This ballot measure is just as simple as it sounds: “Shall the City Charter be amended to allow the City to establish a municipal financial institution or bank?” And, unless you’re particularly fond of helping rich Wall Street bankers get richer, the answer to that question is a resounding YES.
Despite what the LA Times editorial board wants you to believe, this ballot measure is most definitely not half-baked, nor is it a blank check for the City Council and the Mayor to route preferential loans to their pet projects or enrich their favorite donors. Public Bank LA published a response to that editorial that explains all of this — and I’d highly recommend you read it, not least because I helped write it:
Why We Need Charter Amendment B
Banking on the Future of Los Angeles #YesOnB
For some national perspective on the issue, take a look at what Romy Varghese published in Bloomberg Businessweek. Varghese starts the piece by laying out just how much tax payers stand to gain by supporting this measure:
“Why not create a public bank that would support investment within city limits, backing such things as small-business loans and affordable housing instead of sending the money out?”
There isn’t a compelling reason to oppose Measure B unless, of course, you’re a banker. So it makes sense that the California Bankers’ Association (CBA) has just came out in opposition to Measure B, claiming that the measure “represents a significant threat to commercial banks.”
But community banks and credit unions have nothing to fear from Measure B. Just as the CBA points out in their own analysis of the LA public bank, the Bank of North Dakota “routes its public lending programs through community banks and cooperate rather than competes with local banks, aiding with capital liquidity requirements” — and that’s the plan for the Municipal Bank of Los Angeles
It’s only the too-big-to-fail Wall Street banks like Wells Fargo, JPMorgan Chase, and Bank of America that have anything to worry about from this measure. Those banks collected $1.1 billion in interest from the City of Los Angeles last year. And they charged us a further $170 million in fees. With a public banking option finally available to handle our financial transactions, those interest payments and fees could stay right here in Los Angeles and be reinvested into our city.
The bankers don’t want to have to compete with an accountable, transparent public banking option. The CBA set up a donation page to fund opposition ads against Measure B because, as bankers, they clearly don’t already have enough money to oppose this measure on their own. And they’re running that opposition (the Californians For Financially Responsible Government) out of San Rafael, CA, nearly 400 miles north of Los Angeles. In the interest of fairness, there’s also a way to contribute to the Yes on B campaign, if you’re interested.
Don’t be surprised if there is an advertising blitz in the coming weeks that tries to convince you that public banking can’t work in Los Angeles. It can, and it will.
The only way to guarantee that a bank acts in the best interest of Angelenos is to have Angelenos own that bank. That’s why I’m supporting Measure B.