Incorruptible Massachusetts

Public Banking: How our State House power structure kills no-brainer solutions

March 20, 2020 Season 2 Episode 4
Incorruptible Massachusetts
Public Banking: How our State House power structure kills no-brainer solutions
Chapters
Incorruptible Massachusetts
Public Banking: How our State House power structure kills no-brainer solutions
Mar 20, 2020 Season 2 Episode 4
Anna Callahan

Hi, this is Anna Callahan and you’re listening to Incorruptible Massachusetts.  Our goal is to help people understand state politics: we’re investigating why it’s so broken, imagining what we could have here in MA if we fixed it, and reporting on how you can get involved. 

Today I’m interviewing Charles Grigsby from Mass Public Banking Group.  Their mission is to persuade the legislature to authorize a public bank in MA.  

This interview was a surprise to me.  I wasn’t surprised to find out how beneficial a public bank could be, but I was surprised to find that the effort to pass this legislation was a perfect example of the broken nature of the state house. 

The city of Boston spends 67 million dollars a year just on interest — that’s money that comes out of your pocket in taxes and goes to the 1% owners of Wall St companies.  Every city in MA does this, and it makes municipal projects cost 30%-50% more than they normally would.  Having a public bank would save every city in Massachusetts millions of dollars.  It’s a total no-brainer.  So why are we not able to pass this legislation?

If you have been listening to this podcast, you won’t be surprised by the answer.  Both the Governor and the Speaker of the House directly benefit from us not having a public bank.  The Governor gives out grants to cities and towns, and in return mayors have to play nice with him.  Speaker DiLeo also hands out state money to house districts called “budget earmarks”. This is just one of the powers he has that gives him so much influence, and why house members do what he tells them to do rather than voting the way their constituents want them to.

A public bank would reduce the concentration of power we have in our state.  It would give cities more autonomy; it would mean that districts were not so desperate for these earmarks.  So the speaker will make sure this doesn’t pass, because it would reduce his personal power over state reps, and consequently over what laws can pass in our state.

In any other state, we’d ask you to call your state rep and insist that they co-sponsor the public banking bill.  But here in MA, your state rep could sign on officially as a cosponsor, then secretly kill the bill because you have no way of knowing how your state rep votes.  

So all this points to how important it is that we make our state house transparent.  

Chuck began as an international banker at Bank of Boston. He has managed a minority enterprise venture capital fund, served on the Board of Boston Private Bank, was President of Mass Growth Capital Corp. In addition to being on the steering committee of Massachusetts Public Banking he is on the advisory board for the Public Banking Institute.

Show Notes Transcript

Hi, this is Anna Callahan and you’re listening to Incorruptible Massachusetts.  Our goal is to help people understand state politics: we’re investigating why it’s so broken, imagining what we could have here in MA if we fixed it, and reporting on how you can get involved. 

Today I’m interviewing Charles Grigsby from Mass Public Banking Group.  Their mission is to persuade the legislature to authorize a public bank in MA.  

This interview was a surprise to me.  I wasn’t surprised to find out how beneficial a public bank could be, but I was surprised to find that the effort to pass this legislation was a perfect example of the broken nature of the state house. 

The city of Boston spends 67 million dollars a year just on interest — that’s money that comes out of your pocket in taxes and goes to the 1% owners of Wall St companies.  Every city in MA does this, and it makes municipal projects cost 30%-50% more than they normally would.  Having a public bank would save every city in Massachusetts millions of dollars.  It’s a total no-brainer.  So why are we not able to pass this legislation?

If you have been listening to this podcast, you won’t be surprised by the answer.  Both the Governor and the Speaker of the House directly benefit from us not having a public bank.  The Governor gives out grants to cities and towns, and in return mayors have to play nice with him.  Speaker DiLeo also hands out state money to house districts called “budget earmarks”. This is just one of the powers he has that gives him so much influence, and why house members do what he tells them to do rather than voting the way their constituents want them to.

A public bank would reduce the concentration of power we have in our state.  It would give cities more autonomy; it would mean that districts were not so desperate for these earmarks.  So the speaker will make sure this doesn’t pass, because it would reduce his personal power over state reps, and consequently over what laws can pass in our state.

In any other state, we’d ask you to call your state rep and insist that they co-sponsor the public banking bill.  But here in MA, your state rep could sign on officially as a cosponsor, then secretly kill the bill because you have no way of knowing how your state rep votes.  

So all this points to how important it is that we make our state house transparent.  

Chuck began as an international banker at Bank of Boston. He has managed a minority enterprise venture capital fund, served on the Board of Boston Private Bank, was President of Mass Growth Capital Corp. In addition to being on the steering committee of Massachusetts Public Banking he is on the advisory board for the Public Banking Institute.

