credit – or allowing a Wall Street bank to enjoy the benefits of lending its capital – California may decide to create its own, publicly-owned bank. On May 2, AB 750 moved out of the Banking and Finance Committee with only one nay vote and is now on its way to the Appropriations Committee. Three unions submitted their support for the bill – the California Nurses Association, the California Firefighters, and the California Labor Council. The state bank idea also got a nod from former Secretary of Labor Robert Reich in his speech at the California Democratic Convention in Sacramento the previous day.

Amid Divestment Protests, More Cities Explore Public Banks

Wells Fargo bank sign (Photo by Mike Mozart | Flickr CC 2.0)

By Oscar Perry Abello for Moyers and Company – Philadelphia City Council Member Cindy Bass was already thinking about how to cut the city’s ties with Wells Fargo when bank CEO John Stumpf testified last September before the US Senate. Questioning Stumpf about the bank’s fraudulent accounts scandal, Sen. Elizabeth Warren said, “So you haven’t resigned, you haven’t returned a single nickel of your personal earnings, you haven’t fired a single senior executive. Instead, your definition of accountable is to push the blame to your low-level employees who don’t have the money for a fancy PR firm to defend themselves.” Search the US Department of Justice website for “Wells Fargo” and “settlement” and you’ll get a litany of results: a $25 billion settlement for foreclosure abuse (a record), $1.2 billion for improper mortgage lending practices, and $184.3 million in compensation for steering black and Latino borrowers into predatory subprime mortgages. The 2016 hearing was the moment when the wheels fell off the stagecoach. Stumpf finally stepped down, about a month later, but he never returned a nickel of his pay. In fact, he left with a $133.1 million severance package. “Their lackluster responses, it was so outrageous, they just didn’t get it,” says Bass. “As a city, how could we be in bed with this company?

TiSA And The Threat To Public Banks

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By Thomas Marois for TNI – The Trade in Services Agreement (TiSA) is an attack on the future publicness of public banking around the world. This briefing is about how the Trade in Services Agreement (TiSA) would be an attack on the future publicness of public banking around the world. Despite 30 years of privatisation, publicly owned banks remain active in most countries and communities. Yet the importance of TiSA to the future of public banks has yet to be raised as a fulcrum of resistance. Indeed, by privileging a private, profit-oriented vision of financial services over the public good and public provisioning, TiSA will impact public banks’ mandates and capacities to serve the public interest, directly and indirectly, now and in the future. In this way, public banks will be pressured to internalise the interests of a global, private, corporate elite by forcing their activities into increasingly narrow competitive market logics – this being a precursor to eventual bank privatisation. Again, we do not claim that public banks are perfect, but they do a lot of good.

Public Banks Can Help Cities Honor Promise To Give Sanctuary To Immigrants

The First Bank of the United States in Philadelphia. (Teemu008 / CC BY-SA 2.0)

By Matt Stannard and Marc Armstrong for Truth Dig – Mayor Javier Gonzales of Santa Fe, N.M., was defiant when he spoke with National Public Radio’s Kelly McEvers in November. Donald Trump had just won the election after running on a strong anti-immigrant platform, emphasizing his intent to cut federal funding to “sanctuary cities,” municipalities that have pledged to neither detain nor prosecute people solely for being undocumented immigrants. Gonzales said that would not, while mayor, use municipal funds or resources to enforce federal immigration laws, nor would he allow police or city employees to inquire about a person’s immigration status.

Public ‘Bank Of N.J.’ Would Save Pensions, Rev Economy

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By Claude Brodesser-Akner for NJ – NEWARK — Former Wall Street executive turned 2017 Democratic candidate for governor Phil Murphy on Thursday unveiled a radical proposal for reviving New Jersey’s economy and saving its pension system millions in fees: A public bank, owned by taxpayers. Daring New Jersey to “put our money where our mouth is” Murphy unveiled his idea for a “Bank of New Jersey” as the cornerstone of his economic platform during a speech at the New Jersey Institute of Technology.

Public Banks As The Antithesis Of Neoliberalism

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By Matt Stannard for Public Banking Institute – The Commission on Social Development is a sub-body of the United Nations Economic and Social Council. In 1995 the Commission hosted a Summit on Social Development in Copenhagen, which the United States attended—sending a contingent led by then-Vice President Al Gore. All participating nations at the Summit signed its set of conclusions, the Copenhagen Declaration on Social Development.

Public Bank Of North Dakota To Refinance Student Debt To 2%

Erick Hardmeyer, president of the Bank of North Dakota said the bank is expanding its outreach efforts for its Deal One student loan program. (Tom Stromme / Bismarck Tribune)

By Jessica Holdman for Grand Forks Herald – BISMARCK, N.D. — When first-time homebuyers get ready to purchase a house in North Dakota, Realtors may start handing them information on refinancing student loans as well. The Bank of North Dakota is partnering with Realtors to get the word out about its DEAL One loan program. Eric Hardmeyer, president of BND, said national reports have shown students graduating with an average of $27,000 to $30,000 in student loans.

Revisiting Public Banks And Worker-Owned Cooperatives

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By Matt Stannard for Public Banking Institute – Foreign corporations could sue to undermine US protections for consumers’ health, safety and financial security under a provision added to the proposed Trans-Pacific Partnership trade deal (TPP) after executives of big banks pressed the nation’s chief trade negotiator, himself a former big-bank executive, to include it.

Wall Street Fees Are Bleeding Our Cities Dry

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By Zach Cartwright for US Uncut. United States – Cities, counties, and states are all hemorrhaging hundreds of billions, and possibly even trillions of dollars a year in banking fees. The root cause of this extortion has been ignored, until now. The Public Banking Institute’s (PBI) What Wall Street Costs America project is shining light on the fact that fees paid to private Wall Street banks simply for managing accounts for state and local tax dollars is bankrupting communities across the country. The combined total for all 50 states may be as high as $4 trillion. United States – Cities, counties, and states are all hemorrhaging hundreds of billions, and possibly even trillions of dollars a year in banking fees. The root cause of this extortion has been ignored, until now. The Public Banking Institute’s (PBI) What Wall Street Costs America project is shining light on the fact that fees paid to private Wall Street banks simply for managing accounts for state and local tax dollars is bankrupting communities across the country. The combined total for all 50 states may be as high as $4 trillion. PBI has launched a crowdfunding campaign to find the true cost of what private Wall Street banks really cost in major cities in all 50 states: 1pbi “The latest banking collapse cost people their lives, their homes, their educations, their futures. What we have been seeing is that Wall Street extracts hundreds of billions of dollars of our taxpayer money used for our public needs. That’s not necessary,” PBI board chair Walt McRee told US Uncut. “We don’t need to borrow their money for public needs.”