Talk about a public bank, but base discussion on facts

Let’s have a fact-based discussion about a public bank for New Mexico. What do we call it when a person who knows the facts of a specific situation fails to state them fairly and accurately, and tries instead to confuse and mislead people? That is what Jay Jenkins did in his op-ed piece against a public bank for New Mexico in The New Mexican last week (“Public bank won’t help what ails N.M.,” My View, Aug. 9).

I am writing to say that, if there is a case to be made against a public bank, do so honestly and in a straightforward manner, not with outright and purposeful misrepresentations.

◆ Jenkins says the public bank will compete with community banks. Not true! The core of the public bank proposal is exactly the opposite. The bank will only support loans brought to them by credit unions and community banks. And, as he points out, the North Dakota public bank does exactly that.

◆ Jenkins says the bank will not have FDIC deposit insurance. In fact, to be chartered in the state, the bank must meet the FDIC’s “gold standard” regulations and requirements. However, since the bank is working solely through partnerships with community banks and credit unions, it will not have depositors in the traditional sense. So, it won’t need FDIC deposit insurance coverage. The state will be the bank’s only depositor.

◆ Jenkins says the bank would be susceptible to political pressure. But, ironically, given that the bank can only work in collaboration with existing banks, the only politics, if such existed, would be at the community level and with those institutions.

◆ Jenkins says the bank might make risky loans due to inexperience. But the only loans the bank can consider would be those brought to it for shared support by the credit unions and the community banks.

◆ Jenkins says a New Mexico public bank would not be viable financially. In fact, when Santa Fe did such a study, it was determined the city was too small financially to support the concept. But North Dakota is significantly smaller than New Mexico and is doing very well. And several other places are also planning a public bank.

A public bank would strengthen community banks’ and credit unions’ ability to serve their communities by collaborating with them on loans that are different, loans that support more entrepreneurial business plans, loans that, without the public bank’s support, might be considered high-risk.

In closing, let me say that, yes, I serve on the Alliance for Local Economic Prosperity board, the organizational advocate promoting the public bank. But this letter is from me as an individual, asking for an honest and accurate debate as the concept moves forward.