money moves the world and banking moves money welcome to the public bank solution conversations about an emerging new american institution publicly owned partnership banks able to through the device a public banking which is a row it was a new development the american stage about one hundred years ago but there's only one bank in the in the country that way now it's the bank of north dakota we're in the process of making many more as you may know the prospect that new jersey people in new jersey are really looking at this very seriously and so we're excited about the prospect and today we have two very special  last edition we were talking about how the international global or the global financial cartel and interests of large banks and other monetarists financial this have taken away of have been parasitically extracting the resources of the people around the world for the sake of special private interests and we discussed a little bit about how public banks intercept that strategy with an actual institution that can do something about reclaiming the control of money the power of money for the people and public interest and we talked a little bit about some of the things that we obviously the people are obviously needing more affordable housing jobs the opportunity for credit for creating small business for new businesses to host of other concerns that are not met or and really are not of particular interest to the international financial cartel which wants to maximize profits rather than create public services as a priority you know that would be an incidental thing but it's profit over people now where we're at a point in the in the national discussion where infrastructure in all of its various realms whether it's transportation or whether it is you know water systems or schools even our health system all of these systems are in need of great improvement but we have not kept pace at all we've failed that one because municipalities and states don't have access to affordable credit because they have to also borrow from the private  here's what we call generically wall street and to focus in on that we're going to i just want to mention now when michael hudson arrived he was delayed considerably because the real line in new york track failures offenders should have been replaced or repaired years and years ago but we're glad you made it michel good to be here it was very hard you know you talk about infrastructure i think to frame the issue a bank what bank can do with this for the last stop five to six thousand years every country in the world has kept infrastructure in the public domain and the reason is that it's natural monopolies the transportation is a natural monopoly  the water systems are a natural monopoly if banks will only be interested in lending money to privatized if the buyers the private buyers of this transportation a water system can add interest charges onto it can add management fees can make a capital gain can and can make it into a stock company and push up other stock prices and they will make their profits by raising the cost of living for the economy as a whole now that's why the american economy is losing its competitive ability so when president trump came in a few months ago he said well you know i'm going to but you know a billion trillion dollars worth of infrastructure but just after the break down and it was on the new jersey line of m track that broke down he said well no no no we're not going to do that we're not going to build a new tunnel has to be private it has to be for my campaign contributors to make a profit there's a reason that  i have all goldman sachs people on my team and they're all investment bankers infrastructure has to be privatized no role of government that means that you have a completely a radical break only relationship to the actual cost of production now suppose that you had a public means of financing for infrastructure instead of having to borrow from the bank the public the public would actually finance the infrastructure and say we're we're charges into the economy without turning it into a stock company without giving a monopoly right which is what the prop what trump wants to create a trillion dollars worth of monopoly rights to extract probably six or seven trillion to turn america into a desert that is the plan of privatizing infrastructure and if you privatized infrastructure through the banks no americans can afford to use it ellen brown has a wonderful story about one example of that private partnership is seen as the as the the solution to a lack of money or a lack of money now that could that whole notion is a is a is a myth is a deception show that it's like i pump tromping the i mean it seems to me the problem is as we know the reason that they have to go to public private is that we have this twenty trillion dollar debt with a debt ceiling on it and so trump is attempting to achieve all these amazing things without going further into debt and as most people think that the only way you can do that is the privatized everything but there is another way and so that's our whole point here is to try to get this message across that there is another way that you can put the just put the money out there it's been done before i just read an article on how lincoln did it in their eight hundred sixty s where they actually literally doubled the money supply with greenbacks us notes and they use that money among other things to build the transcontinental railroad they put sixty two million dollars it was four hundred fifty million of greenbacks they put sixty two million dollars into this railroad they started to two companies that started at either end of the country and built this railroad into the middle and by the time it met seventeen years later they had generated i believe it was one hundred three million dollars so they had a forty percent return before the thing was even completed and dig tied the country together they generated all sorts of economic development i mean one of the most productive periods in american history in other words the government made money i created it putting it in you know no no no government didn't build the railroads it gave the money  to crooks to build the railroad it gave away the land grants destroyed most of the west read frank norris's the octopus about other railroads all of these railroads could have been built without giving away the land grants to the crooks who bribed the congressman to put through so and that's the problem we have to acknowledge the problem of public banking is and with any public thing is if you have crooks running the government and crooks were the ones you can read the history of the great stock that's the word watered stock comes from water giving away stock to government people who give you the right to create a monopoly and to try to reckon the one who isn't part of your gang so this was gangsterism alas and you have to be very careful that if you do have a government bank it's not run by the rip off boys you want to be very careful you need checks and balances on the government that's why there is such a opposition to public infrastructure from the begin with because it's been the objective of the private sector is to corrupt the government most of the money in the fortunes and history have been made from the government and you want you want to make sure that you don't have infrastructure russia style kleptocrats style you want to avoid the kind of yeltsin thing that was done when you put american neo liberals in the chicago boys in charge of something you want to make it sure it's the twenty first century we now have computer systems that could actually hear and see against corruption by making things totally transparent totally immune about this would be basically your black chain not of it comes from big claim which i've been writing about that's after ninety years and importantly and as we talk about it here in new jersey the management of the bank is separated from the special influences of the special interests and the politicians because they are professionally run separate organization that is transparent and accountable to the public but but there is no point of deciding who gets the loans done by special interests the bank decides  within the framework of its mission whether or not the project is worthy and the risks are saved before it lends out the people's money and of course the success is enormous the bank of north dakota has been as outperforming wall street seventy eighty percent two to one in returns on equity so we know it can be done we live in this even though his history might work against the confidence we work in the in the hope that we can organize ourselves democratically and with integrity  as long as public infrastructure was kept in the