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Anna Callahan:
00:02
Hi, this is Anna Callahan and you’re listening to Incorruptible Massachusetts.  Our goal is to help people understand state politics: we’re investigating why it’s so broken, imagining what we could have here in MA if we fixed it, and reporting on how you can get involved. Today I’m interviewing Charles Grigsby from Mass Public Banking Group.  Their mission is to persuade the legislature to authorize a public bank in MA.  This interview was a surprise to me.  I wasn’t surprised to find out how beneficial a public bank could be, but I was surprised to find that the effort to pass this legislation was a perfect example of the broken nature of the state house. The city of Boston spends 67 million dollars a year just on interest — that’s money that comes out of your pocket in taxes and goes to the 1% owners of Wall St companies.  Every city in MA does this, and it makes municipal projects cost 30%-50% more than they normally would.  Having a public bank would save every city in Massachusetts millions of dollars.  It’s a total no-brainer.  So why are we not able to pass this legislation?If you have been listening to this podcast, you won’t be surprised by the answer.  Both the Governor and the Speaker of the House directly benefit from us not having a public bank.  The Governor gives out grants to cities and towns, and in return mayors have to play nice with him.  Speaker DiLeo also hands out state money to house districts called “budget earmarks”. This is just one of the powers he has that gives him so much influence, and why house members do what he tells them to do rather than voting the way their constituents want them to.A public bank would reduce the concentration of power we have in our state.  It would give cities more autonomy; it would mean that districts were not so desperate for these earmarks.  So the speaker will make sure this doesn’t pass, because it would reduce his personal power over state reps, and consequently over what laws can pass in our state.In any other state, we’d ask you to call your state rep and insist that they co-sponsor the public banking bill.  But here in MA, your state rep could sign on officially as a cosponsor, then secretly kill the bill because you have no way of knowing how your state rep votes.  So all this points to how important it is that we make our state house transparent.  Chuck began as an international banker at Bank of Boston. He has managed a minority enterprise venture capital fund, served on the Board of Boston Private Bank, was President of Mass Growth Capital Corp. In addition to being on the steering committee of Massachusetts Public Banking he is on the advisory board for the Public Banking Institute.
Anna Callahan:
02:51
Hey there. Um, welcome back and I know I'm really excited to be here with Chuck Grigsby Hate.
Chuck Grigsby:
02:59
Thanks for inviting me.
Anna Callahan:
03:00
Absolutely. We're gonna talk about public banking, which I think is ah, a thing people don't know enough about -- a really fascinating solution to our revenue issues. And first, I just want to ask you the name of your organization and the mission of your organization
Chuck Grigsby:
03:21
We call ourselves the mass public banking group, and our mission is to persuade the Legislature to authorize the creation of a public bank in messages in the public bank is very different private back because the public back works for the public, it doesn't have to create dividends. It doesn't have to worry about earnings every quarter. It doesn't have to pay big salaries to managers. It doesn't have branches all over the state. It doesn't have ATMs. It just works to do financing for the public, through municipalities, to citizen towns. It doesn't finance businesses. It doesn't finance individuals. It finances cities and towns to do what they need to do and keeps the money in the state. Instead of all that interest between being paid out of state, money circulates within the state. One example is that the city of Boston now pays $67 million a year in interest. That money leaves the state every year. It might go to Fidelity, which is our state. But then it goes to people who don't live in the state. And so you and I who are paying taxes are sending that money someplace in the world. We're not sending it in our state. We're sending it out of the country.
Anna Callahan:
04:33
Wow. And we're sending it to the 1%.
Chuck Grigsby:
00:00
Yes  
Anna Callahan:
04:37
Our hard earned dollars --
Chuck Grigsby:
04:38
That's exactly right
Anna Callahan:
04:40
-- being sucked up by Wall Street,
Chuck Grigsby:
04:41
and it doesn't do anything for us. So public bank works for the cities and towns in the state to do whatever they need to do. In our case, we're suggesting that the public bank start focusing on infrastructure: roads and water problems and little floods that happen in cities and towns. Schools, small office buildings like police stations, or community centers. Those are public, publicly-financed issues that, right now, cities and towns have a few ways to finance them, but not enough ways to finance them. So we're looking for a public bank that could help cities and towns do what they need to do to keep us safe and then to grow.
Anna Callahan:
05:20
Wow. So it sounds like currently, at least Boston and probably some other cities and towns, one of the things that they do in order to meet their financing needs is they take out loans from banks -- is that accurate?
Chuck Grigsby:
05:39
