An older discussion in the NYT:
https://www.nytimes.com/roomfordebate/2 ... capitalism
This piece explains IMO pretty well how it works and what North Dakota’s Public Bank does:
https://boss.blogs.nytimes.com/2014/03/ ... usinesses/
Another summary:
https://ilsr.org/rule/bank-of-north-dakota-2/
BND functions mainly as a “banker’s bank” — meaning that most of its lending is done in partnership with local banks and credit unions. About half of the bank’s $3.9 billion loan portfolio consists of business and agricultural loans that are originated by a local financial institution and funded in part by BND. By participating in these loans, BND expands the lending capacity of North Dakota’s community banks, giving them added strength in competing against big out-of-state banks.
The remainder of BND’s loan portfolio consists of residential mortgages and student loans. In keeping with its mission to support, rather than compete with, local banks, BND does not make home loans directly. Instead, it provides a secondary market, buying up mortgages originated by the state’s local banks and credit unions.
There even used to be one on a federal level:
https://en.wikipedia.org/wiki/Reconstru ... orporation
The Reconstruction Finance Corporation (RFC) was a government corporation administered by the United States Federal Government between 1932 and 1957 that provided financial support to state and local governments and made loans to banks, railroads, mortgage associations, and other businesses. Its purpose was to boost the country’s confidence and help banks resume daily functions after the start of the Great Depression. The RFC became more prominent under the New Deal and continued to operate through World War II. It was disbanded in 1957, when the US Federal Government concluded that it no longer needed to stimulate lending.
The agency played a major role in recapitalizing banks in the 1930s and it was effective in reducing bank failures and stimulating bank lending.[1] It also helped to set up relief programs that were taken over by the New Deal in 1933.
https://www.theguardian.com/us-news/201 ... -law-ab857
The California governor, Gavin Newsom, on Wednesday signed the Public Banking Act, or AB 857, which will allow city and county governments to create, or sponsor, public banks. Those banks will in turn provide public agencies access to loans at interest rates much lower than they could find at private banks.
The state-owned KfW (Credit Institute for Reconstruction) is Germany's third largest bank:
https://en.wikipedia.org/wiki/KfW