Democratic Public Finance: A Radical Vision for Mamdani’s New York City

Summary

This document elaborates an emerging economic paradigm that is already latent in Zohran Mamdani’s plans and practices. The paradigm, which we call Democratic Public Finance (DPF), reframes money as an inexhaustible and malleable public institution. According to DPF, money is public credit, a capacious tool for mobilizing everyone’s capacities to meet our needs and build a desirable future. Contrary to economic orthodoxy, this paradigm redefines politics as the process of coordinating our abundant human and material resources within ecological limits, rather than exploitative competition for scarce funds. DPF is the process of making collective capacities visible, organizing them democratically, and enabling us to care for each other. Understood in this way, DPF discloses previously invisible possibilities for communal well-being and denaturalizes the impoverished suppositions that legitimize fiscal obstruction by establishment liberals, conservatives, and right-wing demagogues alike.

Mamdani has already displayed unparalleled political expertise in debunking myths about public spending. We build on this expertise, equipping the mayoralty with tools to openly and comprehensively challenge what we call Neoliberal Public Finance (NPF). NPF is an ideology and governance practice built on the false premise that money is a scarce private resource. NPF stages politics as a zero-sum game, assuming that communities can only deploy their capacities if they acquire money from taxpayers and bondholders. Undermining robust fiscal programs, NPF devalues extant collective capacities and obscures New York City’s potentials. The result not only validates ongoing neoliberal austerity, but also enables the right-wing destruction of public services and the expulsion of vulnerable persons from the country and its institutions. Ultimately, NPF serves as a consistent excuse for inaction, leaving genuine democratic projects vulnerable to fiscal sabotage.

In what follows, we outline four strategies for the Mamdani mayoralty to consider. All four strategies are grounded in current proposals advanced by the Mamdani team. Each strategy is designed to advance inclusive democratic projects, while undermining the political legitimacy of manufactured crises perpetuated by establishment Democrats and the Trump administration:

1. Reframing Debt and Taxation: Reframes current taxation and debt limits as not only arbitrary, but also as irresponsible limits on what we can do for our communities. The aim is to publicly explain and contest current rules about municipal debt and taxation, highlighting how the rhetoric of money scarcity devalues workers’ actual and potential contributions.

2. Mobilizing People Differently: Expands the public sector by using multiple forms of credit, particularly within the public school system, to create a culture of public service and a pipeline to a citywide Job Guarantee program.

3. Creating Public Banking and Payments Infrastructure: Establishes municipal-level public banking and a “Public Venmo” to democratize finance, serve the unbanked, and build a resilient local economy independent of Wall Street and insulated from federal political volatility.

4. Challenging Deep Legal Structures: Commences a long-term contestation of foundational laws at the municipal, state, and federal levels (e.g., balanced budget amendments), which legally enforce NPF’s austerity logic.

The document concludes with a bibliography, which provides the theoretical and historical foundations for the principles of DPF outlined in this proposal.

* See here for a PDF version of this document.

Introduction: From Neoliberal to Democratic Public Finance

Across the political spectrum, most people still believe that the U.S. economy is governed by immutable laws of supply and demand. On this logic, unemployment, rising rents, or scarcity of public goods are natural outcomes, not political choices. This market-centric worldview gives rise to misdiagnoses of social problems. Worse, it tends to validate pathological solutions that do far more harm than good. Take the oft-repeated notion that deporting migrants will “free up” jobs and homes. Such ideas not only justify ongoing state violence; they also mask the real challenge at issue: overcoming our collective misunderstanding of public finance so that we can openly care for our communities and planet.

The present text argues that a robust response to the ills of market ideology requires cultivating shared knowledge about the political constitution of money. When communities grasp money as a contestable form of collective organization, large-scale public jobs and housing programs become eminently possible. Once this knowledge is widely shared, “illegal migration” no longer appears as a problem. Responding to establishment handwringing and right-wing cruelty becomes an opportunity to build a democratic and inclusive future.

This document argues that building a just future requires shifting from the reigning ideology of Neoliberal Public Finance (NPF) to Democratic Public Finance (DPF). NPF constrains democratic possibilities by perpetuating the idea that money is always private, uncontrollable, and scarce. If money is scarce, so too are housing or jobs. NPF seems natural and almost unassailable, both as law and as a mode of framing collective life. It underwrites the neoliberal habit of acquiescence, which trains politicians and publics to treat fiscal sabotage as an impersonal event to be managed, not contested.

