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PBI Newsletter, Issue: # 007
September 29th, 2011
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Welcome to the PBI Newsletter, September Edition

Dear Friends of PBI,

On Monday, California Governor Jerry Brown returned AB 750 to its sponsor, Representative Ben Hueso (D-79), with the following message:

To the Members of the California State Assembly:

I am returning Assembly Bill 750 without my signature.

This bill would mandate yet another “blue ribbon” task force: in this case to examine whether California should establish a state bank.

This is a matter well within the jurisdiction and competence of the Assembly and Senate Banking Committees.

Rather than creating a new entity, let’s use the  resources we have.

Edmund G. Brown Jr.

At least he didn’t say no to a state bank!  Part of the platform on which Brown ran was to curtail the formation of commissions and panels, among other measures pbi_video_-_control_of_money 2designed to tame the state’s budget crisis, so we should not be surprised by his veto. Study commissions are said to be where bills go to die.

In fact, we are taking Brown’s note as a call to action.  We are currently organizing an effort to produce a bill that would create, not just a study committee, but a state- owned bank, something the world’s eighth-largest economy needs and should have.

Look for more information as this effort evolves.

On a more philosophical level, in this month’s newsletter Ann Tulintseff examines an often confusing subject, “Wealth versus Money,” while Ira Dember contemplates the vision of public banking.

And thanks again for your support of our latest video (see "Taking Control of Our Money" link above). In the first seven days after publishing, we received over 3,000 hits on YouTube. Let’s keep this rolling!

Robert Bows
PBI Newsletter Editor
Public Banking Institute


Featured Article:  The Vision of Public Banking

Ira Dember, PBI Volunteer Writer

Imagine a world in which ordinary Americans get an even break—doing better than our parents did: —a fair shot at a decent job; a modest but secure retirement; a world in which our tax dollars bring us good education, public services, roads and bridges, buses and trains, a medical and social safety net; a better life and better future. An even break.
It's all possible. In fact, it used to be that way, but things got off track. Today’s problem lies in our banking system and how Wall Street bankers have abused it. In 2008 these abuses crashed our whole economy. We still haven't recovered, but the same Wall Street banks are bigger, richer and more powerful than ever.
States and cities continue depositing tax revenues—our money!—in these same Wall Street banks. More than a trillion dollars a year. 
One state does it differently. By law, the State of North Dakota deposits all its tax revenue in one bank—the Bank of North Dakota, owned by the State of North Dakota.
It’s one of America's best kept secrets in plain sight: any state or city, or labor union, or any other organization with a decent revenue stream, can start its own bank.  Bankers don't want you to know this. Some of their largest depositors—the states and thousands of cities—would take their deposits elsewhere instead of giving these big banks, mostly Wall Street banks, a free ride at taxpayers' expense.
But our vision isn't about what's wrong with the banks. It's about what's right with America: our states and cities have the power to give all of us an even break the way North Dakota does for its citizens. Maybe even better.
While America struggles, North Dakota has a budget surplus and full employment. There's no credit crunch in North Dakota: worthy borrowers can buy a home or finance their business. Relative to its population, North Dakota has more community banks than any other state, a sign of a very healthy banking ecosystem. And while some conservatives may view state-owned banking as socialistic, for North Dakota—one of America’s most conservative “red states”— owning its own bank for nearly a century is a matter of local sovereignty, not politics.
We envision an America in which states and many cities and counties own their own bank and deposit their tax revenues there. Profits from lending go back to public coffers instead of fattening Wall Street. These public banks loan money to build and repair public infrastructure such as roads, bridges, courthouses and community centers, cutting in half the cost of these projects (since the interest is returned to them)—a dramatically better deal for taxpayers.
Public banks can also participate with local community banks to give Main Street businesses the affordable credit they need to operate—especially in times like these when the big banks tighten credit, forcing businesses to lay off workers.
Public banking puts people to work on public infrastructure projects and on Main Street. It makes tax dollars work harder for us. And it keeps our money working locally where it belongs, instead of being diverted to Wall Street.
That’s our vision: more jobs and affordable credit for people in local communities across America. “Too big to fail” Wall Street banks are the problem. Public banks, owned by our states and cities, are the answer.


