2017 Public Bank Bill Gets a Hearing in Olympia on Feb 7. Why public banks save money.

The bill to establish a public bank, Senate bill 5464, is scheduled for a public hearing in the Senate Committee on Financial Institutions on Tuesday, February 7 2017 at 8:00 am in Olympia. Here is a link to this bill:

If you cannot attend this hearing, here is a link to submit comments in favor of this bill:



The bill to establish a public bank, Senate bill 5464, is scheduled for a public hearing in the Senate Committee on Financial Institutions on Tuesday, February 7 2017 at 8:00 am in Olympia. Here is a link to this bill:

If you cannot attend this hearing, here is a link to submit comments in favor of this bill:


Email us if you need a ride to Olympia

David Spring M. Ed.
Washington Public Bank Coalition

What is a Public Bank?

A public bank is a bank that is established to operate for the public good rather than for private profit. There are many public banks in nations around the world. In particular, public banks were responsible for the restoration of economic prosperity in Germany after the devastation of World War Two.


All 50 states, except North Dakota deal with private wall street banking system that works like this:


How our current system works:

1) We pay our taxes / fees and they go to the state government.

2) The state government invests our money in private “Too big to fail” banks.

3) The banks speculates with our money in the stock market and in derivatives, financial gambling instruments, which were part of the cause of the 2008 crisis)

4) The banks profit from our money.

5) We get a modest return.

6) And equally important, because our government doesn’t take in enough revenue to pay for infrastructure (like roads and school construction) the city, county and state governments have to issue bonds and we end up paying huge amounts of interest and fees (debt service) to both the banks who write the bond deals and to bond holders.

Read more: What is a Public Bank?

Welcome to the Washington Public Bank Coalition

Welcome to the Washington Public Bank Coalition! Our goal is to provide you with information on the benefits of creating a public bank to finance public projects, such as public public schools, rather than financing public projects through private Wall Street mega banks. The safety of one million school children in our state depends on replacing one thousand crumbling school buildings. The best and least expensive way to build these urgently needed schools is by creating a public bank. Our hope that you will join with us to support the establishment of a public bank here in Washington state so that we can begin to build these urgently needed schools – financed entirely by repealing tax breaks for billionaires – and without placing additional financial burdens on local homeowners.

What is a Public Bank?
A public bank is a bank that is established to operate for the public good rather than for private profit. There are many public banks in nations around the world. In particular, public banks were responsible for the restoration of economic prosperity in Germany after the devastation of World War Two.

Due to the corrupting influence of greedy Wall Street banks, the only public bank in the United States is the Bank of North Dakota – which was established by conservative farmers in North Dakota to free their state from the economic control of powerful East Coast Bankers. Despite many attempts by Wall Street bankers to kill the Bank of North Dakota, it has thrives and allowed North Dakota to be free of the debt slavery imposed by Too Big to Fail banks. Each year, the Bank of North Dakota returns millions of dollars in profits to the people of North Dakota – in addition to providing low cost loans for the building of public schools and public roads in North Dakota.


Best of all, the Bank of North Dakota is the safest bank in America. It does not engage in risky “credit default” speculation and it has the highest ratio of assets to liabilities of any bank in America.


Why do we need a Public Bank in Washington State?
We have gone for more than 100 years in Washington state ever since we were granted Statehood in 1889 without a public bank. So why do we need a public bank now? The answer is that our state is facing economic problems which are greater than any time in our history. Over half of public schools are more than 50 years old. They do not meet earthquake codes or health codes. They are so unsafe that they place the lives of 500,000 students at risk should a major quake occur while the children are at school. It would take more than $30 billion to replace all of these crumbing schools. We also have a $20 billion road construction and repair backlog. Half of our bridges are also more than 50 years old and would collapse in the event of a major earthquake. We are already paying more than $2 billion per year just in interest payments to Wall Street banks from past loans. We as a State simply cannot afford to continue squandering billions of dollars every year to payments to greedy Wall Street bankers when a public bank would allow us to build public schools and roads with no interest charges. Below are just a few of many benefits of creating our own public bank.

