Public Banking: A Marxist Response to the Financial Crisis and the “Financialization” of Capitalism?
Financial crises and “financialization” are nothing new for capitalism. Yet, the vast majority of self-proclaimed “Marxists” have only two responses: Revolution or reregulation i.e., a new 21st “Glass Steagall” that once again separates commercial and investment banks. Reregulating the banks, however, is the very (Einsteinian) definition of insanity i.e., doing the same thing over and over again and expecting a different outcome. The private banksters will always be at least two steps ahead of the regulators. Moreover, it doesn’t get to the fundamental question of who should control public monies and decide how they should be invested. There is a third alternative however: Public Banking. There is also an existing model: The Bank of North Dakota. Founded in 1919 after populist North Dakota farmers organized the Nonpartisan League and won both houses of the state legislature in the elections of 1918, The Bank of North Dakota is the only public state bank in the country. It collects state tax revenues and then invests them in public projects. There should be 50 state banks along with a public federal bank so that all public monies (taxes and public pension funds) are deposited in them and invested for public purposes. In New York, for example, the public pension funds of New York City municipal workers has over $160 billion in assets. Imagine what “we” could do with $160 billion invested in everything from affordable housing to rebuilding our crumbling infrastructure, to making all of our buildings energy efficient to reduce our use of fossil fuels and creating a 21st century clean-energy economy to supporting worker-owned cooperative businesses to give workers ownership over the means of production etc.
This session will explore the concept of public banking as an organizing and programmatic strategy for fighting the power of the private banksters and for raising the fundamental question of who should control public monies and decide how they are invested.
Dan Karan has worked for NYC housing and community development organizations for 25 years and studied Marxism for nearly 40.