Private banking has failed. The separation between commercial banking and investment banking, which was established by the Glass Steagall Act, has been done away with. The commercial banks now can and do make risky loans and investments with our deposits — knowing they will be bailed out by the federal government.
The Federal Deposit Insurance Corp. (FDIC) was put in place to protect the deposits of us (the little guys, the 99 percent). While our tax dollars bail out the mega-banks through quantitative easing, the banks continue to pay their CEOs millions of dollars in bonuses. It is time we looked at public banking in the state of Washington, a bank that will serve the people.
Banks create money by creating credit. The people of Washington should reap these windfall profits, not private banks. A public bank could underwrite municipal bonds at a low rate of interest.
Together, we, the people of Washington, can create a public banking system that will invest directly in Washington’s infrastructure by, among other things, investing in small businesses and through low interest construction loans. The profits that are generated will return to the people of Washington.