First, we could build schools and roads for half the cost – or build twice as many schools and roads! The concentration of wealthy and power in the hands of Wall Street banks is greater now than at any time in our nation’s history. The difference in cost between what Wall Street banks are able to get from the federal government versus what they charge states is the highest in history. Wall street banks get money at near zero percent interest and charge our State, cities and School Districts 4 to 5 percent interest – even though no city or school district in our state has ever defaulted on a loan. The prices were are being charged in interest by Wall Street banks amounts to robbery. The only reason they get away with it is that the big banks are a monopoly.

A public bank would allow us to build public schools and public roads without being fleeced by the private Wall Street banking monopoly. Currently almost half the cost of all public schools and roads goes simply to pay off the bonds of the Wall Street banks. If we loaned the money to ourselves, we could eliminate these greedy bankers and return the money to the tax payers by lowering the cost of public projects. Alternately, we could build twice as many public projects with the same amount of money.


Second, we could lower local property taxes. Because our state is at the debt limit, the state school construction matching funds have fallen from 67% of the actual cost of building schools in the 1980s to less than 10% of the actual cost of building schools today. As a consequence of the state failure to help build schools, local homeowners have been forced to pick up the difference through skyrocketing local property taxes in order to pay off the Wall Street banks in a vicious cycle of debt induced slavery. If we had a public bank, there would be no need to increase local property taxes – in fact, we could cut local property taxes in half. Eventually, we would become like North Dakota which has virtually no debt and therefore has very low taxes.

Third, starting a public bank would allow us to create more than one hundred thousand new good paying jobs – building the schools our kids need and the roads that the rest of us need to get to and from work.


Fourth, we could reduce our dependence on greedy corrupt Wall Street banks.
The reason Wall Street banks were given billions of dollars in bailouts in the past few years is because we do not have a public banking system to fail back on when private for profit banks go broke. Starting a public banking system will allow our economy to grow even if the greedy Wall Street banks gamble away all of their profits and go broke. It is much safer to invest our tax dollars right here in Washington state helping build our local schools and roads than to hand our money over to Wall Street bankers who will gamble it away in a reckless drive to maximize profits.


Put Our Tax Dollars to Work for Us – Interest earned from investments made by a Public Bank would be returned to the State’s general fund and put to work right here in Washington. The North Dakota State Bank returned over $300 million dollars to the State in the last decade. With our larger population, a Washington State Bank could generate even more revenue, stabilize our economy, and avoid tax increases.


Do you know where your Washington State tax dollars go?
When you go to the drugstore to buy some aspirin for the headache you got watching too many false and misleading ads on TV, the store adds 9.5% of the price to your bill. That money is collected and used by the State of Washington to pay for schools and social services. But before the state uses the funds for their intended purpose, did you know that all of those billions of dollars go into an account at Bank of America? This basically billions of dollars of free money that Bank of America uses to increase their corporate profits. This is the same Bank of America that is now considered “Too Big to Fail” and that you and I paid billions of tax payer dollars to bail out when they recklessly gambled with depositors’ money and lost it on speculation in financial schemes such as collateralized debt obligations and mortgage-backed securities.


This is the same ruthless Bank of America that is now foreclosing on tens of thousands of Washington State residents, all the while skirting its obligation to re-negotiate underwater home loans in good faith and using “robosigners” to pretend to hold notes that were sliced diced and discarded years ago. A Washington State Public Bank would allow us to keep our state tax dollars out of the hands of these greedy, lawless Wall Street bankers.


The Cause of our Economic Crisis is the Private Mega Bank Monopoly
Clearly, our current financial systems, nationwide and in Washington State, aren’t working. The gap between the rich and poor is growing; worker lay-offs and state deficits are increasing, and many, many people need jobs. Our current banking system is directly connected to big banks. On August 31, 2010, Washington State had 67.8% of its current deposits of $5.4 billion dollars in nine private banks that are headquartered outside the Northwest. Most of our tax money is deposited in the Bank of America. These private banks are in business to make profits for their owners and their shareholders. These 9 banks directly benefit from holding Washington’s state revenue on their balance sheets. They are able to leverage that money (multiply it many times) to create new loans, including out of state loans and to invest that money on Wall Street.

Our State’s tax payers pay interest to Wall Street Bankers in at least three ways.

