Originally published at: https://boingboing.net/2018/09/09/yesonb.html
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That’s a great idea.
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Cory “…wrecked untold harm…” Pretty certain that you mean to say ‘wreaked’.
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I’m surprised that the big banks have not lobbied to make such a thing illegal, after all thats what we’ve allowed big tele-co’s & cable companies to do with internet access.
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The most obvious thing in the world is for the USPS to become a community bank, nationally. Would wipe out predatory lenders, predatory pay day lenders and check cashers, and revive the institution at the same time. Stamps, and mailing letters, is a loss leader to money orders, wiring money, loans and consumer banking
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I’m sure the big banks and their think tanks are drafting legislation as we speak, and you can bet the libertarians will be howling at the government Monday morning.
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I’d be weary of politicians being in control of the bank. That doesn’t always work well, especially when they put their short-term get-re-elected goals ahead of the financial health of the institution and the last long-term interest of the community.
Why not a credit union? E.g. https://www.lafcu.org
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Well the only public bank in the US has worked exceedingly well for 100 years, in North Dakota of all places. So yeah. We have one case in the US, and we’re batting a thousand.
Further, I didn’t read the specifics of the LA proposal but I’d imagine the board of the bank will be airgapped somewhat from political chicanery, and even still, what is an easier proposition- removing politicians from office, or removing the management of a major private bank?
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I suppose that I am thinking of this:
Over time, most cajas colluded with regional political establishments to create a self-serving system of unscrupulous financing for regional governments provided by politically stuffed savings banks’ boards which, in turn, thrived in what has been defined as “a culture of greed, cronyism and political meddling”. This system was exposed in the aftermath of the global financial crisis. As a result, out of the 45 cajas in existence at the start of the crisis in 2007, only two have survived in their initial form. The rest were absorbed by banks, dismantling in effect the cajas model in Spain.
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And for the record, this is fantastic- public banks can be a vanguard for socialism. But there’s even more to love than that, public banks can finance all kinds things that the private sector generally refuses, like actual affordable housing.
http://inthesetimes.com/article/20044/the-fight-for-public-banking
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heard about this on the great TRASHFUTURE podcast https://trashfuturepodcast.podbean.com/e/the-tears-of-lloyd-blankfein-feat-josh-androsky/
very exciting, I don’t know why all municipalities aren’t doing this as a matter of course
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From my brief reading it seems as though the cajas original purposes were abandoned in the 1930’s (not shocking, cuz Franco) and that from then on they operated more like private than public banks?
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They had an Obra Social (social works) that financed welfare and arts projects. I remember frequently visiting the exhibitions of one of the cajas near my high school. After Franco, party politicians and trade union leaders were appointed to their governing boards, with disastrous consequences. From the same article:
The reasons why the cajas imploded can be traced back to a 1985 act which altered the composition of the governing bodies by trusting the boards of directors to political parties and trade unions. Over time, the financial crisis unveiled what has been defined as “a culture of greed, cronyism and political meddling” within the cajas, including boards stuffed with political placements generally incapable of analysing the banks’ books, often limiting themselves to rubber-stamp decisions. Board members typically rewarded themselves with well-paid positions, luxury foreign trips and soft loans.
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I suspect that private banks arrived first in almost every given area, then did what they could to convince everyone that a public-owned bank was unnecessary or a bad idea.
A lot like how private nationwide ISPs spend billions on false advertising and lobbying against municipal ISPs.
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I remember something like this coming up before, and what I said then is still relevant. There are lots of examples throughout the world of non-corporate models for banking. And in a world where access to financial services is more or less essential, leaving this completely under corporate control makes no sense (unless you happen to be making money from the arrangement).
Also, with so many other things, a public bank to encourage the development of a community and a nation was such a good idea, that it was rolled out in post-war Germany, and never implemented in the US and UK.
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And that is why the Freedom Loving Billionaires will kill the idea deader than stir-fry
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Any more “weary” than you are of payday and title loan companies, rent-to-own scams, private health insurance, the bail bond system, for-profit prisons, fly-by-night charter schools, fraudulent student loans and for-profit colleges or any of the thousand other ways that private enterprise has screwed up and screwed the public over?
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Yup, postal banking would be a very helpful thing in America.
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I am for strong regulation of the financial sector and against usury. I prefer a cooperative approach, exemplified by credit unions in the US, over private or government-controlled banks.
Another case in point of politicians managing financial assets is the 1994 Orange County bankruptcy. You can read about it here:
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I am all for providing alternatives to the US banking industrial complex. However, I encourage the great people of LA to put in place a very solid regulatory structure to make certain that their elected representatives resist the temptation to screw around.
While tenously related, I am reminded of the bank that the US Congress gave themselves, up until they managed to abuse it out of existence in the 1990s. All they needed was a simple thing like overdraft protection in order to utterly destroy their own banking service: https://en.wikipedia.org/wiki/House_banking_scandal
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