The Co-op idea lives on

Those of us still clinging doggedly to the ‘caring, sharing’ principles that underlie the Co-op movement may take heart from what’s happening in Vermont. Probably the most European of the States, it is currently thinking of instituting a public bank of its own.

The idea is fundamentally co-operative. The Vermont Economic Development Authority would apply for a banking license and allocate 10% of taxes collected by the state for the state’s own use. At present, all tax income goes to large banks outside of the state, which are free to use it as they like. If Vermont controls its own finances, it can fund projects that benefit the state and local economies, including granting loans to Vermonters. It is, in fact, a replica of our Credit Unions, which communally-minded people are increasingly turning to.

Vermonters have voted about 2:1 in favour of public banking. Town meetings are going on, and they have, in the American phrase, ‘done the math.’ Supporters calculate that a State bank would create more than 2,500 jobs and generate about $350 million annually. And that’s in a State comprising only 600,000 citizens.

They have a good model to work on. North Dakota. the ‘Peace Garden State’, has had its own bank for 99 years. The Bank of North Dakota helps to fund large projects, and it provides inexpensive loans to students, businesses and farmers. Its financial stability has made North Dakota one of the few states that have weathered the recession in the past five years with no serious trouble. Whether Vermont will follow remains to be seen. The Wall Street banks will of course fight their community bank idea every inch of the way.