Contact: Sylvia Chi, Asian Pacific Environmental Network (510-834-8920, email@example.com) Anthony Rogers-Wright, CJA (631-402-7855, firstname.lastname@example.org)
Today, Representatives Rashida Tlaib (D-MI) and Alexandria Ocasio-Cortez (D-NY) released the Public Banking Act. If passed, the legislation would vastly increase the creation and maintenance of public banking through state and locally administered public banks, including the postal service, and the establishment of a Public Bank Grant. Building off of the recently passed California AB 857 Public Banking bill, the Public Banking Act would decrease debts for municipalities, offer public options for large city pensions and provide much needed investments in infrastructure and renewable energy projects.
Sylvia Chi, Policy Director for CJA member organization Asian Pacific Environmental Network, who led a coalition of California groups in the drafting and passage of AB 857 explained what the Tlaib/Ocasio-Cortez bill could mean for the future of banking in the United States, “The Federal Public Banking Act is an important step towards creating the democratized and decarbonized financial system that we need to help fund a Green New Deal and create a Just Transition to a regenerative society.” She went on to say, “This legislation clears the way for states and communities to establish public banks that can lead an equitable recovery from the pandemic.”
The Public Banking Act is particularly relevant given the fact that the U.S. economy is in tatters due to the global COVID pandemic. The legislation would provide critical relief to states who are mired in financial uncertainty as they await the federal government to develop and implement a comprehensive relief package. People Organizing to Demand Environmental and Economic Rights (PODER), also CJA members and integral in the passage of AB 857, argue that the new legislation will address years and decades of neglected, frontline communities. PODER Community Organizer, Reina Tello stated, “Our push for public banking is due to the flaws and historic underinvestment in our communities. The COVID-19 pandemic, and the other crises we face underline the importance of bold solutions like public banks.”
As imperative and transformative as public banks can be, they can still be tools of the fossil fuel industry without restrictions on how money is utilized and invested. We’ve already seen this in state’s like North Dakota, where the nation’s only state-owned bank invests heavily in fracking. To this end, CJA is very encouraged that Tlaib and Ocasio-Cortez utilized language from Senator Jeff Merkley’s recently introduced, Protecting America’s Economy from the Carbon Bubble Act, that strictly prohibits banks from investing in fossil fuel projects.
CJA Executive Director, Angela Mahecha Adrar broke down why this is a key provision of the bill for frontline communities, “When it comes to the fossil fuel industry, their false solutions and their poisonous pipelines, it’s always been about following the money, who is funding these projects.” She added, “Increasing the utilization of, and access to, public banks, while decreasing and removing the ability for banks to fund climate chaos and environmental racism is a frontline solution we can all get behind. I applaud the Congresswomen not just for their legislative product, but the inclusive process that led to it; when the frontlines lead, we all win.”