public domain it was provided either freely or at a subsidized basis and the first business school professor in america simon patton in the eighteen eighties and eight hundred ninety s said public infrastructure is a fourth factor of production along with land labor and capital but the job of infrastructure is not to make a profit or income it's to lower the cost of doing business so that the economy can become more profitable and to lower the cost of living so that wages will go further and that's how you raise the price of living so all of this was spelled out in the nineteenth century and there is no scarcity of money as we mentioned in our last segment you know the banks create money when they make loans  i mean if you look at england under thatcher the privatisation of water it just raised the prices and they've used as a monopoly to squeeze out whatever they can get a private you tell it is going to build all the financial costs and the economic rent go during and the exorbitant salaries in the stock market into the cost of producing a service and the whole idea is of public ownership of basic infrastructure is to provide basic services that everybody has to use in order to live businesses and families in order to provide at below cost or even freely that's why most roads are free if you begin to charge for them you'd have people would have to charge a much higher salary and so they'd have to pay so much money that they couldn't afford to export any goods at all and that's why america can't be a manufacturing country as long as that is run by a financial ised economy and that's a new word that's added to the english language financialization it means when you run the economy for the benefit of the financier's not for the economy as a whole where you build cost structure and ellen said very quickly that half the cost of infrastructure goes for paying interest and that's at least the case now if half the cost of production infrastructure is paying interest is opposed to government funding then you're going to have very expensive roads very expensive water for and the reason that  my train when the train went off the rails and delayed me from being here in new jersey was because the new governor christie of new jersey said no we want to use of the money for something else he he opposed the tunnel and on television you had the new jersey manager saying well wait a minute we're been using the capital budget instead of fixing the rails we've been using it just to break even and so the printer going off the rails twice that's not in the public consciousness yet and yet no what cuz adam smith said no government has ever paid his debt and he can now you can say that no economy has ever paid its debt and the question is how are we going to pay the debt will it be just to to write off the federal reserve could buy up all the government debt then you're not going to hurt any maybe should know that have their twenty five you know look at your little lady is a billionaire you're a little old lady is someone who should have their savings wiped out the problem say on the opposite side of this debt or the savers the one percent the the huge fortunes as long as you leave those fortunes in place they're going to own the government and as we were talking before if the people don't would basically have no business nobody would want to borrow if they can get a better trail at the center bank so they said we could set it up it seems to me i mean i just don't see that it's going to happen that we are going to get rid of the billionaires just by saying give us the money back right make sure that there isn't any public banking remember the private banks are going to fight like anything to prevent a public bank but what you want to do is have a bet a bank that acts differently from the way the banks have pushed our economy into a post two thousand and eight depression that we're still in there well i would like to deliver a message to our president get somebody who had the federal reserve who understands where money comes from and that they have the power to to right to take the entire federal debt on their bikes and it would not be inflationary you can get rid of the debt and you think you they can do many other things it's quantitative think first thing you need to do is change the federal reserve make it actually serve the people you want a central bank that is in the service of the people the big banks but a precondition for being a head of the federal reserve is not understanding how money is created but why would they true that it's called an idiot savant someone who's very smart means well but doesn't have a clue as to how the world works or in this case how money is created the federal reserve was created as in such a way is to shift money creation out of washington into wall street that was the debate that it took one hundred years to culminate in the federal reserve interesting and of course we used the phrase institutionalized deception the concern about the debt for example and the scarcity of money is part of the syndrome of living in this putting up with the scarcity that is part of the economies because if people knew that there is an abundance and an ability for people to have and of course we see the discussion around the world about providing some sort of basic income for people experiments trying to be working in several places seem like a logical place to go if people  moved out of the work environment out of the typical jobs that they were able to to have there are new possibilities for us and of course you were referring to the black train capabilities the digital rendering of currencies and debt and pay people off and start a new san the problems of private debt right now and the brits the private debt that's growing and the financialization of the pension funds i mean we've spoken about all these things before there's an economic structure that goes way beyond that and you talk about institutionalized deception that's exactly what it is it's the idea that people are dependent on the banks and dependent on the rich people in order to get the money to grow they used to be people thought they were dependent on the government to create to create the money to go to grow so you have a whole india logical framework for all of this and it's this framework that is ruling out the idea that government cannot create money or if it does it's going to be hyper inflation weimar and that's that the myth that they're trying to sell so what you're given in the media is missed or else you get just a lack of understanding you know the paul krugman so of the world that don't understand that banks create money they're not savings banks they don't lend out other people savings they actually create money you know you need a you need an economic columnist for the new york times so actually knows what money is as you see it so that rather than just having governments for print money you could have them and then let let foreign investors buy up the bank of north dakota actually did something very interesting and exemplary of what a public bank could do during the depression when the farmers could not pay their mortgages the bank nor the person look where there's bad that's the kind of flexibility for the actual flexibility that a public bank could provide that we really desperately need instead of having millions of people losing their homes for this is what congress passed tried to bring about the and yeah the accountability and the i guess ability of the local relationships and that's of course another aspect of money money really is an expression of the relationship that we have of trust and collaboration together we want to be able to bring killing the host which is the second to the most recent book this is the one that talks about it focuses on the the metaphor of the instance of the financial system being a parasite on the health and well being of the of the sinews of our economy and then jay's for junk economics the new one which are focuses on the deception that we all live with and that we make policy around public policy around which is very troubling this is kind of a wake up call this conversation there's a lot more to talk about we'll do more of that on this program in subsequent issues so thank you very much for joining us and please be able to go check out the website from the public institute dot or gee and also here in new jersey banking on new jersey dot org the effort locally the effort in new jersey to bring about through all of the stakeholder interests all the political interests all of the people here in new jersey to take a stand together to break through this deception and break away from the extraction of the financial interests that have basically determined future thanks again for joining us