The Public Bank Solution: : Transforming Our Broken System

Here is an article from the Public Banking Institute Newsletter. If you want to get them on a regular basis you can sign up on their web site www.publicbankinginstitute.org

The Public Bank Solution: : Transforming Our Broken System

As the US federal government sits largely silent on the eighth day of a shutdown and the nation moves ever closer to a debt ceiling default, it has never been more clear that the 'dialectic' that passes for debate today between two parties that operate within the box of a privatized money system, is not solving our most pressing, fundamental problems. The core problem we face is nothing less than money itself, and who gets to issue it. A completely privatized monetary system results in the empowerment of those who control the money. In the US this of course is Wall Street and its central bank, the Federal Reserve.

The most powerful alternative to our current, privatized monetary and banking system is public banking, which continues to explode into popular awareness. Ellen Brown's new book The Public Bank Solution is making waves, receiving critical acclaim and opening doors for new conversations and possibilities to emerge. As an example, Ellen was recently invited to lead an online discussion by the New York Times on their website, on public banks. The discussion just opened on October 1st and is raging away as you read this with a powerful impact so far, judging by the comments and conversation. Dive in!

In an excellent interview on the Max Keiser show last week, Public Banking Institute Executive Director Marc Armstrong makes a central point about money which could transform our whole economy: no one thinks twice about electricity being a fundamental human need that should be generated and regulated in the public interest, so why not money? Money is as vital a need in our complex society as electricity, and should be issued and regulated in the public interest as well. As Ellen said this week in the New York Times, "Banking, money, and credit are not market goods but are economic infrastructure, just as bridges and roads are physical infrastructure." Currently in our economy, money is issued and regulated in the corporate interest, which is a primary reason that corporations are doing well, sitting on trillions in cash, stock market near record highs, while the rest of the economy falters.

The consequences of a privatized corporate monetary system include a national debt. Our nation is subject to needless showdowns and ongoing panic over the national debt; however in a completely publicly-owned monetary system this drama and consternation would simply not exist, as there would be no national debt. There would simply a money supply, in amounts required to support full employment and sustainable prosperity. In contrast, in our privatized corporate monetary system, the Federal Reserve's quantitative easing can go on for years, increasing banks' balance sheets - without increasing the money available to main street. As a result, tens of millions of unemployed citizens today remain idle, while factories and crucial infrastructure priorities lie in wait - for money. That private banks do quite well under quantitative easing while people suffer is no accident, and until we as a people start to think outside the box that our politicians operate in, we will continue to languish.

Two years ago House Majority Leader John Boehner said of government workers during the Republican austerity budget cutting drive, "...if some of those jobs are lost so be it. We're broke." Actually, we are broke as long as we have a monetary and banking system that serves elites, not the people.

Meanwhile, House Minority Leader Nancy Pelosi recently said of Republican-led budget cutting efforts, "The cupboard is bare. There's no more cuts to make. It's really important that people understand that." Of course, there is another way beyond endless austerity battles, and it starts by fundamentally rethinking money and banking.

No one is suggesting that public banks would give politicians a blank check for endless spending on pet projects. We are suggesting that public banks can transform the process by which we set our collective priorities and create our future, making that process fundamentally accountable to we the people, not they the corporations. This is what this movement is ultimately about - empowering citizens to bring money and banking back under the people's control, one public bank at a time.

Our readers are very passionate, informed, and active. Thank you for all that you are doing to spread the word, shape the debate, and get public banks on the ground. Working together we can - and already are - creating the foundation for real and lasting change.

Christapher C. Cogswell
Board Member, Public Banking Institute