A Democratic “unity” task force designed by supporters of presumptive Democratic presidential nominee Joe Biden and Sen. Bernie Sanders (I-Vt.) is recommending that post offices provide banking services to improve access to financial services.
“One in four American households are either unbanked or underbanked, putting them at risk of losing money due to exorbitant fees or usurious interest rates,” the task force, one of several formed to try to unify supporters of Biden and his closest rival for the Democratic presidential nomination, said. Postal banking will remedy this, they contend.
“I commend the Task Forces for their service and for helping build a bold, transformative platform for our party and for our country,” Biden said on Twitter, adding that he is “deeply grateful [to Sanders] for working with us to unite our party and deliver real, lasting change for generations to come.”
The task force reports, which do not contain specific ways recommendations might be implemented, will be used as the national Democratic party forms a platform for the fall campaign.
The plan does not provide details about how postal banking might work. The proposal was included in the 2016 national Democratic platform and Sanders has endorsed it in the past.
While Biden and Sanders pointed at postal banking as a way to expand financial services to areas where it is not easily accessible, others have said it could be a way to shore up the finances of the postal system.
However, the Government Accountability Office earlier this year said the cost of changes to the system and renovation of Post Offices would cost too much to provide any financial relief to the system.
Credit union trade groups have been vehement in their opposition to any postal plan, contending that if Congress amended federal law to serve underserved areas, they could better service those people.
In addition to postal banking, the Biden-Sanders plan recommends that policymakers:
- “Reinvigorate” the Consumer Financial Protection Bureau, which Democrats have said has abrogated its responsibilities during the Trump Administration. The plan said that the Democrats would use the agency to restore the government’s power to enforce settlements against discriminatory lenders.
- Expand access to credit by establishing a public credit reporting agency to provide a non-discriminatory alternative to private agencies.
- “Strengthen and enforce” Dodd-Frank; the plan does not give specific details about how that would be accomplished
- Double funding for the Community Development Financial Institutions program, which received $262 million this year.
- Require the Federal Reserve to establish a real-time payment system so that people do not have to wait for their checks to clear. The Fed has been working on such a plan.