Want to Have a Happy Planet? Just Ask Costa Ricans About Their Banks

[xchrom]

http://www.alternet.org/economy/want-have-happy-planet-just-ask-costa-ricans-about-their-banks



In Costa Rica, publicly-owned banks have been available for so long and work so well that people take for granted that any country that knows how to run an economy has a public banking option. Costa Ricans are amazed to hear there is only one public depository bank in the United States (the Bank of North Dakota), and few people have private access to it.

So says political activist Scott Bidstrup, who writes:

For the last decade, I have resided in Costa Rica, where we have had a “Public Option” for the last 64 years.

There are 29 licensed banks, mutual associations and credit unions in Costa Rica, of which four were established as national, publicly-owned banks in 1949. They have remained open and in public hands ever since—in spite of enormous pressure by the I.M.F. [International Monetary Fund] and the U.S. to privatize them along with other public assets. The Costa Ricans have resisted that pressure—because the value of a public banking option has become abundantly clear to everyone in this country.

During the last three decades, countless private banks, mutual associations (a kind of Savings and Loan) and credit unions have come and gone, and depositors in them have inevitably lost most of the value of their accounts.

[demwing]

1. K&R /nt

[BelgianMadCow]

2. Wanted to post this too

albeit from another source: http://ellenbrown.com/2013/11/11/public-banking-in-costa-rica-a-remarkable-little-known-model/

But I see only the headline is different and the one you posted is better. Thanks for the thread!

[xchrom]

3. ...

[Wilms]

4. ^

[daleanime]

5. K&R....

[Grins]

6. As if I needed another reason to hate the IMF.

"...in spite of enormous pressure by the I.M.F. and the U.S. to privatize them"


As if I needed another reason to hate the IMF.

[pampango]

7. "By 1980, the Costa Rican economy had grown to the point where it was by far the richest nation in

Latin America in per-capita terms. It was so much richer than its neighbors that Latin American economic statistics were routinely quoted with and without Costa Rica included. Growth rates were in the double digits for a generation and a half. And the prosperity was broadly shared. Costa Rica’s middle class – nonexistent before 1949 – became the dominant part of the economy during this period. Poverty was all but abolished, favelas [shanty towns] disappeared, and the economy was booming.

This was not because Costa Rica had natural resources or other natural advantages over its neighbors. To the contrary, says Bidstrup:

At the conclusion of the civil war of 1948 (which was brought on by the desperate social conditions of the masses), Costa Rica was desperately poor, the poorest nation in the hemisphere, as it had been since the Spanish Conquest.

The winner of the 1948 civil war, José “Pepe” Figueres, now a national hero, realized that it would happen again if nothing was done to relieve the crushing poverty and deprivation of the rural population. He formulated a plan in which the public sector would be financed by profits from state-owned enterprises, and the private sector would be financed by state banking.

I wonder if CAFTA has impacted Costa Rica's publicly-owned banks at all.