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Las Cruces says it supports a public bank. But what does that mean?
By Michael McDevitt, Las Cruces SunNews – At its first meeting of the year, the Las Cruces City Council voted to support New Mexico exploring the feasibility of a state public bank. A public bank is owned by the government (in this case, New Mexico), funded by taxpayers and accountable to its owner government. State-owned public banks take deposits from state revenues like taxes, fees, fines and interest from investments and make loans to the owner government or governmental entities. Public banks follow the same state and federal guidelines as a private bank. The operations of the bank are run by professional bankers serving a public-driven interest. The revenue earned by the bank goes back to the state and can be reinvested in the state’s priorities such as infrastructure, education or local business.
Public banking sweeps across the country
Public banking sweeps across the country
In the years since the financial crisis, vibrant campaigns for public banks have emerged all across the country. The time for public banks in the U.S. has come.
California Breathes New Life Into Public Banking Movement
By Evan Weinberger, Bloomberg Law – A California law allowing municipalities to create public banks has given energy to lawmakers and activists around the country looking to set up their own local financial institutions in 2020. Much like North Dakota, New Mexico is a largely agrarian state with a population of around 2 million, and little access to big banks. So a public bank that looks like the Bank of North Dakota is the goal for supporters in New Mexico, said Angela Merkert, executive director of the Alliance for Local Prosperity.
Public banker says support is key for state-run bank
By Mike Catalini, AP – New Jersey Democratic Gov. Phil Murphy wants the state to become the second state with a public bank, and if it has a chance at succeeding, he’ll need to get residents’ support and ensure the bank is not competing with private banks, said the head of the country’s only public bank. Eric Hardmeyer, the president and CEO of the century-old Bank of North Dakota, said in an interview that he’s been watching the conversation about New Jersey starting a public bank for a while and offered some tips to Murphy and others who are planning to set up a public bank.
NJ considers setting up nation’s second public bank
By Mike Catalini, AP – New Jersey would become the second state with a publicly run bank — after North Dakota and its century-old institution. On November 13, alongside organized labor representatives and members of a liberal-leaning think tank called New Jersey Citizen Action, Gov. Murphy signed an executive order creating a 14 member board charged with setting the bank up. The idea is that state deposits currently sitting in large international banking institutions would instead go into the public bank, which could then provide what Murphy described as “below market rate capital” to “creditworthy and socially beneficial projects,” like infrastructure and small business lending, along with affordable housing and higher education loans.
Murphy Takes First Key Step Toward Establishing a Public Bank
By John Reitmeyer, NJ Spotlight – Gov. Phil Murphy signed an executive order November 13, that creates a 14-member “implementation board” to advance his goal of establishing a public bank in New Jersey. The basic premise of such an institution is to hold the millions of dollars in taxpayer deposits that are normally kept in commercial banks and leverage them instead to serve some sort of public purpose. The new board will be led by Marlene Caride, a former state lawmaker who now serves as Murphy’s commissioner of Banking and Insurance.
Goodman: Time For A State-Owned Bank In New Mexico?
By Peter Goodman, KRWG Public Media – Suppose, in 1919, New Mexico, a cattle-raising state being taken advantage of by large cattle-dealers and big eastern banks, had formed its own state bank? In agricultural North Dakota, a populist wave established the Bank of North Dakota (BND) to protect farmers from powerful out-of-state grain brokers, railroad tycoons, and private bankers. Through changing times, BND has fulfilled its mission to “promote agriculture, commerce, and industry,” by plowing state funds back into local economic development.
BND works with private institutions to help North Dakota’s students, entrepreneurs, and farmers and ranchers. In 1967 BND made the nation’s first federally-insured student loan. BND has been in the black every year since 1971. In 2017 BND’s income was close to $150 million. It’s loan portfolio was just under $5 billion. More than half of the profit goes back into North Dakota’s general fund, offsetting residents’ taxes. The rest goes toward more loans.
The Bank in the Background
By Evan Sparks, ABA Banking Journal – “We were getting to the point where we had people who were saying, ‘I just can’t work, I have no place to take my kids,’” says Obenauer, president and CEO of Union State Bank. Two years ago, Energy Capital Coop Child Care opened to meet that need. The story of how it came together is a classic small town and community banking story, but with a twist. The total cost of the project was $250,000—which may not sound like much, but it can be a big hurdle for a nonprofit coop in a town of 2,400. The Bank of North Dakota in Bismarck was what made the whole project come together. The result: child care for up to 60 kids, employing 19 people at the coop and facilitating 100 additional Mercer County jobs.
As another economic crisis looms, radicalism is the world’s only hope
Grace Blakeley, NewStatesmanAmerica – only way to respond to the radicalism of the right is with a radicalism of the left. The next recession should be met with calls for a Green New Deal – a huge package of state investment that would both absorb the impact of the slowdown today and improve the sustainability of the economy over the long-term. A public banking system must be established as part of this in order to direct capital away from speculation and towards productive, sustainable investment.
Revolution at the Federal Reserve: Nomi Prins and Thomas Hanna
Revolution at the Federal Reserve: Nomi Prins and Thomas Hanna
The Laura Flanders Show
January 22, 2019
As Jim Yong Kim resigns from the World Bank, we talk about the way central banks steer world development and for whom. Former Goldman Sachs managing director Nomi Prins, author of “Collusion: How Central Bankers Rigged the World,” and public ownership researcher Thomas Hanna believe that banking, and development, could be very different.
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Episode: Everyone deserves a public bank
“I had the good fortune to work on this initiative before Bernie kidnapped all my time. This is one of those no-brainer initiatives that only the 1% could oppose. It has the potential to save the state millions of dollars by vastly reducing the cost of its bonds to improve infrastructure funding. in a public bank, our state funds can be used to build our local economy and our local infrastructure.”
– Paul Gibson
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