In this episode on community wealth building, we look at how communities are working to transform their local economies by harnessing the assets that exist in their place. It’s the Kryptonite to the corporate model that extracts wealth from communities. Instead, they’re anchoring capital and resources locally to directly invest in that place and its people – from land to money and finance.

We hear from Nicole Ndumele from the Center for American Progress; Mike Strode, from the Kola Nut Collaborative; and Deyanira del Río of the New Economy Project. 

This episode is part 3 of a 4-part series exploring how communities are working to transform their local economies by harnessing their assets, anchoring capital and resources locally to directly invest in that place and its people – from land to money and finance. Explore the full series here.

Guest Host

Laura Flanders is the host and executive producer of Laura Flanders & Friends, which airs on PBS stations nationwide. She is an Izzy-Award winning independent journalist, a New York Times bestselling author and the recipient of the Pat Mitchell Lifetime Achievement Award from the Women’s Media Center.

Credits

• This series is co-produced by Bioneers and Laura Flanders & Friends
• Laura Flanders & Friends Producers: Laura Flanders and Abigail Handel
• Production Assistance: Jeannie Hopper and David Neumann
• Executive Producer: Kenny Ausubel
• Senior Producer: Stephanie Welch
• Producer: Teo Grossman
• Host and Consulting Producer: Neil Harvey
• Program Engineer and Music Supervisor: Emily Harris

This is an episode of the Bioneers: Revolution from the Heart of Nature series. Visit the radio and podcast homepage to find out how to hear the program on your local station and how to subscribe to the podcast.

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Transcript

Neil Harvey (Host): Today a global financial super-elite has attained unprecedented heights of inequality – a world of have-nots and have-a-lots. This obscene wealth inequality is also antithetical to democracy. So how do we break the vicious cycle and democratize the economy?

In this episode, we look at how communities are working to transform their local economies by harnessing the assets that exist in their place. It’s the Kryptonite to the corporate model that extracts wealth from communities. Instead, they’re anchoring capital and resources locally to directly invest in that place and its people – from land to money and finance.

We hear from Nicole Ndumele from the Center for American Progress; Mike Strode, from the Kola Nut Collaborative; and Deyanira del Río of the New Economy Project.

This special series was produced in collaboration with Laura Flanders & Friends, the public TV and radio program that reports on social change experiments every week on PBS and online.

This is “The Solidarity Economy: Taking it to the Bank to Build Community Wealth” with guest host Laura Flanders on the Bioneers: Revolution from the Heart of Nature.

Laura Flanders (LF): Wealth matters. As distinct from income, it’s the money, property, investments and assets that a person or a community has beyond what they need day-to-day to survive. Whoever has wealth tends to be able to accumulate ever more of it through speculating, saving, or  investing – in businesses – or in influencing policy.  After all, most great American fortunes are also the result of government policy. It’s the Golden Rule: Who has the gold makes the rules.

Wealth doesn’t come from nowhere. It comes from some fairly specific places. In the US for example, Indigenous lands were seized and claimed by colonizers with the help of government forces. Women were barred from owning property, and were property themselves under law. African people were kidnapped and treated as personal, tradeable property and coerced to make wealth for others – wealth in which they did not share. None of that should have been legal. It certainly wasn’t moral, but it was sanctioned and assisted by governments and courts and banks; and those institutions were dominated – you guessed it – by the very people who had the most influence and wealth.

Nicole Ndumele is the Center for American Progress’ first senior vice president of Rights and Justice. In this position at that progressive think tank, she leads the organization’s work in promoting policy solutions that address human rights, justice, and equity, and at the center of all that is the exponentially expanding problem of wealth inequality. One dimension of that is racialized capitalism.

Nicole Ndumele (NN): There’s actually a very clear through line from the beginning of the country until now that there have been systemic institutional racist policies within the government and within the financial industry that have gotten us to the wealth gap we experience today.

