AOC’s contention that people need a “public option” for finance was arguably true 100 years ago, but even then it was a contentious plan. The law enacting it was extremely limited, capping interest rates at 2 percent and not allowing a customer’s account to exceed $500 (or about $13,000 today).
Moreover, the lion’s share of deposits accepted by the Postal Savings System was then redeposited in local banks. Another fact unmentioned by the Little Octobrist: these were just savings accounts; no checking, no lending, and none of the other services of banks. The government merely acted as a go-between and guarantor for the traditional banking sector in the field of savings.
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