They don't take out loans from banks because banks don't want to loan to a city or town. Think of what happens if you are a bank and the loan goes bad -- you don't want to foreclose on that town -- you'd lose all of the customers in that town. So banks don't want to lend to cities and towns. What they do do is support a municipal bond which are sold widely. And so that the town or the the bank just leads the city of town to an investment banker. And that banker floats the bond, charges them a lot of money, and that bond is what finances the infrastructure. So if the city of Boston has a $2 billion.5 year capital plan to repair and build all their city buildings. Have to raise the money in the bond market to pay for that over five years. So every year they're raising maybe $500 million in bonding. Outlet goes outside the state to pay for stuff in C. C. Does look building schools, repairing things, building roads in this city, building community centers, building police stations, building libraries. That money has to come from somewhere. So it comes from outside the state now in this form of municipal bonds. And so the City Council approves it,
Anna Callahan:
06:55
and then, uh, the the S O. Sorry that I'm kind of a novice about this, but it sounds like the city has to pay some sort of a fee just to have these from the banks. And there's also the interest bonds and that all is paid to sort of, you know, investment like one percenters out-of-state.
Chuck Grigsby:
07:16
The problem is that missile bonds increase the cost of product from 30 to 40 to 50% because their fees, their commissions, their bond lawyers it's a specialty and their placement fees. For instance, if the City of Boston placed a $200 million loan, a bond in the market It'd probably pay close to $250,000 in fees just to get that bond placed as a starter, never mind the interest rate on the bond. That's just the fee to get that bond placed in the marketplace. So think of Holyoke or Brockton or New Bedford trying to pay that kind of money. They're just the bond place of the actress. They don't kill in place. They don't place the bonds. They can't sell a bond because they can't afford to cover the cost of paying the bond.
Anna Callahan:
08:04
That is incredible. And really, we're talking about U. S. Dollars --  in order for cities in towns in the United States to get access to U. S. Dollars, they're paying these crazy fees to 1% bankers.
Chuck Grigsby:
08:20
and the Wall Street Will has rules. One of the rules that we appointed to last year, which let us put us on the Wall Street, attended, like to put my car up. I think Way pointed out that Wall Street bonds require that the total death service of a city of town cannot be more than 6% of the total annual budget. So that protects the bondholder. But it caps what a city a town can do.
Anna Callahan:
08:48
Yeah -- that's austerity
Chuck Grigsby:
08:52
So we point purported that out. So all of a sudden the city of the bond market told you, will you go to 7% of 9%? So they increase it because they heard that we were saying that the problem. But nevertheless, that caps what a city or town could do. The state says that most cities or towns could handle 10 to 12% of their budget for debt service to carrying bonds, but by Mark wanted to do that so they can't get the cat for bonds.
Anna Callahan:
09:16
So Let's talk about how it would work with a public bank. How will it be different?  
Chuck Grigsby:
09:22
It would work in a couple of ways. First, it would have no branches, no ATMs, no big advertising campaigns, no big budgets. And it would simply say, What city or town? What do you need? A city or town needs a $1,000,000 not 10 million off. We could do that. The bank could do that, could make a small loan That's a small loan to a city or town, and they could work it out when they need to work it out. We want a board of directors, there's a skilled, and we also want an advisory committee that meets with the board and with the management once every quarter, once every six months to say to the back, you're not doing what we need you to do. You know we need to change that policy. This policy doesn't work for us without operating. Thing doesn't work for us, so that there's a way for the city of town to weigh in on what the bank is working for them or not, and, uh, and that's that's a difference than what a private bank is private Bank has a board of directors but not an advisory committee.
Chuck Grigsby:
10:16
So the bank would be capitalized once by the state and would never need to go to see the state again for money because once this capitalized can do, it can grow forever. It would have a deposit made by the state. The state has about a 1,000,007 of money floating around the state and very supplies. We just want 300 million of that for a department for the back. And with $50 million equity investment by the state direct appropriation, this bank could grow forever. It would never need to go back to see the state again. I'm like a loan fund or, like the Karzai publication, just have to go back to the state every few years to get more money. This bank will never go back to ST again, and it could, uh, could work their regular citizen times to provide the financial that they need directly at 2%, a max of 2%. And that's not just my number, we asked. One of the best CPA firms in the state, absent ends with Harrington to do a Senate projections for us in a 2%. With no big fees and no big families salaries paid. This bank could be profitable within three years.
Anna Callahan:
11:25
Wow. So, um, I really want to get to the fact that this is a no brainer and talk about what is working against us. But first, you and I were talking just before we started the podcast about why --- so we know that California just passed a law and can now have banking for cities, towns in up to a certain number
Chuck Grigsby:
11:48
for 7 banks.
Anna Callahan:
11:50
Yeah, And so I was fascinated by what you're saying about the politics of Massachusetts and why it's better here for us to have a statewide bank.
Chuck Grigsby:
12:02
