The need for publicly owned banks

[eridani]

http://www.staythirstymedia.com/201510-090/html/201510-wolf-banks.html

Most of this public debt is owed either to individual banks or to banking syndicates. When a municipal bond offer is considered risky or too large, banks will group together in a syndicate to share the payout or the risk. Chicago's bonds, which Moody's has rated at junk, have now forced the city to borrow at close to eight percent interest. Richard Daley's successor, Rahm Emmanuel, proposed a recently approved plan to borrow another $1.1 billion.

When city services are continuously cut and, in Chicago's case, property taxes are not raised, how much longer can the shell game continue until a city, Chicago perhaps, resembles Detroit or Camden?

Consider what the difference would be for Chicago and other debt-ridden American cities if, instead of borrowing from the megabanks or investment firms, the same cities had their own publicly-owned banks. These banks would issue loans at moderate rates to the city which would use them for public works projects or social services or any other project that would expand the city's economy. The interest would be returned to the bank for future investment in civic works. Instead, the usurious interest rates charged by Wall Street banks and investment firms go into the same private hands that set off the Great Recession in 2008, and continue to strip cities of money and impoverishes millions, causing cutbacks in needed services including education and health care.

The malfeasance of the too-big-to-fail banks continues to generate public outrage, such as expressed by journalist and author Chris Hedges. In the online progressive journal, Common Dreams, Hedges wrote, "Speculators at megabanks or investment firms such as Goldman Sachs are not, in a strict sense, capitalists. They do not make money from the means of production."

This point was made years earlier by John Ransom Saul in his book, Voltaire's Bastards, published in 1992. In one chapter, "The Hijacking of Capitalism," Saul wrote that of the corporate leaders calling themselves capitalists, "very few of them are capitalists. Instead, there are bevies of corporate managers, financial managers, financial speculators, and service providers . . . they are horrified by the personal commitment and personal risk that is central to capitalism. They are, in effect, prophets and defenders of a system they reject."

[Hiraeth]

1. Love my Credit Union. K&R

[eridani]

2. State and municipal banks back up community banks and credit unions

They don't offer direct consumer services.

[Hiraeth]

3. Ikr.