Yes to Public Banking

Given the often “ungressive” character of its editorial positions, it comes as no surprise that The New Mexican advocates against a public bank for Santa Fe (“City must take care of finances,” Our View, Oct. 13).

What is especially unattractive, however, is the condescending tone that is used, calling the public bank effort “a notion” and then conflating it with justifiable concerns about the city’s auditing issues. I invite the editorial writer to attend one of the open meetings of the public banking task force to better appreciate its seriousness and competence.

Perhaps, then, The New Mexican might be moved enough to reconsider its attitude and embrace an endeavor that will save the city money as well as free us from the clutches of Wells Fargo and other banksters.

Robert Baroody

Santa Fe


From Free Lunch to Public Banks, These Cities Are Giving Us Hope

Dispatches from the Urban Resistance: Alameda to Elyria and beyond. 


By Jimmy Tobias | SEPTEMBER 29, 2017 | The Nation

Oakland public bank organizers look to fund renewable energy

FILE – In this May 6, 2013, file photo, a wind turbine farm stands near Glenrock, Wyo. Renewable energy developers say they are hopeful about the future despite President-elect Donald Trump’s promise to bring coal mining jobs back. In recent years, huge solar and wind farms have sprouted up on public desert land in the Western United States buoyed by generous federal tax credits. (AP Photo/Matt Young, File)

By Ali Tadayon | East Bay Times | October 6, 2017

OAKLAND — Advocates for a public bank in Oakland are looking to Germany for inspiration, as that country’s public banks fund a large portion of the renewable energydevelopment.

During a community forum hosted Sept. 25 by Friends of the Public Bank of Oakland, German economist Wolfram Morales explained how public banking works in his country and how the banks offer low-interest rates to companies providing solar and wind resources, driving development.

The destruction caused by Hurricane Maria in Puerto Rico and the U.S. Virgin Islands is the most recent marker of the world’s need for renewable energy resources, said Oakland City Council member Rebecca Kaplan, who is pushing for the formation of a public bank in Oakland alongside Councilman Dan Kalb.

“Facing all these storms, droughts and åoods, we need to build a more sustainable world,” Kaplan said. “We need to be using energy that is positive for the environment and for the community, we need to do it in a way that creates and supports local jobs and we need banking institutions that fund projects that help people.”

The Oakland City Council on Sept. 19 approved spending $75,000 to study if creating a public bank is feasible. Berkeley is fronting $25,000 for the remainder of the funds needed for the study.

Though public banks are a fixture in Europe, the only one that exists in the United States is the Bank of North Dakota, Morales said. There are more than 600 in Germany, most of which are county-level, putting billions into renewable energy development. Those banks are able to offer interest rates as low as 1 percent on loans, which is much lower than what commercial banks offer.

Speakers at the forum talked about how a public bank can help give the community more control over its energy sources.

Last year, Oakland and other East Bay cities joined the East Bay Community Energy Authority, a community choice energy program.

The program allows cities to pool their money to purchase cleaner energy than what Paciäc Gas & Electric offers. The program is looking to make “big infrastructure investments” such as electric vehicle charging, solar plants and clean energy storage projects, and would beneät from the low-interest-rate loans that a public bank could offer, said East Bay Community Energy Authority CEO Nicolas Chaset.

Gregory Rosen, founder of clean energy advisory firm High Noon Advisors, said he has worked with both commercial and public banks, and commercial banks in most cases make investments based on return, not social or environmental good.

Public bankers would be able to make investments based on what will benefit the community, rather than what will make the most money, Rosen said.

“Instead of having the mission be to make money by lending or providing services, there’s really an opportunity to turn the equation on its head, and say the mission is to serve communities, so let’s go listen to what communities need and then structure products around these community needs,” Rosen said.

Public banking — an idea whose time has come

By Rachel Stofocik and Mark Paris | 9-24-17 | New Mexican

Berl Brechner (“Is public banking sound policy for city?,” My View, Sept. 17), is concerned that public banking may be too “complex” in a city “where auditors routinely find flaws.”

