Good News: We Can Create Public Banks To Fund The Green New Deal

It’s a shell game, and it’s still your money being used for their Modern Socialist ideas

Public banking can fund green investment

To ensure the long-term environmental health of the planet, we will have to spend. This spending cannot be wasteful, but must embody a pragmatic investment in our future. Estimates predict that we will have to invest $5.7 trillion worldwide annually to fund green infrastructure and conservation efforts. As a Center for Strategic and International Studies brief notes, this investment gap is concentrated in developed countries.

In recognition of America’s responsibility for swift and consequential action, legislators have introduced the Green New Deal—a policy proposal for addressing climate change and environmental deterioration. Yet, even the lower end of estimates put the plan’s sticker price in the multi-trillions of dollars.

Investments in infrastructure, or other massive policy initiatives of the kind that environmental crises require, have historically been shared between the federal government and the states. While the national body would provide some funding and expertise through grants and federal agencies, states would identify the most profitable investment opportunities and the areas of the most need. But, with a decade sincethe last major federal infrastructure bill, the federal government has become an unreliable source of green investment funding. And it’s no surprise why. The federal debt is above $22 trillion, the annual deficit projected near $1 trillion and politicians have prioritized other issues.

Also, if you’ll remember, most of the “green” money from the Stimulus was used to hook up Obama donors, and, what have we gotten from it? Almost nothing. A majority of those loans have resulted in nothing, as well as lots of defaults/un-repaid. Solyndra was the poster child of irresponsible loans.

This has put states in a compromising position. On the one hand, they need to invest in sustainability and conservation to protect their citizens, their environments and their economies from ecological disaster. On the other hand, they face their own pressing budget issues and an increasingly reluctant partner in the federal government. Through the establishment of state public banks, state governments can escape this dilemma and deliver affordable, green investment to their communities.

This is how it works: A state grants a charter to a bank of its own creation. The conditions of the charter give the bank a “public purpose” that ensures that the bank and its officials maximize community benefits and not profit. The state, once the bank has been established, moves most of its existing funds into the bank as deposits. These deposits allow the bank to create loans and other financial instruments with the goal of reinvesting state money back into the state economy.

There are two ways in which a state bank can fund state investment for a greener future. First, the bank can provide loans, bonds and other forms of financing for investments to the state government and private organizations on better terms than those available in regular markets.

As a part of the bank’s orders to serve the public interest, it can prioritize societally-beneficial investments over profit-making. As a result, it can afford to provide credit at lower interest rates or with lower fees, or both, than most profit-seeking banks can afford.

Where are they getting the backing money? Your pocket, of course. For social justice stuff. There’s no possible way this could be abused, right, especially with below market rates, right?

Second, a public bank will improve a state’s fiscal health. By holding state deposits as assets, the bank’s profits can be returned to state coffers to fund direct state investment. Additionally, the activity of the state bank – which will prioritize investing state assets and extending credit within the state for the benefit of the state – will improve the state economy. Exploratory analyses in New JerseyWashington and Maryland have all estimated the creation of thousands of new jobs and millions of dollars in economic growth from the establishment of a public bank. These economic gains will flow back to the state through increased revenues, which can then be reinvested into essential environmental projects.

And will mostly increase the size of government. The article mentions that the state of North Dakota has done this, but, then, ND isn’t big into the Social Justice Warrior scene, nor in pissing their citizen’s money on Hotcoldwetdry stuff. It’s a state that relies on its fossil fuels industry. How well will this work in places like NJ, Washington, and Maryland, among other left leaning states? What happens when the loans default? Will the state come after the money, or, will they just write it off as serving the public interest?

It comes down to the notion that private banks won’t piss away the money deposited for projects bound to fail, so, let’s create something run by government. And you know it would work quite differently than in North Dakota. And when that doesn’t work, will they come after the private banks, much like they did with private student loans? Remember, the use of, cost of, and default of those student loans has skyrocketed since Obamacare created a virtual takeover of the student loans business.

Further, if this is so darned important, why are True Believers funding this? Why do Warmists always want to use Someone Else’s money?