What it means is that wealth in America is highly unevenly distributed by race. And some dollars and cents to that is that Black families have 12 cents of wealth for every dollar of a white family. So what does that mean, really? It means that in 2019, white families had an average of $188,000 in wealth compared to just $24,000 is the average for Black families. So that’s where you can see the huge difference in how Black and white Americans experience wealth in this country.

LF: The policies and practices and laws that powerful institutions devise determine how money flows and to whom and where. Over generations, thanks to interest rates and inheritance laws – and now dark money tax havens – all that wealth piles up in certain, disproportionately white and male hands.

And so at the beginning of the 21st century, we find ourselves here: in a massively unequal world – and one that was engineered to be that way. The question is if it was engineered to be like this, could it be engineered differently?

In this series, we’re looking at what people and communities are doing, not to correct or reform or repair the worst of the abuses of the current way of doing things, but to design their economies differently, so as to produce better results for people and the planet as a matter of course. In this, no matter is more important, or more tricky, than the question of who has access to money, loans, finance, capital, wealth. And what is that money used for?

NN: Another really startling way of looking at this is that white college dropouts have more wealth than Black college graduates. That just really gets to the high level of disparity and the systemic nature of it. It started with slavery. It continued through Jim Crow segregation and occupational segregation of African-Americans in this country. It continues through financial markets today in various ways.

It has to do with lending. Who gets loans from banks? At what rates do they get those loans? Who is able to have a home and a mortgage, which is one of the major generators of wealth in America. The numbers for Black and white Americans in terms of home ownership, home mortgages, and the rates they pay are very different.

Similar to who is able to live out the American dream of having a small business, small businesses there are far fewer Black Americans who are able to get the capital they need from the financial industry to start those businesses and live out those dreams. So those are some concrete ways.

There’s other ways in which where banks are located and what products they provide and whether they’re meeting the needs of communities contribute to the wealth gap in significant ways. So if there’s no banks in your communities, that means you are relying on payday lenders and loans and other financial services that give you less and cost you more. All of those things are some of the key reasons that the financial industry is still contributing to the racial wealth gap today.

LF: Studies show that Black-owned banks approve a higher percentage of loans to Black applicants than other banks, but their impact is limited by their low numbers in the country and their often precarious financial situations themselves. In an effort to promote and support more minority-owned banks, in 2008, the board of directors of the U.S. Federal Reserve created a Partnership for Progress, which worked with minority bankers to assess their needs and provide them with new tools and skills.

The program tried to build capacity among minority bankers and raise their visibility nationwide. Still, between 2010 and 2021, the United States closed over 15,500 banks, with the majority of them located in Black communities that already had few alternatives. The problems weren’t personal or professional, they were systemic and they were the same problems that affected the residents. Racial segregation, limited access to capital and loans, and having few real relationships with people in power made it hard for Black business owners to establish, expand, and thrive. And the same problems faced their bankers.

The 2008 financial crash, which stripped billions of dollars of property wealth out of Black communities, was cataclysmic. Black and Latino households lost 48 and 44 percent of their wealth, respectively, while white households lost just 26 percent of theirs. The Covid 19 pandemic just made things worse. Black businesses closed at twice the rate of white ones in the early days of Covid. 41% of black businesses shut down permanently. Meanwhile, in a feat of disaster capitalism, the financial elites engineered perhaps the biggest wealth transfer in history into their coffers.

So what can be done?  A community wealth building approach looks at the entire financial ecosystem, from lending, investment and ownership to day-to-day banking. What if it were designed and operated specifically to make an entire community more stable and more equal? If that sounds like an old school local bank of the sort movies have been made about, it is. But it could also be a mission-driven community development financial institution, or CDFI, or a cooperatively-owned bank or credit union, or a public bank charged specifically with advancing racial justice.

Again, Nicole Ndumele of the Center for American Progress.

NN: There’s not gonna be a silver bullet to one policy solution or one model that’s gonna solve the racial wealth gap. It’s gonna require an entire whole of government approach. How do we make it possible for more people of color to be able to buy homes? What do we need to do in the financial industry to allow more people of color to be able to start their own businesses? Are there ways that we can expand the current range of banking products that exist; including are there other types of banking options that are out there like postal banking, but every community has a post office, if we allowed banking services to be in post offices, more communities of color could have low cost, high service banking options.

