AOC and Rashida Tlaib propose creating public banks

[GenesisNemesis]

Public banking offers a few very attractive and beneficial elements.

First, public banking means absolute insurance on deposits.

Second, it means the leverage of newer fiscal technologies. It means that the state can finally mandate updated payment systems.

Third, it means that banking deserts go away.

Fourth, it means that having a bank account is a right. The equal protection clause means that everyone is equally entitled to a bank account if the state offers bank accounts.

Fifth, it means that the public is finally capable of engineering loans and interest that actually make sense based on needs rather than "risk", the latter being a concept that is really justification for charging more of those with the ability to pay less.

Public banking is also not anything remotely like "government banks" as they exist today, so fuck off with that noise

#1 is a non-issue, few people have enough in a bank for the current insurance limits to matter.

The rest are going to cause the banks to need huge government subsidies. This is a hidden welfare program and as such I consider automatically bad. (I am not opposed to welfare per se, but I am categorically opposed to hidden welfare programs. One agency, decide how much money to give them and how to allocate it. That's it.)

Wait... is your argument, "fuck the poor inner city people"?

That's the standard conservative argument, right?

 

[Trausti]

Public banking offers a few very attractive and beneficial elements.

First, public banking means absolute insurance on deposits.

Second, it means the leverage of newer fiscal technologies. It means that the state can finally mandate updated payment systems.

Third, it means that banking deserts go away.

Fourth, it means that having a bank account is a right. The equal protection clause means that everyone is equally entitled to a bank account if the state offers bank accounts.

Fifth, it means that the public is finally capable of engineering loans and interest that actually make sense based on needs rather than "risk", the latter being a concept that is really justification for charging more of those with the ability to pay less.

Public banking is also not anything remotely like "government banks" as they exist today, so fuck off with that noise

#1 is a non-issue, few people have enough in a bank for the current insurance limits to matter.

The rest are going to cause the banks to need huge government subsidies. This is a hidden welfare program and as such I consider automatically bad. (I am not opposed to welfare per se, but I am categorically opposed to hidden welfare programs. One agency, decide how much money to give them and how to allocate it. That's it.)

Wait... is your argument, "fuck the poor inner city people"?

That would be the people who want to defund the police.

 

[Don2 (Don1 Revised)]

"A public bank is what it sounds like: a financial institution owned by the government, funded with taxpayer money, and directly accountable to elected officials and civil servants. For this reason, supporters believe they offer a transparent alternative to private banks like Bank of America..."

We already have a transparent alternative to private banks like Bank of America.

https://en.wikipedia.org/wiki/Credit_union

Up to this point I was 100% with you on this very reasonable question. Credit unions are very effective and are an alternative.

So what's the point of a financial institution owned by the government, funded with taxpayer money, and directly accountable to elected officials and civil servants, other than to finance economically inefficient wealth-destroying projects that are in the personal interests of lobbyists and officials instead of in the public interest?

That question is too political and dramatic. You have a point somewhere but it gets lost in extremism.

 

[Alcoholic Actuary]

"A public bank is what it sounds like: a financial institution owned by the government, funded with taxpayer money, and directly accountable to elected officials and civil servants. For this reason, supporters believe they offer a transparent alternative to private banks like Bank of America..."

We already have a transparent alternative to private banks like Bank of America.

https://en.wikipedia.org/wiki/Credit_union

So what's the point of a financial institution owned by the government, funded with taxpayer money, and directly accountable to elected officials and civil servants, other than to finance economically inefficient wealth-destroying projects that are in the personal interests of lobbyists and officials instead of in the public interest?

So they can fuck with the underwriting standards in the name of social justice, then use government money to bail out the problems that result.

Fucked up underwriting standards followed by government bailouts is practically a private sector bank copyright infringement.

aa

 

[Trausti]

So they can fuck with the underwriting standards in the name of social justice, then use government money to bail out the problems that result.

Fucked up underwriting standards followed by government bailouts is practically a private sector bank copyright infringement.

aa

CUOMO ANNOUNCES LENDERS AGREE TO MAKE NEARLY $1.4 BILLION IN MORTGAGE LOANS TO BOOST HOMEOWNERSHIP BY LOW- AND MODERATE-INCOME FAMILIES AND MINORITIES

 

[Jarhyn]

Personally, I think the bigger threat to public banking are the libertarian "starve the beast" fucks who would try to capture and run it into the ground.

 

[Bomb#20]

Cheaper check cashing and alternative to high interest payday lenders.