Brechner and your readers might be interested to know that, according to the “City of Santa Fe, New Mexico Comprehensive Annual Financial Report for the Fiscal Year ended June 30, 2016,” the city held uninsured deposits of about $95 million in 2016, of which about 63 percent were held by Wells Fargo Bank. Most of your readers will recognize Wells Fargo as the financial institution that has recently paid in excess of $26 billion in “settlements” with the U.S. Department of Justice for defrauding its own customers.

According to an assessment by the Federal Reserve Bank of Dallas, the 2007-09 financial crisis erased from $6 trillion to $14 trillion of wealth from U.S. households — due primarily to the actions of private banks. We might take Brechner’s assurance that “private banks handle government accounts because they have experience and expertise, independence, professional and technical resources in place” with a grain of salt.

Public banks, where community welfare and public investment are guiding principles, have accountability measures far superior to those of the private sector where profit and personal gain encourage criminal behavior. Brechner favors the advocacy that continues the control of private bankers to enhance the fortunes of out-of-state wealthy bankers with questionable professional integrity.

We think most middle-class voters welcome the community-based “advocacy” that public banking represents. Profits earned by public banking that would otherwise go to out-of-state banks like Wells Fargo will be used to benefit the people of Santa Fe by investing in programs for the public good. It’s an idea whose time has come and truly a “no-brainer.”

Is there a public bank solution for Santa Fe?

by George Gamble | September 23, 2017

Is public banking sound policy for Santa Fe? Berl Brechner (“Is public banking sound policy for city?,” My View, Sept. 17), raises an appropriate question, but he appears to be critical of the systematic educational and investigative efforts that the city has been following to answer that question.

Yes, it’s true, as Brechner notes, that North Dakota’s almost 100-year-old public bank is the only example in the U.S. However, he neglected to mention how successful the Public Bank of North Dakota has been, and that community banks in North Dakota thrive while community banks in other states have been systematically swallowed up by large global banks. In addition, he did not mention that public banks are both common and successful in Europe.

Why haven’t public banks caught on in the U.S.? Maybe it’s because of the outsized role that large global banks are allowed to play in the U.S. Global banks see public banks as competitive and lobby to prevent their establishment. In recent years, big bank lobbyists certainly worked against establishment of a state public bank in New Mexico.

The city of Santa Fe has been engaged in a public educational and investigative process over the past three years to explore the feasibility and desirability of establishing a public bank in Santa Fe. A conclusion of the feasibility study contracted by the city last year was that a public bank was a feasible option for the city, one that could improve their financial situation.

Any attempt to discredit the Public Banking Task Force by suggesting that its members are biased and therefore the investigative process is flawed is speculative at best. Some members have indicated an interest in public banking, but more importantly, they are engaged in a public, transparent, investigative process to identify critical issues in establishing a public bank here in Santa Fe.

Anyone who supports the concept of a public bank here would also want to establish it only if they believed it would really be successful in saving money for the city by minimizing the need for some bonds, by eliminating the costs of depositing city money in big global banks, and by creating additional resources that could help leverage money for projects that improve the well being of Santa Fe citizens. The task force is working to answer many questions related to the legal, governance, regulatory and capitalization needs of a public bank.

If anyone wants to learn more about this process, they are encouraged to read summaries of the task force meetings on the Banking on New Mexico website ( and to attend the meetings of the task force, particularly the public forums that will be devoted to public input (dates to be announced).

Establishing a public bank in Santa Fe would involve change, but hopefully that change would offer substantial new benefits to the city and the local economy. Currently, the city has few options other than global banks to serve as a fiscal agent. A public bank is not a problem-free undertaking, but it would be a public, transparent, locally and professionally managed institution. Is it sound public policy for the city of Santa Fe? While I am certainly interested in the city moving ahead with establishing a public bank, I only want it to do so after the relevant issues have been carefully researched and it is determined that the public bank’s substantial benefits will outweigh the risks for the people of Santa Fe.

Wells Fargo’s estimate for unauthorized accounts jumps 67%, to 3.5 million

By Samantha Masunaga and James Rufus Koren  | Los Angeles Times | August 31, 2017

Wells Fargo & Co. said Thursday it may have created as many as 3.5 million checking, savings and credit card accounts without customers’ authorization over the last eight years — a number that is similar to an estimate in a class-action case but one that far exceeds the bank’s initial accounting of its sham-accounts scandal.

