There’s no shortage of pundits condemning the riots in Baltimore. There are also plenty of well-meaning people focusing solely on the disenfranchisement of particular pockets of that city as if the human beings suffering there were characters in some morality play. But it’s time to talk economics, because the events in Baltimore didn’t happen in a vacuum. “In fact,” writes Harlan Green of PopularEconomics.com, “the Baltimore riots are the result of an economic system that can only be described as broken, where the bullies win, everyone else loses.”Read more
Do you know a Mayor? If so, you may be able to help PBI's friends at Commonomics USA with their campaign to put public finance on the agenda at the 2015 United States Conference of Mayors. Read the information here, and email them at info@commonomicsusa if you can help--as soon as possible!Read more
Chicago is in trouble. According to Mish's Global Economic Trend Analysis blog, there is a $1.1 billion "budget hole" in the Chicago public school system. A "derivative time bomb" of as much as $263 million, just triggered on the Chicago Board of Education, means that Chicago Public Schools may be out of money in 30 days. "On March 9, Moody's dropped Chicago School bonds two notches to Baa3, that last rank above junk," according to the site's blogger, Mike "Mish" Shedlock, who adds: "On March 20, Fitch downgraded Chicago Board of Education Rating to BBB-, also one step above junk." If the district cannot renegotiate the swap, or pass further bonds for the funds (and both events seem difficult to implement), a "termination event" would trigger, forcing the Board to pay the negative valuation on the swap, which it simply cannot afford to do. The District supposedly has just enough to pay the termination fees, but would be left "virtually broke."Read more
Maine public banking advocate Randall Parr continues his productive output answering critics of public banks. Will local banks with state deposits suffer losses if those deposits are redeposited into a state-owned bank? What would be the impact of a public bank on the state's economic health? On its poverty rate? Would creating a state-owned bank be costly? How would it be funded? Parr offers practical, documented answers to these questions in the piece we are reprinting below.Read more
Longtime public banking writer and leader of the New York public banking movement Scott Baker has published America is Not Broke! Four Multi-Trillion Dollar Paths to a Thriving America, a book his publishers call "a potent economic antidote for all that currently ails the US economy."Read more
LD 24 would create a Maine State Bank. as well as allow the creation of county and city-run banks. LD 14 provides that the Maine State Bank would come into existence on July 1, 2017, provided that it had capital of $20,000,000. The bill further provides for a quarterly examination of the Bank by the Department of Professional and Financial Regulation, as well as a state audit every two years.
Although the frontal façade of this essay is “policy analysis of how public finance can solve poverty,” this is really an attempt to explain, at a fairly (but not completely) personal level, why I do what I do.Read more
German public bank Landeskreditbank Baden-Württemberg, or L-Bank, is suing the European Central Bank to avoid coming under EU supervision and regulation, which would increase L-Bank's costs and fees. L-Bank argues that higher costs tied to ECB supervision would undermine its ability to support local families and businesses.Read more