Why Not Ohio? It's Time For A State Bank Of Ohio

[irishbobcat]

Why Not Ohio? It's Time For A State Bank Of Ohio

It's time to promote the idea of a state-owned bank for Ohio.

Modeled after the powerful Non-Partisan League's state-owned bank in North Dakota, An Ohio state-owned bank could be modeled after the nation's commercial banks and — relying on the commonly accepted practice of "fractional reserve banking" — could provide fixed-rate mortgages at two percent and credit cards at six percent. The Bank of the State of Ohio, could also provide attractive rates on car loans and other consumer borrowing while offering CD's yielding a 6 percent return.

The bank's profits would help fund the state government in much the same way that the Bank of North Dakota regularly contributes to that state's budget. In the past decade, the nation's only state-owned bank plowed nearly $300 million into North Dakota's treasury.

Consequently, it's one of the few states that doesn't find itself in a fiscal crisis.

In 2009, North Dakota enjoyed a record $1.3 billion surplus, enabling the state legislature to shift more of the burden for funding education to the state while requiring local governments to cut property taxes by $295 million. In addition, individual taxpayers and businesses received about $100 million in income-tax reductions.

According to the Wall Street Journal, state lawmakers anticipate a $700 million budget surplus in June 2011, the end of its next budget cycle. With a jobless rate of only 4.4 percent, the state also boasts the lowest unemployment rate in the nation.

A similar state-owned bank could become the catalyst for an "economic miracle" in recession-ravaged Ohio, a state that experienced thousands of foreclosure filings in 2009. The bank could be instrumental in providing the necessary capital to create jobs for many out-of-work Ohioans.

Why not Ohio? If the Big 10 can look west to Nebraska for help, surely Ohio state government could look west to North Dakota for help.