The question of just how many unauthorized accounts were created has loomed over the San Francisco institution since it agreed to pay $185 million to regulators after acknowledging the existence of as many as 2.1 million such accounts opened over a four-year period that ended in mid-2015.

But this spring, the bank agreed to settle several class-action lawsuits over the matter for $142 million, and the plaintiffs attorneys who negotiated the deal estimated that some 3.5 million accounts were created since 2002.

The bank on Thursday released a statement, based on a long-awaited independent report it had commissioned from accounting firm PwC, that concluded as many as 3.5 million sham accounts were created, though in a shorter time period dating from January 2009.

Wells Fargo Chief Executive Tim Sloan, in a conference call, called the new figure “a reminder of the disappointment we caused” to customers and investors, adding the bank lacked the records to expand the review to an earlier date.

Though the new, larger figure was not a total surprise, it gave new ammunition to critics of the bank.

Sen. Elizabeth Warren (D-Mass.) renewed her call for the Federal Reserve to oust more members of Wells Fargo’s board over the still-growing scandal. And Rep. Maxine Waters (D-Los Angeles), the ranking Democratic member of the House Financial Services Committee, said in a statement that the bank should be broken up.

“Wells Fargo’s misdeeds are egregious, and they must be held accountable for their many abuses of American consumers,” Waters said. “Wells Fargo has made a routine practice of ripping off and preying on their customers, in a seemingly never-ending avalanche of scandals.”

Indeed, the larger sham accounts figure is only the latest in a series of admissions, mea culpas and management changes the company has made as it continues to try to put the scandal behind it.

Over the last six weeks alone, the bank has admitted charging hundreds of thousands of auto loan customers for insurance policies they didn’t need, reported that federal regulators are looking into claims mortgage borrowers were forced to pay excessive fees and has been sued over allegations that its credit-card processing division gouged small-business customers.

Amid the seemingly unending stream of bad news, the bank announced in August that Stephen Sanger, a longtime board member who took over as the bank’s chairman in the early days of the scandal, will step down at the end of the year.

His departure and that of two other long-serving directors mark the highest-profile exits from the bank since former Chairman and Chief Executive John Stumpf resigned about a month after the Sept. 8 settlement.

Wells Fargo’s practices were first uncovered in a 2013 Los Angeles Times story that found workers, faced with overbearing pressure from management, were creating sham accounts so they could meet sales goals. In many cases, customers paid fees on those unauthorized accounts or faced potential damage to their credit scores because of unapproved credit inquiries and unknown fees.

After the story, Los Angeles City Atty. Mike Feuer began investigating the bank, and his office sued Wells Fargo in 2015. The $185-million settlement was shared by Feuer’s office and two federal regulators: the Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency.

Soon after, during a bruising Capitol Hill hearing, then-CEO Stumpf said the bank would review accounts created as far back as 2009 and as recently as September 2016. The new estimate of 3.5 million potentially unauthorized accounts is based on that review, which looked at more than 165 million accounts.

The review found that 190,000 of those accounts incurred fees or charges, up from an earlier estimate of 130,000 accounts. The study also found that about 528,000 accounts were potentially enrolled in online bill pay without customers’ knowledge or consent. The bank said it would refund $910,000 to those customers who incurred fees or charges. Payouts from the $142-million class-action settlement would be on top of those refunds.

The bank had known for weeks that the new review would identify a larger number of potentially unauthorized accounts. Last week, Sloan sent a letter to employees warning that there would be a wave of news coverage after the announcement of the new figures.

“The results of our reviews will generate news headlines,” Sloan wrote, “but even as we face this renewed coverage, the best thing we can do is stay focused on fixing problems, making things right for customers, and building a better, stronger Wells Fargo.”

Still, despite the expanded review, it remains unclear exactly how many unauthorized accounts were created in all. Sloan said the bank could only review back to 2009 because that is the year it acquired Charlotte-based bank Wachovia.

“That was a big demarcation in terms of data,” Sloan said. “The farther you go back, the data is just not as available or of as high quality.”

The ongoing scandal has taken a toll on the bank’s retail business, which has seen fewer customers open new accounts than in the past. In January, the bank announced a plan to trim expenses by $2 billion by 2018, and in May, it announced plans to cut $2 billion more by the end of 2019.