First, we pay about one billion dollars per year from the State General Fund to cover the interest on loans from State public projects. Second, we pay more than one billion dollars in interest on public projects funded through local governments like cities and counties. Third, we pay more than one billion dollars in interest and principle payments for local school district school construction bonds. The total bond payments, for all three bond sources for public projects by all tax payers in Washington State, exceed $3 billion per year. By contrast, thanks to having their own public bank, the State of North Dakota has no bond payments and has no budget shortfall.

Currently, taxpayers in our State pay about 5% interest on these $3 billion in bonds to Wall Street Bankers. This is an unreasonably high interest rate given that Wall Street banks are able to get the funds to finance the bonds from the Federal Reserve for near zero interest rates. If we financed our own public bonds, we could likely cut the interest rate in half, saving our State’s tax payers more than one billion dollars per year in interest payments on bonds – simply by eliminating the Wall Street middle men.

The Solution to our State’s Economic Problems is to Start Our Own Public Bank
Instead of banking on Wall Street, Washington State needs to bank on Main Street. The answer lies in Public Banking. Simply put, Public Banks put state tax revenue, investments and assets to work on Main Street, not on Wall Street.

Click on the other pages on our website to learn more about the drawbacks of continuing to borrow money from Wall Street banks and the benefits of creating our own public bank.


Then click on the Join Now button to join with us in creating a public bank here for Washington State! Together with the help of a public bank, we can restore economic prosperity here for everyone.


Why a public bank would save money

Passed by the Washington State Progressive Caucus:

WHEREAS, the taxpayers of Washington state have demanded greater accountability and wiser use of the taxes they pay to benefit Washingtonians, not Wall Street; and

WHEREAS, a state bank owned by and for the people of Washington State would meet those demands by using taxpayer dollars to invest in infrastructure, student loans, create jobs, increase access to capital for small businesses by supporting local community banks, absorb debt capacity, generate revenue, avert long term debt payments to Wall Street, and keep taxpayers dollars in Washington state; and

WHEREAS, Senate Bill 5464 – Creating the Washington Investment Trust (2017) would streamline and create efficiencies of the State’s numerous existing revolving loan programs and leverage their capacity to work for the people of Washington State while lowering overhead and exercising efficiencies of scale, paying it’s own operating costs, and returning profits back to the state; and

WHEREAS, recent Washington State legislative sessions have exposed a serious lack of resource and bonding capacity to deal with the state’s overwhelming capital needs; and

WHEREAS, a state bank can grow in capacity to be an unparalleled resource for future generations of Washingtonians; and

WHEREAS, a successful model of public banking is the Bank of North Dakota, which was first established in 1919 and is controlled by the people for the benefit of the people and economy of North Dakota; and

WHEREAS, public banking is a bedrock of social development in most high achieving global economies like Germany, Japan, Brazil, Russia, India and China; now, therefore, be it

RESOLVED, that the Washington State Progressive Caucus endorses creation of a publicly owned State Bank, which shall be governed by an independent public Commission that is accountable and transparent to the people; and, be it further

RESOLVED, that Washington State Progressive Caucus should work with others to convene a study group to examine the possibility of sponsoring an initiative of the people for the 2016 general election for the purpose of creating a publicly owned state bank; and, be it finally

RESOLVED, that a copy of this resolution be transmitted to the Governor, House and Senate leadership, and other civic minded stakeholders for further dissemination to, and education of, the general public.

Close loophole and college can be affordable

If you had a child at the University of Washington at the beginning of the Great Recession, you may have been set back by the tuition. In the 2008-09 academic year it was $7,254 (in today’s dollars), almost one-fifth of a full time job paid at the median wage.

You may have thought that was bad, but as revenue for the state has imploded and failed to recover since then, the state has disinvested from public higher education. How was the difference made up? Through increased tuition. That’s why tuition is now $12,393 this year — a $5,000 increase since 2008. It also takes a bigger bite out of a smaller pay check, as median wages have fallen during this time by almost $1 an hour.

So as a result, tuition for the University of Washington now takes up almost one-third of the typical wage earner’s annual salary. That student and her family are left on their own. Their income is too high to qualify for any significant tuition assistance, and besides, there is a waiting list to get the little assistance there is.

