Mike Siegel and Mike Lewis join Money on the Left to discuss municipal currency politics. The conversation focuses, in particular, on our guests’ recent success in Austin, Texas, where they helped critically rewrite anti-public and anti-environmental crypto legislation to open fresh possibilities for public banking and payments that support local communities and ecologies.
A former public school teacher, Mike Siegel is a civil rights attorney, a co-founder of the progressive non-profit Ground Game, and a former Democratic candidate to represent Texas’ 10th Congressional district in the US House of Representatives. Mike Lewis, meanwhile, served as communications director for Siegel’s 2020 campaign, works regularly to advance Ground Game’s commitment to progressive electoral politics, and remains a prolific advocate for public money.
In early 2022, Siegel, Lewis and Money on the Left Collective member Andrés Bernal mobilized an effort to block the development of an official cryptocurrency in the City of Austin. Initially, they appealed to the Austin Chronicle opinion page to reshape public opinion. Next, Siegel, Lewis, and Bernal persuaded and then worked alongside Austin City Council members to amend recently-passed crypto legislation. Impressively, these amendments introduced new language into municipal law, warning against the eco-social dangers of crypto, on one hand, and articulating a broad-based need for robust public banking and payment systems, on the other. Woefully underreported in comparison to news about all things blockchain, the story of municipal money politics in Austin represents a powerful model for local public money action worldwide, particularly in light of the recent catastrophic crash in crypto markets.
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The following was transcribed by Mercedes Ohlen and has been lightly edited for clarity.
Maxximilian Seijo: Mike Lewis and Mike Siegel, welcome to Money on the Left.
Mike Siegel: Right on. Thanks so much for having us.
Mike Lewis: Hey, thanks for having us.
Maxximilian Seijo: We’ve invited you two on the show today to speak about your efforts to redirect some… what we could say, misguided attempts around cryptocurrencies and municipal politics. Moving it more towards a movement for public banking and public payment systems. And so we’re especially interested in hearing about your organizing in and around the city council in Austin, Texas. We feel strongly that this still relatively underreported story can serve as a powerful model for local public money action worldwide, particularly in light of the recent catastrophic crash in crypto markets, including certain stable coins.
Before we launch into this conversation, though, we’d like to give you each a chance to tell us a bit about your professional and personal background. Let’s begin with Mike Siegel. Mike, can you say a bit about yourself for our listeners, who might be unfamiliar with your previous congressional campaign or your organizing efforts with ground campaign Texas?
Mike Siegel: Well, thanks again for having me. Great to be on Monday on the Left. I’m Mike Siegel, I’m a former public school teacher, union organizer, and civil rights lawyer. In 2018 and 2020, I was the Democratic nominee for Congress… challenged this guy, Michael McCaul, one of the most wealthy and most corrupt members of Congress. And, you know, it was endorsed by Bernie Sanders and Alexandria Ocasio Cortes and labor and progressives and environmental groups. With the help of a really broad coalition, you know, ran a campaign that was probably the strongest pro Green New Deal campaign in the South among congressional candidates. Built a really strong base of organizers and volunteers and turned what was previously a safe Republican district into a national battleground race.
Despite being for the green New Deal Medicare for All and endorsed by Bernie, I also was a D-Triple-C candidate. So somehow was able to thread that needle of getting both mainstream and progressive support. After 2020 I didn’t want to keep running for Congress every year of my life. I stayed in the fight and politics. I joined together with another progressive Democrat, Julie Oliver, we founded Ground Game Texas. The basic idea is to fund year round work in politics, not just getting out the vote for a candidate on the eve of the election. But working year round, focusing on places that don’t get enough investment, and focusing on progressive issues. We know that the Democratic Party in many parts of the South is not popular, but our issues are. I would include what we’re talking about today, you know, the idea of public banking. I mean, these are issues that really appeal to working class people.
What Ground Game is doing, you know, we’re basically based on 2020. Joe Biden was outperformed in many states by progressive issues. Florida, 60% voted for $15 an hour, but voted for Trump. South Dakota legalized marijuana and voted for Trump. We’ve got a set of issues we call workers, wages, and weed. The idea is to lead with these populist, popular issues, and then use that as a way to engage more people in the political process. Long story short, right now, Ground Game Texas is running ballot measure campaigns in 10 cities to get issues like these on the ballot as a way to excite more voters.
William Saas: Mike Lewis, you are a great friend to us at Money on the Left, having transcribed some of our important back episodes. Could you say a bit about your own roles that you’ve played in Austin politics and how you might have collaborated with Mike Segal in particular?
Mike Lewis: Absolutely. Thanks for having me, Billy, Max, and the Money on the Left crew. I’m Mike Lewis, I’ve been a volunteer activist since the Bernie 2016 campaign. Prior to that, I was kind of passively aware of politics. I kind of identified loosely as a “Ron Paul libertarian” as folks do who grew up in rural Texas. Turned around thanks a lot to my Mom who started organizing against a sinister landfill company. She was posting Bernie memes on my Facebook wall. I got into organizing and showed up at a Fajita Phonebank for Bernie in January 2016. I’ve been working on various campaigns and issues ever since.