Wells Fargo shares fell 29 cents, or 0.6%, to $51.07 on Thursday, their lowest point since late last year.

Analysts who follow the bank said they weren’t surprised by Thursday’s announcement, but they’re still waiting to see what other bad practices the bank may divulge and how management and the board will handle new developments.

Cathy Seifert, an analyst at research firm CFRA, said it’s inevitable that there will be more bad news.

“More stuff is going to come out,” she said. “The question is, what is the board going to do, and what will regulators do?”


Mayor, council reluctantly keep Wells Fargo as city’s bank

By Tripp Stelnicki|The New Mexican|August 31, 2017

City councilors on Wednesday approved a four-year contract extension with Wells Fargo as the city’s fiscal agent.

Councilors, both for and against the measure, expressed trepidation over the extension through 2021, saying the banking giant’s financial support of the Dakota Access Pipeline and fraudulent retail account-creation practices suggested a corporate culture that does not align with the community’s values.

But, by a 6-3 margin, the council ultimately swallowed that discomfort and accepted a recommendation from city finance staff that Wells Fargo was best equipped to handle the city’s banking, treasury and investment functions, including the management of roughly $210 million in city accounts and some $560 million in annual transactions.

On top of that, councilors acknowledged Wells Fargo has a significant community presence, with seven branches in Santa Fe that employ some 90 local workers, with sizable investments with local businesses and residents.

Citing the staff evaluation, Councilor Peter Ives said Wells Fargo represented “the logical choice,” if not the perfect choice. Take any large corporation, Ives said, and “chances are you can find something I don’t like about what they have done in the past.”

But, as Councilor Carmichael Dominguez said, “We can’t just put our cash in a cash box in the finance office. We do have to work with these institutions.”

Councilors Signe Lindell, Joseph Maestas and Chris Rivera voted against the contract extension.

“It’s impossible to ignore the national issues, the corporate issues that have occurred,” Maestas said.

Those who voted in favor — including Mayor Javier Gonzales, who called his vote a “reluctant yes” — said variously they appreciated the local Wells Fargo branches’ community involvement and recognized that the bid process had produced no viable immediate alternative for the city’s needs.

“I can’t in good conscience vote no knowing there isn’t a second selection,” Gonzales said.

Gonzales also proposed a new resolution Wednesday that would amend the city’s investment policy to ensure the city’s financial agents won’t invest city money into fossil fuels. The contract extension will be governed by the investment policy, city Finance Director Adam Johnson said, and would be subject to that possible amendment.

The staff evaluation of five bidders for part or all of Santa Fe’s fiscal services ranked Wells Fargo’s bid highest overall. “Wells Fargo does provide the most comprehensive, safe and efficient fiscal service at the best price,” Johnson said.

Councilors’ and residents’ concerns about Wells Fargo’s corporate-level activities were incorporated into the evaluation under a “community initiatives” section, which found Wells Fargo represents more of a local community bank than other bidders.

Kathleen McClure-Wight, a Wells Fargo executive vice president, told councilors she appeared before them humble but confident the bank would continue to be accountable to the city and community.

“We feel very comfortable that what we do every day is in the best interests of the city,” McClure-Wight said.

The San Francisco-based bank was battered last year by revelations of fraudulent accounts created without customers’ knowledge. Thousands of workers were fired, the bank paid millions in fines and the chief executive eventually resigned.

A former vice president of a Santa Fe Wells Fargo branch filed a wrongful discharge suit earlier this year, alleging his superiors knew about the deceptive account-creation practices and fired him for raising the issue.

But perhaps of greater concern locally is Wells Fargo’s financial support of the contentious Dakota Access Pipeline, which last year drew sustained protests from Native Americans, environmentalists and others who said the project would endanger sacred lands.

Wells Fargo has loaned some $500 million to the project. The financial stakes prompted Gonzales and councilors to ask for a broader review of the city’s fiscal agent services and to try to include local options in the appraisals.

The second-ranked bidder, Bank of Albuquerque, does not have much local presence, Johnson said, with only one Santa Fe branch. In addition, that bank’s parent company is based in Tulsa, Okla.

Gonzales said he was “disappointed we didn’t see a stronger presence from the local banking community,” acknowledging the city has greater needs than those local institutions could feasibly manage.

