"MONEY sets the world in motion," noted the Roman statesman Publius Syrus. The motion of money can be either beneficial or harmful. The rapid movement of money today is having an increasingly pernicious impact on our economies and communities. Financial services now account for some 7 percent of our GNP.

We trade more than $100 worth of stock and bonds for every dollar raised for investment in new plant and equipment, a ratio almost four times greater than 30 years ago. The volume of currency trading is now some 50 times greater than the volume of trade in goods and services. In 1970, more than 95 percent of currency trades were for activities linked to what many call the "real economy"--investment, tourism, foreign aid, trade. Today only two percent are.

This increased speculation has been accompanied by the physical delinking of our financial institutions from our communities. The number of independent banks is lower than at any time since 1934 and the tidal wave of mergers and acquisitions continues to shrink that number. Depository institutions are closing branches while the fastest growth in the financial sector is in non-depository institutions like mutual funds and pensions that have never had a physical presence in communities.

This delinking of money from place and productive investment is not the inevitable result of technological advances or economic evolution. Money is a human invention and the rules that control its dynamic are also a human invention. The rules we have fashioned favor mobility over community, speculation over productive investment, volatility over permanence.

The challenge is to develop new rules. This web page contains rules that reconnect capital and community, with a special emphasis on those parts of the community that traditionally have been left behind

Rules:

• ATM Surcharge Bans
  Surcharges are the fees banks charge noncustomers for use of their ATMs. Surcharges are deducted directly from the consumer's account at the time of the transaction. Surcharging first began in 1996. Today, 93 percent of all banks surcharge noncustomers an average of $1.37 for each ATM transaction. Americans paid an estimated $2.1 billion in surcharges in 1998. Surcharges are anti-competitive and threaten the viability of small banks and credit unions. More...
• Market Share Caps
  In 1994 Congress allowed states to raise, lower, or abolish the bank deposit cap, which says that banks may only have 30% of all the deposits in the state (they are limited nationally to 10%). Banks may exceed the limit by attracting new customers, but they may not grow above the limit by acquisition. Most states chose to keep the 30% level. Two - Michigan and Utah - abolished the cap. New Mexico raised it to 40%, and several states lowered it. More...
• Community Reinvestment Act
  Congress enacted the Community Reinvestment Act (CRA) in 1977 after years of grassroots pressure to encourage banks to help meet the credit needs of the communities in which they are chartered. Previously, individuals and businesses in low-income areas were often denied credit because of the perceived high-risk nature of such loans. Under the CRA, a bank is evaluated approximately every two years on its community reinvestment performance by federal bank regulators. More...
• Taxing Financial Transactions
  Financial transactions taxes are in place in more than 15 countries. The U.S. had a financial transactions tax from 1914 to 1966 but then reduced it to a trivial .004 percent tax only on stock transfers to generate revenue to support the operations of the Securities and Exchange Commission. Recently there has been renewed interest in such a tax, either on domestic or international financial transactions, or on both. More...
• Community Art Policies
  In the early 1970's, several cities adopted "one-percent-for-the-arts" policies. One percent of public capital spending had to be spent for art that enriched public spaces. Today more than 100 communities have adopted such provisions. Some- like Fort Lauderdale, Dallas, San Francisco and San Jose- have increased the requirements to 1.5 or 2 percent. More...
• The Bank of North Dakota
  The Non Partisan League (NPL), born in 1915, united progressives, reformers, and radicals behind a platform that called for reforms to return control of North Dakota's government and economy to the people. Taking leadership of the state in 1919, the NPL formed the Bank of North Dakota (BND). Today it is the only state-owned bank in the U.S. More...
• Canadian Style Venture Capital Funds
  In the early 1980s, high unemployment and the rapid exodus of capital from Quebec led the province to offer seed capital and tax incentives for a new kind of venture capital fund that provided equity to small and medium-sized businesses. Since then about 25 such funds have been created: two national and the rest provincial. More than 400,000 Canadians are shareholders in the funds, which generate $500-$700 million a year, equivalent on a per capita basis to $5-$7 billion in the United States. More...
• Credit Unions
  Credit unions are non-profit, tax exempt financial institutions owned by their depositors. About 70 million Americans are members of some 11,500 credit unions. Most are very small. Sixty percent have assets below $10 million and nearly one third have assetes below $2 million. On the other hand, the largest credit union---Navy Federal--has $10 billion in assets. More...
• Employee Ownership - ESOPs and Coops
  Like community-owned sports teams, cooperatives and employee stock ownership plans are organizational models that tend to root businesses in their communities. Both ESOPs and coops are powerful tools that give decision making authority to those who will feel the impact of the decisions they make. When authority and responsibility are linked, decisions will likely be made in the best interests of the local community. More...