I worked on Mike Siegel’s campaign in 2020 as comms director, really helping kind of develop and organize around the green New Deal. We actually organized the first major Green New Deal town hall in Texas. Built that into winning over the labor support in Texas with AFL CIO across a bunch of different labor unions. Building their trust around the programs just transition and whatnot. I’ve been working also as a volunteer research assistant for different projects in the MMT space as well. Helping Andrés Bernal publish a paper as a research assistant on inflation. Then we have an upcoming paper that we’re working on around MMT for local government. Really helping progressive candidates up and down the ticket, especially around messaging public finance approach, the classic “how do you pay for it” question that we all love.
Maxximilian Seijo: Thanks so much, Mike. Maybe to set up this narrative for a bit, can you all explain what’s been going on with the crypto industry at this sub-federal level, both in Austin and elsewhere? As you do so, maybe try to provide some basic definitions and context for our listeners who are not closely following this space? So for example, what for instance, is meant by the term “crypto”, “blockchain” or “web point three”? Who are the big players in this world and what are they trying to accomplish? How is the crypto industry strategy and rhetoric been changing as of late, at least prior to the recent crypto market crash? By contrast, where do orthodox municipal commitments to bond and tax financing fit into crypto’s advance?
And how are you all working alternatively, to transform Municipal Finance, guided by the insights of MMT? Most important, finally, how do you all see municipal public money politics affecting various struggles for social and environmental justice? There’s a lot there, but maybe we can wait into some of these questions.
Mike Siegel: Mike, you want to start? I feel like you’re more of the expert on these issues.
Mike Lewis: Sure, right on. Yeah, I guess I’ll start with the definitions. Cryptocurrency is, you know, it says it’s a currency, right? But it’s a private token on what’s called a “blockchain,” which is a line of code that has a consensus mechanism. There’s proof of work, proof of stake, different consensus mechanisms out there. All the popular cryptocurrencies operate on a proof of work blockchain, which is basically a justifiable rage at private banks. Bailouts from the 2008 financial crisis kind of led this this project of cryptocurrency on a quest to create this, quote, unquote, “trustless money system”, where not only is code law, but apolitical laws, as Ron Gray recently pointed out responding to one of the Winklevoss tweets, that was talking just about how, you know, there is no politics here. It’s a trustless money system, you don’t have to have any kind of mediation between parties, but you can basically trust in a line of code.
It’s kind of a deeply libertarian ethos that’s built into the technology itself. It’s basically, you know, a cyber collectible asset priced in dollars. It uses money aesthetics, to prop up a revolutionary technology narrative. It’s most likely… it’s an unregulated security. It’s something that is kind of imagining money as a scarce object. That is, you know, finite. Of course, most people really only buy into this stuff because it’s going to increase in value, in dollars. It really kind of defeats the purpose of what money is, which is the things that price, things are priced in the actual unit of account. That’s kind of the basics. You know, Web3, is basically just imagining the internet. If we’re in Web 2.0, right now, which evolved out of Web1, Web2 being the platforms, you know, Facebook, the different kind of centralized platforms. This kind of venture capital backed project around so called Web 3.0 imagines putting the internet onto a blockchain. Just to make sure to zoom in on what a blockchain is really just think of that as a distributed ledger that is append only. It’s imagined to be something that’s immutable, that can’t change.
But of course, there’s many examples throughout crypto history of exactly the opposite happening. I think one of the things to really understand about the crypto space as we get into this conversation has to deal with stable coins which when you walk into a casino and you get casino chips, you trade your dollars for an official casino chip, and that’s supposed to have exact value to the the amount of dollars that you put in. So the way that the crypto space works– the way that people on ramp and off ramp out of these crypto tokens is they convert their dollars into these so-called “stable coins”. What we recently saw with this huge crash, with the Terra stable coin, the fourth largest crypto token that was out there about $18 billion in market valuation, we basically saw the value proposition of the crypto space kind of contradicting itself and failing as it has repeatedly again and again.
There’s been so much money pouring into culture and the politics from the crypto space. It seems like they’re kind of desperate for new suckers, new liquidity, so that they can kind of exit from their initial investments. We’ve seen, of course, massive amounts of celebrities endorsing everything. Maybe that that kind of leads into where we picked up with things here in Austin, I’ll kind of pass it over to Mike.
Mike Siegel: Right on, yeah. To be clear, I don’t promise to be an expert in any of this. Mike Lewis is kind of my translator for a lot of this new financial technology. He turned me on to Stephanie Kelton and an MMT. I think what I’ve been trying to do the last several years as a relatively high profile kind of political figure on the left in Texas, is like how do we translate these ideas into political campaigns and action? And how do we build coalitions that kind of understand these concepts and combat the status quo in Texas? I would say, the way this issue came up in Austin is essentially… I mean, first of all, think of Austin– all the big tech companies are ramping up more and more. Google just bought 50 stories of commercial office space on a riverfront property, like the most beautiful building in Austin. Facebook, Oracle, everybody has these huge footprints… Amazon going down the line.
That’s often an extremely booming city that is unaffordable for even working class, middle class people at this point. And you have the Super Bowl, where everyone knows that there’s all these pro-crypto ads in the Superbowl. That’s followed up by our annual festival in Austin, South by Southwest. And I think most your listeners are generally aware of what South by Southwest is. But it started out as this kind of cute Music Festival, Film Festival, and has now become this major cultural moment where all these big venture capital folks, tech bros, and what have you are coming to Austin, spending 1000’s of dollars for tickets to the festival, spending all this money and hyping up their various pitches and proposals. So this year, South by [Southwest] was bigger than the last couple years because of COVID.