We can expand community development financial institutions, because their goal is really to get financial services to those who are most in need. Banks can open more branches in Black and brown communities. Banks can offer more services that are tailored to the needs of those communities so that the current numbers of Black and brown people who are underbanked or completely unbanked will go away. So that Black and brown people can have a bank, a local banker in their community. They can have savings accounts that allow them to build wealth. They can open businesses, they can buy homes, do all of the things that allow for wealth in the way that exists in many white communities in America.

There are a lot of bite-sized solutions that when pieced together and layered can really help to overcome what is 400 years of history. It’s not gonna happen today, it is not gonna happen in a year or two years. It’s gonna require a sustained commitment to address the long history that’s led us to where we are.

LF: Banks could do a lot of good. With trillions of dollars in assets, they could invest in redistributive, creative, and environmentally healthy ways. But mostly they don’t – being private and generally large with lots of interests and far-off investors, they prioritize pumping up profits. And yet billions of public dollars are invested in private banks every day. What if we redirected those public dollars into a public bank?

A coalition in New York – the Public Bank NYC Coalition – wants the city’s government to do just that. $100 billion in public city money is handled by private banks in New York every year. That’s money from taxes and revenues and grants and New York worker pension funds. And those private banks are free to do what they want with that money, some of it in the public interest, and much of it not – like investing in fossil fuels and private prisons and buying up real estate for speculation in a way that causes a housing crisis.

The Public Bank NYC Coalition wants to create a city-owned and operated public bank that would act as the city’s public banker. That way the interest from those investments could go back to public coffers and those public dollars could be used for public purposes, not private gain. Advocating for a public bank is part of the social and racial justice mission of Deyanira del Río, the Co-Director of New York’s New Economy Project.

Deyanira del Río (DdR): Right now, we literally have billions of public dollars that the city has collected – and that instead of being reinvested back in our local economy, back in local communities are being siphoned out by these banks and invested outside of New York City and in very destructive kinds of projects and so what we’re pushing for through this coalition Public Bank NYC is for a really bold vision for what a city-owned, public municipal bank could do if the city peeled off even some of those billions of dollars to put in a bank that it creates for the public good. 

LF: Deyanira del Río advocates for financial institutions that are more accessible and equitable for low income Americans, immigrants and people of color. A public bank could provide basic high-quality banking services to the hundreds of thousands of New York families who remain unbanked or underbanked, and create new opportunities to support existing community development financial institutions in underserved communities.

DdR: Our vision in New York City is that a municipal public bank could be chartered specifically to reinvest public dollars, back into real economic needs that so many low income neighborhoods and communities of color in New York City are struggling with, needs that the banks are not meeting.

Some of those examples include cooperative, democratically controlled institutions right now that are really taking root in neighborhoods of color around the city in very exciting ways and creating safe, well paying jobs for immigrants and others who are routinely exploited in the private job market. We’re talking about financial cooperatives like community development credit unions that are actually mobilizing neighborhood deposits and investing in permanently affordable housing in local businesses and much more.

We’re talking about community land trusts, now that are on the rise in New York City, to say the least. There’s tremendous momentum now. There’s more than a dozen of these models that are being formed in different neighborhoods throughout the city, and what they’re doing is actually pretty radical in a sense, although from a different point of view it’s common sense. They are taking land out of the private market, saying this is not something that should be bought and sold to the highest bidder. Land belongs to everyone, and there should be a way to manage land that is in the public interest.

LF: After cities, come states, and the North Dakota Public Bank is a famous testament to the fact that public banking models can work at the state level, too. For over a century, this public bank has prioritized serving North Dakotan farms and businesses. And it’s done that because it’s written into its charter. Instead of solely focusing on maximizing profit, the bank is required to invest in the residents of the state. Most of its lending is done in partnership with local banks and credit unions, too.