What can we do? State Sens. John Braun, R-Centralia, and Barbara Bailey, R-Oak Harbor, have an idea. They introduced a bill to cut tuition at our four-year colleges. Now, their bill has loopholes for mandatory fees like “student activity fees.” But it goes in the right direction! They propose tying tuition to a percentage of the state’s average wage. The average wage is now $52,635 a year. (That may not make sense to you, but remember, this is not the typical wage of a middle class worker — this average is thrown off by the million dollar pay packages of the top 1 percent.)

Under their proposal, University of Washington and WSU tuition could be no more than 14 percent of the average wage — that is, $7,369. For the regional universities, like Western Washington University, tuition could not exceed 10 percent of the average wage. So instead of being almost $9,000, tuition at Western would fall to $5,264.

Braun and Bailey’s bill could do better for students at Everett Community College and all the other community colleges in our state. They propose reducing current tuition and fees of $4,000 by just $59. These community college students make up about four-fifths of the students in our public higher education system. They are typically lower income part-time workers trying to go to college, earn a living, and keep their family together. They deserve a break, too.

But let’s take this bill and ask: What’s the total cost? About $226 million. Look around the bill, turn over its pages, look in the margins, and you won’t find any funding source. Without funding, these tuition cuts are completely hypothetical. But it doesn’t have to be this way.

What could the funding source be? Our tax code is full of holes for privileged corporations. One loophole enables companies to invest (or gamble) their money in financial stocks on Wall Street and not pay any taxes on the profits that they gain. That’s a perverse loophole to start with, because it encourages companies to NOT invest in plant and equipment in our state. Why? Because the revenue they get from sales of products in Washington will be taxed, while anything they make from the money they give Chase Bank or Bank of America or Citicorp to invest is tax-free. This one loophole costs our state about $342 million.

It’s that simple. Close this tax loophole — one that encourages companies to take our money and run — and the Legislature could responsibly and permanently reduce tuition at our public colleges and universities.

Over the past decades escalating tuition has erected a higher and then even higher barrier to education for low-income and middle class students. Tuition blocks the pathway to what is supposed to be public higher education. What is a higher priority for us here in Washington: higher education for our children or Wall Street profits? We all know what that answer should be and what it can be!

Originally published at EOI Online

Support Senate Bill 5553 to create a state bank and support vital infrastructure


Create the Washington State Investment Trust, Support Vital Infrastructure

Get SB 5553 a Public Hearing – Call the Committee Members
We need creative solutions to spur investment in Washington State to support infrastructure for schools, stimulate economic development, put more Washingtonians to work and make projects like Solutionary Rail closer to becoming a reality.

The American Society Of Civil Engineers rated 372 of Washington state’s bridges as structurally deficient in 2013. With little investment in vital infrastructure, it’s only gotten worse. If you think this is outrageous, then we need your help.

Senator Bob Hasegawa of the 11th Legislative district has sponsored Senate Bill 5553 to create a state bank that could leverage state accounts to generate funds for critical infrastructure projects.

SB 5553 has been referred to the Senate Financial Institutions & Insurance. We NEED YOUR HELP to give SB 5553 a public hearing and move it out of committee!

Please make a call to the committee members and ask them to give SB 5553 a public hearing (make sure to leave a message if you don’t get through)!

Benton, Don (R) : Chair ~ (360) 786-7632
Angel, Jan (R) : Vice Chair ~ (360) 786-7650
Mullet, Mark (D) : Ranking Minority Member ~ (360) 786-7608
Darneille, Jeannie (D) : (360) 786-7652
Fain, Joe (R) : (360) 786-7692
Hobbs, Steve (D) : (360) 786-7686
Litzow, Steve (R) : (360) 786-7641
Pedersen, Jamie (D) : (360) 786-7628
Roach, Pam (R) : (360) 786-7660

“The legislature finds that there are significant public infrastructure needs of the state that are unmet, and that the level of unmet need has been exacerbated by the economic downturn. The legislature further finds that there are opportunities to use the state’s depository assets to generate additional benefit for the people and the economy of the state. Therefore, the legislature intends to create the Washington investment trust as a legacy institution that amasses sufficient capital reserves to address opportunities now and in the future.”

Thank you for taking action.
– Forward Together!