Um, the cities and towns outside of Boston are are poorer than you think they are. The real estate values in New Bedford are not wonderful. And so they can't raise a lot of money to satisfy the bond market. The other source of funding outside Boston in Massachusetts is grants that the governor gives out. But you don't. You're gonna get the graft. You don't know if you're gonna be get all you need. You typically with daily pride. 35% of what you need, and so you still have a big gap of what you need. You don't know when the grants coming out. You don't know if he's going to forget it. And what that the problem for us is that that means that the governor and let's I want control grants to citizen times of the control. They're the things that they get. A supposed toe responded what they need. Here's we'll give you when we will want to give it to you And it's It's not a great approach to life. So cities and towns have the grant program mass called Mass Works. They have the bond market, Uh, and then the Legislature has promised some new bond issues, but they're not on the table yet, They say, Well, we'll provide a $1,000,000,000 here over 10 years. 1,000,000,000 are there were 10 years, but those are just promises so far. So citizen time, still on every way of getting all the fancy they need for for things they need, like schools and roads and water problems. And we're way behind in helping cities and towns to prepare for climate change when there's flooding in their town. or to decrease the flooding, or to control the waterways. And there were way behind in doing that. So this fund would help them do that as they need it, and it could respond quickly. If there's a flood, you could respond within a few weeks, as opposed to waiting till the next six months for the next grant program to come through. So it it will be Avery very Responsive stores of financing the cities. The Times could cop directly and talk to the Linda directly. We need this by next month. Can we start talking about that? Yes, we can, and it's 2% so they could afford it. And, um, and they would be able to work directly with the lender.
Chuck Grigsby:
14:15
Let's let's have said to me how risky it is, why it is risky. And the answer is citizen towns can't close their doors, and over the next days, the new company, like a bit of company can. When a company called closes doors, they lose all their debts when they close their doors and change their name. A town can't change its name overnight so, uh, the risk is very very low. The last default of a city or town was eight years ago when a garage in Boston didn't meet its projections. And so if you just stagger the loan and restructuring plan out of a longer period time. The last loan that went bad before that was 20 years ago, when Boston City Hospital was not adequately capitalized when it merged with Boston University, and that needed to be restructured. So the risk is very, very low of lending to a city or town. Um, and that's far less risky than a commercial loan to a company.
Anna Callahan:
15:10
Oh, yeah. Um, and as far as like a state would make versus the individual municipal banks in California, there are all these large cities and big metropolitan areas before is here it sounded like, Yes, there's really Boston has a large city. Um, and you know, if Boston wants a municipal bank, why would all of the town in western Massachusetts vote for that? But all those small towns in western Massachusetts, they're not nearly big enough to have one. So so that from a from the question of should we go with the California model, which is really about multiple municipal banks versus what you guys air pushing for, which is, Ah, statewide bank that could serve any city or town that in Massachusetts. Given our sort of one big city and tons of tiny towns that don't have a lot of power, it makes more sense here. First,
Chuck Grigsby:
16:03
it makes a lot more sense. You know, One bank in California, Los Angeles and San Francisco are vory wealthy cities in Boston. He goes down very quickly after you leave Boston. And the second thing is that because of the the lack of comfort over the years between Western mass. Nixon, Mask need to have one bank that serves the whole state and develop the trust of Western Masters season towns to do this. That's why we're not asking for any deposits from a time saying just to be a state, make the parts initially down the road. It's two dozen times gonna make a deposit back. They will find it. We'll find a way to do that. But let's start off with just a state deposits and then dot the trust in the city in time statewide, and then see what things is the bank does on dhe people have all kinds of suggestions, which, which are important suggestions, like student loans that had been affordable, like being able to do a just support, affordable housing, where cities, towns allow it and all the problems of the banks now don't want to solve because they don't want to get into it. And probable, they don't want to get in debt down for out of the weeds.
Anna Callahan:
17:15
So it sounds like this is a complete no brainer, right? I mean, all the legislators are like, Well, we would pass this if only we had the budget. We don't have the budget. What's what we can't do? A great deal can't affordable housing. We can't look at you. Go on and on and on is why we can't do things because we don't have a budget. Um, it sounds like this would very clearly provide cities and towns with it would just flat out save them a ton of money, a ton of money so as to complete no brainer. Right? What is the opposition?
Chuck Grigsby:
17:52
The opposition? The first opposition is Wall Street. As I mentioned before, when we pointed out last year that the Wall Street policy of not letting to a city a town if their debt service was more than 6% of the total budget. And since they changed that, I were on their screen. Now they don't like us. Second opposition is that, frankly, is that the governor and the Legislature want control grants to citizen towns for whatever benefit they can get from that.
Anna Callahan:
18:24
That's the power that they have.
Chuck Grigsby:
18:26
That's a very powerful thing. The governor walked around the state last year giving out $120 million to Citizen Town. Now they couldn't plan for that crazy that they didn't know who's gonna do it, and they didn't know when he's gonna do it or what they're gonna get a grant or not. But But he walked around giving out Grant. Those have pretty good photo ops for the for the governor,
