July 4 – California cities declare independence from Wall Street!

California public banking bill clears another state Senate committee as momentum generates a swell of press coverage Yesterday, California’s Public Banking Act, AB 857, passed the Senate Governance & Finance Committee 4 Aye’s to 3 No’s. In the extended hearing, Assemblymember David Chiu, the bill’s co-author, emphasized, “Something is truly broken with the present financial system.” The bill has one more committee — Senate Appropriations — before the Senate floor vote. 

Watch the hearing video here (bill discussion starts at 1:25). 

Meanwhile, publications in San Jose, Santa Cruz, Santa Rosa, North Bay, Marin County, San Francisco, Sacramento, Los Angeles, and Monterey Bay each published robust articles recently detailing what a public bank could mean to their local communities. The journalistic push indicates a high-water mark for interest in public banking, and provides advocates around the country with excellent talking points to share.

An article by Jennifer Wadsworth in Santa Cruz’s Good Times, for example, describes one important benefit of a public bank mandated to serve the public interest:  “[T]he broader decline of small banks across the Greater Bay Area reflects a broader trend. … But the rural Midwestern state [of North Dakota] boasts six times the number of locally owned financial institutions than the rest of the country. Its secret? A public entity that supports small private lenders by helping with capitalization and liquidity and allowing them to take on larger loans that would otherwise go to out-of-state megabanks.”
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Thomas Marois shows how Costa Rica models a democratic public bank, and why public banks have far greater capacity than we think

Public banking is a way to “democratize” our money, but how can we ensure that the bank is run democratically? Costa Rica has shown the way with its broadly democratic, worker-owned Banco Popular, described in a recent article in Open Democracy by University of London public bank scholar Thomas Marois. Designated Bank of the Year 2018 in Costa Rica by LatinFinance, Banco Popular is governed by a 290-member Workers’ Assembly comprised of representatives from across ten social and economic sectors, 50 percent of whom are women. The bank just announced the availability of 140 billion colones ($240 million) in lower-interest loans for micro, small and medium companies and for housing for families who do not have access to credit from traditional commercial banks.

Marois’ new research also demonstrates that there are nearly 700 public banks around the world that have combined assets nearing $38 trillion — about 48 percent of global GDP. That means 20 percent of all bank assets are publicly owned and controlled — much greater financial capacity than commonly believed. His research contradicts the standard neoliberal narrative that there is no alternative to using private finance for climate finance and other community needs.  

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Ralph Nader Radio Hour interviews Walt McRee on public banking and Ellen Brown’s new book

Former PBI Chair Walt McRee discusses with Ralph Nader why public banks should be the future of banking on the most recent episode of the Ralph Nader Radio Hour

They also discussed Ellen Brown’s new book Banking on the People, which Nader included in his list of Highly Recommended Books for 2019 Summer Reading. Nader comments: 

“[W]hat we have here is out of control corporate bank socialism. Namely, they reap the profits using other people’s money. They enrich themselves at the top of the company. They make money from money, which isn’t a very productive enterprise. And then they send the bill to Washington when their whole edifice collapses.”

[listen to the show]

Ellen Brown: Facebook may be more dangerous than Wall Street

In her most recent article in Truthdig, PBI Chair Ellen Brown stresses the dangers of Facebook’s new corporate-controlled Libra cryptocurrency, evidently intended to be a private global currency bypassing governments. She describes the needed alternative: 

“A currency intended for trade on a national — let alone international — scale needs to be not only centralized but democratized, responding to the will of the people and their elected leaders, [r]ather than bypassing the existing central banking structure as Facebook plans to do.”

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