DPF, by contrast, asserts that money is an unlimited and disputable public good which can always be reorganized to serve people and the environment. For DPF, money is an inexhaustible institution, involving an always-ongoing and deeply public process through which societies mobilize their capacities and create their future. Imagine a city where public banks extend zero-interest credit to retrofit housing, or where a Job Guarantee program is financed through democratic credit issuance. This is the vision of DPF: not scarcity, but capacity; not limits, but collective potential.

A centuries-old tradition of legal and economic knowledge stands ready to support DPF: the credit theory of money. The credit theory of money demonstrates that when a governing institution issues or spends money, it credits the receiver, and records it as a debit in its books. Later, money can return to the issuer in payment of fines, dues, taxes, or other payments. When it does, the issuer credits itself and erases the debit. After its creation and before its return to the issuer and eventual erasure, money can mediate activities among money users. This is the crux of the credit theory: Money is the process of its creation, transmission, and final deletion. The credit theory of money could also be called the “monetary theory of credit” because it emphasizes that money is credit and credit, money. Therefore, this document will use “money” and “credit” interchangeably.

If money is the ongoing process of issuing and deleting credits, it cannot be solely understood as an inert quantity that reflects past accomplishments. Money cannot be something we need to hoard to create a livable future. And it certainly cannot be scarce unless we make it so. Money is, instead, the world-making act of crediting those actors who construct the future.

As a crediting operation, money involves record keeping: the issuer notes credits on a ledger (analog or digital); it can also issue tokens such as coins or banknotes that have served as “distributed ledgers” for millennia. The form money takes is secondary. No technological innovation can displace its essence, even as it constitutively shapes its operations and scope. All money is credit; all money, always, is an operation where crediting someone’s balance sheet means recording a debit on someone else’s. All money is orchestrated by a public entity situated at the center of a collectivity. In the United States and its predecessor polities, a wide range of actors, including colonies, states, and the federal government, but also municipalities and commercial entities such as banks, have operated ledgers, activating the capacities of millions of people. The economic situation in which we find ourselves currently—defined by myriad atrocities as well as capabilities—is the outcome of a long history of crediting operations.

These crediting operations never occur at random. All money, without exception, is a function of political design, as the legal scholar Christine Desan has pointed out. In everyday practice, some actors, but not others, are authorized to operate our crediting facilities, according to rules that govern for what purposes, and for whom, they can do so. How we answer the questions of monetary design is how the future takes shape. Thus DPF must name current rules, engage them, and propose avenues for democratic change. Just as exclusionary crediting patterns under the redlining scheme created a segregated housing sector, inclusive forms of money will make a just and inclusive world.

Readers of this document may recognize elements of DPF in Modern Monetary Theory (MMT), which has gained traction among progressive economists and challenged neoliberal assumptions about the federal budget. MMT rightly insists that the federal government, as a currency issuer, can never “run out” of money, and that many forms of human suffering—unemployment, lack of housing, and other unmet needs—result from artificial budget constraints. This document, however, presents Democratic Public Finance (DPF) as a broader political framework than MMT alone. Whereas MMT typically centers the federal government’s capacity to issue currency, DPF reframes all levels of collective life—federal, state, city—as potential sites of monetary transformation.

DPF builds on MMT’s insights but pushes further: it sees money not just as a federal tool but as a design system embedded in law and governance at every level. It asks how public credit can be mobilized even within existing constraints—and how those constraints themselves can be named, politicized, and changed.

Contrary to conventional treatments of MMT, which often focus on technical truths about sovereign currency issuance, DPF is a form of democratic participation. It becomes a way of seeing, naming, and expanding what is possible, not only fiscally, but also politically. At the city level, this means exploring how to expand crediting capacity through public banking, rethinking debt rules, and transforming public service employment, all as part of a broader struggle over the meaning and purpose of money itself.

First, DPF reframes collective life as an open-ended crediting process that occurs at all levels, including the municipal. DPF refuses to accept the premise of money scarcity, and always looks for creative ways of crediting those who need it most.

Second, DPF is a mode of knowing the world differently: It is the process of learning about our capacities, possibilities, and needs.

Third, DPF is the process of naming the current rules of monetary design while rejecting the neoliberal premises that underlie it. With this, DPF challenges their status as a hard limit and static constraint. To this end, DPF advances and enhances multiple crediting institutions to mobilize people.