David Stockman on the corruption of capitalism and the GOP

I’m reading David Stockman’s book The Great Deformation — the Corruption of Capitalism in America. Stockman was Reagan’s Director of the Office of Management and Budget. He criticizes the GOP for its militarism and its whoring for the rich. He says there was no need to bail out Wall Street. The speculators who would have lost out deserved to lose and the contagion wouldn’t have spread beyond the canyons of Wall Street. The Great Deformation

Progressives would agree with much of what Stockman has to say.

“[T]he Republican Party was hijacked by modern imperialists during the Reagan era. As a consequence, the conservative party cannot perform its natural function as watchdog of the public purse because it is constantly seeking legislative action to provision a vast war machine of invasion and occupation.” (p 688)

“The Republican Party has totally abdicated its job in our democracy, which is to act as the guardian of fiscal discipline and responsibility. They’re on an anti-tax jihad — one that benefits the prosperous classes.”  “How the GOP Became the Party of the Rich”. Rolling Stone.

But Stockman is a true conservative.  He doesn’t believe the government should be involved in bailing out business or stimulating the economy.  He opposes Keynesian macro-economic policies and thinks that government does more harm than good when it meddles.  He also opposes Social Security, Medicare, Medicaid, and the minimum wage.

“At the heart of the Great Deformation is a rogue central bank that has abandoned every vestige of sound money. In so doing, it has enabled politicians to enjoy ‘deficits without tears’ by monetizing massive amounts of public debt.”

Stockman calls the bailout, the stimulus, and the Fed’s printing of money “a de facto coup d’etat by Wall Street” whose purpose was to re-inflate the financial bubble.

“The Detroit-based auto industry was debt-enfeebled house of cards that had been a Wall Street playpen of deal making and LBOs for years, including my own. ”  He thinks the there needs to be a rollback of the “preposterous $100,000 per year cost of UAW jobs.”

Stockman spent twenty years after leaving the White House in the leveraged buyout business.  He was indicted for fraud when a business he invested in went bankrupt. After a two year battle, prosecutors decided to drop charges. Stockman says the business failure was due to stupidity (his) and market decline, not fraud.

In the last chapter, Stockman proposes the following radical policy changes which, he admits, have almost no chance of being enacted in the current political climate.  Some of the changes (such as overturning Citizens United, the establishment of federally funded elections, and a wealth tax on the rich) would be eagerly welcomed by progressives. Other changes (such as the elimination of Social Security, Medicare, and income taxes) would be strongly opposed by progressives.

  1. An end to the Feds expansionist monetary policy and a return to a gold-backed dollar.
  2. An end to deposit insurance and an end to Fed’s lending federally insured money to speculating banks.
  3. Adopt “Super Glass-Stegall II”, erecting a wall between investment banking government funds (“insured deposits or access to the Fed discount window”).
  4. An Omnibus Amendment that limits Congress members to a single term of six years in office and eliminates the Electoral College (“bringing the nation into the modern world of one person, one vote”).
  5. Require Congress to balance the budget, except in case of a declared war.
  6. End Keyesian macroeconomic expansionism and allow the free market to set wages and levels of production.
  7. Abolish social insurance bailouts, and economic subsidies.
  8. “Eliminate the Departments of Energy, Education, Commerce, Labor, Agriculture, HUD, Homeland Security, the SBA, DOT, and the Ex-Im Bank.” Also eliminate Fannie Mae, Freddie Mae, the FHA, the homeowner’s tax deduction, and subsidies for Amtrak.
  9. “Erect a study cash-based means-tested safety net and abolish the minimum wage.”
  10. Abolish all forms of health insurance, including Medicare, Medicaid and Obamacare, and replace them with “cash-based transfer payments.”  Also eliminate tax subsidies for employer-funded health insurance. All these forms of insurance, says Stockman, mostly serve to prop up the corrupt medical-industrial complex. “The cancerous growth of the medical care complex would be halted and reversed.”  He believes the free market will devise innovations to provide efficient care. “The one necessary concession to socialism would be a system of federally licensed catastrophic insurance funds would automatically cover the means-tested safety-net population.”
  11. “Replace the warfare state with genuine national defense.”
  12. Establish a 30% wealth tax on the rich in order to reclaim the trillions they extorted from the US Treasury and the middle class. “Needless to say, $14 trillion of national debt reduction could never be achieved under any known ordinary fiscal device; it would require a one-time wealth tax, essentially a recapture of part of the windfall wealth gain that has accrued to the top of the economic ladder during the age of bubble finance.”
  13. Repeal the Sixteenth Amendment (income taxes) and finance “the beast” via consumption taxes.

