LA Voters to Consider Creating Nation’s First Municipal Public Bank

by Public Bank LA
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By: Dharna Noor. Dharna interviews Phoenix Goodman of Public Bank LA. The Real News Network.

DHARNA NOOR: Welcome to The Real News Network, I’m Dharna Noor.

A charter amendment that will go before Los Angeles voters on November 6 could put LA on track to create the nation’s first municipal public bank. If created, the bank would put public dollars, that’s things like tax dollars and electric bills, into the hands of public officials. Proponents of the historic measure say that unlike for profit banks, which finance things like weapons manufacturers and fossil fuel extraction, the public bank would make loans to LA for things like public education and transit and invest in solutions to issues like homelessness and climate change.

Now joining me to talk about this ballot initiative is Phoenix Goodman. He’s a co-founder of Public Bank LA, an organization which evolved from Divest LA, you may know them for successfully lobbying LA City Hall last year to support divesting its accounts from Wells Fargo. He’s also a co-founder of California Public Banking Alliance, a coalition of municipal public bank organizations in California. Thanks so much for joining us today.

PHOENIX GOODMAN: My pleasure, thank you.

DHARNA NOOR: So, let’s start with the very basics. What exactly is a public bank? I mean, obviously it’s a bank which is publicly owned, in this case by the municipality of Los Angeles. But what does that concretely change about it, and why is it better than a privately owned bank like Wells Fargo, which you pushed LA to stop doing business with?

PHOENIX GOODMAN: Well, Wells Fargo and similar banks on Wall Street have one impetus, and that’s to maximize profits on a quarterly basis. And so, they’re not bound by any ethical guidelines in how those dollars are spent and what they do with their investments. What we want to create is something more than just a public sector bank, but really a people’s bank that takes us this immense power of banking, which is to create money and decide where the flow of funds goes into our economy and put that into publicly accountable hands to democratize the economy itself.

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BANKING ON THE FUTURE OF LOS ANGELES: WHY WE NEED CHARTER AMENDMENT B

by Public Bank LA
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By: Trinity Tran & Chris Roth. Occupy.com. The Los Angeles Times editorial board published a denouncement of Charter Amendment B on September 20, 2018. This is a summary of what they got wrong.

Leading the nation on progressive policies is what we do as Angelenos. From setting the boldest mass transit and electric vehicle targets in the nation to divesting the city’s funds from Wells Fargo, Los Angeles is not only the tip of the spear of the West Coast resistance to Donald Trump, but a place where some of the most enlightened measures are emerging to lead our country forward.

Why, then, should the city’s leadership to establish a public bank in Los Angeles be any different?

In his monthly column for the The Los Angeles Times, Harold Meyerson, editor-at-large of the American Prospect, penned an October 3 editorial in support of public banking (“Why Los Angeles should start a public bank”). But in a September 20 piece, the paper’s editorial board widely missed the mark (“Charter Amendment B is one of the most ill-conceived, half-baked ballot measures in years. Vote no”).

Which side should voters believe?

The editorial board came down solidly on behalf of Wall Street, offering a full-throated defense of the Big Bank status quo. But Angelenos are no longer interested in business-as-usual politics. They want to see progressive reforms in the people’s best interest — and creating a city bank run by the people of Los Angeles is the clearest example of that.

First, the problem: Los Angeles taxpayers currently pay Wall Street banks over $200 million in fees and over $1.1 billion in interest every year. The giant banks that extract wealth from Los Angeles — JPMorgan Chase, Wells Fargo, Bank of America, etc. — are the same ones regularly in the headlines (of the Los Angeles Times no less) reaching out-of-court settlements and paying billions in fines for perpetually defrauding the public.

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L.A. voters will decide whether to eliminate a barrier to a public bank

by Public Bank LA
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By: Emily Alpert Reyes and James Rufus Koren. Los Angeles Times.

Los Angeles voters will decide next month whether to nudge along the budding movement to create a public bank owned by the city.

The choice is a seemingly modest one: whether to alter the City Charter to allow L.A. to create a “purely commercial” enterprise.

City Council President Herb Wesson, who first floated the idea of a municipal bank more than a year ago, said the ballot measure is simply a way to gauge whether Angelenos want officials to explore a public bank before the city goes to the trouble of hammering out a detailed plan.

“If people say, ‘We don’t want you to do this,’ then we don’t move forward with it,” Wesson said.

But public banking advocates nonetheless see Charter Amendment B as a potential watershed moment — one that could help shape the debate about public banks for years to come.

If the ballot measure passes, advocates say it would bring fresh momentum to the public banking movement, as Los Angeles could be the first jurisdiction in the U.S. where voters have signed off on the idea.

There are only two public banks in the United States and its territories: the Bank of North Dakota, which was founded nearly a century ago, and the recently formed Territorial Bank of American Samoa, which was created after commercial banks decided to stop doing business in the seven-island territory.

Economic justice groups and other advocacy organizations have backed the idea of financial institutions owned by cities or states as an alternative that could save money on banking fees, avoid risky financial schemes and predatory lending, refinance public debt at lower rates and generate profit that could be invested to help the community.

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