There was kind of like a big push to make South by [Southwest] this huge event. It seems like in concert with that, the crypto money came to town, and particularly the crypto political money. And this is something that I’ve been very aware of that there are now, you know, super PACs trying to influence candidates on crypto issues. Trying to give congressional candidates millions of dollars. Trying to influence city council candidates. So what seems to have happened in Austin is it in concert with South by Southwest, the crypto lobbyists started reaching out to city council members in Austin and other local political figures to try to get some sort of symbolic win in Austin, timed with South by Southwest. And it seems like their goal was to push Austin to adopt a coin similar to Miami, or some of these other places– an “Austin coin”– that would be this blockchain style currency.
That was kind of the move they were making. I got word of this because through my political work, some of my labor allies who happen to work in City Council offices, they pinged me, “hey, you should take a look at this draft resolution circulating”. It was basically… it was going to be a city of Austin official action that endorsed blockchain and crypto, and basically offered the services of the city bureaucracy to advance the local so-called Web 3.0 movement in Austin. And there were two or three draft policies. Some of them were extremely supportive. My immediate concern was that these folks, what they were basically going to do is get the city of Austin to endorse this get rich quick pyramid scheme, as Mike Lewis described it. And that a year or two from now when crypto crashes, all these working class people would invest in crypto because the city of Austin put their reputation behind it and they would be screwed.
I’ll pass the mic back to you in a second, but long story short, what happened was once we got word of this move that was happening in the Austin City Council, Mike Lewis kind of gathered some experts. We created basically an educational guide for the City Council staff and officeholders so they understand what these different terms mean. Because a big part of this is all these crypto advocates come in and they use all these terms of art that most people have no clue what they mean. They were basically starting to convince the city council that, oh, what’s the harm in supporting local business? You know, that’s how it’s being framed. These are just local business people in Austin, so let’s support them. We produced an educational guide that kind of showed the risks, the history of Bitcoin, that the fluctuations, how it’s basically a scheme to transfer wealth from late adopters to early adopters. We started lobbying individually, with council members and council offices.
Then as it progressed, we realized that even though we were kind of raising these flags and bringing up this history, that the council was going to move forward. In particular, the mayor of Austin, who I consider a friend of mine, and another council member, did this big press conference right before South by Southwest launched that they were going to introduce these two resolutions. And that’s when we kind of mobilized even more, we’re like, oh, no, this is about to go through, with almost no debate.
Together, we wrote an op-ed, in the local paper, The Austin Chronicle, which got a lot of circulation. That created this opportunity where multiple council offices were willing to work with us to say, okay, hold on, let’s put a brake on this pro-crypto stuff. Then that’s when we introduced the concept of public banking and complementary currencies. I guess this is kind of giving away the end game, but ultimately, we’re able to get these resolutions amended. So now technically, even though they passed something that was ostensibly, pro-Web 3.0, they also passed a resolution that’s pro-public banking.
William Saas: Could you say more about– either Mike or Mike– about the particulars of that proposal? That sort of “wolf in sheep’s clothing” of something for small businesses that’s actually about the transfer of wealth from late adopters to early adopters? We particularly understand that y’all were troubled by and I think we share that concern, the potential tax receivable ability of this Austin coin. Could you talk about the particulars of the proposal and your critique of it in that op ed and other forums?
Mike Siegel: Well, I’ll start Mike, and then pass it to you to fill in. The most extreme version was going to allow city workers… the city of Austin employs 13,000 people, right? It’s not just cops. It’s a whole class of the city is employed by the city. So people were gonna be able to receive their salaries and crypto, people were gonna be able to have their retirement get transferred to crypto, people were gonna be able to pay their water bills and their electric bills in crypto. It was basically like fully using this as a quote unquote, “currency” were some of the proposals that were out there. I’ll never forget, while Mike and I were working on these issues, going to my barber– I go to a black barber in kind of far North Austin– And I’m like, I’ve got all these kinds of blockchain questions on my mind.
And in the barber shop, I’m hearing one of the barbers talk about how his son has $15,000 invested in crypto. Like basically instead of a college fund, this working class family has put $15,000 in the crypto. What the guy said was like, we can’t touch it until he gets to college. So not only are they invested in it, but they can’t get out even if things go wrong. To me, it just seemed like hucksterism. That these extremely wealthy donor types had convinced the mayor and these other politicians, oh, there’s no harm in lending the city’s name to it. This is all… this is all good. And there was no discussion of the drawbacks. Basically, this op-ed we put together… I forgot how many words… 600 words or something, but basically just introduced the real high points of how risky this investment is and how disastrous the Miami coin has been. But yeah, Mike, how would you flush out what we were going through?
Mike Lewis: Sure. We saw how the whole purpose of the resolutions were to A) get support for cryptocurrency, generally speaking, and all of the tax perceivability especially on the most extreme end. And then also kind of using the mysteriousness or possible, magically innovative potential of blockchain technology in a separate resolution as being kind of two separate things. We kind of saw that there were some folks on council who said, I’m skeptical of crypto, but I’m interested to see what all types of use cases there are at the municipal level for blockchain technology. The crypto industry is very interested in getting that narrative out there because they want to be able to say that there’s a whole lot of use cases for this distributed append only ledger and whatnot.