More about the Public Banking Institute

The Public Banking Institute (PBI) was formed in January 2011 as an educational non-profit organization.  Its mission is to further the understanding, explore the possibilities, and facilitate the implementation of public banking at all levels -- local, regional, state, and national.

PBI’s vision is to establish a distributed network of state and local publicly-owned banks that create affordable credit, while providing a sustainable alternative to the current high-risk centralized private banking system. This network will act in the public interest, using its counter-cyclical credit-generating capacity to stabilize potential credit crises, maintain the floor against threats of asset devaluations, build infrastructure, and fund expansion of critical industrial productive capacity.  Most important, public banking will create jobs, by partnering with local banks to fund local business, advancing credit for public infrastructure, and augmenting government revenues.

PBI’s mission includes analyzing U.S. and global financial events to facilitate public banking, sharing best practices and lessons learned from research and initiatives in the U.S. and globally, using PBI’s online resources, website, webinars, blog, and in-person conferences.  PBI’s activities include:

•Publication of research involving the U.S. private banking system, past and current;
•Evaluation of existing and historical public banking models, in the U.S. and abroad;
•Publication of research regarding the legal requirements, structure, and daily operations of existing and proposed public banking and financing systems;
•Publication of a semi-annual legislative guide and presentations to aide local public banking initiatives; and
•Organization of public forums that enable state and local public banking efforts.


For more information on how BND operates, and how it partners with community banks instead of competing with them:


  “Public Banking in America” Legislative Guide, Spring 2011, pp. 17-23. Ed Sather and bankers from several states explore the North Dakota model.

NOTE: Public Banking in America, Legislative Guide, Fall 2011 will be available October 10, 2011

• Bank of North Dakota,

• Public Banking Institute,

In this Issue


- Featured Article:  The Vision of Public Banking
- Public Banking in the News (sidebar)
- CANARD ALERT (sidebar)
Wealth vs. Money:  Why Main Street is Better Off Without Wall Street (sidebar)

Swami's Corner

swami2 4Corporate personhood?  I'm all for it.  Imagine corporations acting like nonsociopathic persons instead of predatory machines.  So, to qualify for corporate personhood, corporations must undergo a heart implant.  Implanted in each corporation must be an individual who speaks on behalf of all human beings – an ombuddhasman, we can call this person, who is asking, 'What would Buddha do?'

  -- Swami Beyondananda


Public Banking in the News


New York Times, "No Extra Credit," Joe Nocera, September 19, 2011

Mother Jones, "How Debt can Help Save America," Rick Ungar, September 9, 2011

Yes!, "North Dakota's Economic Miracle -- It's Not Oil," Ellen Brown, August 31, 2011

OpEd News, "Book Review -- No More National Debt, by Bill Still," Ken Welton, August 26, 2011

Asia Times Online,S&P and the Bilderbergers,” Ellen Brown, August 25, 2011

To trash the U.S. economy?,
” Ellen Brown, August 19, 2011

Huffington Post,California Legislature Passes Bill to Study State-owned Bank,” Ellen Brown, August 16, 2011

Berkeley Daily Planet, "Privatizing Unemployment:  Bank of America's Sacramento Coup," Gar Smith, August 16, 2011

Pravda, "The market has spoken: Austerity is bad for business," Ellen Brown, August 9, 2011

Huffington Post, "Forget Compromise: The Debt Ceiling is Unconstitutional," Ellen Brown, August 1, 2011

From the Archives:

Rolling Stone, "The Real Housewives of Wall Street," Matt Taibbi, April 12, 2011

From the Web:

Northern Trust Global Economic Research, “If Some Dare Call It Treason, Was Milton Friedman a Traitor?,” Paul L. Kasriel, September, 2011

Senator Sander’s website, “The Fed Audit,” Bernie Sanders, July 21, 2011

Money Changes website, “Infrastructure Banking -- Stimulus Loans that Pay for Themselves,” Jeffrey Orr, June 5, 2011

Global Finance, Total Debt to GDP (%),” Tina Aridas




The Federal Reserve System is a Governmental Body.

ca·nard. noun. A deliberately misleading fabrication.

