Michigan leaps forward into the running for the first state in a hundred years to create a state Public Bank, thanks to Republicans and Democrats working together for their state's best interests.
Last Thursday, MI House Bills 5431-5434 were formally introduced — a bipartisan package of bills that would create and maintain a state bank. According to a statement by State Rep. Martin Howrylak (R), the Michigan state-run bank would effectively be a co-operative, holding state and local government funds. The bank could then use those funds to provide loans to the state and its subdivisions (schools, cities, townships, villages, etc.).
“This is a fiscally responsible solution for taxpayers. As states are looking for ways to reduce spending, many are exploring the idea of a state-owned bank, similar to the Bank of North Dakota. In North Dakota, public revenue runs through the state-owned bank (Bank of North Dakota, BND). The BND provides loans significantly below market interest rates to local governments, smaller banks and businesses. Local governments and schools use these savings to pump more money into classrooms, expand access to infrastructure funding and keep tax rates low.”
Trailblazer New Jersey Governor Phil Murphy wastes no time. Directly following his swearing in last week, State Senators Nia Gill and Richard Codey introduced the State Bank of New Jersey Act at the beginning of the legislative session.
According to Politico:
"Under the Codey-Gill proposal, all public entities in New Jersey would be able to use the state-run bank. It would provide transportation project loans, student loans, small business loans and be able to purchase mortgages from commercial banks. The bank would also be able to purchase, lease and construct buildings, and would even have the power of eminent domain. And it would be able to buy and sell federal funds."
PBI Chair Ellen Brown and former Chair Walt McRee present on Public Banks at national conference on sustainable infrastructure
Ellen Brown and Walt McRee head to Washington DC this week for the National Council for Science and the Environment (NCSE) conference on Sustainable Infrastructure.
The conference features experts from around the globe and will host thousands of participants. Ellen and Walt are conducting a workshop "The Backbone of Sustainable Infrastructure: Cooperative Ownership & Public Banks.” The workshop will explain how co-ops and Public Banks provide the structural mechanics for creation of a “new regenerative economy” (NRE) that goes beyond mere sustainability to embrace a commitment to public service that generates human-focused community outcomes rather than mere paper profits.Read more
An eloquent op-ed in Santa Cruz IMC penned by Steve Pleich describes why California and Santa Cruz are uniquely suited to stand up to the pressure brought by the crisis-rocked private banking industry and create their own Public Banks. He writes, "[Public Banks] are a way, at long last, to manage money in the public interest."
"In point of fact, the reason that there aren’t more public banks around the country has nothing to do with any legal problems. ... Indeed, the lack of public banks in America has everything to do with political will and the resolve to stand up to the pressure brought to bear by the private banking industry. California, and so Santa Cruz, is uniquely suited to stand up to such pressure. The people of the state are increasingly determined to chart their own course independent of Wall Street and, where necessary, independent of the federal government. There has never been a better time for a city council and active citizens to push back against Wall Street lobbyists and implement a model of sound and ethical financial policy."
International News: Ireland's Cabinet is set to discuss introducing a "game changer" Sparkassen type of Public Bank
The Irish publication The Journal reports that a proposal to introduce a Sparkassen type of Public Bank in the country will soon be discussed in the Cabinet. Government officials have completed their report.
Labour TD Willie Penrose says, “The development of a network of regionally based public banks could be a game changer for small and medium enterprises, agribusiness and the regions.”Read more
Santa Rosa Councilmember Jack Tibbetts endorsed the proposed resolution for a Public Bank of Santa Rosa as another city steps forward toward Public Banking. Last week Santa Rosa City Council had its public hearing for their 2018-2019 budget priorities. Most speakers spoke in support of Public Bank, seeing it as critical to addressing the community’s needs following the devastating fires. Friends of Public Banking Santa Rosa have posted the proposed resolution on their new website.Read more
Nonprofit advisor Tivoni Devor writes in Generocity Philadelphia should invest their money locally in Philadelphia for the betterment of its citizens by leveraging the city’s enormous public deposits. He explains:
“Currently Philadelphia uses large commercial banks to handle its nearly $2 billion in payroll as well as $621.3 million in deposits and $1.8 billion in various investments. By putting this money in a public bank specifically chartered to loan money only to businesses, nonprofits and individuals in Philadelphia, we would be better suited to drive economic growth in the city.
Activist Paul Alexander writes an articulate article in Medium that describes how Seattle’s emergency-level housing crisis can be directly and concretely addressed with a Public Bank, and why now is the time for grassroots activists to push their public officials.
Alexander explains that with a Public Bank, Seattle would be able to meet the needs demanded by advocacy groups. The city could also leverage a Public Bank’s power to help fund community land trusts and build public housing at dramatically lower costs, eliminating the issue private developers continually raise: that it’s not sufficiently profitable for private developers to build affordable housing. He writes:
“The right to housing must not wax and wane with the stock ticker. We must build institutions capable of holistically and comprehensively addressing our housing needs until there are no more impoverished citizens sleeping on Seattle’s streets, or devoting half their paychecks to the roofs over their heads —and we can start doing this right now.
The movement to create municipal Public Banks continues to surge forward as more and more cities wake up to the powerful benefits it promises. An article out this week in Fast Company quotes PBI Chair Ellen Brown and describes the challenges faced by our allies at Public Bank LA when NoDAPL activists successfully pressured Los Angeles to move their money out of Wells Fargo: where to put city funds next?
Where is the banking institution that is large enough to handle the city’s sizable accounts, ethical in their business practices, and accountable to the public? The need became clear for a Public Bank with a mandate to serve the public.
“That’s our tax dollars that get siphoned off to profits on Wall Street,” Public Bank LA's Phoenix Goodman says.Read more
Activists as diverse as Black Lives Matter, local tribal members of the Standing Rock Coalition, 350.org, Democratic Socialists, and MLK County Labor Council, as well as several experienced bankers, retired government officials and law school professors have coalesced along with Public Banking advocates in Seattle to pressure City Council to move forward on their newly approved $100,000 feasibility study.
For those in the Seattle area, join the Seattle Public Banking Coalition here.Read more