Rep. Pressley, Progressive Members of Congress Urge Leadership to Include Public Banking in COVID-19 Response
WASHINGTON – This week, Congresswoman Ayanna Pressley (MA-07) and five other progressive members of the House of Representatives sent a letter to U.S. House Speaker Nancy Pelosi and Minority Leader Kevin McCarthy, and U.S. Senate Majority Leader Mitch McConnell and Minority Leader Schumer, urging them to include a public banking option for state and local governments in the next COVID-19 relief bill. The letter was led by Congresswomen Rashida Tlaib (MI-13), Alexandria Ocasio-Cortez (NY-14) and Ilhan Omar (MN-05). Reps. Pramila Jayapal (WA-07) and Jesús “Chuy” García (IL-04) also joined the letter.
The members believe that including a public banking option would address critical structural issues within the banking system that have disproportionately burdened low-income communities. By allowing state and local governments to offer a public banking option, the most vulnerable communities would have access to banking services.
“For decades, profit-motivated decisions have driven bank branches to disappear from rural areas and low-income communities, creating banking deserts that are dominated by predatory cash-advance stores. Given that the goal of public banks would be to serve all individuals, these locally controlled banks would not need to weigh their servicing decisions on profitability alone,” the letter read.
The group of lawmakers also pointed to the potential for public banking to be in postal offices. A notable mention as the United States Postal Service continues to explore funding options to address to undue burden Congress imposed on USPS in 2006 to prepay retiree benefits.
“The U.S. Post Office ran the Postal Savings System from 1911 to 1967, and this brought affordable banking services within the reach of Americans nationwide,” the congressmembers wrote.
Public banking would offer transformative solutions for unbanked and underbanked communities.
“By allowing cities and states to offer public bank accounts, Congress can help localities address immediate problems. In the short term, public banks would be a seamless and effective way to deliver relief funds to all eligible recipients. In the longer term, public banks would remedy long-standing systemic problems with our banking system that have disproportionately burdened low-income communities, ultimately bringing about transformational change to the American monetary-financial system,” the letter continued.
The complete letter can be viewed here.