According to one of their senior counsels (see link above to our latest video), all Federal Reserve banks are owned by the private member banks, which appoint their own boards. The only connection between the Federal Reserve System and the U.S. government is that the President appoints the Board of Governors. Given that the “too big to fail” banks are the biggest contributors to the Obama’s campaign, and given that Obama’s Chief of Staff (William Daley) is JP Morgan Chase and his Treasury Secretary (Timothy Geithner) is Goldman Sachs, the question is really, “Is the United States government an agency of the banks?”


Wealth vs. Money:  Why Main Street is Better Off without Wall Street
Ann Tulintseff
PBI Board Member

The real measure of your wealth is what’s left after you’ve lost all your money.”

As we look at the devastation being wreaked across the United States as a result of the selfish recklessness of the titans of the financial services industry, it’s clear that Main Street doesn't need Wall Street. In fact, Main Street is better off without Wall Street.
It’s time to see the seduction of Wall Street’s promises for what they are—an illusion that confuses money with wealth. Money should not be confused with wealth, and the fundamental definitions of each will help understand this difference.

Wealth is a combination labor and/or natural resources.
Money, on the other hand, is simply a medium of exchange for goods and services—a means to facilitate transactions. Money has taken many forms, including shells, beaver pelts, coins, paper notes, and now accounting entries on a computer. In other words, money is an abstract social invention that can be viewed as a contract—a financial obligation. [1]

A community combines its labor and natural resources in order to meet the needs of its members. Money is simply the oil that helps the machine of society function.
Thus the fundamental difference between wealth and money is that money is itself only a claim to wealth, and not that wealth itself. [2]

What are the implications of this? Main Street produces wealth, Wall Street does not. In fact, Wall Street cons us into holding our money, and then siphons it off with interest, fees and market manipulations, resulting in an unnecessary transfer of wealth from people on Main Street to those on Wall Street.

As Glen Edens, a former Sun Microsystems executive, summarizes, "… How can we break the cycle of Wall Street, a strong financial services industry is simply not good for society.Wall Street does not improve productivity, the model is parasitic, transferring huge resources out of the system." [3]

Finally, as a means of facilitating transactions, money should be seen as a public, or community, creation and/or utility. A "free market" becomes a manipulated market when the ability to create money is held by private interests. It’s time that we, the public, reclaimed our sovereign right to issue money “and regulate the value thereof,” as our Constitution declares, by establishing publicly owned banks.

[1] Jere Hough at
[2] "Fixing the System: A history of populism, ancient and modern," by Adrian Kuzminski.




PBI and Move Your Money - Return to Prosperity


For people who are starting from scratch and wish to learn enough about public banking to make a difference in their communities, provides both a handbook and a presentation that can be used to help spread the word.



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The mission of the Public Banking Institute (PBI) is to leverage the historic role of publicly-owned banks nationally and internationally in fostering access to affordable and readily available credit, particularly as used for increasing productive capacity.


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PBI may also be reached at:


Public Banking Institute

PO Box 2195

Sonoma, California  95476


March, 2011 Newsletter
April, 2011 Newsletter
May "Read the Bills (1 of 2)"
May "Read the Bills (2 of 2)"
May "The Fed Speaks" Special Edition Newsletter
June, 2011 Newsletter
July, 2011 Newsletter
August, 2011 Newsletter

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