I guess there’s a lot of problems with tha though, from a privacy standpoint that folks who’ve had on Money on the Left, like Rohan, I’ve written about. There’s also just the aspect that it’s a predatory financial scheme and that there’s folks that are pushing massive returns when they’re basically left holding the bag. The whole system is riding on this whole stable coin industry that’s kind of a ticking time bomb in terms of… its basically shadow banking or 19th century “Wildcat Banking”… kind of all the reasons we have modern banking and finance regulations is what the crypto industry is kind of speed running through the last couple of years. So, I think that at the local level there was organizations like CityCoins that were trying to push their agenda to get Austin to adopt a CityCoin. Basically, how this scheme works is a Peter Thiel acolyte-run organization. Basically, the idea is they allow… once the city announces that they’re willing to allow a CityCoin to be created, they allow the mining to start.
Miners mine the cryptocurrency with their computers using a bunch of computing power. Then people gain those tokens and then you can sell them or buy them on… there’s one exchange for just for CityCoins, for MiamiCoin, in this one use case. What’s interesting about that is the mayor of Miami was pressed on the fact that this one exchange, Okcoin, he was pressed by a reporter from CoinDesk, that they were advertising 430% returns on investment annually. This is a token is now down like 98%. The idea is the mining reward… 70% goes to the miners, 30% goes into a wallet that basically belongs to the city and they’re just the beneficiary of it. So, it’s basically kind of a bribe, if you will, to the city to kind of put the cities and perimeter on this speculative token that doesn’t have any use cases for payment system, for banking the unbanked, all the different narratives that they put out there. It’s just a speculative coin and it’s lost a lot of people a lot of money.
Maxximilian Seijo: You’ve both narrated some of the aspects of the problems with these resolutions, and obviously as well touched on the sort of rapid advance the crypto industry is making towards politics. Before we move to some more general questions though, I want to ask specifically about the resolution amendments that you all lobbied and had introduced. Particularly maybe some of the language that describes some of the limits and problems of crypto that you’ve been outlining, as well as the language that legally enshrined support for public banking, complementary currencies, and public payments platform.
Mike Lewis: Sure, I can go ahead and read those. I’ve got our after action report pulled up. On the cryptocurrency resolution, the first one we got added into their awareness statement that basically pointed out that cryptocurrencies present notable consumer risks including volatility scams, lost encryption keys, the inability to reverse transactions, and privacy issues. And then we also got added to that, whereas existing and potential public payments, currency and banking technologies and infrastructures that exist for the city of Austin should be also considered for broader investment, creation of a digital wallet based payment platform that’s public, administered by the city as well as the creation of a local complementary currency issued and accepted by the city. Then on the blockchain and Web3 resolution, we got a whereas statement that pointed out that blockchain technologies have known power consumption challenges that should be researched to determine the environmental impact.
Just pausing for a moment there, one of the whole reasons that the cryptocurrency industry professes that they can create this trustless environment for peer to peer transactions and things like that, is that we can trust in this line of code. But we can also trust in the fact that there is a sea of computers that are running calculations to guess at numbers. Basically, that’s what we can put our trust in versus people. It’s putting our trust in that kind of that waste of massive amounts of energy. Bitcoin alone wastes as much energy as the entire country of Argentina consumes, or the Netherlands. Then lastly, we got added into the resolution in the be it further resolved, supporting the creation and development of any financial innovations that could benefit Austinites and city governments, and applications that could include public payment platforms, public banks, or local complementary currencies.
Mike Siegel: And to just add a little color to that, the frame for our critique of what the crypto lobby was trying to do was equity. That was really resonant for the politicians and community groups. Who is this serving? To really clarify, for the office holders that this is serving the early adopters, the crypto proponents themselves. But you know, something Mike said earlier about Miami, really goes to the heart of why the crypto lobby was able to get as far as they did. It’s this bribe that they’re essentially offering. I mean, here in Texas, where a progressive city like Austin is operating in extremely challenging financial environment, where the state has basically constrained sources of income. We have no income tax in Texas. And beyond that, the city is constrained from even raising local taxes.
But by state law, such that you actually have to have an election, if you want to increase taxes, or sorry, increased spending above a certain amount each year by, I think it’s 4%. We can’t even to keep up with the cost of living. We can’t even keep good staff working for the city, where they’re talking about lawyers or engineers, or all sorts of specialists. There really is this overall feeling of financial desperation. How do we fund the bare minimum? I mean, we have a housing crisis, but we can’t afford to pay for housing. We’re in a climate crisis, but we can’t afford to shut down the coal plant that powers the city. And so I think the promise of this crypto money is so tempting for the politicians. And that’s where Mike and I talked about… as we were doing it we tried to kind of perform a little bit of judo energy transfer, like, okay, the crypto lobby created all this energy and momentum. But can we somehow turn this moment and shift it towards complementary currency and public banking? I think we did like really establish a foothold here. Were multiple council members at the council meeting, when all this was decided, spoke in favor of public banking. And now we’ve introduced this concept to the city that presents an opportunity in the years to come. Oh, well, you know, we might be able to pay for that housing that we need, if we set up a public bank, we might be able to generate additional local income if we have a complementary currency and introduce these progressive financial technologies as an alternative to crypto.
