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Vermonters Want to Try a New Way of Banking

Vermonters Want to Try a New Way of Banking

Vermont is currently considering massive changes in the way it conducts banking by instituting a public bank of its own.

The proposal would give Vermont Economic Development Authority a banking license and allocate it 10% of taxes collected by the state, rather than the current scenario where large banks outside of the state hold (and use) Vermontís money. With Vermont in control of its own finances, the state could use the money to fund projects that benefit the state and local economies, including granting loans to Vermonters.

More than 20 Vermont towns met this month to weigh the merits of public banking and the response was extremely favorable. By a margin of about 2:1, Vermonters advocated for public banking.

Unfortunately, as usual with politics, itís never that easy. Each townís votes only serve as an endorsement to their elected officials for what they would like to see happen. If state politicians were indeed committed to representing their constituents interests, then the legislation would pass with flying colors. Instead, private interest is lobbying hard to block the idea, so their corporate money and clout could prove more influential to legislators.

In fact, thatís why supporters of public banking turned to the town meetings in the first place. The idea was to show that when Wall Streetís money and connected politicians were removed from the debate, most Vermonters do want public banking. At least now, politicians with ties to the banking industry cannot pretend not to know the will of the people.

Preliminary calculations conducted by Vermonters for a New Economy indicate that public banking would be a boon for the state. The group estimates that the program would create more than 2,500 jobs and generate about $350 million annually. Considering that Vermont is a state with only 600,000 citizens, thatís a 1.26% boost in overall growth.

Vermont citizens also liked the idea of severing ties with Wall Street banks. For example, many Vermonters are disappointed to learn that their money is held by banks that are currently lobbying for the Keystone Pipeline, a project understandably opposed by residents in one of the nationís greenest states. Additionally, though the bank would turn big profits, that wouldnít be the sole motivation. For that reason, the state bank would not make risky, economy-crashing investments like the big-name corporate banks.

ďA public bank for Vermont would create jobs and allow Vermonters to take control over our financial destiny at a time when everyone agrees that Wall Streetís corporate commercial banking model is deeply flawed at best,Ē said Rob Williams, a Vermont resident who supports the proposal.

Those afraid of whether public banking will actually work need look no further than North Dakota. The Peace Garden State is a pioneer in public banking, first establishing the institution 99 years ago. The Bank of North Dakota exists to help the state fund large projects, as well as offer inexpensive loans to students, businesses and farmers. Between 2000-2009, the bank pushed $300 million in earnings back to the stateís treasury. The financial stability and cushion that public banking affords the state has been credited with making North Dakota one of the states to best weather the recession in the past five years.

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12:20AM PDT on Mar 16, 2014

Wonder if they'll be able to get away with it.....

10:23PM PDT on Mar 15, 2014

Each state should have its own bank, the USPS should do community banking, and there shoudl be more preferential laws and regulations for Credit Unions and or forms of cooperative credit.

8:07PM PDT on Mar 15, 2014

■  On Feb. 3, Ryan Henry Crane, 37, a JPM executive director who worked in New York, was found dead inside his Stamford, Conn., home. A cause of death in Crane’s case has yet to be determined as authorities await a toxicology report, a spokesperson for the Stamford Police Department said.

■  On Jan. 31, Mike Dueker, chief economist at Russell Investments and a former Federal Reserve bank economist, was found dead at the side of a road that leads to the Tacoma Narrows Bridge in Washington state, according to the Pierce County Sheriff’s Department. He was 50.

■ On Jan. 26, William Broeksmit, 58, a former senior risk manager at Deutsche Bank, was found hanged in a house in South Kensington, according to London police.

Hopefully it is a trend or a virus infecting banksters who screwed the global economy.

8:06PM PDT on Mar 15, 2014

Only slightly off topic

Just saw this article Trader kills self in finance world’s latest suicide

A Manhattan trader was killed Tuesday morning by a speeding Long Island Rail Road commuter train, marking at least the seventh suicide of a financial professional this year.

It seems that 6 more did as well

■  Autumn Radtke, the CEO of First Meta, a cyber-currency exchange firm, was found dead on Feb. 28 outside her Singapore apartment. The 28-year-old American, who worked for Apple and other Silicon Valley tech firms prior to founding First Meta, jumped from a 25-story building, authorities said.

■  On Feb. 18, a 33-year-old JPMorgan finance pro leaped to his death from the roof of the company’s 30-story Hong Kong office tower, authorities said. Li Junjie’s suicide marked the third mysterious death of a JPMorgan banker. So far, there is no known link between any of the deaths.

■  Gabriel Magee, 39, a vice president with JPMorgan’s corporate and investment bank technology arm in the UK, jumped to his death from the roof of the bank’s 33-story Canary Wharf tower in London on Jan. 28.

10:37AM PDT on Mar 15, 2014

I guess that Kathryn has not been paying attention to the wall street wolves, the dimonds of the world. State run banks will not, imi NOT, play with your investments. Your dollars will be as safe as they were in the 80's before Clinton caved into the thieves and connivers. Another perfect way to save your money, albeit with low interest but no anger, is through an old tried and true system, Postal Banks. There are Post Offices in every community. even the poorest are within walking distance in most cities. BTW, the PS is not "losing" money. It is being forced to pay 5.5 billion a year to prefund benefits for 75 years. The PS is the only organization/business that has such an onerous requirement placed on it. The sole purpose of this pre-funding is to bankrupt the PS and then sell it off piecemeal to the highest bidders. If not for the pre-funding requirement this year, the PS would have been 600+ million in the black. So K, governments can get it right at times, even when they are trying to do it wrong.

9:24AM PDT on Mar 14, 2014

Well, here's a real good idea. Let's trust the government with our money. They've been doing such a real good job with the taxes they've collected, and we all know its honesty is above reproach.

8:02PM PDT on Mar 13, 2014

cool

7:06PM PDT on Mar 13, 2014

Great idea!

6:11PM PDT on Mar 13, 2014

Great idea

5:00PM PDT on Mar 13, 2014

I still don't see why the USPS can't act as banking agent again. It was very successful until congress killed it.

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