A DPF-informed challenge to NPF’s money scarcity logic can deepen the transformative impact of Zohran Mamdani’s vision.

The Mamdani team already undermines NPF and has taken important steps toward DPF. When it denounces current debt rules as arbitrary, it challenges NPF. When it highlights the city’s vast and diverse resources—from public sector assets to workers’ capacities—it undermines NPF. When it creates a sense of collective possibilities and responsibility, it undermines NPF. When it frames prices as a multifaceted political problem grounded in law, it undermines NPF’s core tenet that prices can be an apolitical market outcome if the public sector does not “interfere.” When Mamdani highlights the city’s vast unmet needs, from housing and childcare to food, and proposes feasible solutions for making life affordable, it makes economic life legible as a changeable provisioning system. These highly popular challenges to neoliberal orthodoxy have validated and strengthened forms of collective knowledge that are uniquely suited for advancing DPF.

At present, Mamdani’s agenda challenges some features of NPF, such as its extension of municipality bond issuance to fund public housing. Rhetorically, however, he has not fully broken with NPF’s scarce money framing. This choice, of course, has a number of advantages. Above all, it enables Mamdani to focus on specific city projects and programs without introducing unfamiliar and potentially challenging ideas about public finance. That said, leaving NPF undisputed also has significant drawbacks. For such reasons, we urge the Mamdani mayoralty to go much further.

There are at least five reasons why leaving NPF largely intact damages Mamdani’s program for NYC. First, when we allow the appearance of money scarcity to persist, current human capacities and biophysical resources can appear secondary to money’s availability, and potentially redundant. For instance, unemployed people can appear as a burden to the public purse and a cost to deserving taxpayers, not a tragic instance of exclusion and lost capacity that could be mobilized by credit creation.

Second, when money can continue to appear scarce, there is a tendency to see politics as the process of groups vying for scarce public outlays, rather than a future-oriented democratic coordination of capacities for the common good. Thereby, NPF plays down people’s actual and potential contributions, creates fertile ground for exclusion, and distracts from a present that demands world-making.

Third, when money seems limited, taxpayers and bondholders can continue to present themselves as the center of political debate because we seem to depend on their money. It gives the voices of those who present themselves as taxpayers and bondholders special legitimacy as the alleged source of public financing, while of course disempowering everyone else. Instead of people who can presently claim certain assets, they are presented as the only geese that lay the golden eggs. They are those who ultimately pay. They are the pillars of the community on whose shoulders our collective welfare rests. Or, so we are told.

Fourth, leaving the assumption of money scarcity intact helps eclipse monetary design questions. Because money appears as a scarce quantity, not a political process of crediting and debiting, the rules that govern its issuance become less legible. This eclipsing shrinks the space of political possibilities because it becomes difficult to develop a widely shared language for public banking or a public payments system as a possibility within reach, just as urgent as freezing rents or expanding public childcare, and with potential effects that go beyond a single sector.

Fifth, when monetary capacity is regarded as a delimited resource, it induces political paralysis. Neoliberal ideology dictates that a democracy with tremendous organizational and productive capacity must nevertheless be held hostage by the veto power of private money holders. In countless scenarios, when talented organizers are ready, coalitional energy is real, and the democratic appetite for change is present, the dominant political imagination consistently stalls at the threshold of private investors. The assumption that only billionaires or suburban taxpayers can provision democracy has become so entrenched that it is easier to imagine acquiescing to authoritarianism than bypassing this veto.

In sum, NPF makes collective capacities less legible or appear redundant; it spells exclusion, enforces unjust hierarchies, and sabotages political action. NPF is an unjust past’s best bet to extend itself into the future, but DPF is here to say it has overstayed its welcome. If NPF says No, we can’t!, DPF asks What do we wish to accomplish together? DPF involves collective decision-making about how we want to live and work in community based on an accurate understanding of money as a world-making public institution.

This document sketches four areas through which NYC can maximally expand crediting operations to its residents as it engages current rules, mobilizes people’s capacities democratically, and builds empowering forms of economic knowledge. Each of these areas can stand on its own; together, they constitute a broad challenge to NPF. Individually, reframing each area can extend municipal crediting operations. If one of the areas for action falls short, then controversies about it nonetheless contribute to the overall goal of undermining NPF. DPF can still be advanced in the other areas. In addition, many of the anticipated gains are not easily reversed.