William Saas: As a sort of, several years ago, as a recent transplant to Louisiana, we had a new governor replaced Bobby Jindal– John Bel Edwards, a Democratic governor. There was a lot of hope and excitement around that. And he came in saying, basically, that we’re going to move forward putting Louisiana first. I was pretty new to MMT and interested in public banking at the time, and wrote an op-ed in The Advocate, which is the Baton Rouge paper, basically advocating for public banking. The responses to that op-ed– they made it a letter to the editor– were shocking enough for me to just be like, I’m not gonna look at those again. Could you share a bit about… and there were some good ones and I actually made some good connections with folks as a result, but it was illuminating. Could you share a bit about the reception of y’all’s work and y’all’s op-ed? And I wonder if there’s any overlap between the constituency that is sort of is interested in weed wages and money or–
Mike Siegel: Workers, wages, and weed?
William Saas: Workers, wages, and weed and crypto. So what sort of conversations have you had? How are people receiving this work?
Mike Siegel: I think… Do you want me to go first, Mike, or do you want to go?
Mike Lewis: Yeah, all I was gonna say is we’ve basically kicked off a conversation and it’s picking up across a bunch of different kind of intersectional bases of the grassroots climate organizers, racial justice organizers, folks that combat predatory payday lenders and whatnot. There’s a whole lot of different sectors that should have a major interest in public money and what it can do and how it applies to what they’re trying to accomplish. Go ahead, Mike.
Mike Siegel: I think there was a lot of interest. The local DSA chapter, there was a lot of interest. An Austin interfaith that deals with workers with working class. Faith communities, they’re interested, Austin Justice Coalition. I think the challenge for the activists was like, this sounds good. But how do we do it? I think, overall, in Texas, I mean, shit, we’re recording this couple days after the horrible Uvalde shooting. I mean, they’ve banned abortion in the state. I mean, we are under such immense pressure on so many fronts, that a lot of the good organizers are completely maxed out. So, I think the reaction was from some of the key folks, that sounds great, but where do we come up with the resources, the leverage to actually make this real? Then the other concern is that basically, even if Austin does this, will the state of Texas just preempt it?
There’s this long standing struggle with Democratic cities in Texas, especially in Austin, where you do something progressive, you lead the way– we pass a paid sick leave ordinance. We pass protections to ban the box for formerly incarcerated individuals. And then the state at the next session of the legislature passes a law that preempts or overrules what we’re doing locally. Some folks feel not only are am I overwhelmed and don’t have enough capacity to take on this project. But also, if we win, isn’t the state just going to overrule us one year later? I think part of where we’re at right now with this movement, is people understand the idea. And in particular, it’s the Bank of North Dakota, right, Mike, that is a great example? I think the two stories where we were able to tell really effectively is one, the Bank of North Dakota is an amazing example of a public bank, like you wouldn’t expect this amazing… you know, socialist, progressive institution to exist in North Dakota. But it does, it was extremely successful.
During COVID, it was able to get more PPP loans for small businesses in North Dakota per capita than any other state. It’s a bank that’s actually fighting for the people. And so that example, teaching the story of the Bank of North Dakota, really got a lot of people excited, including some like, relatively conservative, Austin City Council members, they’re like, wow. And so like the record of the Austin City Council meeting, there’s a lot of discussion in the Bank of North Dakota. And then from the organizer point of view, we were pointing to the successful campaign in Philadelphia, to take major steps towards the public bank. I think where we’re at right now is, we’ve established this concept, it’s enshrined in city law. If we work on this as a movement, the city manager and city staff are obligated to help us under the resolution. Now we just need to get like another wave of momentum to push the project forward more.
Mike Lewis: Yeah, all it took in Philadelphia was one, really active city council member, Derek Green, activating the Black community in Philadelphia, especially around the fact that historically denied access to credit, and how this could help Black entrepreneurship, small businesses, but also people who are unbanked, underbanked, low income, as well. And then, just a handful of volunteers. I think the important other thing to point out about Philadelphia is, they just passed last… or in March, 15 to 1 passing the creation of the Philadelphia Public Financial Authority. So that’s not quite a bank. They don’t have a charter yet. They’re on the way to, they’re the first city in the US that is on its way to a public bank charter. But there are things that can be won between no bank and bank.
And I think that’s important to point out, just in the fact that, it’s not all or nothing. The PPFA is going to be able to establish letters of credit to help provide more loans to low income folks and folks who had been historically denied access to credit and other other financial services that it can offer. Just wanted to make sure to point that out. There’s a huge movement across the country for public banking. California. 10 different cities looking at it there. LA, San Francisco, New York– there’s a huge movement going there. But even like New Mexico, New Jersey, there’s other places like that too.
And, of course, North Dakota. If you can point out the fact that… and one of the organizers on the Philadelphia campaign told me that they kind of appeal to that local pride by pointing out, like, hey, if these Republicans over in North Dakota, who are running this socialist institution… it was won by socialists between 1907 and 1919 and it’s been around for 100 years successfully running, it’s like, if they can do that, and has 7 billion assets under management we can too. So that’s definitely been kind of the rallying cry.