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4 Responses to “Good News: We Can Create Public Banks To Fund The Green New Deal”

  1. Elwood P. Dowd says:

    TEACH opposes states investing in their own infrastructure, preferring instead that that state monies go to wealthy private bankers. Got it.

    We were under the impression that Trump was huuuge supporter of revamping the nation’s infrastructure. Trump states he is “not a big believer in global warming”, calling it “a total hoax,” “bullshit” and “pseudoscience.” But in Ireland he is building a sea wall to protect one of his golf courses from “global warming and its effects.” If we aren’t going to do anything to stop or slow global warming we will need to plan mitigation, e.g., seawalls, moving cities, flood zones, etc.

    Anyway, as we found out during the Great Recession, when even private banks default we prop them up with trillions from taxpayers.

    • formwiz says:

      The Green Nude Eel will invest in infrastructure the way Zippy’s stimulus did. All we got out of that was those @$&^ roundabouts and a lot of graft.

      We were under the impression that Trump was huuuge supporter of revamping the nation’s infrastructure.

      I see a lot of road building and such where I am, so he must be. He just doesn’t want to throw money away like his predecessor.

      But in Ireland he is building a sea wall to protect one of his golf courses from “global warming and its effects.”

      No, he’s protecting his investment.

      If we aren’t going to do anything to stop or slow global warming we will need to plan mitigation, e.g., seawalls, moving cities, flood zones, etc.

      ICMYI we’ve been doing that for centuries.

      Anyway, as we found out during the Great Recession, when even private banks default we prop them up with trillions from taxpayers.

      Thanks to the Democrats who controlled the Senate at the time.

  2. Dana says:

    Private banks are expected to make a profit, or they eventually fail; can a Bank of Kentucky or Missouri fail?

    How do banks make money? They issue loans, charging interest on the money. But these oh-so-social justice warrior banks, will they feel political pressure to make loans to traditionally disadvantaged minorities at below market interest rates, thus compromising their ability to make a profit? When some of those loans go bad, will they undertake aggressive collection measures against minority borrowers . . . or any borrowers at all? Will the Bank of New Mexico take possession of foreclosed upon properties, or will they bow to political pressures to not kick poor people out of their homes?

    Senatrix Kamala Harris Emhoff (D-CA) has already proposed a $100 billion federal program to invest to “give Black families a real shot at homeownership”:

    The program would target residents in red-lined communities — areas the Home Owners’ Loan Corporation has dissuaded lenders from investing in — which her campaign identified as a culprit behind wealth disparities.

    “Redlining has resulted in households of color receiving just 2% of the [Federal Housing Administration] loans expanded between 1934-1962, and formerly redlined neighborhoods are sites of deep racial disparities in home value and lending activity,” an information sheet from her campaign read.

    Her plan would also seek to increase credit access by alter crediting reporting standards to include payments on credit cards, student loans, auto loans, and mortgage payments.

    Mrs Emhoff would have the feds push extending mortgage loans to people with a more marginal ability to repay them, something which helped precipitate the banking crash of 2007-8, and she’d do it on a racial basis. Would the Bank of South Carolina be required to invest in such things?

    The notion of state banks, formed for political reasons and pursuing political agendas, is one fraught with peril; political purposes are frequently at odds with sound banking principles.

    I’m reminded of the tactics that hospitals use, raising prices changed for services because Medicare and Medicaid underpay. Thus, private pay patients are charged more, to make up for the payment shortfalls from the government programs. If these proposed state banks charge accredited victim group members lower rates, the only way to make that up is to charge the better credit risk borrowers higher rates, in which case the better borrowers eschew the state banks and borrow from commercial banks only. This has the spectacular effect of more heavily weighting the state bank’s portfolios toward lower profit and higher risk loans, while concomitantly helping the commercial banks by lowering their overall risk.

    These state bank ideas are spectacularly bad . . . which is why they’ll probably happen.

  3. jl says:

    “…To fund the Green New Deal.” They start from the false premise that the GND needs to be funded. Sorta skipped a step there, guys…..

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