Re-introducing postal banking
Started under the Republican administration of William Howard Taft, the United States postal savings system operated from 1911 to 1967. Deposits were ultimately limited to a balance of $2500 for each individual, and its largest balance sheet was in 1947 with $3.4 billion in accounts. The Post Office’s web site recounts the purpose of this system:
“The legislation aimed to get money out of hiding, attract the savings of immigrants accustomed to saving at Post Offices in their native countries, provide safe depositories for people who had lost confidence in banks, and furnish more convenient depositories for working people.”
The new initiative, as stated by the Campaign for Postal Banking, is as follows:
“Postal Banking is simply the provision of low-cost, consumer-driven financial services via the Postal Service. Products and services could range from check cashing to bill payment to savings accounts to small-dollar loans.”
There will no capital provided for business mergers, initial public offerings, or foreign loans to dictators.
I am old enough to remember passbook accounts and a 5.25% rate on savings. I’m also old enough to remember the S&L crisis of the 80s, 18%+ inflation rate, 20% mortgages, and, before I left for the US Navy, a 15.5% 2.5 year CD at a savings institution in Orange. All of us now know the effects of (1) sub-prime mortgage investment scam, (2) the joining of retail and investment banking, (3) the outrageous salaries and bonuses of banking executives, and (4) the endless fees and minimums that are becoming more and more restrictive. Adding into this mix the obscene payday and title loan companies only makes things worse: a typical interest rate for these institutions is in the hundreds of percents. Whatever your secular, economic, or religious beliefs are, deep down you know this is wrong.
In 1851, Congress shut down the American Letter Mail Company because it competed with the US postal system; now, some legislators want to sell-out the post office. It is time for the Post Office, the banking system, and economic participation by the lower middle class and poor to be strengthened by re-introducing postal banking. Turn the phrase “go postal” into a positive thing!
Please find out more and write our legislative representatives Brian Babin, Ted Cruz, and John Cornyn with your opinion. Information is available at:
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