Why do counties keep public funds in private, for-profit banks?

• I and my team are trying to make Mendocino into a charter county. After 15 drafts of a charter over the last 3 years, there was little or no political will for our Board of Supervisors to put one on the ballot. So the only other way to become a charter county is to elect a charter commission. This is a 2-step process. First, we need to collect 2003 valid signatures by January to get the charter question on to the June ballot. We are aiming for 4000. Then later in January, anyone registered to vote in the county can run for the unpaid office of Charter Commissioner. When the time comes, I plan to run for this voluntary elected office. I am currently raising funds and cultivating fellow candidates. This will be an amazing opportunity to think outside the box and redesign our local government to assure more social and economic justice, more direct democracy, more citizen participation, more local control and more accountability.

  
  
• The current legal opinion is that a county must be a charter county in order to open a public bank. Ideally, the charter will be a fundamental step in that direction. It is yet to be seen whether language about a public bank will be included in the charter. It will be up to the charter commissioners what language will be included.

  
  
• There are 3 kinds of money: coins, currency, and credit. Coins are printed by the Federal government. Currency is printed and controlled by a private banking conglomerate called the Federal Reserve (nothing "federal" about it). Money greases the wheels of commerce and causes economies to boom when there is enough of it in everyone's pockets. When money is scarce, the economy tanks. The third kind of money is credit. Per Federal Reserve policy, every bank can issue credit of up to 90% of their reserves. Each time they loan out credit, the "note" gets added to their reserve of assets. In other words, their assets are based on loan notes.
  
• The credit market is a kind of Ponzi scheme which occasionally implodes. In 2009, the government bailed out the banks from their Ponzi scheme losses, yet the big Wall Street banks continue to glean obscene profits using business plans based on fraud. All counties in the USA keep their public funds in private, for-profit banks, which use those funds in their reserve for their credit Ponzi schemes.
  
• SBMC stayed healthy during the 2008 economic downturn because they only issue credit up to 60% of their reserves. And credit unions even have a lower limit. Only the big Wall Street banks like Bank of America issue all 90% of their reserves in credit.
  
•  A public bank could serve the purpose of parking and distributing our own public funds instead of Bank of America. Why not keep our public funds in our own bank? And if the law allows banks to issue credit based on a fraction of their reserves, then why not use the county's reserves to underwrite economic development loans issued by the local partners like Savings Bank of Mendocino County and MendoLake Credit Union to keep the money circulating right here in our own county?
  

  
  
  So why should we keep public funds in a private, for-profit bank?  We shouldn't!