Monday, May 28, 2012
Philadelphia Crossroads With Ellen Brown
There is a lesson here that needs to be taken to heart. All lending is local. That means that maximum profitability has to take advantage of just that. The error inherent in large banks is that they simply are unable to lay of the money without accepting huge risks or giving up a big chunk of their margins. Also more is simply not better.
At the elevated levels a successful large loan creates demand for a repeat performance which necessarily cannot be achieved without lowering the quality. In time is a burgeoning market that rewards the creation of new product, we have a rush to the bottom.
Just one echelon lower it is easy to send the risk upstairs if they let you. That is no formula for survival.
This conference shows us that the base is taking charge of the National finances and will solve the problem. In time, perhaps as in
someone will call the cops and file charges of treason were they belong. Iceland
The Revolution Will Not Be Televised: Quiet Drama in
By Ellen Brown
"You will not be able to plug in, turn on and cop out.
You will not be able to skip out for beer during commercials,
Because the revolution will not be televised. . . .
The revolution will be live."
--From the 1970 hit song by Gil Scott-Heron
Last week, the city of
system announced that it expects to close 40 public schools next year, and 64
schools by 2017. The school district expects to lose 40% of its current
enrollment, and thousands of experienced, qualified teachers. Philadelphia
But corporate media in other cities made no mention of these massive school closings -- nor of those in
Chicago, Atlanta, or . Even in
the New York City
media, the voices of the parents, students and teachers who will suffer were
omitted from most accounts. Philadelphia
It's all about balancing the budgets of cities that have lost revenues from the economic downturn. Supposedly, there is simply no money for the luxury of providing an education for the people.
Where will those children find an education? Where will the teachers find work? Almost certainly in an explosion of private sector "charter schools," where the quality of education -- from the curriculum to books to the food served at lunch -- will be sacrificed to the lowest bidder, and teachers' salaries and benefits will be sacrificed to the profits of the new private owners, who will also eat up many millions of dollars of taxpayer subsidies.
Why does there always seem to be enough money for military expansion, prisons, bank bailouts and tax cuts for the wealthy, but not enough for education--or for jobs, housing, healthcare, or old age pensions? These are not "welfare" but are part of the social contract for which we pay taxes and make social security payments.
In an article reprinted on Truthout on May 10th titled " Why Isn't Closing 40 Philadelphia Public Schools National News?," Bruce Dixon posed this answer:
"The city has a lot of poor and black children. Our ruling classes don't want to invest in educating these young people, preferring instead to track into lifetimes of insecure, low-wage labor and/or prison. Our elites don't need a populace educated in critical thinking. So low-cost holding tanks that deliver standardized lessons and tests, via computer if possible, operated by profit-making 'educational entrepreneurs' are the way to go."
"Lifetimes of insecure, low-wage labor or prison"--this is very close to the "indentured servitude" that was abolished along with slavery by the 13th Amendment to the Constitution, ratified in 1865.The freed slaves are being recaptured by debt, beginning with the debt of school loans, followed by credit card debt, mortgage debt, and healthcare costs. As was cynically observed in a document called the Hazard Circular, allegedly circulated by British banking interests among their American banking counterparts in July 1862:
"[S]lavery is but the owning of labor and carries with it the care of the laborers, while the European plan, led by England, is that capital shall control labor by controlling wages. This can be done by controlling the money. The great debt that capitalists will see to it is made out of the war, must be used as a means to control the volume of money. . . . It will not do to allow the greenback, as it is called, to circulate as money any length of time, as we cannot control that. [Quoted in Charles Lindburgh, Banking and Currency and the Money Trust (Washington D.C.: National Capital Press, 1913), page 102.]"
The quotation may be apocryphal, but it graphically conveys the fate of our burgeoning indentured class. It also suggests the way out: we must recapture the control of our money and banking systems, including the issuance of debt-free money ("greenbacks") by the government.
Meanwhile, in Other Unreported News . . .
That alternative vision was put before a conference in
Philadelphia in late
April that drew delegates from all over the . The theme of the
first Public Banking in America conference, held at the Quaker Friends Center
on April 28-29th, was that to fix the economy, we first need to take back the
"money power"--the power to create currency and credit. United States
Led by keynote speakers Gar Alperovitz and Hazel Henderson and highlighted in an electric speech by twelve-year-old Victoria Grant, the conference was all about solutions. As summarized by OpEdNews editor Josh Mitteldorf:
“There were two visions expressed . . . . The first is the very practical idea that states and cities around
could be rescued from
insolvency if they had their own banks, instead of relying on commercial
banks to borrow money through bonds. Tax-exempt bond issues supply money to
states and municipal governments typically at 5 or 6% interest, while banks
these days are able to borrow from the Fed at 1/4% per year. America
"The second vision is . . . the radically-subversive idea that the system we have for introducing money into the economy is a boon for the banks, but perhaps a major drag on our economy. Perhaps a simple, direct system of money creation by the Treasury Dept instead of the Fed would put an end to cycles of recession, and create a foundation for long-term prosperity.
