Is this the worst paragraph about economics, at least from a major newspaper, in 2011?
North Dakota currently has the nation’s only state-run bank. Supporters point out that the state is the only one to have had a budget surplus since the economic crisis began, and has an unemployment rate below 4%.
I don’t consider the idea of public sector bank or something like it to be completely absurd, but for this reporter to allow even the hint of a connection between a public sector bank and North Dakota’s economic success is just terrible, irresponsible journalism. Perhaps North Dakota’s recent oil boom that has included a tripling of output over the past few years has something to do with the budget surplus and low unemployment rate? Or maybe it was the state bank that has existed since 1919. I guess it could be either.
One question I want to ask about public sector banks is this: would the financial positions of fiscally troubled states be better or worse if they had public sector banks over the last 15 years? What would the financial position of the State Bank of Illinois be? I know where my bet is.