People’s World – For too long a handful of corporate banks have controlled the financial destiny of the overwhelming majority of Americans. Throughout American history, a commercial oligarchy was responsible for feeding corporate greed and when markets collapsed from too much debt and not enough resources to adequately fund it, countless millions of workers and their families paid the price for other people’s folly and suffered disastrous consequences.
In recent years there have been severe recessions, collapsing financial markets, and subsequent government bailouts of corporate banks, protecting the interests of stockholders at the expense of depositors and helpless debtors.
There are alternatives to corporate banking though there are very few available to consumers.
The traditional savings, or building and loans, prominently featured in the Christmas classic “It’s A Wonderful Life,” are being swallowed up and taken over by larger corporate banks as a direct result of banking deregulation in the 1980s.
Recently there have been proposals in various states to authorize the creation of state-owned banks. There is already one state-owned bank in North Dakota that has been in existence for nearly a century and has been very successful in providing loans and other means of financial support to small farmers and business owners, as well as consumers.
The Governor of New Jersey, Phil Murphy, has also proposed a state-owned bank and made it part of his campaign platform when he ran for governor in 2017. In 2018 a bill to establish such a bank was introduced in the state legislature, and in 2019 Murphy signed an executive order creating a commission, known as the Public Bank Implementation Board, to provide exact details on how the bank would be established.
That same year California Governor Gavin Newsom signed into law the Public Banking Act which empowers county and municipal governments to establish their own community owned banks, and last year the New York Public Banking Act was introduced in the New York State Assembly, and the State Senate. Unfortunately, the recent pandemic, and fierce opposition from corporate banking and business interests, have delayed and frustrated attempts to proceed with successfully establishing publicly owned banks.
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