Anna Callahan:
18:44
not just photo ops. I mean, you know, these mayors of these towns have to, like, play nicey nice with the governor. I don't get this grants.
Chuck Grigsby:
18:51
And the Senate. The House speaker, Speaker Giulio says he wants to put together AH, $1,000,000,000 Green Fund with a small loan program. He's he heard about our planet. I'll give you put a small loan program at 2% now. He hasn't done it yet, but he keeps citizen times off balance. But I think I'm going to do this. So they're waiting, waiting, waiting. Well, it's gonna be a graft from the better a grant, but it hasn't. It's not here yet. I'm going to do this. I'm going to do this. I'm going to do this. He hasn't done it yet.
Anna Callahan:
19:19
Way We've talked a lot on this podcast about the power specifically just in the state House power that speaker and how damaging that is to the culture in the statehouse entered the way that people vote, the voting patterns and everything. So what you're talking about with the governor is like, very clear. He can hand out favors is long as there's no public bank. He's the only person who could hand out favors. That's right. He can get favors back. And it sounds like also with the speaker. Like, if you're a state rap, you know you're a state rat for some city. And if you want your city to be getting, you know, uh, where they called the, um I'm blanking out on the word but like the amount of a certain amount of money for specific projects city, then the speaker is the one who can give those. And as long as there's no public, thank
Chuck Grigsby:
20:19
you. Lt's a case
Anna Callahan:
20:19
to have that power.
Chuck Grigsby:
20:21
He holds the key baton up a little bit. One of the problems that we have in the state is the Democratic Legislature wants her for working a governor because we stand from the government. They're the they're the governor. Uh, I've done this a long time ago because if if they if they're Republican governor, then he won't do anything that they don't want because they control the votes in the legislation. If they have a Democratic governor, he'd be able to go out and raise raised support from isn't from his own party to do things that the little didn't want headed kid pregnant. Fetch along. So they Democratic Legislature wants the Republican government Think of it, Romney. Well, baker go all way back. And I learned this a long time when I worked with the Mayor Menino and there was a Democratic former Democratic attorney general who was running for governor, and they gave him one poor worker, one worker to be sure that they had a Republican governor. And that's been the trend of the state for years. So that's one big problem that they want. Republican governors. So you might remember that. But a year and 1/2 ago, Airbnb said, Please tax us. So we got on equal footing with small hotels in the letters that no, the government doesn't want to sign a tax. Because if we've passed this the governor to sign a tax, whatever. If you turned down attacks, we want to embarrass the governor. We don't make make himself so they didn't even consider it. Now there'll be Airbnb asked to be taxed on. Leslie said, No, we don't want to force the government Say yes, I know in attacks.
Anna Callahan:
21:57
This is a girl. I have to say it in my mind. I'm thinking myself, we're gonna blow this whole thing wide open. I don't think anybody kind of understands the politics at the state level, and this is
Chuck Grigsby:
22:08
and then, you know, I think we all read the paper three weeks in about a couple of the three state representative of young women who started that we can't even speak on the floor of the house.
Anna Callahan:
22:18
That and that was about a amendment to the budget. Thio Remove the tax breaks for the largest corporation
Chuck Grigsby:
22:26
in Massachusetts. Yes. The other evidence, unfortunately, is a friend of mine, Geoffrey Sanchez. I worked with when he was the city of Austin. He was the representative of the city's represented in Jamaica Plain. The speaker of House made him chairman of the House Ways and Means Committee. He was a nice young guy, but that'd be like giving my grandson's keys to my retirement fund. You manage it. He knows nothing about finance. You knew nothing about a budget. But the speaker of the House made him chairman of the House Ways and Means Committee, which control over money, comes with which says that speaker met him. That meant just you just do whatever I tell you to do anything. And he lost in the last election because he couldn't even vote for the things that the building his city is. But if it's wrecked plane, he couldn't even vote for things that benefited Latinos or immigrants. He couldn't, but he couldn't rough anything that Speaker didn't want. So he got voted out, but that does you have closely. The speaker intends to control the list. No Sid, no committee chairs have any power, and they can't, but they can't discuss anything on the floor of the house. So I just discussed, decided behind a closed door,
Anna Callahan:
23:36
and they have no power because they're specifically selected by speakers. As from this pool of people who do every single thing that he says, who are his laptop. That's why they have no power so that they don't have power. They could have power, but they're selected because they will do everything he says.
Chuck Grigsby:
23:53
Representative that I have known for years. Byron Rushing was they had a committee cheer. He bucked the speaker, and all of a sudden his office was in the sewer about the size of a water closet. So things are used to keep people in line.
Anna Callahan:
24:08
Is that the person that we deal with it? Somebody had their desk in the hall, literally didn't have office
Chuck Grigsby:
24:15
