Topic: Business (154)

Hearing on Public Banking Bill - January 28th

On 28 January, there was a hearing on the creation of the Washington Investment Trust (SB 5995), before the WA State Senate Financial Institutions, Economic Development & Trade Committee (11:50 to 47:55 on the video counter). More widely known under the rubric of a public banking bill, the trust would be created to “serve as a depository for state monies and federal transportation funds and is authorized to manage and invest state monies in order to facilitate financing and construction of new and existing public infrastructure systems.” (See Senate Bill Report on SB5995).

Unfortunately, a business plan, for which the state appropriated monies well in advance, (several hundred thousand dollars) has yet to appear. The responsible organization for developing this plan, the Evans School of Public Policy and Government (University of Washington) had a deadline of June 2019 to complete the study, but almost 8 months later, still no product. I have asked Sen. Hasegawa’s office about the nature of the delay but have not as yet heard back.

Without the plan, opponents continue to attack the general concept with impunity since the specifics of setting up and running the bank have yet to appear. So, with each hearing on the bill such as the one on the 28th, a parade of naysayers expound on the legislation without knowing specifics, all the while spreading FUD.* This is not to say that there are no legitimate concerns that must be addressed before the bill’s passage, but some of the concerns border on the ridiculous (Washington State Treasurer Gaslighting on Public Banking). In a similar vein, Brad Tower, who lobbies for the Community Bankers of Washington continues to trot out a minimally relevant 2006 International Monetary Fund (IMF) report that he claims demonstrates serious problems with the German public banking system. (See the report at link below.) He has chosen this report, he tells me with a straight face, because in 2006 the economy was in good shape. One speaker, representing the pension funds of the state, had some legitimate concerns that the laws governing pension funds might prohibit placing funds in a public bank. These are conflicts that can be worked through with diligence by legislators.

One bright spot is that the Bellingham City Council approved moving ahead with a resolution to support public banking in Washington during its meeting on December 16th. The Whatcom County Council and the Bellingham Port Commission should follow suit.

*FUD - Fear, Uncertainty and Doubt

Attached Files

About Dick Conoboy

Citizen Journalist and Editor • Member since Jan 26, 2008

Comments by Readers

Dianne Foster

Feb 07, 2020


Bless your heart for keeping the flame of public banking alive.    (I read the German report, and was unable to copy and paste the usual IMF drivel about an export economy,  but will comment on that).      The neoliberal economic view promotes de-unionization,  outsourcing to cheap labor countries,  and privatization that ends in sucking the national economies dry,   while focused on exports to compensate,  which they do not,   as they channel upwards to the elites.      What we need is to re-localize economies,   re-unionize,   and fund public infrastructure with public banking.     To do anything less,  is to feed the global 1% and  encourage another meltdown that endangers all of us.   The sell-off of our public infrastructure and lands to the private sector has been well-documented by Matt Taibbi in his book “Griftopia”,  as the precursor to right-wing populism in rebellion.    We need a counterbalancing strategy in the public interest,  with fairly spread benefits,   or we’re in for another “market failure.”


Dick Conoboy

Feb 07, 2020


The relevant portion of the report is on page 88.   From p. 88:  

“The focus of the paper is on LBs. Most LBs are characterized by a complex relationship with their Sparkassen, with Sparkassen being co-owners of the LBs and at the same time among the main clients of LBs. This raises the possibility of cross-subsidization or the possibility that LBs provide services to Sparkassen that would otherwise be unavailable from commercial banks. However, there is little evidence of such cross-subsidization or dependency. Sparkassen representatives note that they buy products from LBs when they are competitive or have other attractive features, not because of subsidies or the lack of alternatives. Landesbanken representatives confirm that services are provided at a competitive price and because of familiarity with Sparkassen needs, and do not represent cross subsidies.
Further, Sparkassen are different in several respects from LBs. From the cost perspective, they have not resulted in substantial out-of-pockets costs to taxpayers, unlike some LBs. Nonetheless, public Sparkassen ownership entails opportunity costs to the taxpayer. With an average ROE of 5.2 percent in the last decade, they have been historically more profitable than LBs, but less profitable than comparable banks in peer countries (Table 8). Using the same methodology and assumptions as for the LBs, preliminary calculations suggest that the opportunity costs of Sparkassen is estimated to be 0.17 percent of GDP annually, which translates to an improvement of the intertemporal net worth of 6.6 percent of GDP (equivalent to lowering the public sector debt by 12.5 percent of GDP by 2050). “

