Friday wasn’t a banner day for presumptive Democrat gubernatorial nominee Phil Murphy‘s state bank plan, Save Jerseyans.
Widely-respected former N.J. State Treasurer Andrew Sidamon-Eristoff penned a well-reasoned, sober but no less devastating for it op-ed criticizing the plan:
But most significantly, as noted above, today’s BND performs functions that are already being performed by New Jersey government agencies. This begs an obvious question: would a public bank supplement or supplant New Jersey’s veritable “alphabet soup” of institutions offering “public banking” programs and services?
In sum, the idea of creating a New Jersey public bank may be bold, but it is hardly innovative. Even under the most optimistic assumptions, a public bank’s potential benefits would be marginal and come at a high risk to taxpayers and our state’s private sector. Instead of pursuing a “back to the future” idea for creating yet another government agency, New Jersey should focus on the larger and more difficult task of reforming and improving its existing public banking institutions and programs.
Lt. Gov. Kim Guadagno (Murphy’s most likely rival this fall) pounced, sharing the op-ed across her social media platforms and adding commentary of her own.
“After spending 20 years working for Goldman Sachs, Phil Murphy wants to turn State Street into Wall Street by using our tax money to start his own bank,” declared Guadagno on her official campaign Facebook page. “Not only would a public bank explode state debt, it would put state revenues for critical services at risk. Let’s call Phil Murphy’s wacky plan for what it is: a backdoor way to give his Wall Street friends jobs and let them make risky investments using our hard-earned tax money.”
Murphy made his millions (the exact amount is unknown; some analysts estimate he could be worth around $700 million or more) in the financial sector before entering partisan politics, serving as DNC Finance Chair and, more recently, the U.S. Ambassador to Germany.