water closet. And so he's our legislature. Is, is, has many problems that need to be solved, and that keeps the stakes were really advancing, and those of them in the discussions and decision making in control anybody except the speaker. Uh, keep us from doing anything really good. Um, the education is a big issue. Um, Carlos magazine pointed out in the last issue, Congress magazine, which does great research that the gap between rich white Children and poor black Children is an educational is greater than the gap between blacks and whites
Anna Callahan:
24:57
in the United States.
Chuck Grigsby:
24:58
The United States? Yes, yes. And, uh, you say, Well, G Newsweek magazine published an article last year on two years ago, the ark was here Is your brain on poverty? And they pointed out that that poverty being exposed to violence be exposed to really destruction. Assholes retards the non cognitive learning of any child so they can't learn gamesmanship or how to control your temper or how to control things. They can't learn that because of the non contra skills are depressed have all Children who are poor or in property or sprint lounge where that needs to end. The teachers You mass in Boston to their credit last year in the budget asked for more psychologists for schools and they got maybe one or two. But they said we need help in the classroom and they got one or two to college. They said every cooling five or six and they got one or two. So we're purposefully eating our seed corn and not and not doing the things we know we need to do to help kids grow and become good citizens and skilful people because we're purposely not doing it. Um, never mind the school to prison Pipeline. That's a whole other story. But just helping all kids grow and get over this would happen didn't happen home. If the parents are working two jobs, that can't skill thing. Um, years ago I had a, uh, uh, architectural Millwork company and the kids come to my door. I talked. I'm probably a dozen a young men who had never spoken to an adult, never spoken to doing Bill and G. How can this be? It's because their parents are working full time and there's nobody to help them in a school with the problems they have and with the teachers of arson came to the Legislature said, Please help us and they didn't get the money. So there are things that could be happened. Let's Fletcher that improve, improve our society just not happening.
Anna Callahan:
26:57
There are no brainers, right?
Chuck Grigsby:
26:58
No brainer. Reiner's no Berenice because the money is there, the money's there. But these things aren't happening. So all right notion is if we could get us a public bank started to do public things, we could sneak Lee be going to do other things once it's profitable. Once, once you have the trust of the public.
Anna Callahan:
27:17
And not only that, like, now that we're talking, I'm thinking, Oh, I see how When you allow a public bank serve municipalities, it removes that power state, yes, statehouse, which is So then you're just gonna do those people out of the picture and they will automatically have less because cities go directly to the bank. We need funding for this, give it to us and that none of this sort of, you know, if you play nicey nice with us, we will give you some sort of a grant or some sort of Yes. So
Chuck Grigsby:
27:50
I speak with the locations and they say, Well, she white should be doing this. A G Legislature, Let's sit. In the last 20 years, has created maybe 12 to 15 quasi public agencies. You've created 10 12 to 15 parts of AIDS, like master help Master Element like mass housing. And, like just a long list of a disease that status created, none of them have failed the vault doing what the city's gonna do now, most of them are loans. That's that's gonna have to go back to the place to get more money. Every few years, this bank will have to go back to the station, which is a little bit scarier than that. You don't come back to us from woman. No, we don't. So don't. Dinah dined in the crack. So what I'm saying to the last picture is you have already created a dozen quasi public agencies that have succeeded one treat, one war that to do and you created each time you see a problem to solve a problem. This solves one problem to start. Just lift the infrastructure problem initially. Yeah, a little.
Anna Callahan:
28:45
So let me ask you sort of where we're at in terms of public banking. Have you hod legislation that and how far did that legislation get? Um, is there more legislation coming up? Let us know. Sort of. What's the state
Chuck Grigsby:
29:00
of things State would file the bill and they started from the first moment without 15 did not pass. We got an interview with the community development and dispose of this committee that did not pass. We followed again in 2018. We have had an interview with the Financial Services Committee. You did not get a foot up, did not report out of favorably, and so ways means didn't see it. So we'll follow it again. But instead of doing we're gonna do this year is strategizing. How does to get something directly into the hands of every single mayor in the state and every single town manager in the state to say, Here's what you are missing him. Here's what you need his You should be talking to get this and we want to get something physically into their hands or Lord through social means. What whatever but give into every mayor's hands, says, Here's what you're missing by Not and then once we do are we still were certain that we have everyone in form of what a poet bank is, then start pushing him to start calling the legislators and started lobbying for, but first get him informed of What about the bank does?
Anna Callahan:
30:04
Wow, that's what that's what a brilliant strategy is. Go to the mayor's who are going to directly benefit from a public bank and get them to push sort of pressure upwards.
Chuck Grigsby:
30:14