If this is just about making it easy for poor people to have bank accounts, it's a solved problem, all over the world. It was a solved problem even in the U.S., until the government shut it down way back in the Johnson administration.

https://en.wikipedia.org/wiki/Postal_savings_system

 

[ZiprHead]

Cheaper check cashing and alternative to high interest payday lenders.

If this is just about making it easy for poor people to have bank accounts, it's a solved problem, all over the world. It was a solved problem even in the U.S., until the government shut it down way back in the Johnson administration.

https://en.wikipedia.org/wiki/Postal_savings_system

When people speak of public banks, that is the system they are thinking of.

 

[Harry Bosch]

Personally, I think the bigger threat to public banking are the libertarian "starve the beast" fucks who would try to capture and run it into the ground.

Why would they want to run it into the ground? This isn't much of a money making opportunity.

 

[Loren Pechtel]

Public banking offers a few very attractive and beneficial elements.

First, public banking means absolute insurance on deposits.

Second, it means the leverage of newer fiscal technologies. It means that the state can finally mandate updated payment systems.

Third, it means that banking deserts go away.

Fourth, it means that having a bank account is a right. The equal protection clause means that everyone is equally entitled to a bank account if the state offers bank accounts.

Fifth, it means that the public is finally capable of engineering loans and interest that actually make sense based on needs rather than "risk", the latter being a concept that is really justification for charging more of those with the ability to pay less.

Public banking is also not anything remotely like "government banks" as they exist today, so fuck off with that noise

#1 is a non-issue, few people have enough in a bank for the current insurance limits to matter.

The rest are going to cause the banks to need huge government subsidies. This is a hidden welfare program and as such I consider automatically bad. (I am not opposed to welfare per se, but I am categorically opposed to hidden welfare programs. One agency, decide how much money to give them and how to allocate it. That's it.)

I'd say if banks will fail without subsidy because the public banking is that good that private banks lose customers, FUCK THEM. Let them crash, and burn, and die.

So they should be destroyed for not being able to compete when horribly handicapped?

The minute public banking is available, I will be heading that way. Anyone with half a mind would. And then "investment banking" (leveraging money using other people's money and paying them pennies on the dollar) goes the way it should have a while ago.

If you can do it without public funding, fine. Your proposal will require vast public funding, though.

(Note that if it could be done without a subsidy it would have happened already--someone would have already exploited the market.)

 

[Loren Pechtel]

Public banking offers a few very attractive and beneficial elements.

First, public banking means absolute insurance on deposits.

Second, it means the leverage of newer fiscal technologies. It means that the state can finally mandate updated payment systems.

Third, it means that banking deserts go away.

Fourth, it means that having a bank account is a right. The equal protection clause means that everyone is equally entitled to a bank account if the state offers bank accounts.

Fifth, it means that the public is finally capable of engineering loans and interest that actually make sense based on needs rather than "risk", the latter being a concept that is really justification for charging more of those with the ability to pay less.

Public banking is also not anything remotely like "government banks" as they exist today, so fuck off with that noise

#1 is a non-issue, few people have enough in a bank for the current insurance limits to matter.

The rest are going to cause the banks to need huge government subsidies. This is a hidden welfare program and as such I consider automatically bad. (I am not opposed to welfare per se, but I am categorically opposed to hidden welfare programs. One agency, decide how much money to give them and how to allocate it. That's it.)

Wait... is your argument, "fuck the poor inner city people"?

Why don't you try actually reading what I wrote? I am not opposed to welfare, I am opposed to Enron accounting. If it's welfare put it on the books as welfare. Make one program so you don't have a huge duplication of effort in deciding who qualifies.

 

[Loren Pechtel]

So they can fuck with the underwriting standards in the name of social justice, then use government money to bail out the problems that result.

Fucked up underwriting standards followed by government bailouts is practically a private sector bank copyright infringement.

aa

It was the government that fucked with the underwriting standards. The private sector noted that Washington would buy crap as if it was high quality, of course they sold a whole bunch of crap to Washington.

 

[Loren Pechtel]

Cheaper check cashing and alternative to high interest payday lenders.

If this is just about making it easy for poor people to have bank accounts, it's a solved problem, all over the world. It was a solved problem even in the U.S., until the government shut it down way back in the Johnson administration.

https://en.wikipedia.org/wiki/Postal_savings_system

When people speak of public banks, that is the system they are thinking of.

Look at the proposal in this thread--it's about an awful lot more than the postal savings system ever did.

 

[Bomb#20]

If this is just about making it easy for poor people to have bank accounts, it's a solved problem, all over the world. It was a solved problem even in the U.S., until the government shut it down way back in the Johnson administration.

https://en.wikipedia.org/wiki/Postal_savings_system

When people speak of public banks, that is the system they are thinking of.

