PUBLIC BANKING WORKS

Public Banking Author: JPMorgan Chase Settlement Inadequate,
Doesn't Deal with Root of Problem

November 21, 2013

For Immediate Release
Contact: Matt Stannard
Development Director, Public Banking Institute
matt@publicbankinginstitute.org

Public Banking Author: JPMorgan Chase Settlement Inadequate, Doesn't Deal with Root of Problem

Last Tuesday, JPMorgan Chase, America's largest bank by assets and a multinational holding company, agreed to pay thirteen billion dollars to to settle investigations into its business practices pertaining to mortgage-backed securities--practices which helped wreck the economy in 2008. This includes $9 billion in fines and $4 billion in consumer relief. $13 billion is half of the company's annual profits. A criminal probe into JPMC's activities continues, and won't be slowed down by the settlement agreement.

Although the settlement is hefty, and criminal investigation serious, is it enough to prevent Wall Street from betraying Main Street again? Author and Public Banking Institute President Ellen Brown is skeptical. Brown's most recent book is The Public Bank Solution, a 471-page comprehensive treatment of public banks, and she writes scores of articles for Huffington Post, TruthOut, Alternet and others. Brown says the biggest problem is that bank losses are socialized, while bank profits are not. "If we're going to socialize the losses," she says, "we should socialize profit as well, which means we should own the banks."

Brown points out that the settlement is "less than 2% of the $1 trillion in mortgages [the company] sold to investors," and that the remaining costs will likely be passed on to customers. Indeed, JPMC is seeking tax deductions to cover its fines, in essence robbing the public a second time.

The Public Banking Institute is a non-profit, non-partisan educational organization dedicated to the creation of a network of public banks. PBI's 2013 conference featured Brown, Birgitta Jónsdóttir, Matt Taibbi, Michael Lerner, Margaret Flowers, Kevin Zeese, and other leading economic writers and activists, all of whom discussed issues related to the crash precipitated in 2008 by JPMorgan Chase and others.

Supporters of public banking are currently launching a Friends of Public Banking campaign with a goal of creating public banks in all fifty states in the U.S.

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