Oregon has long been known as a legislative leader. Our Gas Tax, Beach Bill, Family Leave Bill, Bottle Bill, and more have gone on to become model legislation for other states and the entire country. Now, Oregon is looking to break new ground not by leading but by following the lead of another state… North Dakota, the only state with its own bank. Legislation currently moving through the Oregon Legislature would create an Oregon Bank, a bank owned by (and for the benefit of) the citizens of Oregon.
The Bank of North Dakota was founded in 1919 by farmers who had gotten fed up with the tight credit from banks in the East. State agencies are required to deposit their funds in the State Bank, although local jurisdictions are not. While it has limited commercial-bank features, the Bank of North Dakota acts as an economic development agency and “banker’s bank” by guaranteeing the loan risks of private banks and helping to finance larger projects. It also offers low interest rate loans to farmers, students and businesses.
An Oregon State Bank would also operate as a profitable business, run by independent management and subject to the same rules as other banks. It would not compete with local banks but would support and strengthen our state banking system in business, school, and home loans.
The fundamental difference between an Oregon Bank and the banks the state currently uses is that we, the people of Oregon, would be the owners. Profits would not be siphoned out of Oregon and into east coast or overseas banks, but would stay here to help our state and be responsive to our needs and priorities. How big a difference could that make? Pretty big…
- While Oregon has lost 148,600 jobs and nearly 100 family farms so far in this recession, Bank of America reduced the number of low-interest, small business loans by 92 percent. During the same period, the Bank of North Dakota increased its lending to farms and businesses by 35 percent.
- The Bank of North Dakota returned almost $300 million in profits in the last decade, in a state with one-fifth the gross product of Oregon. This would go a long way to covering our $300-$500 million biennial shortfall.
- Under banking regulations a state bank can leverage deposits in a way that loan programs can’t, meaning more credit is available for local businesses and farms.
- While official unemployment in the rest of the country is around 10% (and real unemployment is near 17%), North Dakota’s unemployment hovers near 4% and hasn’t been greater than 5% since 1987.
- North Dakota’s total productivity has grown 7.3% during the recession, expanding twice as fast as every other state but Wyoming (4.4%). It’s probably not all because of their State Bank, but it also probably didn’t hurt.
States have always deposited in big banks because… well… because they’ve always deposited in big banks. It’s worked for a long time. Whatever level of graft and corruption resulted was within acceptable limits, and it wasn’t worth the effort to build a new system to replace the old. However, the bank-driven financial meltdown has shown us that our economy has changed, and it’s negligence, laziness, or denial to pretend it will work like it always has. It’s time to build new systems, but whatever we build will have to be based on new thinking that takes the new reality into account. A State Bank is a reasonable, simple step that will keep our money here, in our State, working for us, and not thrown onto the bonfire of an east coast banker’s greed.
The Oregon legislature is currently considering House Bill 3452 and Senate Bill 889, which would streamline some of the state’s economic development funds and result in an Oregon State Bank. OUR LEGISLATORS NEED TO HEAR FROM YOU! With millions of dollars at stake every year, you know there’ll be pressure from the banking industry to kill these bills. If this issue doesn’t have the vocal support of Oregonians, it will be far to easy for legislators and lobbyists to sweep it under the rug. If you’d like to educate yourself further on this vital issue, we have an page here with links to more in-depth information, including a petition from the Oregon Working Family Party in support of the bank. If you’d like to go further, we have contact information for State and Federal representatives in the Politics section of our website. Thanks in advance for your help!
Digging Deeper…
Hear our KPOJ spot in support of an Oregon Bank
Barbara Dudley outlines the need for a State Bank
Basics from Wikipedia on North Dakota’s State Bank
SIGN THE PETITION FOR AN OREGON STATE BANK HERE!
A State Bank of Oregon would be a huge step toward our ability to build a local, sustainable economy, and to reduce the amount of money sucked out of our state to private interests. Please look over some of the above information, and then sign the petition if you’re so inclined. Your voice matters!