The system has helped many small businesses survive. At the start of the Covid pandemic, for example, the North Dakota Public Bank helped North Dakota small-business owners secure more paycheck protection loans, or PPP loans, from the government than those in any other state.

But at the same time, the bank has also invested heavily in fossil fuels and it loaned almost $10 million to law enforcement efforts to break up the protests against the Dakota Access Pipeline at the Standing Rock Reservation. And that’s a reminder that public institutions are only as good as the people who govern them.

Back in New York in 2022, Public Bank NYC demanded that the City cut ties with Wells Fargo in response to reports that that bank discriminated against Black homeowners. Two weeks later, the Mayor and Comptroller did exactly that – they cut off relations with Wells Fargo and announced new measures to hold the banks that hold city money “more accountable”.

A few months after that, however, in May of 2023, in a first-ever public hearing before the NYC Banking Commission about the designation of which banks could be eligible to hold public money, the City approved all the banks that applied, including scandal-ridden Wells Fargo. ​So, members of the Public Bank NYC Coalition and the New Economy Project reiterated their view that the best way to ensure that public money is reinvested locally in ways that advance the public interest is for the City to establish a public bank with racial and social justice written into its charter.

When we return, you’ll hear more about rooting money locally, and Mike Strode, of the Kola Nut Collaborative in Chicago, will remind us that money isn’t the only sort of wealth there is. I’m Laura Flanders and you’re listening to The Bioneers.

LF: We’ve been hearing from Deyanira del Río of the New Economy Project about public banking and the push for a publicly owned bank in New York. New York City’s not alone in wanting a public bank and there are lots of reasons to go public. I spoke with Deyanira del Rio about that movement.

DdR: There are certainly more cities that are looking at public banking and largely sort of the growing movement for divestment is creating a new urgency for public banking. We’ve heard from cities all over the country that say they want to divest from certain banks because of their investments in pipelines, in fossil fuels, in private prisons. Progressive city councils don’t want public money to be supporting the caging of human beings and our ecological destruction.

We want to make sure that the vision for a public bank isn’t just a publicly-owned bank for its own sake. We want to have a really strong progressive vision so that this bank can be a force. We have no illusions that this is going to be an easy battle, we know what is ahead. Here in New York, the banking lobby pretty much comes out swinging for even the very basic kind of demands that they are more transparent in disclosing the kinds of investments they make.

We think building a broad coalition very deliberately is going to be really key to our success. So we have labor groups, we have community organizations, we have divestment focused organizations, we have community development lenders, and also the growing landscape of cooperatives in the city that are really excited about this idea that there could be a public institution that supports them. So right now we have worker co-ops growing around the city, the city of New York itself has invested in them. We have strong community development credit unions, like the lower east side. But they’re operating as a kind of oasis in this broader system of capitalism and exploitation. And so the idea that there could be a public bank putting public dollars safely, right, into these institutions, investing in proven successful models is something that’s really exciting.

LF: Coalition building has been working. In 2014, after organizing by a wide array of local groups, including the New Economy Project, New York City appropriated $1.2 million to fund the development of worker cooperatives – the largest such investment by a city government at that time. Since then, that appropriation has grown, and other cities have followed suit. Could a public bank also be in the city’s future? In the meantime, many public advocates point to credit unions as an alternative to the big, for-profit private banks.

Credit unions operate like member-owned financial cooperatives, serving their members who can be a designated group, such as government employees or union members, or residents of a certain geographic area. Since they don’t have highly paid CEOs and shareholders, credit unions return their earnings to their members, typically through lower interest rates on loans, higher rates on savings, or other services.

According to the Credit Union National Association, there were roughly 119 million credit union memberships at the beginning of 2019, and some 5,500 credit unions. More than 19% of U.S. households use a credit union as their primary financial institution today.

They can be a great alternative to commercial banks and invest in what communities need. And some, like Community Development Credit Unions, are established to do just that. But what if we looked at local assets and value in a different way altogether? Some community needs can actually be met without money at all.

