25 percent of Swiss voters support sovereign money referendum indicating growing interest in radical overhaul
The Sovereign Money initiative that Switzerland ultimately rejected would have barred commercial banks from electronically creating money when they make loans, and made the Swiss National Bank the only body authorized to create money in the country. While the initiative failed, a full quarter of Swiss voters supported it, which shows a growing interest in a radical overhaul of the monetary system.
Positive Money’s Fran Boait writes in the Independent, the initiative would have “opened up the way for a transformation of the money and banking system the world over. ...
“Unknown to most of the population, 90 per cent of Switzerland’s money is created by private banks ‘out of thin air’ when they lend. …
“Switzerland’s Vollgeld referendum raises a crucial question that has been ignored since the last crisis - should private or public interests be in control of creating almost all the money a country uses?”
“Contrary to common belief, most money in the world is not produced by central banks but is instead created electronically by commercial lenders when they lend beyond the deposits they hold for savers. This arrangement, underpinned by the belief that most debts will be repaid, has been a cornerstone of the global capitalist system …”
“‘The discussion is only just getting started,' said campaign spokesman Raffael Wuethrich. 'Our goal is that money should be in the service of the people and not the other way around and we will continue to work on it.’”
Activists from more than two dozen grassroots organizations including New Economy Project and Public Bank NYC took to the streets of Wall Street on Tuesday to launch a campaign for a NYC Public Bank. Carrying signs reading “Public Bank for Public Good,” and chanting, "Wells, Chase, B of A, public bank's a better way!” advocates called for a paradigm shift:
“Every year, New York City deposits billions of dollars of public money in big banks like Chase, Bank of America, and Citibank. On top of that, Wall Street extracts many millions of dollars in fees and interest from New York City. This means that our public money is supporting Wall Street’s destructive activities: foreclosing on our homes, fueling the climate crisis, redlining communities of color, backing private prisons and immigrant detention centers, and financing war -- to name a few.
“Enough! Clearly we need a paradigm shift, and we call that shift Public Bank NYC.”
Julia Conley reports in Common Dreams:
“‘New York deserves a public bank that will invest in community needs, and be accountable to New York City residents—one that will prioritize housing...and not prey on low-income New Yorkers,’ said Scott Hutchins, a member of the grassroots social justice group Picture the Homeless. …
The sheer volume of cash that legalized pot is triggering is generating the kind of political will needed to create a Public Bank as the solution. We ask: Why not use the power of a Public Bank to help everyone?
The San Francisco Chronicle reports:
"The state Senate passed a bill this week to create a state charter for banks to serve California cannabis businesses, which would allow licensed merchants to write checks to pay taxes, fees and vendors — rather than use large amounts of cash, as they currently do.
"SB930, by state Sen. Robert Hertzberg, D-Van Nuys, now heads to the Assembly."
Washington DC’s Department of Insurance Securities and Banking held the first and second of a series of public meetings May 30 and June 6 on a proposal to establish a Public Bank in the District. The slides created for the meeting closely quoted Public Banking Institute’s language in defining a Public Bank.
The slides presented are available online and audio of the meetings should be available shortly.
Future public meeting dates are June 27, and July 25.
American Banker: Wells Fargo is not alone: OCC finds sales abuses at other banks, but report is being kept hidden
Wells Fargo’s fraudulent practices are commonplace in the banking industry according to a new report. “Hundreds of problems” and “systemic issues” were discovered in a review of large and midsize banks’ sales practices, yet federal regulators currently have no plans to make the results public.
American Banker reports:
“The Office of the Comptroller of the Currency began a broad examination of more than 40 banks after it was revealed that employees at Wells Fargo had opened millions of fake accounts in an effort to meet aggressive sales goals.
“The review uncovered specific examples of other banks opening accounts without proof of customers’ consent, an OCC spokesman acknowledged Tuesday. It also spurred the issuance of warnings on five specific industrywide issues that banks needed to address, and more than 250 specific items regulators wanted fixed at individual banks, according to a consultant briefed on the OCC’s findings. …
“Yet the results of the review have not been publicly disclosed, and OCC has no plans to release a report, according to Bryan Hubbard, a spokesman for the agency.
