The Public Banking Institute


Richard Moore

Bcc: FYI

Public banking is one of the most promising movements going. I suggest you click on the URL, go to the original article, and consider subscribing to their email list.


Public Banking – To What End?

The Clarity of Purpose
A message from
our Chairman


The collapse of major financial institutions and the near bankruptcy of others has wiped out trillions of dollars in hard earned wealth belonging to American homeowners, workers, savers, and investors. A massive direct subsidy voted by Congress and trillions of dollars of taxpayer-backed liquidity and credit from the Federal Reserve rescued the balance sheets of the largest Wall Street banks and the personal fortunes of their managers. But the banks that were “too big to fail” did in fact fail; and across the nation, regional and smaller banks failed by the hundreds as well, costing taxpayers yet more billions as the FDIC rescued depositors.   


Along with these failures, the affordable credit that is essential for economic activity, business expansion and wealth creation for those seeking to move up the ladder in America dried up. The fantastic sums showered on Wall Street never made it to Our Street. Chronic and widespread unemployment grew, the tidal wave of home foreclosures rolled on, and small businesses by the thousands were wiped out, in a social catastrophe that continues to batter the lives of tens of millions of Americans.  Meanwhile, the private banks that failed America posted huge profits, managers’ salaries soared, and the fantastic bonuses continued to flow.


Publicly-owned banks (state and municipal) offer an urgently needed, prudent and fiscally responsible alternative to the reckless risk taking, gross mismanagement, and in some cases outright fraud that has been perpetrated by the Wall Street banking giants.  At the heart of public banking is a commitment to responsible stewardship of public finances. Public banks rescue public assets from risky speculative ventures.  These assets–tax revenue, investments, pension and rainy day funds, land and buildings–become the capital that a public bank uses to leverage credit and investment for public purposes. Public banks partner with smaller, local banks to provide affordable credit to individuals, families, businesses, and municipalities: college loans, home mortgages, job creating business loans, and economic development financing. Public banks are managed by experienced, salaried civil servants who receive no “performance based” incentives to take irresponsible risk. All profits of public banks are reinvested in the bank and the community to create more credit for growing economic activity, or are repaid to the general fund to offset rising taxes.


The large money center banks are considered too big to fail because they are the only game in town.  Public banking offers a viable, sustainable, equitable alternative, insuring prudent management of public finances and affordable credit for local economic development.


Ellen H Brown
Chairman and President
Public Banking Institute

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