The Democratic candidate for treasurer in Indiana is crisscrossing the state touting a plan to change how public money is invested if he’s elected.
The plan laid out by Pete Buttigieg Friday seeks to keep more money in community banks, rather than investing with the banks already overseeing the largest amount of money or generating the highest rate of return on paper…
“Naked, simple rate of return sometimes looks better with big banks, but part of what I’m trying to get across is that there’s a wider kind of rate of return,” Buttigieg said. “Because there’s a multiplier you get on dollars when you keep them circulating in our communities. Not only is that money coming back to you in the interest rate, but it’s coming back to you in the economic growth that it can stimulate when it goes to consumers and when it goes to small businesses that are right there in the community.”
The treasurer’s office has the authority to choose from among nearly 200 banks when deciding where to invest cash from the state’s general fund. But incumbent Richard Mourdock said sometimes the community banks simply have to turn away the state money due to federal investment restrictions.
“You have to be a very well-capitalized, a very large bank to take the volumes that the state has to offer,” Mourdock countered. “We’ve actually had a number of banks come to us recently in this tough financial time and tell us ‘We can’t take any more state money’ and return it to us. So those larger banks are certainly the best option the state has — in fact, the only real option.”
Mourdock said the banks with which the state invests employ more than 1000 Hoosiers. But Buttigieg says he’d institute a requirement that to take state money, the bank would have to be headquartered in the state or employ more than 50% of its workforce in Indiana.