"We're broke. Like nearly every other state across the country, we don't have any more money."
So says Scott Walker who says there is no alternative to state employees contributing more to the cost of their own pensions.
"Fortunately, there is another alternative.
"Wisconsin could draw down the ($67 billion pension) fund by the small amount needed to meet pension obligations, and put the bulk of the money to work creating jobs, helping local businesses, and increasing tax revenues for the state.
"It could do this by forming its own bank, following the lead of North Dakota, the only state to have its own bank — and the only state to escape the credit crisis.
"This could be done without spending the pension fund money or lending it. The funds would just be shifted from one form of investment to another (equity in a bank).
"When a bank makes a loan, neither the bank’s own capital nor its customers’ demand deposits are actually lent to borrowers.
"As observed on the Dallas Federal Reserve’s website, 'Banks actually create money when they lend it.' They simply extend accounting-entry bank credit, which is extinguished when the loan is repaid.
"Creating this sort of credit-money is a privilege available only to banks, but states can tap into that privilege by owning a bank."
Does anyone think Scott Walker will take on Wall Street banks or his pal David Koch?
Maybe the next governor of Wisconsin will?
So says Scott Walker who says there is no alternative to state employees contributing more to the cost of their own pensions.
"Fortunately, there is another alternative.
"Wisconsin could draw down the ($67 billion pension) fund by the small amount needed to meet pension obligations, and put the bulk of the money to work creating jobs, helping local businesses, and increasing tax revenues for the state.
"It could do this by forming its own bank, following the lead of North Dakota, the only state to have its own bank — and the only state to escape the credit crisis.
"This could be done without spending the pension fund money or lending it. The funds would just be shifted from one form of investment to another (equity in a bank).
"When a bank makes a loan, neither the bank’s own capital nor its customers’ demand deposits are actually lent to borrowers.
"As observed on the Dallas Federal Reserve’s website, 'Banks actually create money when they lend it.' They simply extend accounting-entry bank credit, which is extinguished when the loan is repaid.
"Creating this sort of credit-money is a privilege available only to banks, but states can tap into that privilege by owning a bank."
Does anyone think Scott Walker will take on Wall Street banks or his pal David Koch?
Maybe the next governor of Wisconsin will?
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