On Tuesday, the city of San Jose debated whether to waive its wage theft policy in order to award a major banking contract to Chase, or to create its own public bank. At the end of the discussion, the council unanimously approved a memo co-authored by Councilmembers Sergio Jimenez, Magdalena Carrasco, and Raul Peralez that would explore creating a public bank under the recently proposed California Assembly Bill 857, facilitating the formation of public banks in the state.
Chase recently had won the bidding process for the city’s banking agreement, but the city’s policy prohibits contracts with employers accused of wage theft and Chase is currently settling 22 wage theft cases for $160 million according to CBS / KPIX 5.
“I have no interest in lowering our standards,” Peralez said.Read more
On March 15, the Chicago Sun Times again enthusiastically endorsed Ameya Pawar for city treasurer in the runoff election April 2, writing, “His advocacy on behalf of ordinary working people is consistent and principled.” Among Pawar’s proposals is a public bank for the city to support affordable housing, offer low-interest student loans and possibly do business with the marijuana industry if recreational pot is legalized (something other banks may be restricted by federal law from doing).
In The University of Chicago’s Chicago Maroon, student Alex Bisnath echoed the endorsement, stating:
“This is a bold idea. … If all goes according to Pawar’s plan, the bank would be able to refinance student loans at 5 percent interest. This would motivate college students to stay in the city, while providing them with more spare cash to put back into the economy.”
“The Green New Deal won’t get far if it’s left hostage to the whims of private finance,” Johanna Bozuwa and Thomas M. Hanna of Democracy Collaborative proclaim in the latest issue of Jacobin magazine. They continue, “Asserting public control over the financial system is … essential if we want to prevent catastrophic climate change.”
Along with a large-scale expansion of public and cooperative banking, the authors say the Fed needs to be democratized:
“A truly publicly owned, transparent, and democratically accountable central bank would change that — and could become a powerful weapon in the fight against climate change. As Fed expert William Greider puts it, we need to ‘create a new public institution that truly understands that its obligation is to society, not money markets.’ Congressional action to reform the Fed could ‘harness the Fed’s money creation and lending powers to help finance major public objectives.’”
PBI Chair Ellen Brown notes in her latest Truthdig article that former Greek finance minister Yanis Varoufakis has been proposing a similar public bank-driven proposal for a Green New Deal in Europe for several years through the Democracy in Europe Movement 2025 (DiEM25). In Varoufakis' proposal, “the European Investment Bank (EIB) issues [€500bn in] bonds [each year] with the European Central Bank standing by, ready to purchase as many of them as necessary in the secondary markets.”Read more
In the latest episode of It's Our Money, PBI Chair Ellen Brown talks with renowned economist Dr. Richard Wolff about the changing views of socialism and how the shift in public sentiment is creating more solutions to current crises. Co-host Walt McRea describes the episode:
Debating Socialism and Public Banks
Socialism has acquired an outsized connotation for being the enemy of the core values and tenets of American economic and political life – a threat to private ownership and initiative and a challenger on the international stage of cultural and political domination. While variations on the practical themes of socialist-based public policy abound across the globe, and often with unparalleled success, Socialism has now hit the American political arena with surprising vigor and acceptance, particularly by younger generations who are inheriting the systemic costs of capitalism’s latter stages. Ellen talks with noted economist Dr. Richard Wolff about how the growing discussions about socialism enrich the broader discussion about problem-solving of public issues and moving our economic game forward. We also visit with North Dakota author and historian Mike Jacobs in our next installment about the Bank of North Dakota’s history – now 100 years and counting.
Economist and former Greek finance minister Yanis Varoufakis describes in this short presentation how his proposal for a Green New Deal for Europe would be structured and how it would tackle crucial problems such as underemployment & involuntary migration.
“We need to create an alliance, a partnership, between investment banks like the KFW, like the European Investment Bank, and Central Banks so that the money printing capacity of central banks is harnessed to create investments into the things that we need to grow and disinvestment in the things we want less of, like diesel-powered cars, for instance.”
[Watch the video]
“In California, we’re going to get this done!” AB857 carves out a special charter for city-owned public banks
In dual press conferences Monday in Los Angeles and San Francisco, California legislators announced the introduction of AB857, a bill that would enable cities and regions to charter their own public banks and create a public banking network in the state.
The announcement was made by California Assemblymen Miguel Santiago and David Chiu. In L.A., Santiago was flanked by L.A. City Council President Herb Wesson and dozens of advocates from the California Public Banking Alliance. PBI Chair Ellen Brown also joined in the fanfare.
Santiago explained the need for change:
“If there was ever a time to discuss how to use finances for the public good, this is it and this is now. Private corporations are not meant to do the business of public good which is why we need a public bank. [A public bank can] determine how to use our revenues in a way that is leveraged for the public good — [good that’s] determined by the citizens rather than some millionaire or billionaire.”Read more
On March 21, the Philadelphia Public Bank Coalition is holding a training event followed by a conversation with city council members. The Coalition asks:
“What if the City had its own bank and no longer had to leave its billions of reserve dollars to the tender mercies of Wall St? Pipe dream? Hardly. A public bank was established in North Dakota 100 years ago, and it's still going strong. It can happen here in Philly, if we have the will to push our https://www.facebook.com/PhiladelphiaPublicBankCoalition/elected officials.
“Join us as we spend Thursday, March 21st to learn about the wonders of public banking, and how to talk about it. Then we'll carry our message to City Council.”
As Sunrise Movement activists push ahead with a Green New Deal tour that they plan to expand into 100 town hall meetings, Sylvia Chi of the California Public Banking Alliance and Public Bank East Bay continues the conversation on how to finance the massive Green proposal. She writes in a recent Medium article:
“The Green New Deal relies on a network of public banks — like a decentralized version of the [Reconstruction Finance Corporation] — as part of the plan to help finance the contemplated public investments. This approach has worked in Germany, where public banks have been integral in financing renewable energy installations and energy efficiency retrofits. And it’s an idea that has taken root in California: last November, over 430,000 Angelenos voted in favor of amending Los Angeles’ city charter as a first step towards a public bank, and Oakland, Berkeley, Richmond, and Alameda County have completed a favorable feasibility study.”
Video spotlight: Professor Steve Keen explains why a government budget is not the same as a household budget
People often think of the national budget as a household budget, a belief that has enabled policies that have exploded the amount of public debt owed to private banks. But as Professor Steve Keen notes in this short video, the government has a money-printing central bank, so the household budget model does not apply. He explains what the government should do instead to pay for public needs such as university fees:
“Government runs a deficit financed by the central bank, and spends money into the economy. It stimulates the economy and gives us an educated youth that are not encumbered by private debt.”
Last spring, public banking advocates in Virginia reached out to the Public Banking Institute to find out more about how to create a public bank in their state. Less than a year later, they have not only launched the Bank of Virginia Act Campaign, aimed at creating a public bank in Virginia in 2020, but also have secured the support of five candidates: three candidates for Virginia House of Delegates, one for State Senate, and one for City Council in Charlottesville.
The Campaign aims to create an economically sustainable and socially responsible Virginia. Founder Austin Sachs says, “we've been working more behind the scenes, and hope to begin the larger public push starting the end of this month or next. We hope to be able to announce at least one new candidate in support each week.” The Campaign website states:
“The Bank of Virginia Act will decrease Virginia's financing and banking costs, while supporting and investing in socially responsible ventures!”
Sign on to support this effort here.