“Hubbard declined to comment on why the agency is not making the results public. …
Who should get to use our money? Ellen Brown: Blackstone, BlackRock or a Public Bank for California’s money?
Should California give its pension money to an absentee slumlord? Or to the world’s largest, “extremely dangerous” shadow bank that charges 14 percent management fees, lost $500 million of CalPERS’ money in 2009, and is up to their neck in oil and private water interests? No? Ellen Brown explains in her latest article in TruthDig the obvious and urgent alternative: a California Public Bank:
“California’s pools of idle funds cannot be spent on infrastructure, but they could be deposited or invested in a publicly owned bank, where they could form the deposit base for infrastructure loans. California is now the fifth-largest economy in the world, trailing only Germany, Japan, China and the United States. Germany, China and other Asian countries are addressing their infrastructure challenges through public infrastructure banks that leverage pools of funds into loans for needed construction. ...
“Germany has an infrastructure bank called KfW which is larger than the World Bank, with assets of $600 billion in 2016. Along with the public Sparkassen banks, KfW has funded Germany’s green energy revolution. Renewables generated 41 percent of the country’s electricity in 2017, up from 6 percent in 2000, earning the country the title ‘the world’s first major green energy economy.’ Public banks provided over 72 percent of the financing for this transition.
Diane Russell is running for governor in Maine and her number one platform issue is establishing a Public Bank.
Diane Russell spoke with Maine Public recently:
“The fact of the matter is no one else is talking about a state public bank, about getting our money out of Wall Street and putting it onto Main Street, so we can actually take our treasury and invest it better.”
The UK group Positive Money explains in this video how our debt-based, private bank system has created the money supply problem we face. While PBI advocates for a different solution, we agree on the condition: The money system we are enduring is broken.
“More than 97 percent of all the money in our economy is created by banks when they make loans. Most of this money goes into house price bubbles and gambling on financial markets. This has led to ever-widening inequality, the highest personal debt in history, and house prices that very few people can afford, before even mentioning the financial crisis.”
The Public Banking movement currently is being empowered by communities who've insisted their governments stop banking with the financial institutions behind fossil fuel-driven barbarism such as the attacks on peaceful water protectors at Standing Rock. After every divestment victory, however, a critical problem presents itself: finding an acceptable alternative.
Seattle, for example, voted unanimously to divest from Wells Fargo in February 2017, but after realizing virtually all big banks are funders of DAPL and, curiously, no other bank wanted to participate and bid for the city’s services, Seattle last week was forced to sign on for another three years with Wells.
Matt Remle, who lives in Seattle and is a member of the Standing Rock Sioux tribe, explains how the encampment effort led to his forming the group Mazaska Talks and to the idea of a Public Bank:
“We know that as a city or as a tribe, when we are banking with a Wells Fargo or Chase or Bank of America, that money isn’t being reinvested back into our communities. We are very clear when we are pushing our banking ordinance that it’s not a victory to jump from one Wall Street bank to another. Our ultimate goal for Seattle is to take our money completely out of there and have control over our own finances.”
Deregulation was supposed to help community banks, but instead it's helping to kill them. Public Banks could save them.
The bank-deregulation bill that passed the House yesterday — despite public and regulator outcries — was sold as something rural community banks desperately needed to relieve overwhelming paperwork burdens and survive Wall Street's rapacious crush.
It does reduce reporting requirements and red tape, but according to David Dayen in The Intercept, the main effect of Congress's lobbyist-written bill to loosen the regulations on "mid-sized" banks has been to greenlight — well before the bill even passed into law — a new rush of consolidation that is already swallowing up many of the community banks left standing. This was indeed predicted by industry observers. The Crapo bill, oddly, did not look to the only state in the country with thriving community banks — North Dakota — to build upon their successful model: their Public Bank.
Dayen explains in his recent sobering article:
“Indeed, the past 30 years have witnessed a dramatic reduction in chartered banks, from 14,500 to fewer than 5,600. ‘If this pattern continues, we’ll only have Wall Street banks left,’ said Sen. Jon Tester, D-Mont., to Politico. ‘And Wall Street banks won’t serve rural America, they won’t serve Montana. … So, what will rural America do?’ ...