Is it? Back when we had postal banking, it was self-sustaining. That does not appear to be the system lpetrich was thinking of.

"A public bank is what it sounds like: a financial institution owned by the government, funded with taxpayer money..."

 

[ZiprHead]

Is it? Back when we had postal banking, it was self-sustaining. That does not appear to be the system lpetrich was thinking of.

"A public bank is what it sounds like: a financial institution owned by the government, funded with taxpayer money..."

First of all, funded and self-sustaining are two differant things.

And the wiki link you provided provides the answer to your "Is it?" question.

Decades later, Vermont Sen. Bernie Sanders' 2016 presidential campaign platform included plans for postal banking.[22] In 2018, Massachusetts Sen. Elizabeth Warren and New York Sen. Kirsten Gillibrand supported such a program.[23] In April 2018, Gillibrand introduced S.2755 - Postal Banking Act[24] partly in response to the Trump administration's suspension of payday lending regulation imposed during the Obama administration. In 2020, after VP Joe Biden defeated Sen. Sanders in the 2020 Democratic presidential primaries, the Biden-Sanders "Unity Task Force” policy recommendations for a Biden administration, released in July, included postal banking.[25] In September 2020, Gillibrand and Sanders announced a newer Postal Banking Act.[26] It would help keep strengthen the Postal Service's financial situation and help unbanked and underbanked people with savings and checking accounts, debit cards and low-dollar loans they might otherwise be forced to get from payday lenders at high interest rates.

 

[Loren Pechtel]

Is it? Back when we had postal banking, it was self-sustaining. That does not appear to be the system lpetrich was thinking of.

"A public bank is what it sounds like: a financial institution owned by the government, funded with taxpayer money..."

Back when we had such a system banks were about saving. Now they do much more.

 

[Jarhyn]

Is it? Back when we had postal banking, it was self-sustaining. That does not appear to be the system lpetrich was thinking of.

"A public bank is what it sounds like: a financial institution owned by the government, funded with taxpayer money..."

Back when we had such a system banks were about saving. Now they do much more.

When they should be doing nothing but saving people's fucking money and offering loans when appropriate.

The fact that banks "do much more" is a bug, not a feature.

 

[Bomb#20]

When people speak of public banks, that is the system they are thinking of.

Is it? Back when we had postal banking, it was self-sustaining.

First of all, funded and self-sustaining are two differant things.

Yes, that's my point. Funded and self-sustaining are opposites.

And the wiki link you provided provides the answer to your "Is it?" question.

Decades later, Vermont Sen. Bernie Sanders' 2016 presidential campaign platform included plans for postal banking.[22] In 2018, Massachusetts Sen. Elizabeth Warren and New York Sen. Kirsten Gillibrand supported such a program.[23] ...

It only provides that answer if when you said "people" you meant "Sanders, Warren and Gillibrand". Bringing back postal banking is a no-brainer since it wasn't a burden on the taxpayers. But this is lpetrich's thread and it's about the Ocasio-Cortez/Tlaib proposal, not the Sanders/Warren/Gillibrand proposal.

"EXCLUSIVE: @RashidaTlaib and @AOC are proposing a new bill that would foster the creation of public banks across the country — with the aim of encouraging investments in public resources such as affordable housing and renewable energy projects. ...
...establishing an infrastructure for liquidity and credit facilities for them via the Federal Reserve, and setting up federal guidelines for them to be regulated. Essentially, it would make it easier for public banks to exist, and it would give some of them grant money to get started.
... public banks, which theoretically would be more motivated to do public good and invest in their communities than private institutions, which are out for profit. ...
... establishing the Public Bank Grant program administered by the Secretary of the Treasury and the Federal Reserve Board which would provide grants...
... fund public infrastructure projects...
...the passage of The Public Banking Act would provide a much-needed financial lifeline to states and municipalities...

She said that she also believes public banks could facilitate the use of public resources to construct “a myriad of public goods,” ... “Public banks empower states and municipalities to establish new channels of public investment to help solve systemic crises.”
... They could also facilitate easier access to funds for state and local governments from the federal government or Federal Reserve.
... or FedAccounts, where everyone gets an account with the Federal Reserve through which they could receive direct payments from the government, for example, during an economic crisis.

