A little-known fact, especially in the US: a quarter of all banks are state-owned public banks. Yet not all of them operate effectively, equitably, or in response to the needs of the people they ostensibly serve.
The potential of public banks to work for the benefit of cooperatives, small business, equitable economic development, and fair trade is not always realized, says Thomas Marois, Senior Lecturer in Development Studies at University of London, in this video.
We need to build and maintain a popular movement to keep the public in public banking and forestall problems with corruption and bad management. That way we can have a banking system that can support businesses and farmers during down times as well as good, lend for socially progressive and environmental purposes, and privilege the common good over simply focusing on profit.
Marois is right to point out that access to money and credit can’t be left to the private sector, and that civil society has to push for public banks that are small d-democratic and committed to working for the common good. That means that organizers have to overcome the public’s gut-level cynicism about the competence and honesty of government and possible reluctance to expend the time and energy to play even a small role in ensuring that public banks function properly. It’s therefore exciting to see how California activists have been bringing local campaigns and different groups on board to endorse state bill AB 857, which would allow cities and counties to set up their own public banks. We hope that broad support helps ensure favorable reports out from Assembly committees this week!