U.S. CONFUSION: Part 3 — Public Banking (why I’m opting out of the conversation)

It looks like my blogposts on confusion could be a long series, perhaps indefinitely long. From a personal point of view, the good news is that the longer the confusion list grows, the more streamlined my activism list grows. I’ve long since removed the Equal Rights Amendment from my list, replacing it with Women’s Public Authority. (The ERA was never really on my list; I always knew that it was a tepid goal for feminism. Now I know it was not only counter-productive; it was a red herring.)

My first blog on confusion, written right after Charlottesville, Monetary science and healing for white supremacists, Jews, and other confused Americans, gifted me with the experience of streamlining: it eliminated right-left, progressive-conservative polarization from my thinking almost entirely. My second blog on confusion, written two months ago, IS CONFUSION THE DEFAULT SETTING of the 21st century American mind?, took a whole lot of issues off my personal activism list, another downsizing that I welcomed as a 70-year old.

With this blog I’ll be removing “public banking” from my list, not because I don’t believe in some versions and structures of public banks (e.g., postal banks, public banks as local currencies). Nor do I think everyone should stop researching or advocating for public banks; the self-education has been incredibly productive and will continue to be productive as it reaches more U.S. voters. I must admit, however, that deep down I feel as if the value of all this self-education is more a function of our extreme ignorance (and confusion) than it is in the value of public banking as an ultimate answer to multiple problems. For now, let the learning continue — but without my active engagement.

Here is the straw that broke my metaphorical back and made me decide to end my dalliance with and active support of public banking. As is my habit, when a particular issue jumps into my inbox from vastly different sources, all with meaningful perspectives, all at the same time, I commonly reflect on the synchronicity. If the correlation seems meaningful and I can add a little value to the convo, I gather them all in an email and share with my colleagues.

So it was the other day that I sent to the National Public Banking Alliance listserv with four hyper-current items from vastly different sources and arenas. Collectively these four items can be labeled Public Banking Confusion Exhibit A. Here is what I sent on Oct. 18, 2021, followed by my reasons for opting out of this linguistic and conceptual weedpatch.

PUBLIC BANKING CONFUSION: Exhibit A

EVENTS
1.  “Public Banking Around the World: Lessons for New York”
New Economy Project virtual event 
Oct. 20, 2021, 11:00 AM ET
Details & registration

Confirmed panelists: 
Mauro Folegotto, Banco Ciudad de Buenos Aires
Dr. Thomas Marois, University College of London
Melissa Marquez, Genesee Co-op Federal Credit Union in Rochester, NY.  

2. American Monetary Institute 17th annual conference 
Nov. 5 – 7, 2021, virtual event
Details & registration

At least one session is about public banking:
“The Political Economy of German Savings Banks”
Mark Cassell, prof. political science 
Kent State University

B. CAUTIONS re “public” banks — not as “public” as we think
1. “[Public] development banks have no business financing agribusiness”
Statement by GRAIN re annual gathering of public development banks (PDBs)
Gathering is titled “Finance in Common” 

“Finance in Common” or “Finance for Co-optation” ?
“On the eve of an annual gathering of public development banks (PDBs) in Rome (Oct. 19-20, 2021), 280 groups from 70 countries have signed a letter slamming them for bankrolling the expansion of industrial agriculture, environmental destruction and corporate control of the food system. The signatories affirm only fully public and accountable funding mechanisms based on people’s actual needs can achieve real solutions to the global food crisis.” 

GRAIN is a small international non-profit organisation that works to support small farmers and social movements in their struggles for community-controlled and biodiversity-based food systems. Based in Spain, working mostly in Africa, Asia, Latin America.

I first learned about this problem (PDBs funding agribusiness) through Food Policy Networks listserv (Johns Hopkins U.), the N. American listserv that supports food policy councils (FPCs).

2. Cautions from Luciano Difeo Etcheverry (Argentina)

I just met Luciano last week, during our first AFJM social media (Twitter) committee, which he attended as an informal participant. Although I try to confine my own policy work to the U.S., I am always mindful of how we in the U.S. have an extra imperative to learn more about the historical consequences of U.S. policy and actions on the world stage. 