We started thing about going to the mass fistfuls mask. It's still association or metaphor. You're planning council and learn Metropolitan area Plenty Council. If they rented 103 citizen towns around Boston, I sat with them and said, How about doing a survey of your citizen times? Find what they need? They said, OK, let's think about that. And then I realized that they they are the first people who do the first read of the mass works grant proposals, and they must have given good waste up to the with the little They have never call me again. They talk, I said, Well, kind of. But I talked to the treasure talking Deb Goldberg and I got one of her committee members used to the one I serve in our back for years with Boston Private Panic and the President. That back now on the Investment Committee of the Pension Fund of State is that he called the tricks that we talked to Christie. Oh, Charl talks Chuck Grigsby. I call this toters her second assumption. I will talk to you. Org won't even talk to me. And I learned that her husband is an investment banker. I want to see Mass Medical Association all towns across. And they said
Anna Callahan:
31:26
that the Mass which
Chuck Grigsby:
31:27
MM a mask associations their investment bankers who chair their policy committees, of course. And they said, Forget it, done it, done it again. So we have to go directly to the Citizen times themselves. Associations are larded with investment bankers and with people, we're gonna try to kill us. And so we have to go talking t two mayors, town managers and I can't even go to the Treasury's because they're consultants to t the bankers and they can't. They don't lose their they don't lose their place in line. So
Anna Callahan:
32:00
especially city councils as well.
Chuck Grigsby:
32:02
So I have to call the mayor's first and say, you see, here's what. Here's what a public bank does. Here's why it will reduce your costs. You can get loans on your schedule. You can know what the but you can invent. You can have an effect on the backs policy because sitting on the advisory committee and it'll be audited every year, both by the state and by a private Arctic states good auditing procedures. Private auditors need to continue. What you value is because they have to look at the values to give away their five or six ways with this. With this benefits you and you could do half meat alone our $1,000,000 loan. And if you need to spread out over 10 years, you do that. You do it in five years. You constructed along the fits Europe yesterday or town.
Anna Callahan:
32:46
Okay, so So it sounds like for the people in the Legislature, it's not a no brainer, even though it's obviously greater. But for them, in terms of their own power, it's they don't want it. But for mayors, it is a complete no brainer. And, um, what can listeners do? Uh, can you really do have materials that they can like Senate to their to their mayor's can just start writing letters? Or is there some other strategy?
Chuck Grigsby:
33:16
I think that listeners can talk to the world, their city councilors to say, What are we doing about those roads that bridge down there, that's all. We've been broken for years. When we don't got that will cover that. Always floods during what we do about that. Is there another way to get financing for that? What one of the ways do we get finished with? Well, go to the Wall Street. No, probably not gonna. Linda's $5000 for a $10 million park so they can go to the city constantly with their alderman or their mayor. If they know them with the town manager, Say, what are we doing about those problems? And in pull the chain about wilding, I saw on the problems that there are ways to solve this problem when I use it and then push the marriage to say, Well, you better call my Let's say I support that bill. We need that money and that's a way of doing it. Um uh, that they understand. When we started out, I did. We just survey with very bluestone was an economist at Northeastern and weak. A surveyed about 38 mayors, and we said, Are you having trouble raising money for for infrastructure? 39% say yeah, well, haven't told raising money for a structure. A lot of world were having trouble alive everywhere. Trouble. They would admit it, but they didn't want to have. Didn't want to admit it out loud. Secondly, said, Have you had to delay Prairie Private? Yes, 55% that we've had to delay priority projects, 96% said. Is there another while training for the private market that we go after 96%? One town said they didn't need t have it always was Cambridge just fine? You've been having being Harvard's pocket affect the one anyway. It's clear That's it, isn't it? When asked, they say we need help, but they don't want to be admitted out loud. It could be used against him in public. So that very care what they say. Yeah, so is it. Does it? Don't Don't tell me the numbers, just talking with you having a problem or not. And they said, Yes, we're having a problem.
Anna Callahan:
35:09
Yeah, So is there like a timeline? And I'm thinking, rather than the people sort of individually, just one by one, like talking to their mayor and saying, you know, we have roads that need to be fixed. Are you guys reaching out with a timeline. Do you have an email list where people get on? And you could say we just sent this information to the mayor of Taunton? If you live in Taunton, Contractor mate look, is there some way coordinated? Yes,
Chuck Grigsby:
35:34
there will be. Once we file again in 2019 we will do our best to learn the schedule of committee's meeting. And they will ask people to weigh in on those notes, committees and even couples committee meetings to testify. Eso Well, yes, we will try to coordinate people coming in and talk to the life station on a very specific base with committee meeting when comedians are being scheduled. House ways and Means our first financialservices that maybe communities and small business and then ways and means. So yes, we will try to coordinate when people make their phone call. Um, it's in their letter or or send something to the effect that we support this building.
Anna Callahan:
36:14
So how can they get on a sort of email list? How can they find out?
Chuck Grigsby:
36:18
Go to our website and we'll and we'll have a schedule on our website. Uh,
