By M. Benevento
Early in the 20th century, a grassroots group in North Dakota campaigned to establish state-owned banks, mills and elevators, as well as farm insurance. Under state control, the organizers argued, these things would be in place to support hard-working North Dakota farmers rather than profiting nefarious out-of-state interests, such as rapacious lenders and grain price under-cutters.
The outcome of the group’s progressive work was and is the Bank of North Dakota – an instrumental force in North Dakota’s economy and still running strong.
The Gilded Age when North Dakota’s bank was established was a time of extreme income inequality and predatory practices on the part of financial institutions – circumstances that similarly drive interest in the possibilities of public banking in many places around the country today. In fact, public bank initiatives are currently underway in more than 23 government entities, especially cities and states, across the U.S.
Here in New Mexico, the case to establish a state-owned public bank for our state is clearly explained and strongly promoted by the Alliance for Local Economic Prosperity (https://aflep.org). An affiliate of the Public Banking Institute, this visionary group sees a public bank as an answer to many of our state’s most important challenges, including:
- Creating a healthy, diversified economy
- Providing inclusive social and economic development
- Fostering educational opportunities
- Ensuring equitable access to public services and facilities
- and much more…
In simple terms, a public bank in NM would serve the public’s needs and would lessen the export of our citizens’ taxes into large deposits of New Mexico’s funds to the global banking establishment (those so-called banks too big to fail). That, in turn, would mean more money kept here, ready and available to develop our local potential. We’d benefit from this “banker’s bank” recycling of local dollars into community banks and credit unions – as well as community economic development investment and community wealth creation – instead of lining the pockets of investors elsewhere.
Now ask yourself: Do you trust Wall Street to have the best interests of New Mexico at heart as we struggle to revive from the damage caused by COVID shutdowns? This past June, Retake Our Democracy published an excellent article explaining how public banking here in NM could actually be our best chance for economic recovery. Accompanying the article is an eye-opening video with activist Ellen Brown, one of the founders of the public banking movement in the U.S. and author of two noted books on the subject. Click here for access:
A public banking bill will be introduced to the NM legislature in 2021. It will require a strong, well-informed advocacy effort to take advantage of this opportunity, as Retake Democracy points out. Let’s prepare to work along with them, with the Alliance for Local Economic Prosperity, and with our NM senators and representatives to ensure the bill passes. Take a lesson from those farmers back in 1900’s North Dakota, and get it done!