New Hampshire has joined the growing list of states proposing to form their own publicly owned banks. HB 367 was introduced in early January, and on Tuesday, Feb. 12, the House Commerce Committee held a public hearing. Next steps for the bill are a Subcommittee work session at 10:30 am Feb 21, followed by an Executive session that afternoon. The Public Banking Institute submitted written testimony from Chair Ellen Brown for the hearing, which is reproduced here as a model that might help others wanting to submit testimonies for public banks in other states:
“Congratulations on a well-written bill for a state-owned bank that will allow New Hampshire to realize the benefits of public banking: a sustainable supply of locally generated, locally directed, affordable credit and liquidity, and a significant new source of non-tax revenue for the state.”
Comprehensive study by Cornell University strongly supports public banking model to finance needed infrastructure
In honor of the Bank of North Dakota’s centennial anniversary, here is an excellent academic report from Cornell University that includes a detailed case study of BND’s 2015 Infrastructure Loan Fund. The report examines the “unique benefits of public banks and explores strategies for the implementation of similar structured institutions in New York State and the broader US context.” Prepared by Shareef M. Hussam for Professor Mildred Warner at Cornell’s Department of City and Regional Planning, it provides strong academic reinforcement for advocates’ testimony, concluding:
“The public banking model offers several lessons for governmental entities seeking to affordably and sustainably finance infrastructure. First, funds for infrastructure investment should not be separated by sector, but rather commingled to enable cross-subsidization. Second, by pooling municipal capital and resources into an umbrella institution, local governments could access cheaper financing and improve their ability to compete for federal and state grants. Third, the institution should have profit motive, market discipline, political independence, and good governance. Through implementation of these strategies, it may be possible to sustainably finance critical infrastructure through public banking.”
The public banking message has even reached a small town in Western Kentucky. Columnist Marshall Ward began a series of articles last week in the Murray Ledger that articulately outlines the need for Kentucky to implement a public “development bank program that transforms our economy and infrastructure development into a 21st century model.” Murray, Kentucky has a population of 17,741 and began its existence as a post office. With the concept of public banking reaching towns like that, we’re well on our way to achieving PBI’s vision of public banking becoming common knowledge.
“The trick will be to use these state banks as a depository for state and municipal revenues. Rather than lending their capital directly, the bank leverages those deposits 10X in loan programs. … Locally, we desperately need to bring our roads, bridges, dams, libraries, post offices, universities, electrical power, mortgages and farms to 21st century standards. This is a great opportunity to start-up our own Kentucky Infrastructure Bank!”
In this new spotlight section, catch up with new videos to share or ones you might have missed. The first one featured is a short Public Service Announcement-type video recently launched by San Francisco Public Bank. Check it out!
More coverage of SF’s recent steps toward a public bank appeared in the SF Weekly as Ida Mojadad writes:
“The resolution clarifies that it doesn’t commit the city to specifics of a public bank. Still, it’s not often that the Board of Supervisors unanimously co-sponsors legislation and doing so for a publicly-owned bank sends a strong message that San Francisco is serious about the transformation.”
It’s official! “The City of Philadelphia is seeking responses to this request for a proposal from consultants to conduct a feasibility study on the City of Philadelphia's ability to establish and operate a municipally owned bank.”
Mike Krauss of the Pennsylvania Public Bank Project says, “This is the result of the steady, careful work of the Philly public bank team (Facebook link) and our team of colleagues.”
On Tuesday, Feb 5, the San Francisco Board of Supervisors unanimously approved a resolution by Sup. Sandra Lee Fewer that supports state legislation that would authorize local government bank charters. As reported by Tim Redmond in 48 Hills:
“The more cities get on board, the more pressure legislators will face to approve enabling legislation that would clear the way for a San Francisco public bank.
“And the overwhelming support in this city suggests strongly that this is an issue whose time has come.”
Bernard Lietaer, friend and guiding light to the public banking and community currency movements, passed away of colon cancer Feb 4. Lietaer’s close friend and colleague Gwendolyn Hallsmith from Vermonters for a New Economy, with whom he co-authored three books, wrote this recent tribute:
“Those of you who remember back to the days when Vermonters for a New Economy was called the Vermont Monetary Policy Advisory Group will remember Bernard Lietaer, arguably one of the fathers of our little organization. He came to Vermont several times, and spoke at more than one of our early meetings.
“He died this morning of colon cancer. A very sad day for me. He was a dear friend, a mentor, and we co-authored three books and workbooks together. One of them, Community Currency, was translated into 13 languages and used all over the world. Another one, Creating Wealth: Growing Local Economies with Local Currencies, was published in 2011 and gave me the impetus to start to think about how what I had learned writing the book could help us in Vermont.”
Alaska lawmakers and advocates continue their work on legislation introduced last year to create the Alaska State Bank. Advocate Charles Duncan writes an excellent opinion piece in Anchorage Daily News challenging the customary assumptions of political leaders to explain how a publicly-owned state bank would give the state the solution for current budget problems and the expected crises to come:
“State income taxes are not the solution to our budgetary problem for the same reasons that cutting the Permanent Fund dividend is a bad idea. Income taxes and PFD cuts suppress the volume of money circulating in Alaska’s economy, do not address the root of our economic problem and do not prepare us for the next financial crisis.”
Ameya Pawar, a strong advocate for creating a public bank for Chicago has been endorsed for city treasurer by one of Chicago's two major newspapers, further evidence that the public banking alternative is becoming widely recognized.
The Sun-Times editorial board writes:
“Pawar talks of creating a public bank to support affordable housing, offer low-interest student loans and possibly do business with the marijuana industry. ... Reasonable people might have questions about all these ideas, but they’re fresh and worth exploring.
“We certainly support his overarching goal, which is to give working-class and middle-class Chicagoans more opportunities to prosper while securing strong returns for the city’s investments.”
PBI Chair Ellen Brown talks with razor-sharp wit Lee Camp about how Germany’s national public development bank, KfW, and FDR's Reconstruction Finance Corporation funded massive infrastructure without taxing the people. They also discuss a universal basic income (UBI), Modern Monetary Theory (MMT), debt, and more.