Anna Callahan:
36:23
that site is public banking dot org's
Chuck Grigsby:
36:28
yes, but we haven't got to schedule yet. We're we have a strategy meeting come up their first part of December. However, how we're going about this, how much money do we need to raise to put into this the sunless? They're willing to put our own money into this to just get it going. It's so important to all of us. My sister lived in Oakland, California, and she was on one of the bridge that collapsed, but she lived through it. I said, I don't want to be And I know that 15% bridge in the state are in arrears. I don't wanna be the first guy that bridges goes down. I want to do this thing is very personal, but this is a selfish, so it's it's it is bigger. It's a bigger deal than we think, because when you think of the bridges, being last should last recited for years and don't and we're not repairing them. Uh, improving our road to the director's accidents when I were not doing about waterways that we know are gonna flood. Why don't we wait?
Anna Callahan:
37:23
Well, really, every policy you know, whether it's municipal infrastructure fixes or education, climate change, anything wonder at the state level, it requires money. S o like having to fork over, like, half of your money and fees and interest in all this garbage to the 1% Wall Streeters is insanity. And, you know, it's like every single issue. If you want any issue to pass Massachusetts way have to be able to find
Chuck Grigsby:
37:56
we do. Senator Spilka, president of City Counts of president of the Senate, have fostered a bill back of 2011 to form a committee to look at whether we need infrastructure back right now. I said on that committee, and I was sat beside Bob Gallery, who was then president of Bank of America in New England. It was clear that they were gonna kill it from the minute the pretty Open. And they never talked to a mayor. They never talked to me. In cities, they never talk to anybody that they didn't hold a hearing. So what do you need? Um, and they welcome to today's denigrated Bank of North Dakota, which is the only public back on now public back of North Dakota did not have the same part of the state did not have the same problem. All the rest states ad during 2000 about fact lord losses. No banks were were subsidizing. In North Dakota, there were no foreclosures. There were no unemployment to not go down. They in fact producing. They were wonderful. North Quarter was wonderful vaccine. Here's my way. Then I did not as important, we are. So it was kind of a denigrating, You know, we're not there, not there in the West. That's a country back. And there's that attitude about not even listening to the So we're faced with a very liberal state with very conservative financial thinking, yes, above by the bankers and different by the legislators and by whoever's. So we have to. We have to overcome that by getting the grassroots to say we need something that you're not provided to us. The let the heads up that the Los Angeles had and California had was when wealth Wells Fargo stole all that money from people and by creating all those dozens of millions of accounts that were not for fraudulent and people will in conference, and we gotta get get rid of Wells Fargo. The problem is they have no place to put that money. No, banks were big enough to hold it because they couldn't detect $30 billion from last bargain. Put it a little country bank. That So they said we had need to have our own bank. And that was We don't have ah, Wells Fargo here, although we probably don't do don't know it. So we've got they had one impetus and one set of conditions that got people think we've got to create our own understanding about what a public bank doesn't. Why we needed here. And we have to start with the mayor's and start locally.
Anna Callahan:
40:22
Wonderful. Do you have any sort of last thoughts? Anything you want people to do? Any any final closing?
Chuck Grigsby:
40:30
Yes, it's important that we do create a bank, not a loan fund loan funds to go back to the source for new new fund Every now and then, people don't understand that. 19 35. We gave private banks the ability to create money, and they've been doing it ever since. When a bank makes alone, it's creating money, and that's how money gets created, not breaded. And so a public problem bank can create money and can can make as many loans that wants to make because every time makes alone it's creating money. And private banks have known that for years. They don't want the problem. Jacksonville. They don't give that up. I don't want the public pranks to do that. So we have a way to take back our own money and keep it in our state by coming in public bank and making and then and solving our problems we know exist in our state. And we could then grow, grow, grow, grow, grow as long as we've do it smartly, openly with a lot of transparency and with focused on the needs of cities and towns.
Anna Callahan:
41:31
Amazing.  I have to say, this is one of my total favorite interviews. I feel like we've we've really dug into the power structures in Massachusetts in a way that totally lines up with all the other interviews that I've done. But kind of, you know, coalesces it. Fascinating. Thank you so much.
Chuck Grigsby:
41:50
Change yields to a demand it doesn't, doesn't necessarily, change used to a demand. And was it who said that that whoever wants change without the turbulence of born in water and storms... changed. You know you're going to face, we know we're gonna face opposition and frustration and barriers to change anything. So here we are.  
Anna Callahan:
42:14
Wonderful. Thank you.  
Chuck Grigsby:
42:16
Well, thanks for doing it. Thanks for taking time with this. It's It's This is, um could be an important step for the state.  
Anna Callahan:
42:24
Absolutely.  
Chuck Grigsby:
42:26
Thank you for taking the time for doing it. And thanks for being interested in it.
Anna Callahan:
00:00
Thank you!  
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