Maxximilian Seijo: Then, as you’ve both already said and started getting into, there’s latching into this movement nationally for public banking seems to be a part of these steps that you all are suggesting. And I guess I wanted to ask, in framing and linking together the political work that you’ve both been doing on public banking and complementary currencies, with the contextual environment of crypto finance and the recent crash. I guess I’m wondering if you all had particular thoughts about how public banking organizers such as yourselves, but also around the country, can take advantage of… I heard Judo mentioned? Take advantage of the context and some of the news coverage of this kind of the crypto crash, and as well as the real losses that people as you said, who are not always like high class investors who that are taking, in light of some of these particularly smaller– smaller than Bitcoin, at least, but not at all small coins collapsing.
Mike Lewis: I think that’s a huge moment for public education. Being able to help organizers, help policymakers, help the public generally better understand that there is an alternative from the horrible situation that we got into with the global financial crisis. And the response to that of crypto, which doesn’t appear to be any better, if not massively worse than what got us into the financial crisis. That there are better alternatives to that involving our public institutions, having better governance, having better accountability for the system that we rely on for transactions, for money, for our economy, for care, and for taking care of each other. I think that when it comes to just providing that alternative to kind of a private offering, with what we can have under public institutions that benefit everyone.
That’s that’s kind of the moment we’re in I think, is is really around public education, and then getting folks to act on that, because they have to realize that, at the municipal level, the the revenue model, the taxpayer model… the idea that, you know, our cities are funded by taxpayers, the wealthy. Of course, we know this is a deeply racist, sexist, classist institution deeply embedded in American white supremacy. We know that that institution has led to the status quo that we’re at. It’s led to the status about the crisis of public education finance, like our local public schools. We know that setting that up with property taxes to pay for it was a product of systemic institutional racism, to drive segregation. We’re understanding the foundation that we’re on, how money relates to what we’re trying to accomplish, and then how public money is going to get us to where we want to go.
Mike Siegel: Yeah, just to add to that I agree. This is a huge opportunity this moment. Unfortunately, what’s missing as a movement is our capacity to do the organizing and do the outreach. I think the idea of a public bank really appeals to a lot of people’s ideas, especially Texans’ ideas of self determination and self sustainability. In Austin right now on our tax bills, for every $8 that were tax for school’s finance, $7 actually doesn’t go to our local schools, it goes to the state of Texas to use in all sorts of ways–good and bad. People here really do feel trapped. They’re looking for answers for how we can fund the schools we want, how we can fund green infrastructure, how we can fund housing. I think the moment is really here, because crypto has people thinking about money or… fake money, obviously. But so what’s the real alternative? I think my thing is, from an organizing point of view, we need infrastructure. Y’all have this wonderful show, Money on the Left, y’all are educating the people doing the Lord’s work, right? Extremely important.
But how do we get a major national union for example to realize that public banking might be the way for their members to have better quality of lives? Better health care? How do we get national political groups to invest in public banking or national foundations to fund it? Because, unfortunately, we’re operating in this market economy, this capitalist context. This movement requires a lot of public education. It requires a lot of nuance in terms of how we communicate the message to the people, how do we build the coalition? Part of what I’m looking for, and maybe all the hosts of the show have some ideas, but, how do we make this more of a mainstream concept? I mean, think about Medicare for All.
When Bernie ran on Medicare for All, he educated a ton of people about it. But now you’ve got, you know, the National Nurses Union that spends millions of dollars every year organizing for Medicare for All, 15 an hour, the SEIU National Union has an entire program that’s been going for 10 years at this point, “Fight for 15”. How do we inspire folks to develop similar infrastructure for this essential tool, which is a public bank?
William Saas: You talked about capacity and infrastructure. And earlier you talked about, and I hadn’t really realized that there was a crypto lobby, but it makes absolute sense. You’ve got millionaires and billionaires investing in this speculative asset, of course they would hire some of the best lobbyists to look out for that asset and tt’s continued existence. So you got the crypto lobby on one hand and then you also have in terms of like state banking and state finance, you have the financial industry itself, which is, in Louisiana, I think that our state revenue goes into Chase Bank. If it still does, right? And is that the same for Texas?
Mike Lewis: Austin banks with JP Morgan Chase.
William Saas: Okay yeah, they probably have a lock on the South, maybe even more. But they also have armies of lawyers and lobbyists that are arrayed against something like this. So the capacity and infrastructure argument is just tremendously important. I mean, daunting, right? I guess one of the things that I can think of an immediate example from this morning actually as we record this, a very qualified and unsatisfactory, and maybe it’s not a win, but the announcement, sort of, in a roundabout way that the Biden administration is thinking about canceling $10,000 in student debt. And this is not the first time we’ve heard this, but the work of the debt collective, which is pretty… they’re not a huge organization.
Right? They are a posse, they are lots and lots of people who are– myself included– who count themselves as like somebody who would be a member. I guess we can, I don’t have… you can pay dues and be an actual member of the Union now. But something along those lines, they’ve been very, very successful on a small… with a small team and infrastructure relative to what they’ve been up against, with the student loan industry and the medical loan financing industry to get student debt cancellation at front and center. Presidential politics and making it something that Biden cannot ignore and get away from… and is probably very annoyed by, but I mean, that would be an example. I don’t know how you would replicate that energy and effort. But I think it would maybe some inspiration there for a small team doing big things.