At the city Finance Committee meeting last week, the bank’s regional manager encountered councilors’ sharp lines of questioning about both the pipeline project and the bank’s corporate culture.

Bryan Scott, the manager, told the committee he was “personally very disappointed with things that have happened in other areas of our institution” and added certain company actions did not reflect his values or those of local employees.

In a letter to the council and residents, Scott said the bank has “enhanced our due diligence … to include more focused research into whether or not indigenous communities are impacted and/or have been properly consulted” as a result of the blowback the bank has faced over its Dakota Access financing.

A task force assembled for the purpose of examining whether the city should create its own public bank recently met for the first time, and a report on its findings must be delivered to the full council by the spring.

Any move toward a public bank in Santa Fe could still be years away. But either the city or Wells Fargo can terminate the fiscal agent contract by providing written notice at least 60 days prior to the date of termination in 2021.


In Texas, drowning in debt

By Mike Krauss | Intelligencer

Watching the broadcast media reporting on the catastrophe in Texas, I heard the team on Fox News wonder aloud what the evacuees would do and where to turn to find shelter and safety? Many left their homes with little more than the clothes on their backs. What resources could they draw on?

Commentator, Chris Stirewalt put it in perspective when he observed that most Americans cannot, in times of crisis, lay their hands on more than $500. Other published estimates put that at $400.

Texas may be drowning in water, but the American people are drowning in debt. This is the legacy of decades of neo-liberal economic policy enforced by both political parties, in the Congress and the White House: Americans trapped in a web of debt spun over four decades by a parasitical finance “industry.”

The “capitalism” endlessly extolled by talking heads on networks like Fox and in leading publications like The Wall Street Journal and the Economist is dead; having been steadily degraded into a global economics of trans-national monopolies, with wealth and income monopolized by the few.

It’s simple, really. It takes capital to be a capitalist. Most Americans don’t have any. They have debt. Families, students, small businesses, state and local governments, school districts and the taxpayers that support them are drowning in debt.

The proposed way out? It’s just another step deeper into the web of debt. As in Pennsylvania and across the nation, the same old, same old: more debt and taxes.

The burden of debt will come quickly into focus as Congress is asked to appropriate the many billions that will be needed to fund the federal participation in the recovery from Hurricane Harvey. Deficit hawks are already insisting that whatever amount is appropriated must be offset by cuts elsewhere in the federal budget.

There is an alternative. To understand its utility, it is first necessary to understand how the money of the United States is created. Look at a dollar bill, or any bill. It says clearly at the top, “Federal Reserve Note.” The Fed has a monopoly on the creation of our money. It works like this.

The Fed takes the “full faith and credit” of the United States (Nothing more — no gold, no silver), sells bonds and transfers the credit raised to the Treasury. The majority of the buyers are the global cabal of parasites in pinstripes and some foreign governments. The roughly two dozen banking and finance companies with a license to sell those bonds make a fortune. The Treasury then pays off those bonds, at interest, with the money raised in income taxes. The interest is killing taxpayers and keeping Americans in debt.

Interest on mortgages, car loans, student loans, credit cards, municipal bond issues and built into the chain of production and supply for almost everything we purchase. One example. The new Bay Bridge in San Francisco cost about $6 billion. But there is another $6 billion in interest costs for California taxpayers to pay off.

The alternative is the one used by Lincoln in the Civil War, to bypass the banksters and their high interest. The Treasury can issue the money directly, as “U.S. Treasury Notes,” and avoid the interest paid to the banksters. Cut out the middleman.

Lincoln had the Treasury issue $450 million of “greenbacks,” which went directly into the productive economy, buying goods and services. That $450 million in 1864 is equal to roughly $6.7 billion in today’s dollars, a tiny fraction of the current $4 trillion federal budget and almost $20 trillion U.S. economy.

Trump has proposed a $1 trillion infrastructure package. It will come at interest. The Treasury could issue three times that as low, almost no cost interest (the same terms on which the Fed loaned an estimated $17 trillion to Wall Street) to underwater homeowners and businesses, students and cash strapped state and local governments and school districts, to pay off older, more costly debt and start rebuilding the entire national infrastructure.

The Treasury can be repaid easily by an elimination of debt-service costs, an explosion of wealth-generating productivity, the growth of tax receipts at all levels of government and the future employment of well-educated young people.