Ellen Brown of the Public Banking Institute sent me this email comment about the IMF report:

“I just looked at p. 88. As they note, the Sparkassen aren’t the Landesbanken and don’t have their problems. I don’t know what they mean about lost opportunity costs. So what if some banks in other regions are more profitable? The Sparkassen aren’t focused solely on profits; they’re focused on serving the community. The profits come from the businesses they service that wouldn’t otherwise get affordable loans. Note this study was in 2006, before the 2008 crisis, when it was all about profitability. After that it was recognized that public banks were more stable and provided credit to communities when private banks failed. I’ve written quite a bit about that.”



Dianne Foster

Feb 12, 2020

Yes,   I have her book;   Ellen Brown is my idol.   Wish we had an actual bill to take to our state reps at this point   I’m sure Liz Lovelett will listen.     But again,  the IMF is usually focused on export economies,  not local beneficiaries.   Thank God we didn’t pass the TPP,    which would have made public banks illegal,   and banned “Buy American.”  It was written by and for the banksters and Big Ag,   Big Oil.   It was worth fighting,  even if Trump took credit for deleting it,  and Hillary lost because she didn’t mention it in the Rustbelt debates.    (Indeed, she had referred to it as the “gold standard” of all trade agreements!)     But it was already defeated by progressives who knew what they were up to.     It wouldn’t have passed the Lame Duck Congress in 2016.       I do know a big barrier is the state treasurer;   he spoke up against the state bank idea about 8 years ago when he was here at some Dem event (can’t remember which).      Maybe neoliberalism has passed its peak -   we can only hope.



Kurt Sperry

Apr 02, 2020

In Italy, where my family moved twenty-odd years ago, evryone has access to free, basic banking through the post offices. It’s an excellent system to guarantee everyone access to banking services.


Dianne Foster

Apr 02, 2020


Exactly.   Thanks.


Kurt Sperry

Apr 02, 2020

As you probably already know, there’s a precedent for a public state bank in North Dakota. It’s been successful and popular there, and it would I’m sure be here as well.


Dianne Foster

Apr 02, 2020


Oh yes,  I’ve been working on that for over 10 years.   (sigh).   If we had Bernie or Elizabeth for Pres,  we might just get it.

To comment, Log In or Register

Hearing on Public Banking Bill - January 28th

By Dick ConoboyOn Feb 04, 2020

On 28 January, there was a hearing on the creation of the Washington Investment Trust (SB 5995), before the WA State Senate Financial Institutions, Economic Development & Trade Committee (11:50 to 47:55 on the [...]

7 comments, most recent 3 months ago

RING! RING! Rama Lama Ding Dong…

By Dick ConoboyOn Feb 02, 2020

A short while ago I wrote an article (Bellingham Parking Fees Go To Volkswagen) on all the surveillance “extras” that accrue to users of the PayByPhone app to pay for [...]

3 comments, most recent 5 months ago

Yet Another Shiny Thing - Motorized Scooters

By Dick ConoboyOn Nov 23, 2019

Bellingham just loves shiny new things. The Infill Tool Kit to solve our housing woes. Detached Accessory Dwelling Units to provide affordable housing. The green painted bike lanes to assist [...]

3 comments, most recent 7 months ago

Sink, Swim, or Divorce – Options Narrow for our Relationship with Harcourt

By Alex McLeanOn Oct 23, 2019

First, we’ll want to peer inside the Granary Building and ponder the spectacle of the world’s loneliest yoga studio ensconced within the world’s emptiest building. Then we’[...]

18 comments, most recent 8 months ago

California Adopts Public Banking

By Dick ConoboyOn Oct 03, 2019

Hooray for California! Hooray for public banking! North Dakota did its ground-breaking work by establishing a public bank 100 years ago. California, usually leading the pack in progressive pursuits, comes in [...]