Mike Lewis: Yeah. Just to piggyback off that, like some other examples– Chicago’s bailout for the many that Rohan Grey worked on. Back to Philadelphia beginning of COVID, they passed a unanimous resolution calling on the Fed to create a facility for municipal loans at zero interest, you know, we got the Municipal Liquidity Facility, but the it was completely unusable. The rates, which were a total policy choice… could have put cities, you know, balance sheets and a lot better position. And that’s all a policy choice. Of course, we know.
Maxximilian Seijo: Yeah. And it makes me think, too, that in the coming months and years as there’s more crypto volatility, which there no doubt will be. I think that’s the one thing that is we can say for certain, there’s gonna be a lot of people that have lost a lot of money in this space. And we’re promised like you mentioned with the MiamiCoin, we’re promised returns. We’re promised a certain kind of path to flourishing and amidst, you know, all the hardship that we see around the country in the world, it’s some level understandable when the culture is speaking those potentials.
People are making money around you to want to get in on that. I do think that will present some opportunities for maybe bringing some people on board into the public money, space, and just politicizing money more so on these terms and you know, it’s not always a happy story, but same goes for after the financial crisis in 2008. That this was an impetus to politicize a lot of different aspects of financial malfeasance, and then bailouts as well, and the political capture. So, it’s not exactly hope, but it’s… there’s certainly paths that these sorts of things might go down where there will be potential to make some gains.
Mike Lewis: I was gonna say, Hamilton Nolan wrote a piece in In These Times, it was about kind of after crypto’s crash, what happens. And in exploring the high potential that he sees and folks going even further right, more fascist and whatnot. I don’t think any of that’s inevitable or deterministic. Of course, we have… it’s kind of our job to make sure it doesn’t happen.
Maxximilian Seijo: Yeah, and then I think the last thing I’d also add too is this environmental component that you both brought up is really important, too. Because, particularly for these municipalities, who all variously have commitments to environmental sustainability. I know in California, for example, there are often municipalities that pass ordinances right to… moving towards environmental sustainability, and that’s in a state where we have a commitment to net zero carbon emissions, but on the table sometime in the future. Thinking about the ways that perversely crypto is kind of a perfect storm, to move against that sort of commitment or those sorts of values. Potentially that’s another angle that it seems like y’all are pursuing so I appreciate the work.
Mike Lewis: I was gonna say, Texas has 40% of Bitcoin mining. Of course, we all know that we have the best power grid here. And I’ll let Mike take it from here.
Mike Siegel: I think unfortunately if you look at future opportunities, if we’re analyzing the opportunity for this movement, we not only look at future crashes of crypto, but we also look at future failures of the Texas grid. We had the terrible freeze I guess about a year and a half ago at this point. And right now, our grid is not stable enough to survive the summer. We’re most likely going to have blackouts this summer, hopefully not long ones. But it’s extremely likely and the fact that crypto mining is such a huge load on the grid could be a potential turning point.
Right now, there’s a governor’s race for Beto O’Rourke. I wouldn’t say he’s a longshot, but he definitely not the favorite to beat the Republican incumbent Greg Abbott. But when he launched his campaign, there were actually only two issues he was highlighting: fix the grid and legalize weed. And you gotta know, I loved it when I heard him talk about marijuana on the first day of his campaign, because this is one of these popular wedge issues that can change politics. But in the history of Texas politics, actually, grid failures and electrical failures have led to major restructurings in the state politics. There was a major series of breakdowns about 60 years ago at this point, that actually led to municipal electric utilities being formed. So, right now in Texas, it’s not the majority of cities.
But, for example, Austin controls its own electric utility. San Antonio has a quasi-public electric utility. So you don’t want to root for a grid failure. But it’s possible that if we have 100 degrees in a row for 60 days in a row, as we often do in Texas, that there could be major failures that are then politicized through this governor’s race. That can create another opportunity to fight back against crypto, because what are they doing for the people of Texas other than taking away our electricity that’s life sustaining for so many others?
William Saas: I guess I’m not familiar with the Texas grid in the same way that y’all are but, I know that in Louisiana, very close to y’all, our own grid and our own sort of energy infrastructure, and then our sort of environmental situation are both precarious and made then more so by lack of public investment. And wondering, seeing I guess, as you’re talking about that, Mike and Mike, the opportunity for even more intimately interweaving the the grid and the public bank as public infrastructures that ought to be managed by public officials. Which is a tricky thing, I guess, probably in Texas and especially in Louisiana, where it’s like, okay, so we’re going to make these public things. And then we’re going to hand it over to the politicians? We got to make sure to develop these robust and durable democratic structures at the same time as we’re advocating for these things.
So yeah, no shortage of work there. I wanted to maybe ask y’all to close by sharing any sort of major takeaways that you have from your experience here. Thinking about your… maybe your experience with developing your own arguments in the face of the sort of swarm of Web 3.0 crypto bros. Anything you learned from tangling with them that you might share with others who might be interested in fighting that swarm when it comes to their city next. Maybe what you might have learned from collaborating with or learning from organizers in Philadelphia, and any through lines you see, or possibilities for developing a more national movement as they’re emerging right now?
Mike Lewis: Want me to go first, Mike?
Mike Siegel: Sure.