"California just legalized public banking, setting the stage for more affordable housing " - "Supporters say the change allows for funding infrastructure demands or providing loans to public agencies at low rates"

So lpetrich, Ocasio-Cortez and Tlaib are clearly not thinking of a self-sustaining system. What they're advocating will plainly be at ongoing taxpayer expense. That's also what Jarhyn is evidently thinking of:

... Fifth, it means that the public is finally capable of engineering loans and interest that actually make sense based on needs rather than "risk", the latter being a concept that is really justification for charging more of those with the ability to pay less. ...

But I take your point -- some people are thinking of more expensive systems than others. It's a mixed bag. Sanders' and Gillibrand's moderate proposals should satisfy Jimmy Higgins' concerns, for instance.

 

[Jarhyn]

First of all, funded and self-sustaining are two differant things.

Yes, that's my point. Funded and self-sustaining are opposites.

And the wiki link you provided provides the answer to your "Is it?" question.

Decades later, Vermont Sen. Bernie Sanders' 2016 presidential campaign platform included plans for postal banking.[22] In 2018, Massachusetts Sen. Elizabeth Warren and New York Sen. Kirsten Gillibrand supported such a program.[23] ...

It only provides that answer if when you said "people" you meant "Sanders, Warren and Gillibrand". Bringing back postal banking is a no-brainer since it wasn't a burden on the taxpayers. But this is lpetrich's thread and it's about the Ocasio-Cortez/Tlaib proposal, not the Sanders/Warren/Gillibrand proposal.

"EXCLUSIVE: @RashidaTlaib and @AOC are proposing a new bill that would foster the creation of public banks across the country — with the aim of encouraging investments in public resources such as affordable housing and renewable energy projects. ...
...establishing an infrastructure for liquidity and credit facilities for them via the Federal Reserve, and setting up federal guidelines for them to be regulated. Essentially, it would make it easier for public banks to exist, and it would give some of them grant money to get started.
... public banks, which theoretically would be more motivated to do public good and invest in their communities than private institutions, which are out for profit. ...
... establishing the Public Bank Grant program administered by the Secretary of the Treasury and the Federal Reserve Board which would provide grants...
... fund public infrastructure projects...
...the passage of The Public Banking Act would provide a much-needed financial lifeline to states and municipalities...

She said that she also believes public banks could facilitate the use of public resources to construct “a myriad of public goods,” ... “Public banks empower states and municipalities to establish new channels of public investment to help solve systemic crises.”
... They could also facilitate easier access to funds for state and local governments from the federal government or Federal Reserve.
... or FedAccounts, where everyone gets an account with the Federal Reserve through which they could receive direct payments from the government, for example, during an economic crisis.

"California just legalized public banking, setting the stage for more affordable housing " - "Supporters say the change allows for funding infrastructure demands or providing loans to public agencies at low rates"

So lpetrich, Ocasio-Cortez and Tlaib are clearly not thinking of a self-sustaining system. What they're advocating will plainly be at ongoing taxpayer expense. That's also what Jarhyn is evidently thinking of:

... Fifth, it means that the public is finally capable of engineering loans and interest that actually make sense based on needs rather than "risk", the latter being a concept that is really justification for charging more of those with the ability to pay less. ...

But I take your point -- some people are thinking of more expensive systems than others. It's a mixed bag. Sanders' and Gillibrand's moderate proposals should satisfy Jimmy Higgins' concerns, for instance.

You are making a grievous mistake: loans will still be profitable. They just won't be AS profitable. And they don't need to be anywhere near as profitable because "the owners" don't need to turn a profit: there is no parasitism off the top.

You assume right off the bat that offering loans to poor people will cause the bank to not generate enough revenue to pay the postal workers, despite that the post office itself without any interest bearing products already makes enough money to pay it's workers.

 

[Loren Pechtel]

Back when we had such a system banks were about saving. Now they do much more.

When they should be doing nothing but saving people's fucking money and offering loans when appropriate.

The fact that banks "do much more" is a bug, not a feature.

I was addressing what was proposed in this thread and that's a lot more than savings. A simple savings system probably wouldn't actually be economic (the postal service would end up eating some of the costs) but probably worthwhile.

You are making a grievous mistake: loans will still be profitable. They just won't be AS profitable. And they don't need to be anywhere near as profitable because "the owners" don't need to turn a profit: there is no parasitism off the top.

Once again, the usual infinite pool of profits that can be used to fund whatever you deem worthy. Note, also, that no profits means no growth--they can't keep up with the economy unless you continue to add money.

You assume right off the bat that offering loans to poor people will cause the bank to not generate enough revenue to pay the postal workers, despite that the post office itself without any interest bearing products already makes enough money to pay it's workers.

And here you go into loony land. In 2019 the postal service lost $18,747 per employee.