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My Presentation to the New York Trilevel Task Force on Jobs

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From the Bank of North Dakota's (BND) website: " All state funds and funds of state institutions are deposited with Bank of North Dakota, as required by law ." [2] These monies are loaned through a network of community banks in a harmonious relationship that benefits both the banks and the citizens of North Dakota. The BND sailed through the crisis of the last couple of years with a profit, unlike so many other larger banks, which had to be bailed out. [3]

New York State could also establish a bank that would extend loans to small businesses and individuals [4] to create new opportunities and recreate a competitive credit environment. New York has ample "seed" money to fund a State Bank from abundant reserves in State and municipal agencies, variously estimated to total nearly half a trillion dollars. The introduction to the state's Comprehensive Annual Financial Report (CAFR) for 2009 [5] cites a budget deficit of $8 billion. However, in the same report, there are net Fiduciary assets, worth $111 billion (pg. 42) [6] . Alarmingly, the loss from equity and bond investments, and management fees, totals $40 Billion, (pg 84), a figure over 4 times greater than our budget gap! For the privilege of mismanaging the people's investments, the state paid a whopping $773 million administration cost - none of which went to our citizens (pg. 43).

This is only the tip of the iceberg. The state has thousands of various government CAFRs with investments like this. What the citizens of New York need is a comprehensive and independent accounting - and analysis - of how to maximize these funds for the public benefit.

Some of these monies could be used to invest in state needs, such as infrastructure, while taking only prudent risk. Today, I ask the task force: which types of investments are more risky - the kinds of investments made by investment banks which lost $40 Billion last year, or the kinds of investments made in state and local needs, which are not securitized, nor divvied up and resold to foreign investors, and which instead provide good jobs in the state for those who need them now more than ever? Local is not only better for the state, but better for the bottom line too.

In short, the State is not broke. Even according to current under-assessments from the New York City Department of Finance, and crunched by Common Ground's proprietary Real Estate Database, there are at least half a trillion dollars in city land values alone, [7] ready to be properly taxed, to go with the half trillion in all the State's CAFRs.

With this money and resources, and by untaxing wages, capital, and sales, jobs can be created by the people, for the people, of the State. It's just a matter of determining the best use of all available resources.

I believe in the can-do spirit and ability of the American worker and entrepreneur, but I also believe government has an essential role to play in making conditions favorable for that spirit and ability to assert itself. A Land Value Tax and a State Bank would both go a long way towards creating the environment that would make New York a leader in job creation for the country. It would be consistent with the best of our traditions, including the American tradition of creative problem-solving.

List of supporting sites

http://commongroundnyc.org/ - Common Ground-NYC's main site, showing assessment disasters

http://groups.google.com/group/common-ground-nyc - Professor Steven Cord's papers are in the Files section.

www.nd.gov/ndpers/forms-and-publications/publications/"‹2009-annual-report.pdf - North Dakota 2009 CAFR

http://www.banknd.com/about_BND/index.html

http://www.banknd.com/lending_services/2009/legislativeprogramchanges.pdf

http://www.huffingtonpost.com/ellen-brown/the-growing-movement-for_b_504846.html - Ellen Brown is the leader in the State Banking Movement

http://www.businessweek.com/ap/financialnews/D9ID269O0.htm

http://www.statebudgetsolutions.org/publications/detail/nd-budget-outlook-1b-budget-surplus-in-july - North Dakota posts a budget surplus in 2010

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http://newthinking.blogspot.com/

Scott Baker is a Senior Editor/Economics Editor and Writer at Opednews, and a blogger for Huffington Post.
Scott Baker is President of Common Ground-NYC (http://commongroundnyc.org/), a Geoist/Georgist group. He has written dozens of (more...)
 

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Op-Ed News rules, eh?:)your friend,Ned... by Ned Lud on Thursday, Oct 14, 2010 at 9:55:40 AM