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Public Banks and Our Covid Recovery

The sudden disabling of our economic engines by Covid illustrates how quickly our fiscal stability can be shaken to the core.  As the pressure of debt obligations on people, businesses and governments builds, many are moved to new edges of monetary survival. Our states and cities are especially challenged to meet their vast responsibilities while facing significant drops in revenue.
 
Meanwhile, the Federal Reserve and US Treasury are more focused on bailing-out private financial markets. States and cities must fend for themselves in capital markets to make up the shortfalls  by borrowing at market rates, even with penalty rates, while corporations, hedge funds and private banks can borrow at virtually zero interest from our central bank, the Fed. The Fed is using America’s money to serve private banking interests, not the public interest.
 
If New Jersey had held on to its money in a state bank instead of depositing it in Wall Street we could leverage that capital and extend credit to ourselves to protect, recover and nurture state citizens and businesses. Studies from around the world have shown consistently that public banks help stabilize local economies by keeping them away from risky and expensive private capital markets and by claiming the true potential of our state’s equity.  The Covid crisis has made that opportunity all the more urgent.

Groups Call for State Bank Study Update

With a sense of urgency precipitated by the Covid crisis, over 20 prominent New Jersey civic groups have asked (DOBI) Commissioner Marlene Caride to provide a progress report on the state Implementation Board. Reflecting the far-reaching economic impacts of the pandemic on public life and businesses, the groups say the need for a state bank to alleviate and assist state efforts has made the bank prospect more relevant than ever.  While much needs to be determined about the bank’s mission and structure, it’s clear that without the bank the state will have to rely on expensive borrowing from the private capital bond markets and from the Federal government, as recently approved by the legislature.  Governor Murphy has said the state is facing a financial catastrophe beyond the levels seen in the Depression, and in so doing has called on Washington to get much more focused on providing the sort of affordable and necessary lending or granting of funds to help get the state through this period.

NJ Public Bank Implementation Board Notes

Banking On New Jersey Director Joan Bartl is one of four governor-appointed public members of the New Jersey Public Bank Implementation Board and reports the following: Regular meetings are underway by Governor Murphy’s Executive Order-appointed Bank Implementation Board, which  consists of Administration, Department and Agency heads as well as representatives of key public groups.  The Board is studying a range of state financial needs that are not currently being met and investigating how having a state bank might better serve their missions. Meetings are chaired by Department Of Banking and Insurance (DOBI) Commissioner Marlene Caride and convened by the Governor’s Senior Policy Advisor Jeffrey Oakman. The Board is charged with coming up with a report and recommendations for the bank by the end of the year and has been listening to presentations from various experts on banking and public banking.  An earlier selection of consultants chosen for completing a comprehensive study about a New Jersey public bank had to be abandoned due to complications associated with the Covid crisis.  Nonetheless, studies are being actively pursued to formulate some viable approaches for the bank, which will be reviewed by the Board prior to drafting of legislation which is expected to result from the studies.  Developments will be shared as they materialize.

New Jersey Needs a Public Bank – Fast 

The NJ Work Environment Council’s Brandon Castro  penned the sentiments of the above mentioned civic groups in an op-ed calling for a state bank – fast!    
 
If the past three months have proven anything in New Jersey, it’s that we need money.

Not “we,” meaning our millionaires and billionaires and Wall-Street backed corporations. “We,” meaning workers. “We,” meaning communities of color. “We” means the poor, the working class and the near-mythical middle class.

“We” means the people hit hardest by the health and economic devastation brought by COVID-19.


“We” have big problems, and you can’t fix big problems without money.

We need the state to invest money into accomplishing good things for the public. To do that most effectively, we need a state-chartered public bank in New Jersey, and we need it fast because it can provide the resources we need quickly and efficiently, and it can stop Wall Street from getting its grubby little mitts on the profits.

Read More

California Prepares to Take Another Step

Following on its groundbreaking initiative last year that codified creation of municipal public banks in the state, the California Assembly is considering a dramatic step forward to redeploy and leverage its assets using existing agency resources.

Read More

“Killing the Host” Economist
Michael Hudson on It’s Our Money  

 

Killing the Host

Michael Hudson’s landmark 2015 book “Killing the Host” exposed how the empires of finance, insurance and real estate captured the global economy through neo-liberalism and sold us down the road to neo-feudalism. Michael returns to the show to describe why the current global economic demise is the fruit of consummate greed, crony politics and rapacious finance – and what we must do if we are to ever get off this road. On a very positive note that shows that The People aren’t taking all this lying down, Ellen talks with one of the team members behind California’s new infrastructure bank bill, AB 310, which may set a national example for accelerating implementation of new state public banks.

NEW PUBLIC BANKING SHORT VIDEO SERIES

NEW PUBLIC BANKING SHORT VIDEO SERIES

A new series of short videos designed for social media sharing highlights the many reasons why we need to create public banks for our communities.  Created by the Public Banking Institute, each is under 2 minutes long.    Please watch and share!

Watch the series

Banking on New Jersey
Directors Joan Bartl & Walt McRee 


www.BankingOnNewJersey.org
www.PublicBankingInstitute.org

info@BankingOnNewJersey.org
Copyright © 2020 Banking On New Jersey, All rights reserved.


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