By the way, Stockman isn’t the only former Reagan economic adviser to argue against GOP tax policy. Former Labor Secretary Barry Bluestone thinks the GOP tickle-down economic policy is a failure. He says “The wealthiest people spend maybe 30% of their income. Poor people spend 100%, working people spend 98%, so as we move money away from working families towards very wealthy families, we take more and more consumption out of the economy, means slower and slower growth, means higher and higher an extended unemployment.”

Seattle Public Municipal Bank Forum, Dec 10


Seattle City Councilman Nick Licata,
State Senator Bob Hasegawa,
Gwen Hallsmith of the Public Banking Institute,
the Seattle Public Bank Coalition,
and experts in public banking for a

public forum on

A Municipal Bank for Seattle

Dec 10 at 7pm

University Methodist Church, 1415 NE 43rd St, Seattle

Seattle could have a public bank for public lending. Once the city capitalizes the bank, it can act like any bank by creating loans for local needs.

1. Public banks can lend for local needs at rates that the global Wall Street banks are unlikely to find attractive.

2. A public bank can reduce a city’s reliance on expensive private bond issuance, reducing the costs of capital projects by 30-40%.

3. A city government can finance its projects through its own bank. The city earns interest, making more projects possible or lowering the tax burden.

4. A public bank as it grows, can partner with community banks and credit unions to support small business with lending at reasonable rates.


Seattle Public Bank Coalition
Public Banking Institute
University Temple, United Methodist Church

Quote from Martin Luther King County Labor Council Executive Secretary/Treasurer David Freiboth:

We are all too aware of the misery wrought upon ordinary citizens by an under-regulated and out of control financial sector. After years of deregulation the banking system is no better than it was preceding the Great Recession. That reason alone is enough to bring some sanity to our financial sector through public banking.

Time for the Washington State Treasurer to Stop Gambling on Wall Street…and Start Supporting the Safety of Public Banking

According to the Washington State Treasurer, Jim McIntire, economic recovery is just around the corner. Herbert Hoover said exactly the same thing in 1932 – just months before nearly every private bank in America went broke due to their excessive gambling on Wall Street. As State Treasurer, Jim manages about $70 billion in pension funds from about 15 different accounts. Much of this $70 billion Jim gambles on Wall Street buying up everything from Mortgage Backed Securities to Monsanto to foreign corporations that make money off Chinese sweat shops. Below is a table with how Jim did from July 1 2012 to July 1 2013 (the latest available annual report).


Jim was elected State Treasurer in November 2008 and took office on January 1, 2009. Jim was re-elected in 2012. So far, the first five years have been a rough ride for Jim. In 2009, according to the Washington State Investment Board, Jim lost 22.8%. In 2010, Jim made 13.2%. In 2011, Jim made 21.1%. In 2012, Jim only made 1.4%. Then in the first half of 2013 (the latest information available), Jim made 13.7%. The average for Jim’s first five years has been about 5% per year. This is despite the Federal Reserve juicing the Wall Street punch bowl with trillions of dollars of “Quantitative Easing” courtesy of the US tax payers.

Jim also manages about 13.5 billion in non-pension funds. His return on investment for that 13.5 billion was less than one percent. This dismal performance was during the “good times” of a rapidly rising stock market. Sadly, back in January 2014, the Federal Reserve began to gradually remove the punch bowl from the drunk speculators on Wall Street. The punch bowl is scheduled to be removed completely later this summer. When this happens, things on Wall Street are likely to get pretty ugly. To understand just how ugly, take a long serious look at the following chart which compares the New York Stock Exchange Margin Debt to the S & P 500 for the past 20 years.


Note that the August 2000 Crash was preceded 5 months earlier by a spike and collapse of Margin Debt (debt used to buy stocks on margin or with only some money down). The October 2007 Crash was preceded 3 months earlier by a spike and crash of margin debt. In February, 2014, right after the Federal Reserve Punch Bowl started to be taken away, Margin Debt again peaked and has declined for the past 3 months. In short, margin debt has been one of the best predictors of a market crash a few months later. Below is another look at a similar chart going back to 1980.


