Who should get to use our money? Ellen Brown: Blackstone, BlackRock or a Public Bank for California’s money?

Stephen Schwartzman, CEO Blackstone Group

Stephen Schwartzman, CEO Blackstone Group. Photo coutesy TruthDig.

 

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.

Ellen Brown continues:

“Note that these deposits would not be spent. Pension funds, rainy day funds and other pools of government money can provide the liquidity for loans while remaining on deposit in the bank, available for withdrawal on demand by the government depositor. Even mainstream economists now acknowledge that banks do not lend their deposits but actually create deposits when they make loans.”

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