Mike Lewis: Cool. Yeah. I think that my final thoughts, I definitely want to make sure to give a shout out to local complementary currencies, too, we didn’t get to chat too much about that. But the idea that below the federal level, cities, states, any level of government can use its role as an active legal agent in the community. It’s taxing power, fees, fines, the settlement of legal disputes, all sorts of different ways, you know, granting of landlord licenses and things like that. We have the ability to increase the capacity of liquidity fiscal capacity at the local level, with local complementary currencies. Then bravo to the UNI proposal doing that exact thing at the university level as well.
Really just being able to use local complementary currencies, like, you know, it could be an AustinDollar, for instance, or something like that. It could be issued with a digital wallet or a digital payment card or something like that. And really being able to… you could directly spin that into the local economy with direct job creation. Tenino, Washington did that with Tenino-bucks printed on wooden dollars, which is how they did it during the Great Depression. The mayor there busted out this printing press from the local museum, and during the beginning of COVID, started creating local complementary currency in Tenino-bucks printed on these wooden wooden pieces… a piece of wood, excuse me, and helping with local stimulus and care at the local level.
That’s something that we can do at the local level. I think that there’s a lot of different steps that are involved with getting that accepted, of course, but it is definitely something that could be used to increase the spending in public housing or increase the spending on local arts and local community care and things like that. So just want to make sure to give a shout out to local complementary currencies. I think that the big takeaway from all of this is that the crypto industry is very wisely and cleverly utilizing the spectacle of culture to advance their project. I think that we would be very wise to understand why Austin is covered in billboards that say crypto is a peaceful revolution, or I don’t know, they say all kinds of wacky things. But you know, the point… or why they’ve put their name on all kinds of sports arenas and things like that.
So. it’s really important just to understand that in order to push back against that, we have to have a counter mobilization, that does include how we make an impact in culture to get our project in advance of public money, and public institutions for care.
Mike Siegel: Right on, Mike. Yeah, I mean, I think for me a couple reflections. One, it’s actually pretty daunting. As a layperson, that’s how I would consider myself, to get involved in organizing in the space, because there’s so much terminology. And even when I would… after we wrote the op-ed, and I would talk to family members and friends. And there’s all these assumptions that blockchain is good and it’s better to move away from fiat currency. I mean, there’s all these kinds of arguments in the ether, that are hard to refute. I’m here with Mike Lewis, my friend, and he is pretty expert on this. It takes a lot for him sometimes to explain to me the different rebuttals for some of the bullshit arguments out there. So I think, first of all, we have to acknowledge that these things are complicated and daunting.
It’s hard for people to engage with these ideas. So unfortunately, a lot of people probably just turn off their brain and be like, oh, that crazy crypto stuff. It doesn’t have anything to do with me. We have to somehow improve our public education, our outreach. Let people know that it’s not as complicated as they think it is. And it’s actually a bad idea overall. But the second idea, and to me is more optimistic, is that I think public banking has huge potential. Because basically it’s a different worldview. It’s not a worldview of scarcity. It’s a worldview of abundance. Right? So much of what we’re being told is that we can’t afford it. We can’t pay for it. But public banking makes sense. Like, here we are in this ultra wealthy city in Austin, Texas. Why can’t we afford enough housing? Why can’t we afford environmental programs? And even Texas? Probably Texas is more wealthy than most of the nations in the world. Why can’t we afford a good grid?
Why can’t we afford public education? And so to me, public banking as a demand just makes a ton of sense. Like, why should we be letting JP Morgan hold our money? Why can’t we hold our money? And we decide who gets loans, and we decide where the investments go. And so to me, there is this overarching argument that that public banking kind of fills a void. And if we can get more people to embrace the demand, I think that’s really exciting. And then the last note, I just want to raise the specter of Elon Musk, who has moved to Austin, unfortunately. Has relocated Tesla from California, because he has so many racial discrimination and sex discrimination lawsuits in California, that he wants to move his terrible business to a different state.
Now, Elon Musk is sitting in my backyard, threatening to take over my city here. We need to fight back. I do think this is going to come down… I don’t know how much y’all talk about class war on this podcast, but I really do think this is coming. We have this guy, that’s Twitter billionaire, whatever he is, and he’s selling this crypto and playing with the DogeCoin. Because he knows he’ll make money if he can trick everybody to buy some. I think all of these issues could come together in a major movement, because Elon Musk is on the wrong side of environmental issues, whether it’s through his support of Bitcoin, or what he’s doing with SpaceX, down by the Mexico border in Texas ruining a rare local ecology for his ships. If somehow we can unite these struggles– the environmental movement, public banking, even public education, and how do we pay for it? I think there is a lot of potential. So that’s what keeps me animated and excited about this. Even though it’s a steep learning curve to understand the issues.
William Saas: Austin is getting weirder and weirder in all the wrong ways.
Mike Siegel: That’s right.
William Saas: Mike Lewis and Mike Siegal, thank you so much for joining us and sharing about your work. The good work that you’re doing in Austin with us on Money and the Left.
Mike Lewis: Thank you all so much for having us.
Mike Siegel: It was great to be with you, thank you.
* Thanks to the Money on the Left production team: William Saas (audio editor), Mercedes Ohlen (transcription), & Meghan Saas (graphic art)