Using Margin Credit as a signal, it looks like a stock market crash is imminent. If the State Treasurer continues to gamble like he did in 2009, he could lose 20% or more of our $70 billion in retirement funds. This would be a loss of $14 billion or more. Below is a summary of where Jim has our pension funds invested.


Note the billions of dollars Jim has invested in foreign governments and foreign corporations. Jim is not only outsourcing our jobs to sweat shops in China, he is also outsourcing our retirement funds to corporations in China! There are other much safer options. First, Jim could immediately move all State funds to inflation linked Treasury Bills. Second, and equally important Jim could drop his false claim that public banking is “dangerous” and join with the Washington Public Bank Coalition in building a public bank here in Washington State. After all, if Jim can invest in sweat shops in China, why can’t he invest that same money creating jobs here in Washington State?

The public Bank of North Dakota has done much better than Jim with their State investments and they did it without risking everything on a Wall Street throw of the dice. For example, in 2012, when Jim McIntire made only 1.4% on $60 billion, the public Bank of North Dakota BND) made 17.1%.

Currently, Washington State has a record $18.7 billion in debt. In the 5 years Jim has been in office, our legislature has been forced to pay an average of $800 million per year ($4 billion) in interest payments to Wall Street banks just because Jim refuses to support a public bank.

Washington State General Obligation Bonds Principal and Interest 2005 – 2013


This is $4 billion robbed from the General fund and given to Wall Street bankers. Had Jim agreed to support a public bank in 2009, we could have used this money instead to hire an additional 8,000 teachers per year. We also have about $20 billion in outstanding school construction bonds and another $20 billion in outstanding transportation bonds. If we financed our own bonds, like they do in North Dakota, we could have saved $12 billion just in interest payments in the past five years. This would give us billions of additional dollars to build roads, build schools and hire teachers. And we would not have to worry about losing our shirts in the next Wall Street Crash.

There will not be an Economic Recovery until we stop giving all of our money to Wall Street Big Banks and Billionaires
The Wall Street controlled media made a big deal out the fact that 200,000 jobs were created in May 2014 – returning the total number of jobs to what they were 6 years ago. As the following chart shows, during the 2008 Crash, we lost 8 million jobs.


So we are back nationally to 138 million jobs – which are the jobs we had when the Great Recession started. But how many people graduated from high school and college in the past 6 years? No mention was made about the fact that 8 million young adults graduated from high school and college in the past 6 years expanding the labor force by 8 million and thus there are 8 million more unemployed people than there were 6 years ago. No mention was made about the fact that the Labor Force participation rate is at an all time low with barely half the people in the US even having a job. No mention was made about the fact that the average hours worked has fallen to 34 hours per week and thus for every person with a full time 40 hour per week job someone is currently working only 28 hours per week for $8 bucks an hour – or less than $12,000 per year at a time when the average rent is approaching $1,000 per month. No mention of the fact that college student loan debt has now exceeded $1.2 trillion or that the unemployment rate among young adults is now over 50%.

Here is the Labor Force Participation rate based on the BLS Household Survey. Does this look like economic recovery to you?


What about the “recovery” of the housing market?

Home prices have stabilized. But 50% of all home purchases are now due to predatory Wall Street speculators like Blackrock coming in and paying cash for foreclosed homes. And who owns Blackrock? That would be the same big banks that caused the economic crash and them forced people out of their homes in the first place. Where did the big banks get all of the money to pay cash to buy up these homes? That would be from us, the US tax payers! Our tax dollars are being used to drive families out of their homes and prop up the big banks and Wall Street speculators. Did I mention that Jim McIntire has also invested in Blackrock? So both State and federal tax dollars are being used to prop up this ugly business.


Since 2007, more than 10 million people have been driven out of their homes after they lost their jobs and could no longer make their mortgage payments. Nearly all of these homes wound up in the shadow inventory of the big banks whose gambling had caused the crash. The banks then sold these homes in bulk at discounted prices to a group called Blackstone through a subsidiary called Invitation Homes. In a single day, Blackstone bought 1,400 homes in Atlanta. In total, Blackstone has spent $7.5 billion buying up homes all over the US. Below is a map of the foreclosed homes Blackstone now owns in Phoenix Arizona.


