Former Goldman Sachs banker says we need public banks and AB 857

Goldman Sachs Tower, Jersey City, New Jersey

Goldman Sachs Tower, Jersey City, New Jersey. Photo by Jordan Merrick.

 

Nomi Prins, author and former Goldman Sachs banker, writes in Truthout of the crucial need for public banks:

[I]t is more important than ever to create public banks tasked with using state and local funds for public good, not private profit. And my home state of California is leading the way. A new bill, AB 857, backed by the California Public Banking Alliance would give cities the freedom to start public banks accountable to the communities they serve. ...

“Public banks would allow cities to professionally manage their money without sacrificing their values.”

Prins elaborates, explaining that “our own tax dollars are underwriting Wall Street’s most reckless investments,” and confirms that local government deposits are at risk in Wall Street banks.

“The Dodd-Frank Act of 2010 placed some regulations on banks’ riskier bets. But, crucially, that reform failed to divide banks into two entities: one dealing with people’s FDIC insured deposits, and the other able to create complex securities and engage in derivatives trading using our deposits as collateral. Ten years after the financial crisis, our money is still very much at risk of being gambled away.

[Read the full article]

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