"Banking is a huge leech on our economy. 40% of every dollar we spend on goods and services -- 40% of all that we create and all we consume -- is siphoned off the top as bank interest in one form or another. ( Calculations of Margrit Kennedy ) The
is in the absurd position of paying interest to a private bank for every dollar
that is put into circulation. The Federal Reserve system has privatized the
power to create money, which, according to the Constitution, ought to belong to
Congress alone. Presently, interest on the national debt costs the Federal
government $500 billion in 2011, and (because of structural deficit spending)
it is the fastest-growing portion of the Federal budget. US
"Five hundred billion dollars could be saved annually just by refinancing the federal debt through our own central bank, interest-free. This is not an off-the-wall idea but has actually been done, very successfully. Among other instances, it was done in
from 1939 to 1974, as was detailed by the youngest and oldest speakers at the conference,
12-year-old Victoria Grant and former defense minister Paul Hellyer, founder of
the Canadian Action Party. Another Canadian at the conference, Toronto
Councillor Kristyn Wong-Tam, has proposed that the Canada city council could improve its finances
by forming its own bank." Toronto
The direct solution to the economic crisis, urged by veteran money reformer Bill Still, would be for the federal government to simply create the money it needs, as the American colonists did by printing paper scrip and Abraham Lincoln did by printing greenbacks.
But cities and states don't need to wait for a deadlocked federal Congress to act. As Wong-Tam has proposed for
they can divest their public revenues from the too-big-to-fail banks and put
them in their own publicly-owned banks. These banks could then do what all
banks do : leverage capital, backed by deposits, into money in the form of bank
This newly-created bank money would then be available for the use of the local government interest-free (since the government would own the bank and would get the interest back as dividends). Among other possibilities, the money could be used to restore the schools. This would not be an expenditure but an investment, as illustrated by the G.I. Bill , which provided education and low-interest loans for returning servicemen after World War II. Economists have determined that for every 1944 dollar invested in the G.I. Bill, the country received approximately $7 in return, through increased economic productivity, consumer spending, and tax revenues.
Legislation for public banks has now been introduced in 18 U.S. states, on the model of the highly successful Bank of
(BND). Elaborated on at the Public Banking conference by Ed Sather and Rozanne
Junker, the BND is currently the country's only state-owned bank and has been a
major factor in allowing the state to escape the recent credit crisis. North Dakota is the only
state to boast a significant budget surplus every year since the economic
downturn of 2008. North Dakota
Ellen Brown noted that 40% of banks globally are also publicly-owned. These are largely in the BRIC countries (
Brazil, Russia, India,
which also escaped the credit crisis, largely because their public banks did
not rely on derivatives and, unlike private banks, lent counter-cyclically to
cushion their economies from the downturn. China
Conference speaker Samuel Giles proposed that even public universities could set up their own banks, which could then leverage university monies for the university's own use, rather than giving those assets away to Wall Street to be speculated with and lent back at much higher interest rates.
Innovative Solutions for
Speakers Michael Sauvante and Mike Krauss noted that efforts are underway in several
municipalities to create public banks. One possibility is for public banks
to take an aggressive role in ending the foreclosure crisis by acquiring
abandoned and foreclosed homes by eminent domain. These homes could be added to
the asset base of the bank, which could extend credit to restore them and then
sell or rent them at reasonable rates. Ohio
Krauss noted that Philadelphia already has a strong effort underway to create a "land bank"--a bank to acquire, rehabilitate and create productive uses for the city's more than 40,000 vacant properties--and legislation (HB 1682) has been introduced in the state legislature to enable this effort. But the land bank proposed is not designed to function as a depository bank that leverages funds into credit. Rather, it would simply work with appropriated funds or bond revenue. This is a positive step toward addressing a real need, but it could be enhanced by turning the land bank into a public bank--a chartered bank having the power to create money as credit on its books.
The efforts for developing public banks in
Pennsylvania are being led by
the Pennsylvania Project, which was a
co-sponsor of the
conference and is supported in its work by the Public Banking Institute and the
Center for State Innovation. The Philadelphia Pennsylvania
Project is creating partnerships with other Pennsylvania
public policy organizations to introduce legislation for a state Bank of in 2013,
after elections are held and a strong foundation of support has been laid. Pennsylvania
We live under a tyranny today that is just as intolerable and unjust as that in 1776, but violent revolution is no longer an option. Our oppressors own the military and the media, and their FEMA camps are waiting for us.
If change is to come, it must be peaceful and legal, beginning with a revolution in the minds and hearts of the people. The message of the Public Banking in
Conference was that we can
throw off the yoke of the financial elite by making money and credit a public
utility; and the most feasible place to start is at the local level, with
publicly-owned banks. America
For videos of some of the speakers, see http://www.publicbankinginamerica.org/speakers.htm
More to come. The Victoria Grant video has gone viral, approaching half a million hits, including copies.