As for regular home buyers, mortgage origination loans are at a 14 year low. This is despite the fact that according to the US census, 15 million homes are not occupied. This at a time when millions of families and millions of children are sleeping in the back seat of the family car. The number of vacant homes in the US and in Washington State have skyrocketed by more than 40% since 2000.


Why are we at risk of a stock market crash?
There are two main “structural” problems with our economy. The first is an extreme concentration of wealth and power. Wealth is more concentrated than at any time since 1929.


The second problem which is related to the concentration of wealth problem is “money velocity.” Money velocity is a measure of how quickly one dollar moves through the economy. The problem is that billionaires sit on money rather than spending it. This leads to a lack of money circulation in the economy. Since money is the blood of our economy, when it does not circulate, then the economy has a heart attack which we call a stock market crash.


As you can see, there has been no recovery in the velocity of the money supply. In fact, it is now at a 50 year low. Instead of circulating in the economy, all of the trillions of dollars in QE simply went to the billionaires and big banks who used the money to create an artificial bubble in the stock market. It is simply a matter of time until the entire house of cards comes crashing down. There is no economic recovery. As long as we allow our country to be run by big banks and billionaires, there is only economic misery. The time is now for the Washington State Treasurer to stop gambling on Wall Street… and start supporting the safety of our own public bank. We could create tens of thousands of jobs simply by keeping our money working here in Washington State rather than lining the pockets of Wall Street Hedge Fund managers.

I am currently running for the Washington State legislature. I helped draft the bill to create a public bank in Washington State. If elected, I will introduce a bill to start a public bank in Washington State and prohibit the State Treasurer from recklessly gambling state funds on Wall Street.

David Spring M. Ed.

David Spring is a leader of the Washington Public Bank Coalition and a candidate for the Washington State House of Representatives for the 5th Legislative District in East King County. To learn more about his campaign, go to http://springforhouse.org/

To learn more about the Washington Public Bank Coalition, go to http://www.washingtonpublicbankcoalition.org/

To learn more about the national public bank and how you can start a public bank in your state, go to Public Bank Institute, http://publicbankinginstitute.org/

Originally published at PublicBankingInstitute.org

Testimony on establishing a state bank for the cannibas industry

I testified today in support of Bob Hasegawa‘s S.B. 5955 which would establish a State Bank to create a financing infrastructure for the cannabis industry. My testimony begins at time mark 29:15 in the linked video. The audience enjoyed my characterization of Wall Street banksters as the real criminals that we should be worried about.



Questions for Rep. Larsen about his votes on the Dodd Frank act

Rick Larsen asked those who could not make his call-in Town Hall to submit questions on his Facebook Page. So I did, and here it is. I’m sure he is drafting his response right now…. I will let everyone know when I hear from him. By the way I have not heard anyone say they thought Larsen gave any direct or satisfactory responses to the Call in Town Hall, only circular talking around the questions.

I missed your Town Hall, so I would appreciate it if you answered these questions. I have others but would rather you respond to them later when we meet in debate this coming election.
People need to hear elected official validate their economic suffering since 2008. They welcome the justified vilification of Wall Street bankers and financiers. And they are relieved to hear lawmakers promise to enact legislation meant to stop Wall Street from gambling with our money, losing and having American taxpayers bail them out. You did all these things in your kickoff speech for the last congressional campaign.

But it was a slap in the face to hear last month that you, Mr. Larsen, and 69 other Democrats joined with Republicans to strip the protections you had spoken of, from the Dodd Frank act. The Swaps Regulatory Improvement Act (H.R. 992) easily made its way through the House giving Wall Street the go ahead to roll the dice and placing the taxpayer back on the hook for future bailouts.
70 of the 85 lines of text in this resolution were written by lawyers from Citigroup, a bank we bailed out.

I have two questions Mr. Larsen:

  1. Why is a bailed out bank writing legislation guaranteeing they remain too big to fail?
  2. Why did you vote for it?

Mike Lapointe, District 2 Congressional Candidate