Such Great Heights

Yet another worthwhile Gillibrand initiative:

Sen. Kirsten Gillibrand (D-N.Y.) is introducing legislation Wednesday that would require every U.S. post office to provide basic banking services, an ambitious step aimed at improving the lives of Americans with limited financial resources.

The bill brings to Congress for the first time a policy idea that has already won the support of liberal economists and anti-poverty activists: Turning the nation’s sprawling network of U.S. Postal Service facilities into places where working-class and low-income Americans who lack adequate access to commercial banking can obtain low-cost, short-term loans.

The central goal of the bill is to replace risky financial products like payday loans, which can trap borrowers in prolonged cycles of debt, with regulated alternatives.

“This is a solution to take on payday lenders, to take on the problems that the unbanked have all across the country. It’s a solution whose time has come,” Gillibrand said in an interview with HuffPost.

To hear Gillibrand and other postal banking proponents tell it, the Postal Service and underbanked Americans are the perfect complements.

The postal system’s 30,000 locations touch every community. A majority ― 59 percent ― are in so-called banking deserts, or zip codes that have either no bank branches or just one.

Launching a postal banking system would require startup funding that could either be obtained through a loan from the treasury or a congressional appropriation. Gillibrand’s staff plans to seek an estimate of the cost from the Congressional Budget Office.

A postal banking system could be a major boon to the financially strained Postal Service. If even 10 percent of the money Americans currently spend on interest and fees for risky financial products went toward postal banking loans that cost 90 percent less, the Postal Service would gain almost $9 billion in annual revenue, according to a 2014 study conducted by the Postal Service Inspector General.

It’s just a great idea — providing a valuable service people need and many poor people lack access to, while also serving as a potential economic boost for some struggling areas and an important public utility.

Having said that, I can’t say whether I like this or not until Jacobin conducts a deep dive into her junior high student council voting record.