100 Years Ago, Farmers and Socialists Established the Country’s First Modern Public Bank

By Thomas M. Hanna & Adam Simpson in In These Times, July 28, 2019

One hun­dred years ago July 28, a bank in Bis­mar­ck, N.D., opened its doors for the very first time. This would have been an unre­mark­able event, like­ly lost to his­to­ry, except for the fact that it was a pub­lic bank, owned by all the res­i­dents of the state. A cen­tu­ry on, the Bank of North Dako­ta (BND) is still the only pub­licly owned bank in the con­ti­nen­tal Unit­ed States (a sec­ond pub­lic bank was recent­ly estab­lished in Amer­i­can Samoa) — though poten­tial­ly not for long.

In the years since the financial crisis, vibrant campaigns for public banks have emerged all across the country.
The BND is enjoy­ing renewed time in the lime­light as activists look to the insti­tu­tion as an exam­ple of how to regain demo­c­ra­t­ic con­trol over finance, and in the process con­front a myr­i­ad of press­ing prob­lems from the cli­mate cri­sis to gen­tri­fi­ca­tion. Rather than hav­ing pub­lic funds be extract­ed from local com­mu­ni­ties to fuel Wall Street spec­u­la­tion, pub­lic banks can ensure that those funds are used to sta­bi­lize local economies and sup­port local pub­lic pri­or­i­ties. As Ellen Brown, chair of the Pub­lic Bank­ing Insti­tute, writes in her new book, Bank­ing on the Peo­ple, ​“a pub­lic bank­ing sys­tem … can fund the goods, ser­vices and infra­struc­ture required to sat­is­fy the needs of the peo­ple and the econ­o­my with­out unsus­tain­able debt, tax­a­tion or envi­ron­men­tal degradation.”*

That a pub­lic bank is res­onat­ing with peo­ple across the Unit­ed States today shouldn’t be sur­pris­ing. If we look back at the con­di­tions that led a diverse group of farm­ers, social­ists and pop­ulists to strug­gle against the odds to cre­ate the BND in the first place — cor­po­rate dom­i­na­tion, an econ­o­my hob­bled by debt bur­dens, gap­ing inequal­i­ties, inef­fec­tive reformists, bought politi­cians —we find they are remark­ably sim­i­lar to those we face today in our new ​“gild­ed age.”