Mike Strode (MS): Timebanking is essentially this very low-level form of collaboration, cooperation, that allows people to build towards more complex collaboration and cooperation. So what I see timebanking as doing at its most basic form is mapping assets in communities, developing reciprocal networks of support and care and communities, and network weaving within communities.

LF: Mike Strode is a Program Officer for the Open Collective Foundation and is the founder of The Kola Nut Collaborative, the first Timebank in Chicago.

MS: Timebanking at its essence is using time as a type of currency. So using an hour of my time that I might spend providing a bike riding lesson to a child in the neighborhood, or teaching a neighbor how to use their computer. So using an hour of my time as a type of currency, I go and support someone with the skill that I have named in the timebank. I earn an hour in the timebank, and then I’m able to spend that hour on something that I need. Perhaps it’s massage services at a local business, or perhaps it’s some other exchange that I might need within the timebank. But ultimately it’s me being able to use my time as the currency of exchange that we use to meet our needs and to access things.

Every hour is the same. And that’s really important, because we want to drive home the idea within timebanking that every skill, every type of work, is necessary and useful. In fact, redefining work is the core value of timebanking. So ultimately everybody in a community is meaningful and everybody does valuable work.

Timebanking allows us to say, here are the things that I have as skills and capacities and gifts that I’d like to offer inside of the community. And then it also encourages people to name their needs, name the things that they need to show up more fully in community and be able to match-make between those things. So it becomes this sort of nugget of more complex collaboration and cooperation to come.

LF: Timebanking reminds us that what we value changes as our needs change. In the Covid Pandemic, for example, no one was more needed or more valued than the person who delivered healthcare or food to people’s homes. And yet, those so-called “essential workers” were typically paid very little and, as measured in money, hardly valued at all. Centering human needs, the time banking model changes how we think about value, our own and other people’s. In a country as big as this one, says Strode, a one-size fits all set of values, like a financial balance sheet, doesn’t suit all, at all. Again, Mike Strode:

MS: We have all the disparities, I think, but what people have finally begun to acknowledge since 2020 that a lot of us have been fighting for decades is that understanding the root causes of every issue is tied to systemic and institutional racism. I mean, we talk about wealth building, we talk about building equity, we talk about disinvestment, but then we have to look at the policies, the practices that have plagued the red lining in our communities that have caused this decades and decades. And now we’re trying to swim our way out of.

It’s really about community self-determination. So communities want to be self-determining. They want to have some political control over what happens in their community, some social control, and some level of economic autonomy or economic independence. And so the combination of those things along with sort of this larger community stewardship, how we steward things together collectively, these are the sort of elements of the solidarity economy.

And solidarity economy is grounded in a few values that, you know, that we like to make sure that we name, which deals with solidarity, equity in all dimensions, participatory democracy, ecological stewardship, and pluralism, right? We want to make sure that everyone feels that they can show up in the solidarity economy.

And so ultimately we are still in capitalism. It’s an evolving framework, an evolving system. And so until we rest ourselves from capitalism, we will continue to be very far from the solidarity economy. But what we do have is communities that already exhibit these values of solidarity, cooperation, mutualism, participatory democracies, equity. We already have social movements that have these values at the core. And so ultimately it’s just about continuing to foster collaboration between those social movements, continuing to push in the political spaces where resistance is happening, continuing to push in societal spaces where resistance is happening and moving slowly along. It’s about the solidarity that we have with each other. And it’s about the fact that recognizing that we are all in the community trying to meet our needs, trying to engage with our political officials to get those needs met. And so those are things that show us the way towards the solidarity economy.

LF: In today’s economy, most of our relationships are mediated through money and money holds a unique value because of what it enables us to do. The idea that we could collaborate with each other directly and operate in what Strode calls a solidarity economy may seem far out, or at least far off. But experiments are happening, and many are working.

Is it easier to leave economic decision making to other people? Often it is. But if we want better, more democratic outcomes, more people are going to have to get involved in how we structure our economies. The first step is realizing that there is more than one way it can be done.

For the Bioneers, I’m Laura Flanders.