Senator Hasegawa To Speak On Public Banking Before the County Council - 24 September

By Dick ConoboyOn Sep 19, 2019

Washington State Senator Bob Hasegawa from Seattle will again speak on the issue of public banking, this time before the Finance and Administrative Services Committee of the Whatcom County Council [...]

It Is Not About Fireworks

By Dick ConoboyOn Jun 25, 2019

Belllingham banned consumer fireworks five years ago, although you might not be able to infer that from activities that are prevalent on the 4th of July to a major extent [...]

Whither Goeth The Planning Commission - Maute-Gibson Resigns

By Dick ConoboyOn Jun 07, 2019

What does the resignation of Iris Maute Gibson [see resignation letter below] portend for the city’s Planning Commission? Appointed in 2017 by Mayor Linville to replace commissioner Tom Grinstad, Maute-Gibson [...]

Public Banking - Senator Hasegawa at the Bellingham City Club

By Dick ConoboyOn May 24, 2019

State Senator Bob Hasegawa travelled from Olympia last Wednesday, May 22nd, to speak to Whatcom County residents about the benefits of public banking: “A State Bank for Washington – Invest in [...]

8 comments, most recent 1 year ago

Legislation By Anecdote - Accessory Dwelling Units in Bellingham

By Dick ConoboyOn Jun 13, 2018

“It was no accident that the Oxford Dictionaries’ word of the year in 2016 was “post-truth,” a condition where facts are less influential in shaping opinion than emotion and personal belief. [...]

8 comments, most recent 2 years ago

The NFL Sowed Its Own Problem With The National Anthem

By Dick ConoboyOn May 30, 2018

The big shots of the National Football League (NFL) have no one to blame but themselves for the problems surrounding the playing of the national anthem at the beginning of [...]

A time to change NW Citizen ownership

By John ServaisOn May 13, 2018

I started Northwest Citizen in September 1995 as a handcrafted blog about local politics and government abuses. This was years before the word “blog” was coined and before Google and before [...]

7 comments, most recent 2 years ago

Uberization Of Your Backyard – Instant Debt Creation

By Dick ConoboyOn May 07, 2018

It did not take long for the rentier vultures to smell the carrion lying in your backyard: that dead space that used to be your garden or lawn. Those vultures [...]

3 comments, most recent 2 years ago

COB Broadband Back To The 80s

By Jon HumphreyOn Feb 13, 2018

Let me start by stating up-front that I am working on public fiber as a volunteer and my interest has no financial benefit to me. I actually want what’s [...]

11 comments, most recent 2 years ago

One year in, Trump’s biggest Wash. donor has no buyer’s remorse

By Ralph SchwartzOn Jan 21, 2018

I was reminded recently of Peter Gigante, the Fairhaven resident who has the distinction of being Washington state’s single largest donor to the 2016 Donald Trump presidential campaign. I interviewed [...]

2 comments, most recent 2 years ago

Case for Public Owned Internet Fiber System

By Jon HumphreyOn Jul 20, 2017

Bandwidth is now an essential commodity, in the same category as electricity, water and sewer. Next-generation tech infrastructure is the only way Bellingham can hope to be the home of [...]

4 comments, most recent 2 years ago

Time to Audit Private Rental Inspections

By Dick ConoboyOn Jun 22, 2017

With the passing of the Bellingham rental registration and inspection ordinance, thousands of rental units have been inspected during the first year the law has been in effect. We saw [...]

4 comments, most recent 3 years ago

100 days: Largest Wash. Trump donor, from Fairhaven, likes what he sees

By Ralph SchwartzOn May 03, 2017

​Not one to shy away from a media cliche, I followed up with Peter Gigante on the occasion of Donald Trump’s 100th day in the White House. OK, so [...]

11 comments, most recent 2 years ago

Water for Whatcom Irrigation

By Eric HirstOn May 02, 2017

Whatcom County farmers use a lot of water every summer to irrigate their pastures and berry fields. But the public never knows just how much water irrigation uses. This means [...]

10 comments, most recent 3 years ago

The Silk Road Reopens

By John ServaisOn Apr 25, 2017

The ancient Silk Road ran between Xi’an, the capital of China, and Rome, the capital of the Roman Empire. As Rome morphed into Europe and the Catholic Church, the [...]

2 comments, most recent 2 years ago