The labor journal. [volume] (Everett, Wash.) 1909-1976, 1920-11-19
WHO LOSE WHEN
THE PEOPLE WIN?

The following story nails a thou
sand lies and chokes a thousand
campaign liars, quite a number Of
them Republicans, residents of the
State of Washington:
The people of North Dakota are
asking themselves this question after
reading the first annual report of
the State Bank of North Dakota.
The patient farmers of that state,
after years Of exploitation by pri-
vate bankers, spectators, and mid
dlemen, decided to institute bank
"owned, operated, and controlled"
by the people of North Dakota "for
the purpose of encouraging and pro-
noting agriculture, commerce and
industry" Immediately the capital
list press all the way from Wall
Street to Puget Sound attacked them
as insane radicals, Bolshevists, and
destroyers of a safe and sane form
of government. Thousands of dol
lars were poured out for propa-
ganda attempting to discredit the
idea of state-owned bank. The
North Dakota Bankers Association
refused to have any dealings with
the Bank, and allied themselves
with the "Independent Voters Asso-
citation" to defeat the program that
had been repeatedly approved by the
people. Political attacks having fail
ed, Big Business called on the
courts to declare the law providing
funds for the starting of the Bank
unconstitutional. The prompt re-
fusal of the District Court and the
United States Supreme Court to
override the constitutional right of
the citizens of North Dakota to
manage their own banking and in
dustrial affairs was a striking vic
tory for the people over private fl
nancial and industrial monopoly.
Now that the record of the Bank
achievements for the first year of
its operation has been made public
and the smoke screen of propaganda
emitted by the big bankers and
grain barons has subsidized, we find
that this peoples bank, instead of
"plunging the state into financial
ruin" and "bankrupting the tax
payers" shows net earnings for the
people of the state of $241 $500,
of more than II per cent on the cap
ltal stock of the bank.
More important than the profits
made are the services the Bank has
rendered for the people. 1t has
made farm loans of 100000 to
develop agriculture, many of them
to farmers with ample security who
had been unable to get money from
private banks. These loans were
made with profit at an interest rate
from 2 per cent to per cent lower
than that charged by private bank
crS.
The farmers of the state saved
100000 through lower interest rates
at the State Bank. Indirectly they
saved much more because of the
stabilizing effect of the State Banks
rate upon rates charged by other
bankers. Did the farmers lose?
Instead of depositing the money
of the state in private banks, with
little or no interest return, the
so that the state gets fully per
cent interest and has complete con-
troll over its own money. Did the
state lose?
Like every other state, North
dakota mas some rlch communities
and some poor ones. The former
have more money than they need;
the latter always need more money
than they have in order to develop
their resources. The State Bank
modified all the public funds in
the state, redepositing them in local
banks where they were most needed
for the promotion of industry, ag-
riculture and commerce. Did bust
ness, agriculture and industry lose?
The y per cent net earnings Of
the State Bank have been used to
establish a substantial surplus and
to decrease the state debt. Did the
taxpayers lose?
This is the record of a bank es-
tablished for service, not profit 1t
proves that a public banking bust
ness can be conducted with gains for
the people and for the state. 1t
disproves the theory that only pri-
vate bankers have brains enough to
handle credit.
When the pepole win, who lose?