A group of state legislators from the Bay Area and Southern California announced the introduction of a bill that would create a state bank capable of giving loans to local governments and small businesses during the COVID-19 coronavirus pandemic.
Assemblymembers David Chiu, D-San Francisco; Ash Kalra, D-San Jose; Buffy Wicks, D-Oakland; and Miguel Santiago, D-Los Angeles, joined members of the California Public Banking Alliance to introduce Assembly Bill 310, the Bank on California Bill.
The bill would convert the state’s Infrastructure and Economic Development Bank, commonly called the IBank, into a state-run bank. The conversion would expand the state’s capacity to lend money to local governments to protect crucial services like schools and public health.
The coalition of lawmakers and public banking advocates argued that establishing a state bank would reduce the reliance on large national banks and federal funding to rescue local governments.
“You can’t count on the federal government to come and rescue us so the state must do its part to save our cities and save our small businesses,” Kalra said.
The bill would enable the state to invest about $9.9 billion of the state’s Pooled Money Investment Account in the IBank to fund the expansion of its lending and credit capabilities and act similar to a credit union for local governments and agencies.
“We’re essentially filling a void where Wall Street banks and the federal government have failed,” CPBA co-founder Trinity Tran said. “We’re mobilizing state resources to provide direct recovery for the people because times of crises is when change happens and to fuel this recovery for California, we need a public bank designed to be able to stabilize the economy and reinvest back in our communities.”
What is the criteria if such loans are not repaid? Also, how long would the repayment period be?
Running a bank is about underwriting risk. If Wall Street and Federal Government Money has not been provided (ie failed) it’s because of excessive credit risk. Real banks never want to be bankrupt.
This endeavor smells funny.
I believe government should help small buisness rather than buying and controlling our health and education. I believe that the economy relies on the people not the government. The more government involves itself in our private lives the more we lose our freedoms.
woah wait a minute
so democrats who are pushing socialism are now
hypocritically being capitalists
wow cant wait for the popcorn and bob democrat twists on this one
and second ….when ever a democrat from the bay area and a democrat from the south of california get together …..we are going to get taxed
they pushed the high speed scam train and got billions form tax payers for nothing ….absolutely nothing ..now they get those billions to spend where ever they want ….cars boats mortrgage affairs ….
so gain this is not good and if it is being posted it is going to happen in this state
just sad that dem voters are so pro whatever politicians say
oh the tax hikes are going to be huge for this one
can see it now oh no we were to big to fail ……well thats ok we will take it from the tax payers …..
democrats erase the past so they can scam you again …..
Not good. Gov’t should not be in business…that’s the role of the private sector. Creeping socialism…
In 5 years or so it will be the only bank allowed in CA.
That’s pure communism.
Those who think this is a good idea are simple fools.
Interesting
So, the state, which now has a $50 BILLION dollar deficit, and thinks it can lend money? HUH? We need to fix the CA law wherein the legislature is required to spend all the funds they receive every year. Our state is literally living paycheck to paycheck.
Socialism has such as great track record that I live this idea.
Can we also get a state bill to provide millions in tax payer dollars to relocate AOC and Ilhan Omar to California?
The Fed already exists to supposedly stabilize the economy.
This state bank is a terrible idea. It is another way they want to get local governments and state businesses reliant on the state of California so they can force them to do what they want or suffer consequences by pulling funds.
This is a huge NO. I also see it being majorly abused by the politicians in office enriching themselves and people they owe through businesses they have a stake in using tax payer dollars. It’s redistribution and fancy money laundering in plain sight.
NO b
State workers? That ought to be productive. Not😂
State workers? That ought to be productive. Not😂. The movie Idiotocracy has truly become reality.
“We’re essentially filling a void where Wall Street banks and the federal government have failed,”
This is just not true. In 2017 Ca. state and local governments had $482 billion of bond debt. This money was borrowed from big banks and wall street. This total does not include what was added to the bond debt in 2018, and 2019. Ca. also owes $187 billion in after employment benefits and has an unfunded pension liability of $846 billion. The total debt in 2017 was a staggering $1.5 trillion!
The banks, wall street, and the federal government haven’t failed. The State of California has failed. More accurately the people of California have failed. To fix this (if it can be fixed), we have to stop electing Democrats. Creating a bank won’t fix it. Thankfully California cannot print money.
https://californiapolicycenter.org/californias-state-and-local-liabilities-total-1-5-trillion-2/
If you really want to know more about this model, I recommend looking up the Bank of Japan and what they do.
Just got a bank statement.
Money market used to pay $11.00 a day.
Now it pays $11.00 a month.
Bank for the win.
No, to a state run bank.
Savers will never win. ☹️
Time for a proposition to make CA lawmakers part time similar to Texas. It will somewhat limit their time to come up with so many foolish and inane bills such as this proposal. Also, stop electing these unqualified career politicians who destroy their cities and towns and then move on up to destroy the State as well as their cities and towns. It’s a vicious cycle.
Sure why not? It can’t be all bad. Just look at the DMV and see how that works.
Our Democrat overlords, er, I mean elected officials, should have issued this statement on April 1st! I already distrust how they handle tax dollars. Why would anyone in their right mind place their money in bank run by these crooks?
Remember when the state started dictating how and from whom PG&E could buy power? And then we had the rolling blackouts and skyrocketing bills? Just imagine what they could do with a bank!
This sounds like a REALLY bad idea. The Democrats grabbing billions of dollars of public funds, pumping the money into their money pit projects and helping build their Orwellian doublespeak propaganda campaigns. And of course, look how they’re sneaking this in while everything else is going on.
California wants to make it,s own rules to Succeed from the the Union. it all starts with the money and stripping of your money if you live here. power starts in the banks. follow the money trail and the Origin Grasshopper and you shall be enlightened.
Because politicians have shown themselves to be competent business persons