ADOS, Biden, grassroots, Black, platform, reparations, African Americans
BLC – Banking Structure – PUBLIC BANKING SYSTEM – One in each community.
UJIMA BANKS IN 17 STATES + WASHINGTON DC.
History: The Freedman's Saving and Trust Company, popularly known as the Freedman's Savings Bank, was a private corporation chartered by the U.S. government to encourage and guide the economic development of the newly emancipated Negro communities in the post-Civil War period. Although functioning only between 1865 and 1874, the company achieved notable successes as a leading financial institution for negros. However, its failure was devastating to the newly emancipated negro communities. Its archives are valuable as a large collection of information regarding the applicants and what was known of them including some physical descriptions of complexion, where they were born and also names of family members in the immediate aftermath of emancipation. The bank maintained 37 offices in 17 states, and deposits peaked at $57 million from 70,000 depositors.
TO AVOID REPEATING THE HISTORY OF THE FREEMAN BANK. . .
UJIMA Districts would have minimally one Ujima Bank within its business community. A Ujima Bank would be a Chartered Public Bank
How a Public Bank benefit its constituents?
Public banks can be chartered and managed so they support local lending within the jurisdiction in which they operate. While existing public banks and those currently proposed generally do not lend directly to consumers and businesses, they can either co-lend with a private community bank or purchase loans made by community banks, allowing those banks to make additional loans that benefit the local economy. Investment is within the governing community, maximizing public good within that community rather than maximizing profits through global investment strategies.
There are exceptions to the policy of not lending directly where it is viewed as directly beneficial to their constituents. For example, the Bank of North Dakota has been authorized by the state to make low-interest-rate loans to students,
which they rightly view as beneficial to the state.
One very important effect of the support of community banks is that, because they are a part of the community they fund, they are much less inclined to foreclose on delinquent loans but lean more toward negotiating
restructured loans that can be repaid.
An interesting aside is that by chartering public banks, the U.S. banking system would be, in part, returning to a banking model closer to the state-level system that was more prevalent before the major deregulation of the banks was passed in 1999, which included the repeal of the Glass-Steagall Act of 1933. Glass-Steagall had required a clear separation of banking operations from risky investment banking operations, and from insurance and brokerage firms. The repeal of Glass-Steagall allowed mergers of already huge banks, insurance companies, investment banks, and brokers—greatly increasing the risk to banking depositors and to our financial system,
contributing heavily to the collapse of 2008.
Public banks would be prohibited from speculating in risky derivatives. This would help prevent economic collapse and the need for bailouts that burden the taxpayer. Further, because of our fractional reserve banking system, public banks multiply the money loaned for economic development and infrastructure, up to ten dollars in loans for local interests for each dollar of capital reserves of the bank.
Like a private bank, a public bank charges interest to borrowers, which generates earnings. Since it does not pay dividends or seek to maximize profits for outside investors, which a private bank must do, it can charge lower interest rates to serve borrower’s needs and facilitate their ability to pay, and its earnings all inure to the benefit of the community.