I don’t think Luciano will mind if I share a couple short quotes from our committee email exchange. They certainly woke me up to some more complicated issues around the terms we use for banking and other monetary policy: public, private, commercial, etc.

Oct. 17, 2021 email #2:
In Argentina the biggest bank is public, and creates what we all use as money as well. Debt Money from the Public Banks.

Commercial banks (private and public) are almost all the creditors because they create almost all money as debt.

Oct. 17, 2021 email #1:
If during the French Revolution, “Liberty, Equality, Fraternity” was an important proclamation, I think we can do it similarly.

1- Liberty: for the Central Bank  #FREEtheCentralBank  #FREEtheFED ..,… (free from Commercial banks)NOTE: do not discriminate between private or public banks (both create money from nothing as debt. It is true that public ones lend to lower rate and direct the credit to the production). We can discriminate later. First all for the Central Bank ( people need simple things, and for freedom can move mountains.

PUBLIC BANKING: A Personal Lost Cause

It was after I sent these four items to the National Public Banking Alliance listserv (which promoted one of the items) that I realized public banking belonged on my personal list of lost causes. By way of introducing these items, my email had half-jokingly suggested: “Based on the four items in this email, it looks like the money & banking reform movement may eventually require some new terminology, a whole new Wikipedia article on public banking, or a kindergarten curriculum on money, banks, etc.” On 2-seconds’ reflection, I now think that those are all worthy projects.

The main reason why I’m going to get out of these particular weeds is threefold:

1. “Public” has clearly been co-opted by private, commercial entities, such as using Public Development Banks to support agribusiness and public banks like the Bank of North Dakota to finance the fossil fuel industry.

2. I believe that “public” and “private” as general words have different connotations in the U.S. and the UK Commonwealth countries. Even though I try to confine my work to the U.S., in the world of monetary policy, it’s no longer possible to do that in a global economy.

3. In the U.S., public banking (which is still quite new to voters, legislators, etc.) is often confused with community banking, which could be private — i.e., commercial, for-profit — or public (such as postal banks). 
Again, I still support much of the good work that is being done on public banking. I just know that I’m not going to follow along as closely as I did.

MY LIFE in the public banking movement, 2011-21

By way of ending this blog, I do want to acknowledge that my discovery of public banking in 2011 or so saved my sanity at having been cheated by numerous food “justice” folks during the “great” recession (2007-10). To put it another way, like all good weedpatches, there are some edible ones, but 21st century weeds primarily serve to revitalize our entire ecosystem (including feeding non-humans). Public banking as promoted in the U.S. has certainly helped to do that.

Occasionally I wondered what I had done wrong to deserve such behavior. But I had just retired from a 25-year gardening career in which I’d had zero financial problems with clients, colleagues, vendors, etc. My financial relationships had been impeccable. Later I came to understand that people who made a living through “intellectual” means — academics, media, policy folks, non-profits, writers, etc. — were subject to different forces (i.e., additional fears) than those of us who provided goods and services — e.g., gardening.

But what ultimately led me to public banking and larger monetary issues was the number of times I was cheated combined with the variety of ways in which I was cheated (out of a total of $30,000 – $50,000, conservatively). Clearly, something deeper, more historic, more psychological was going on, having to do with people’s fears & stresses about money, even by people who had a good academic salary (i.e., $80,000) or who had a good non-profit salary of $100,000 or $200,000 (“bare bones” according to one CDFI founder who wanted to tap into the food & farm movement). Stumbling across the U.S. public banking movement, as initiated by Ellen Brown and the Public Banking Institute, opened a door to all kinds of productive self-education and grassroots organizing that I now lump together as monetary reforms.

I still don’t have a handle on that deeper, more historic thing that is working through our U.S. and global psyche (apart from confusion), but I’m grateful that public banking led me to see how our operating system — money + banking + power — could be unpacked. I’m still unpacking.