Public Banking Institute News: Mar 21, 2019
San Jose lawmakers unanimously vote to study a public bank and abandon banking with Chase
On Tuesday, the city of San Jose debated whether to waive its wage theft policy in order to award a major banking contract to Chase, or to create its own public bank. At the end of the discussion, the council unanimously approved a memo co-authored by Councilmembers Sergio Jimenez, Magdalena Carrasco, and Raul Peralez that would explore creating a public bank under the recently proposed California Assembly Bill 857, facilitating the formation of public banks in the state.
Chase recently had won the bidding process for the city’s banking agreement, but the city’s policy prohibits contracts with employers accused of wage theft and Chase is currently settling 22 wage theft cases for $160 million according to CBS / KPIX 5.
“I have no interest in lowering our standards,” Peralez said.[read more]
Students join Sun Times in endorsing public bank advocate Ameya Pawar for Chicago treasurer
On March 15, the Chicago Sun Times again enthusiastically endorsed Ameya Pawar for city treasurer in the runoff election April 2, writing, “His advocacy on behalf of ordinary working people is consistent and principled.” Among Pawar’s proposals is a public bank for the city to support affordable housing, offer low-interest student loans and possibly do business with the marijuana industry if recreational pot is legalized (something other banks may be restricted by federal law from doing).
In The University of Chicago’s Chicago Maroon, student Alex Bisnath echoed the endorsement, stating:
“This is a bold idea. … If all goes according to Pawar’s plan, the bank would be able to refinance student loans at 5 percent interest. This would motivate college students to stay in the city, while providing them with more spare cash to put back into the economy.”
To fund a Green New Deal, “We need to set up public banks and democratize the Federal Reserve.”
“The Green New Deal won’t get far if it’s left hostage to the whims of private finance,” Johanna Bozuwa and Thomas M. Hanna of Democracy Collaborative proclaim in the latest issue of Jacobin magazine. They continue, “Asserting public control over the financial system is … essential if we want to prevent catastrophic climate change.”
Along with a large-scale expansion of public and cooperative banking, the authors say the Fed needs to be democratized:
“A truly publicly owned, transparent, and democratically accountable central bank would change that — and could become a powerful weapon in the fight against climate change. As Fed expert William Greider puts it, we need to ‘create a new public institution that truly understands that its obligation is to society, not money markets.’ Congressional action to reform the Fed could ‘harness the Fed’s money creation and lending powers to help finance major public objectives.’”
PBI Chair Ellen Brown notes in her latest Truthdig article that former Greek finance minister Yanis Varoufakis has been proposing a similar public bank-driven proposal for a Green New Deal in Europe for several years through the Democracy in Europe Movement 2025 (DiEM25). In Varoufakis’ proposal, “the European Investment Bank (EIB) issues [€500bn in] bonds [each year] with the European Central Bank standing by, ready to purchase as many of them as necessary in the secondary markets.”[read more]
It’s Our Money podcast examines socialism and public banking with Dr. Richard Wolff
In the latest episode of It’s Our Money, PBI Chair Ellen Brown talks with renowned economist Dr. Richard Wolff about the changing views of socialism and how the shift in public sentiment is creating more solutions to current crises. Co-host Walt McRee describes the episode:
[listen to the podcast]
Debating Socialism and Public Banks
Socialism has acquired an outsized connotation for being the enemy of the core values and tenets of American economic and political life – a threat to private ownership and initiative and a challenger on the international stage of cultural and political domination. While variations on the practical themes of socialist-based public policy abound across the globe, and often with unparalleled success, Socialism has now hit the American political arena with surprising vigor and acceptance, particularly by younger generations who are inheriting the systemic costs of capitalism’s latter stages. Ellen talks with noted economist Dr. Richard Wolff about how the growing discussions about socialism enrich the broader discussion about problem-solving of public issues and moving our economic game forward. We also visit with North Dakota author and historian Mike Jacobs in our next installment about the Bank of North Dakota’s history – now 100 years and counting.
Video spotlight: Yanis Varoufakis on a Green New Deal for Europe
Economist and former Greek finance minister Yanis Varoufakis describes in this short presentation how his proposal for a Green New Deal for Europe would be structured and how it would tackle crucial problems such as underemployment & involuntary migration.
[watch the video]
“We need to create an alliance, a partnership, between investment banks like the KFW, like the European Investment Bank, and Central Banks so that the money printing capacity of central banks is harnessed to create investments into the things that we need to grow and disinvestment in the things we want less of, like diesel-powered cars, for instance.”
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