Famously, federally insured banks and credit-unions won’t take deposits from the marijuana industry, even in states where marijuana sales have been legalized; this leaves the weed industry dealing all in cash, from safes in the basement to sacks of money delivered to the tax-office by armored car.
There’s an alternative: state-backed public banks, like the ones in North Dakota, where the state-run banks were relatively unscathed by the 2008 mortgage crisis. These banks are publicly owned, and use deposits to fund local investments (rather than playing the stock market or other high-risk activities enjoyed by the too-big-to-fail federally insured industry).
Matt Stannard of Commonomics USA, a group that advocates for a commons-based economy, said California could deposit revenue in a public bank, use that money to make loans, and recycle any profits toward state projects. This is what North Dakota has done to the tune of $85 million in the past four years. Stannard previously said that as the sixth-largest economy in the world, California’s path forward will carry much weight. If California decides to move forward with a publicly-owned bank, the implications are bound to resonate throughout the country’s banking sector.
Could the Marijuana Industry Bring Public Banking to California?
[Aaron Fernando/Shareable]
(via Naked Capitalism)
(Image: Christopher Thomas, CC-BY-SA)
