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Reply #30: State bank legislation passed in CA [View All]

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eridani Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Sep-20-11 05:49 PM
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30. State bank legislation passed in CA
AB 750, California's bill to study the feasibility of establishing a state-owned bank that would receive deposits of state funds, has passed both houses of the legislature and is now on the desk of Governor Jerry Brown awaiting his signature.

It could be the governor's chance to restore the state to its former glory. As noted in Time Magazine:

"n the 1950s and '60s, California was a liberal showcase. Governors Earl Warren and Pat Brown responded to the population growth of the postwar boom with a massive program of public infrastructure--the nation's finest public college system, the freeway system and the state aqueduct that carries water from the well-watered north to the parched south."

But that was before Proposition 13, a California constitutional amendment enacted by voter initiative in 1978. Prop 13 limited real property taxes to one percent of the full cash value of the property and required a two-thirds majority in both legislative houses for future increases of any state tax rates.

Prop 13 radically reduced the tax base, and it would be difficult to raise property taxes now. The tax savings simply drove property prices up, getting capitalized into additional debt service to the banks. Today, a rise in property taxes would lead to even more foreclosures and abandonments, reducing tax revenues even more.

Meanwhile, the state is struggling to meet its budget with a vastly shrunken tax base. What it needs is a new source of revenue, something that won't squeeze consumers, homeowners, or local business.

A state-owned bank can provide that opportunity. North Dakota, the one state that currently has its own bank, is the only state to be in continuous budget surplus since the banking crisis began. North Dakota's balance sheet is so strong that it recently reduced individual income taxes and property taxes by a combined $400 million and is debating further cuts. It also has the lowest unemployment rate, lowest foreclosure rate and lowest credit card default rate in the country, and it hasn't had a bank failure in at least the last decade.

Revenues from the Bank of North Dakota (BND) have been a major boost to the state budget. The bank has contributed over $300 million in revenues over the last decade to state coffers, a substantial sum for a state with a population less than one-tenth the size of Los Angeles County. North Dakota is an oil state, but according to a study by the Center for State Innovation, from 2007 to 2009 the BND added nearly as much money to the state's general fund as oil and gas tax revenues did. Over a 15-year period, according to other data, the BND has contributed more to the state budget than oil taxes have.


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  -Time to push for a state bank of WA eridani  Feb-12-10 02:40 AM   #0 
  - AM 1090  seattle_blue   Feb-12-10 04:18 PM   #1 
  - There will be a hearing on this bill at 8AM March 2nd  eridani   Feb-20-10 08:19 PM   #2 
  - Update and details  eridani   Feb-25-10 08:43 PM   #3 
  - My report on the hearing  eridani   Mar-03-10 05:47 AM   #4 
  - Observations from Cindy of the 34th LD  eridani   Mar-03-10 05:50 AM   #5 
  - TruthOut article  eridani   Mar-20-10 03:42 AM   #6 
  - Fellowship of Reconciliation is having a workshop on state banks 4/17 (among other things)  eridani   Apr-13-10 10:30 PM   #7 
  - More arguments in favor  eridani   Jun-06-10 10:56 PM   #8 
  - Sign up to be on Rep. Hasegawa's State Bank list  eridani   Jun-17-10 07:02 PM   #9 
  - Talking Points for a State Bank Invest in Washington  eridani   Aug-05-10 03:32 AM   #10 
  - Talking to our State Representatives and State Senators  eridani   Aug-05-10 03:34 AM   #11 
  - Report on the state bank, Oct 11, 2010  eridani   Oct-12-10 01:15 PM   #12 
  - Report on a meeting of Oct 19, 2010 on the state bank project  eridani   Oct-22-10 03:58 AM   #13 
  - Reintroduced in 2011  eridani   Jan-25-11 01:06 AM   #14 
  - Good Idea  LeFleur1   Jan-26-11 09:56 AM   #15 
     - So do Texas and Oklahoma, but they are not running surpluses  eridani   Feb-04-11 05:33 AM   #16 
  - Writeup on the Progressive States blog  eridani   Feb-04-11 05:34 AM   #17 
  - Well, back to the drawing board for 2012  eridani   Mar-05-11 03:25 AM   #18 
  - Thank you for your efforts. nm  rhett o rick   Apr-01-11 02:47 PM   #20 
  - Let's remember McIntire's obstruction  pscot   Apr-01-11 11:34 PM   #22 
  - Join Hasegawa and others on a State Bank conference call 3/24 at 6PM PDT  eridani   Mar-24-11 04:22 AM   #19 
  - Please keep us updated on this effort  BanzaiBonnie   Apr-02-11 06:11 PM   #23 
  - Thom Hartmann was just talking  BanzaiBonnie   Apr-01-11 04:18 PM   #21 
  - One last attempt at progress this year  eridani   Apr-10-11 03:36 AM   #24 
  - New website for a state bank set up  eridani   Sep-06-11 02:21 AM   #25 
  - Frank Chopp designates Bob Hasegawa as chair of state bank task force  eridani   Sep-06-11 02:33 AM   #26 
  - State Bank task force to meet in Olympia 9/19  eridani   Sep-10-11 12:03 AM   #27 
  - Forgive me for coming in on this late. I dont spend enough time in the WAshington the State  rhett o rick   Sep-11-11 04:53 PM   #29 
  - Rest of the meeting dates set  eridani   Nov-01-11 02:34 AM   #32 
  - REport on Bob Hasegawa talk in Renton 9/10  eridani   Sep-11-11 02:28 AM   #28 
  - Videos of the event  eridani   Sep-29-11 06:07 AM   #31 
  - State bank legislation passed in CA  eridani   Sep-20-11 05:49 PM   #30 

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