[Peace-discuss] how about an Occupy *bank*? (from The Nation)

[Stuart Levy]

http://www.thenation.com/article/165333/revolution-through-banking

Some excerpts from this article by Carne Ross (along with other good 
words - it's worth reading the full article):

[...] One evening in Zuccotti Park, I somewhat rashly, and without much 
forethought, stood up and announced that I wanted to set up a working 
group to explore alternative systems of banking. I did not have a clear 
plan but felt that we had to get to the heart of the problem. If we 
could change banking and make it embody the values of Occupy—equality, 
transparency, democracy—we might not only change the financial industry 
for the better, but also change the very nature of the economy—and thus 
society itself.

Other members of the group share this ambition. Those who have joined 
the group represent an extraordinary and eclectic mix. There are army 
vets and unemployed students, but also a large number of financial 
experts: former derivative traders, SEC regulators, bankers, financial 
analysts and bloggers and even a professor of financial law. We have no 
shortage of expertise, and no shortage of determination either.

Over the last several weeks, we have been examining what legislative 
changes are needed to reform the banking sector: some day soon there may 
be Occupy-originated proposals and draft legislation, for instance to 
amend the so-called “Volcker Rule”. One group has split off to explore 
and design the creation of an ideal bank that would put into practice 
the values of Occupy. What would this look like?

The ideal bank would be democratically owned and controlled by its 
customers and its employees. Like at many credit unions, all depositors 
would get an equal say, regardless of the size of their accounts. It 
would be nonprofit, building in a competitive advantage over the 
for-profit banks. It would be accessible to all, in particular the poor 
(we are inspired by the Grameen Bank, started by Mohamed Yunus in 
Bangladesh). It would be a bank that anyone can bank with and receive 
better service than what they receive today at conventional banks. Any 
small-scale bank we establish in, say, New York would have be to be 
replicable by others elsewhere.

The banking crisis was caused by several intrinsic characteristics of 
the financial system. The level of debt and risk was concealed by the 
unintelligibility but also by the secrecy and opacity of many banking 
practices. The infamous credit default options concealed risk as they 
spread it and were barely understood even by the bankers trading or 
buying them. In contrast, an Occupy bank would be wholly transparent, 
perhaps even in real time, showing transactions as they happen. 
Technology now makes this plausible. Likewise, technology has enabled 
new peer-to-peer platforms where borrowers and lenders negotiate with 
each other directly. We have also discussed minimizing risk by adopting 
some of the ideas of Laurence Kotlikoff, whose concept of “limited 
purpose banking” permits no buildup of liabilities within a bank, 
because all liabilities would be mutualized. Kotlikoff proposes that 
banks would essentially become clearing houses where investors would 
“buy” the loans of other customers via a cash-based mutual fund. The 
bank would not itself hold any loans, thereby eradicating the risk of a 
bank run.

[...]

Our group works on, and we are well aware that we may not succeed. But 
there are other groups around the country thinking about this problem: 
Occupy San Francisco is already setting up its own credit union. Perhaps 
our work will inspire someone else to set up a bank like the one we are 
imagining. If many attempts are made, there is a greater chance that one 
will succeed.

Make no mistake, the kind of bank we are discussing is both plausible, 
and better, than the conventional for-profit banks. It can and should be 
done. These ideals are the stuff that make Occupy such an exciting 
movement to be part of. The chance exists to change the very nervous 
system of the economy, and make it fairer, open and more democratic. In 
this way, we can begin to undermine the domination of our economy and 
society by those who seek nothing but profit, at any cost, including to 
the world economy. We can replace it with a system which both embodies 
and promotes other values that are equally if not more important: 
equality, democracy and justice.