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Hundreds Gather for Public Banking and Economic Justice

Posted on Jun 23, 2013
Images_of_Money (CC BY 2.0)

By Matt J. Stannard, Political Context

(Page 2)

In its simplest manifestation, a public bank is a democratically-run, fiscally transparent bank designed to serve community stakeholders rather than capital shareholders. The profits of public banks are returned to the public, whereas privately owned banks increase taxpayer costs through compound interest and are compelled to return profits to shareholders. Public banks issue credit at low-cost or no-cost to cities and states. Public banks can offer “bridges” to residential, agricultural, and public works financing, as the BND did during the Great Depression. BND also partners with the private sector, encouraging entrepreneurial startups and providing check-clearing, liquidity, and bond account safekeeping to private banks. PBI President Ellen Brown adds:

A new publicly owned bank would have a clean set of books, untainted by the Wall Street addiction to gambling in complex derivatives; and its profits would go back to the local government and community, rather than being siphoned off in exorbitant salaries, bonuses, and dividends. A publicly-owned bank could funnel credit where it is needed most, directly into the local economy.

Although this blueprint for public banks was the guiding vision of the Conference, several complimentary economic themes emerged from the vast array of speakers there. Rabbi Michael Lerner explained the Debt Jubilee movement. Margaret Flowers, Kevin Zeese, David Brodwin, Georgia Kelly, and Arthur Stamoulis held an important forum on the very disturbingTrans-Pacific Partnership, a threat not only to ideas like public banking, but to huge other sectors of public goods. OpEd News founder Rob Kall gave a rousing presentation on the general concept of bottom-up economics, while speakers like Gar Alperovitz and David Cobbshared their visions linking ideas like public banking to the larger vision of a participatory, sharing-oriented economy. Space and time do not permit a comprehensive review of the Conference, but Leilani Clark’s very accessible treatment of the Conference at Bohemian.comis worth reading. And interested wonks may read the entire Conference program here.

Rolling Stone economic crusader Matt Taibbi was perhaps the highest profile guest at the Conference. He joined Icelandic parliamentarian Birgitta Jonsdottir, PBI President Ellen Brown, and Alperovitz in a thoughtful discussion on the relationship between the corruption of the private financial sector and the promise of public solutions. He also made himself available forinterviews before and after that discussion. Last month, I had expressed some hope that, after attending the conference, Taibbi would move from criticizing big banks to endorsing public banking. During our walk to a reception on the day of Taibbi’s attendance, a few friendly conference attendees quietly explained to him the mechanics of the idea (although I’m sure he already knew a great deal about it). Discussions continued through the reception and after the public discussion that evening, and he seemed excited to be among so many like-minded folks, and genuinely reluctant to leave. His post-conference tweet demonstrated that he was sold on the idea. “Want to thank all the folks from the Public Banking institute for the event last night,” he tweeted. “- amazing time – an idea whose time has come.”

In between speakers, the PBI media team interviewed both attendees and movement leaders. The interviews and speeches were webcast by the Community Media Center of Marin team, and according to that organization’s director, hundreds watched the webcasts from their home computers.

Soft-spoken but surgically analytic, PBI President Brown was the intellectual center of the Conference. Brown’s work has been instrumental in building awareness of the economic and legal facets of public banking. This interview with Brown is informative, as were her presentations at the Conference. Brown continues her prolific work in an article published last week at Counterpunch, where she takes on the student loan crisis from a decidedly egalitarian (and practical) perspective:

Other countries make loans available to their students interest-free. For more than twenty years, the Australian government has successfully funded students by giving out what are in effect interest-free loans. They are “contingent loans,” which are repaid only if and when the borrower’s income reaches a certain level. New Zealand also offers 0 percent interest loans to New Zealand students, with repayment to be made from their incomes after they graduate.

Brown’s website is also up now for book orders for her new book, which premiered at the Conference, The Public Bank Solution.

Although participants left the Conference with a lot of inspiration and satisfaction, there was also wide recognition that more building remains to be done. “I believe we need to engage a larger diversity of people and especially younger people in discussions about how public banking would address the challenges in their own lives and their own communities,” Canova told me. “We also need to recognize that we are part of a much larger democracy movement that goes well beyond banking. The financial crisis and sick economy have revealed the rot in our politics, law, and institutions.  It has revealed that we have a broken democracy. The public banking movement must be at the vanguard of the movement to restore our democracy.”

Of course, there will be more PBI events in the future, and public banking is on the agenda at other conferences, such as GreenFest 2013, to be held Sept. 7-8 in Middlebury, Connecticut. Meanwhile, the real test will be whether interest in public banks continues to spread around the country, and whether activists can translate vision into genuine policy. New York Assemblywoman Sandy Galef recently proposed a state bank for New York, while other proposals continue to emerge, and strong voices continue to push for the idea to explode in the public fora.


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