In her latest article in Truthdig, PBI Chair Ellen Brown delves further into how the US can fund a Green New Deal through a national public infrastructure and development bank. All we need to do is look to how Germany did it. Establishing such a bank should be a “no-brainer,” she writes:
“The real question is why we don’t already have one, as do China, Germany and other countries that are running circles around us in infrastructure development. … Germany has a public sector development bank called KfW (Kreditanstalt für Wiederaufbau or “Reconstruction Credit Institute”), which is even larger than the World Bank. Along with Germany’s nonprofit Sparkassen banks, KfW has largely funded the country’s green energy revolution.”
Banking on New Mexico advocates have returned the group’s focus to its original vision of a statewide public bank and have joined forces with Albuquerque’s Public Bank for Central New Mexico to form the Alliance for Local Economic Prosperity.
The mission of the new group is, “to spearhead a statewide educational campaign to help people understand that keeping New Mexico money in New Mexico can grow financial resources that are safe, support local economic and educational systems, invest in job opportunities and human development, and diversify our economy.”Read more
As Representative Alexandria Ocasio-Cortez takes a seat on the House Financial Services Committee, her tweet saying she wants to get to work on public banking was heard round the world. “I’m looking forward to digging into the student loan crisis, examining for-profit prisons/ICE detention, and exploring the development of public & postal banking,” Ocasio-Cortez tweeted. The French press agency AFP immediately caught on, writing “‘Public banking’ are two words that send shivers down the spine of Wall Street.”
The French know this because Europe actually has public banks and and recognizes the efficiency of that model.
The House Financial Services Committee has long been a major source of campaign contributions from Wall Street for both Democratic and Republican lawmakers, so the response of the financial services industry and Party leadership to this development may be swift.
Meanwhile, the resulting media attention from AOC’s current limelight presents a great opportunity to substantially advance the public’s understanding of public banking and to gain the support of advocates, allied organizations, and elected officials.Read more
North Dakota is facing important budget concerns due to the continued slide in oil prices. Early this month, the North Dakota Legislature lowered the amount of revenue the state can expect to collect from oil taxes by $600 million for the next two year budget cycle. Oil is a major contributor to the state’s wealth and the significant drop in energy tax revenue (despite record levels of oil production) would be expected to have significant effects on state spending. North Dakota, however, has a state bank. Eyeing the trend, they have built into their budget the transfer of a $140 million dividend from the Bank of North Dakota’s record profits (p24 of link). These dividends are funds the state can tap in lieu of a rainy day fund -- one of the major benefits of having a state-owned public bank. They will enable the state to buffer budget woes brought about by volatile swings in commodity prices and boom and bust cycles.
During the current arbitration talks at Canada Post, which have followed last year’s rotating strikes, the Canadian Union of Postal Workers (CUPW) has pitched a proposal that Canada Post create a Postal Bank. Another demand is a proposal to convert their vehicle fleet from gas to electric powered. By including these key public benefits in their agreement negotiations, the Union breaks new ground as advocates.
Chris Arsenault reports for the CBC:
“The proposed postal bank is aimed at rural residents, including First Nations, who often don't have easy access to a bank branch, said John Anderson, researcher with the Canadian Centre for Policy Alternatives. … It would also benefit low-income Canadians, including pensioners and the working poor who often depend on payday lenders for loans, cheque cashing and other financial services. …
“‘The federal government — through its ownership of Canada Post — is the only body that could bring modern financial services to every community in Canada,’ Anderson said.”
Professor Tim Canova discusses the Fed with Ellen Brown and Walt McRee on the It's Our Money podcast. Meanwhile, Canova's campaign continues for hearings and full investigation of the “unbelievable” election results that gave the Broward County, FL House seat to Democrat Party fixer Debbie Wasserman-Schultz. Walt describes the show:
The “Reserved” Federal Reserve
By “reserved” we mean “reserved for the banking giants.” Our guest today is Professor Tim Canova, a noted expert on the Federal Reserve and a veteran survivor of the federal election system that saw his two campaigns for Congress crushed by Democratic Party power-players affiliated with Debbie Wasserman-Schultz, a top party official. Whether it's election outcomes or banking policy, the game is rigged from the highest points of influence and control. Tim and Ellen discuss the details that provide a bracing look at two of our most important public institutions.
In July 2018, Washington State’s Office of Financial Management asked the Evans School of Public Policy and Governance at the University of Washington to complete an evaluation on the benefits and risks of establishing and operating a state-chartered, public cooperative bank. This evaluation would inform the creation of a business plan for such a bank. The interim report delivered mid-December concluded that: “Improvements can be achieved by creating a state-chartered public cooperative bank.”
The report also clarified that creation of such a bank is feasible under the state’s constitution, although it would require an enabling statute and the amendment of others. The final business plan report is due June 30, 2019.
More elected officials every week are seeing the potential of public banking to address budgetary woes. The latest is Connecticut State Representative Josh Elliott, who writes in the CT Mirror of how the century old Bank of North Dakota has “spun off $300 million in revenue to the state over the last decade alone [now $360 million since 2005] while also providing some significant functions. ...
“We need to implement a public bank in Connecticut because it allows for consistent and cheap lending. It works both for the state as an institution, and it works for its residents.”
The concept of “community wealth building” is gaining traction in the UK with politicians on all sides seeing the appeal of community-owned banking models. UK law was changed in 2014 making it possible for banks to be licensed as a true cooperative bank. The resulting coop banks are starting to spread across the UK with the vision of developing a wide network of regional community banks.
One such bank’s founder, Jules Peck, writes how these regional coop banks can put banking back in the hands of the people:
“As well as the bank I have helped found in the West of England region, Avon Mutual, we have banks already in formation in London and the South West and soon we hope in the Preston, Merseyside and Lancashire region, as well as in Wales. … We won’t be trading and involved in the speculative ‘financialized’ economy—just the real economy of our regions. Using local savings to lend to local citizens and businesses and other institutions.”
A recent CalMatters article by Felicia Mello and Ben Christopher examines the arguments made for public banking in California. What is the precedent? How could it work? They cover five things to know.
“If California had a bank controlled by the government rather than profit-hungry shareholders, public banking advocates argue, the state could fund social goods that often get the cold shoulder from commercial institutions: infrastructure projects, low-interest student loans and affordable housing.”