The Treasury can bypass the Fed — which is nothing more than the administrative arm of Wall Street and the banksters — and rescue the American people from their high interest racket.

The banksters will howl, making more noise than a hurricane.

Music to our ears.

Goliath, not a David, likely wins Santa Fe banking contest

Photo: Protesters outside a Santa Fe Wells Fargo in January called for Santa Fe to withdraw its municipal accounts from the banking giant. (Eddie Moore/Albuquerque Journal). 

By Mark Oswald | Albuquerque Journal North

SANTA FE, N.M. — The Santa Fe City Council, as a customer looking for the best deal, is now faced with something similar to the rancorous debate that took place when a new Super Walmart opened about a decade ago.

Santa Feans, and the council, were divided about having a second and bigger Walmart in town. Walmart was blasted for its labor policies, as a corporate giant that hurts local business and as yet another aggression against the old, traditional Santa Fe.

But in a public comment period during what was literally a night-long council meeting, there was also support for what Walmart and its massive organization has to offer – cheap prices. In the end, the Walmart development on far south Cerrillos Road was approved by a single tie-breaking vote.

Now the City Council is considering a new contract for municipal government’s banking services as the existing one with the giant Wells Fargo Bank expires.

Wells Fargo, of course, is coming off a bad year.

In a major scandal, Wells Fargo acknowledged in September that its employees opened up to 2 million bank and credit card accounts without customer authorization in order to meet lofty sales goals – a case of trying to hoodwink its own customers. Federal and California regulators fined Wells Fargo $185 million.

And the bank has faced protests, including in Santa Fe, for its involvement in financing the controversial Dakota Access Pipeline.

Mayor Javier Gonzales cheered the DAPL protesters who showed up outside a Wells Fargo branch in January and pushed for changes to the bidding process for the banking contract to include assurance of local involvement by the city’s banker. The mayor and others on the council also have promoted study of the ground-breaking idea of a public bank for Santa Fe, in part to gain control over how its money can be used as it bolsters a bank’s assets

But a city fiscal team, after reviewing bids from Wells Fargo and four other banks, now recommends sticking with the Wells Fargo behemoth. Three of the four other bidders are locally based. One other bidder has New Mexico in its name, but is a “member” of a banking outfit from Dubuque, Iowa.

The bid evaluation team’s report makes it clear that the competition wasn’t even close.

“Wells Fargo Bank provided a strong alignment of business interests, community initiatives and process priorities while keeping fiduciary responsibility and the safeguarding of the City’s financial assets in the forefront,” says the team’s recommendation.

In the new “community initiatives” category, Wells Fargo scored 501 points out of a possible 525. No other bidder got more than 338 points here. “The most complete, thorough and involved response was provided by Wells Fargo” in this category, the evaluation report says. The report lists Wells Fargo’s local lending to small borrowers, community donations and its employees’ volunteer services as pluses. It even adds, “Wells Fargo has been an industry leader in social, environmental and governance activities.” Wow.

For what it’s worth, a regional Wells Fargo official more or less apologized for the unauthorized accounts scandal. He was “personally very disappointed with things that have happened in other areas of our institution this year,” he told a City Council committee Monday.

The evaluation committee’s rave review of the Wells Fargo bid is going to make it difficult for councilors to move to another bank. The Finance Committee on Monday sent the recommendation onto the full council.

It’s a tough call for elected representatives to go against political beliefs that they and many of their constituents have expressed and strongly hold to. But the city staffers’ strongly non-political evaluation report is hard to argue with.


Housing, battling racism and a municipal bank top agenda for L.A. council president

Los Angeles should explore whether to create a municipal bank that would finance affordable housing and throw its doors open to the cannabis industry, City CouncilPresident Herb Wesson said Tuesday.

Wesson tossed out the idea as part of a sweeping speech that set out his agenda for his final term. In addition to the bank, Wesson said L.A. must take new and innovative steps to battle racism, protect immigrants and build more affordable housing.

“When our grandchildren tell stories of us, what will they say? Will they say we were brave?” askedWesson, who recently was reelected as council president. “When the history books remember us, will they say that we did everything within our power to improve the lives of the people we represent?”

