
John Burbank, Executive Director
From the Everett Herald:
The accepted wisdom is that the wealthy, banks and the biggest corporations are job creators. But in fact, too many are job-taker-away-ers. They suck money, our money, out of the economy and hoard it or spend it outside the country. That slows down economic activity right here in our state.
When the housing market burst, and the financial wizkids had to come to terms with their derivative gambling and sloppy math, the economy pretty much ground to a halt. Credit for new businesses was almost impossible to get. Banks that previously sold mortgages on a whim and a prayer wouldn’t loan money for new projects with solid markets and good business plans and demand. So what did these banks do? They got a lot of money from the Federal Reserve, and kept it.
JP Morgan, which took over Washington Mutual and slashed a lot of jobs in the process, now has $434 billion in cash. Add all the money owned by commercial banks stashed away at the Federal Reserve, and it comes up to $1.6 trillion. And that’s the problem: If the commercial banks hoard the money, and don’t make loans to the private sector for new businesses, they don’t create jobs. It just enables financial gambling for Wall Street.
The real job creators have been forced to go elsewhere. One of the biggest job creators is the American Recovery and Reinvestment Act passed by Congress in 2009. This act saved and created a total of over 30,000 jobs in Washington state in 2009, 20,000 jobs in 2010, and 15,000 jobs this year. Read the rest of this entry »
Filed under: state economy, bailout, community investment, economic growth, jp morgan, main street, plum bistro, stimulus