Why Los Angeles should start a public bank

by Public Bank LA
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By: Harold Meyerson, Los Angeles Times. Harold Meyerson is executive editor of the American Prospect. He is a contributing writer to Opinion.

With all that’s at stake in the midterm elections, Los Angeles voters would be forgiven for overlooking Charter Amendment B, a referendum that would amend the city charter to conform with an ordinance the City Council enacted earlier this year.

But Charter Amendment B is no municipal snoozer. It proposes the most fundamental change to our economic system that Angelenos have ever had the opportunity to vote on. The amendment would allow for the creation of a Bank of Los Angeles: a public bank to be operated by and for the city.

Currently, when L.A. collects tax revenue, that revenue does not immediately flow back out to pay city employees. Instead, the revenue is deposited into one of several mega-banks, to be withdrawn when the city needs the funds. This spring, the city’s portfolio came to $9.5 billion. We’re not talking chicken feed.

L.A. has already withdrawn its funds from Wells Fargo, whose steady stream of abusive and fraudulent practices compelled the bank to pay billions in fines in recent years. But the alternatives — the other Wall Street behemoths that brought us the 2008 crash and saddled us with the Great Recession — also have a deference to shareholders and commitment to bonuses that exceed any interest they may have for the well-being of L.A.

Last year, a group of concerned Angelenos who’d formed an advocacy organization, Public Bank LA, began talking to the City Council about establishing a municipal bank. They pointed to North Dakota, which since 1919 has had a state-owned bank that is used to make loans to businesses and farms.

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Banking on the Public Option: Will LA Lead the Way for People-Owned Banks?

by Public Bank LA
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By: Glenn Daigon, Who.What.Why. Glenn Daigon talks to Trinity Tran and Ellen Brown on Los Angeles establishing a public bank - an issue its residents will vote on in the fall.

If Los Angeles were to establish a public bank — an issue its residents will vote on in the fall — one of two things could happen.

In the opinion of plan proponents, a public bank would free the city from predatory Wall Street institutions and save taxpayers a lot of money. That money could then be used to fund needed projects, such as affordable housing, infrastructure, renewable energy, and small-business expansion.

Opponents of the proposal, on the other hand, predict that such a bank would be a disaster. Untethered from market forces, the “public” bank might make loans to the politically connected without regard to profitable returns. Critics argue it would be so inefficient and poorly managed that city taxpayers would eventually be forced to bail it out.

Granted, even public approval does not mean LA will get a public bank. Other local, state, and federal hurdles need to be cleared before such a bank could be up and running.

Nevertheless, the vote on the measure could have implications far beyond the city or even California. If the proposal passes this November, it could jumpstart other efforts by cities and states around the nation that are currently considering setting up their own public banks.

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What If Banks Were Publicly Owned? In LA, This May Soon Be A Reality.

by Public Bank LA
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By: David Dayen, Huffington Post. Voters will decide in November whether to take city money out of the hands of big banks. David Dayen covers the Alexandria Ocasio-Cortez rally in Los Angeles. Featuring Trinity Tran, Dave Jette and Phoenix Goodman of Public Bank LA.

Trinity Tran is a powerful speaker. Addressing a rally in downtown Los Angeles for New York congressional nominee Alexandria Ocasio-Cortez, the 33-year-old activist and organizer thundered, “We are witnessing the emergence of a solution, from profit and greed to collective prosperity. We can empower our community from the ground up. It’s time to take our power back.”

Tran’s organization, Public Bank LA, is leading the revival of an idea that had largely been discarded until the financial crisis. In November, Los Angeles voters will have the opportunity to approve a public bank for the city. If the measure passes, it would become the first government-owned bank developed in the United States since 1919.

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