To combat hatred, Wesson wants the city to help organize scores of intimate dinners between people of different races, faiths and backgrounds. To defend immigrants, he wants the city to craft new legislation. And to ensure more affordable housing is built, Wesson wants a new commission to think up ideas.

But his most unexpected proposal was forming a bank: Wesson suggested that a municipal bank could help finance affordable housing, provide loans for small businesses and entrepreneurs, and give the marijuana industry a safe place to park its cash. Cannabis businesses have been shut out of many banks and rely heavily on cash transactions.

“Do you know, we’ve got people that are going to go home tonight and sleep on a mattress that’s worth $2 million?” Wesson said, alluding to marijuana entrepreneurs stashing cash at home. “We have to figure out a way to make this industry work. We in government are supposed to push the envelope, not protect the status quo.”

The Southern California Coalition, a marijuana industry group, welcomed the idea. “The cannabis industry is perceived to be a sitting duck for crime because it’s heavily cash based,” said Adam Spiker, the group’s executive director, adding that marijuana businesses also struggle to get loans and have had trouble finding landlords willing to accept cash.

The speech, which was promoted in advance to the media, had the feel of another State of the City address. Wesson, a former speaker of the California State Assembly, greeted fellow council members Tuesday by saying that the inauguration ceremony earlier this month was “the mayor’s day,” while “today is our day.”

Ahead of his speech, a video revisited some celebrated moments for the City Council, including increasing the citywide minimum wage, passing a bond to help the homeless and courting the Olympics.

Wesson, 65, led his remarks with a story, recounting that white men had pelted him with a milkshake and called him racial slurs when he was a 12-year-old headed to the movies in Ohio. He went on to list a number of hateful incidents in the last year, including the desecration of Jewish cemeteries and the slaying of two men trying to defend a Muslim girl on a Portland, Ore., train.

“We cannot stand by and allow bad people to roll back the clock on the progress that we have made, not just in this city, but in this country,” Wesson said.

Wesson plans to partner with Community Coalition, an advocacy group formerly led by City Councilman Marqueece Harris-Dawson, to host more than 100 small dinners that bring Angelenos together throughout the city.

After the speech, he told reporters that he believed face-to-face dinners could change the world, saying that such discussions at college and church had helped him let go of a hardened heart after he was attacked as a youth.

To address the housing crisis facing Angelenos, Wesson said he wanted a new commission to come up with strategies to make it easier to build affordable housing. The commission, created in partnership with the Los Angeles Area Chamber of Commerce and the Los Angeles County Federation of Labor, could explore everything from speeding up permits to repurposing shipping containers, Wesson said.

Wesson said a municipal bank also could help finance more affordable housing. He did not go into details Tuesday about how precisely the L.A. bank would work, saying that he wanted Councilman Paul Krekorian to start examining the idea and see whether it was worthwhile.

The idea of a public bank has been championed by some local activists who see it as a way to keep money in the community and steer clear of “unethical investments.” North Dakota created a public bank nearly a century ago; campaigns to create public banks have popped up in Oakland, San Francisco and other cities.

As of Tuesday afternoon, more than 400 people had signed a petition backing a Los Angeles municipal public bank “accountable to the people.” Phoenix Goodman, one of the co-founders of Public Bank L.A., said that activists who want Los Angeles to divest from Wells Fargo had realized that they needed “an ethical alternative.”

“The real solution isn’t going from a big bank to another big bank — it’s transcending Wall Street altogether,” Goodman said.

But the idea also drew some skepticism Tuesday. The city has “structural deficits going on forever and now they want to start a bank?” said Jack Humphreville, who serves on the Neighborhood Council Budget Advocates, which provides input for city leaders on the budget.

The last time Wesson gave such a speech two years ago, some wondered whether the prominent address meant he was angling to replace Mayor Eric Garcetti. The Tuesday address comes three years before the powerful and charismatic politician will be termed out of the City Council.

In his speech, Wesson repeatedly cast his gaze beyond Los Angeles to the nation at large. But when asked, Wesson said that didn’t mean he was eyeing any kind of national office — only emphasizing that Los Angeles could lead the country toward progress.

“I’m not going anywhere,” Wesson said. “L.A. is stuck with me.”


Public Banking — Funding Local, Sustainable Economies