The core message is: Money is a malleable public institution we use so people can serve one another. This message must come through in practice, not as a doctrine but a reframing of politics that touches most areas of public life—a constant challenge to NPF. NPF must be addressed, not as a static limit or a hard constraint but a series of politically created chokepoints that currently limit what we can do for each other.

The remainder of this document outlines four strategic domains where DPF principles can be operationalized in NYC. Each area demonstrates how rethinking monetary design can unlock democratic possibilities and challenge the assumptions of NPF.

The four strategic areas we cover include:

1. Reframing Debt Issuance and Taxation
2. Mobilizing People Differently: Public Sector Expansion, the Public School System, and the Multiplicity of Credits
3. Creating Public Banking and Payments Infrastructure
4. Challenging the deep structure of neoliberal finance in municipal, state & federal law

1. Reframing Debt Issuance & Taxation

The premise of this section is simple but robust: To advance DPF and deepen its challenge to NPF, Mamdani can reframe current taxation and debt limits as both arbitrary and irresponsible constraints. Mamdani can explain the current rules about municipal taxation and debt and emphasize how illusions of money scarcity devalue workers’ actual and potential contributions. Mamdani has much to gain, and little to lose, from connecting people’s capacities to the monetary chokepoints that are currently obstacles to mobilizing them fully.

This is the message: The rules of NPF prevent the city from democratically mobilizing people to accomplish urgent tasks. NPF hurts people who need support and limits democratic decision-making about the city’s priorities. It limits what we can do for each other. We have the people.  We have the needs. Let us cooperate and build: fast and free buses, affordable childcare, and public grocery stores. Do not sabotage our ambitions through NPF. Don’t be reckless.

This perspective also allows Mamdani to connect ICE (and other harmful public organizations) to the problem of collective provisioning. ICE takes away potentially useful people, who in turn become violence workers to deport people who are contributing in many ways and want to continue doing so. This is not only cruel; it also destroys important webs of social provisioning. Ours is the work of care against the work of violence. Ours is the work of creating future generations versus the work of destroying livelihoods, erasing contributions, and creating suffering. It is the call of the “manosphere” versus the call of care. The NPF budgetary chokepoint and ICE are similar: both represent a reckless sabotage of production and a foolish, uncaring disruption. Countering sabotage and destruction could include creating good job options for people who might consider becoming ICE agents.

The messaging about taxation could be modified along these lines: We presently have to tax the rich to mobilize our labor, but that does not take away from the fact that we are doing the work ourselves. Taxing the rich is good for democracy and necessary for keeping the city’s dollar balances up under current rules, but it ought not limit what we can achieve together. People’s capacities and needs are at the center of the political universe, not taxpayer’s bank accounts. When someone says, “Mamdani thinks there is a Santa,” we should respond with: “We are our own Santa.” When someone says, “By increasing taxes, you are chasing the goose that lays the gilded eggs,” the answer is: “We lay our own eggs.”

Bond issuance practices and messaging can also be modified in this spirit. For instance, the city government could organize bond drives at advantageous rates. It is reasonable to believe there would be subscribers far beyond NYC because of the city’s central place in the global political imaginary and its potential to become a model for transformative change. Many people who donate to blue campaigns might buy such bonds. Instead of donating to campaigns, people would be investing in city infrastructure, and the line between donations and bonds could become blurred. The message could be: We need bond drives, and we are grateful to subscribers who help us minimize pressure on the budget. At the same time, it is us who do the work, and it is us who coordinate our efforts. People’s capacities, skills, and resources precede the dollar balances created by bond sales. This is similar in spirit to war bond drives, even if the context and purpose is distinct: While public discourse valued subscribers, no one doubted who was really going to war. Bond issuance coupled with political messaging has the further advantage of tying asset ownership to a political project. Unlike donations, owning a bond forges a longer-term connection.

There are also strategic advantages to deepening Mamdani’s challenge to NPF. First, a DPF reframing allows the city government to reject the unpopular role of austerity manager. Second, it allows the city to put pressure on those who could attempt to enforce NPF, while staying on message about New Yorkers’ capacities, resources, and needs. Third, not engaging the assumptions of NPF while making “hard choices” means re-anchoring the fictitious chokepoint at the center of collective life, which necessarily implies devaluing the potential contributions and collective resources that could be mobilized to meet urgent needs.

Unless NPF assumptions are challenged head-on, they are bound to shape how the city’s capacities, resources, and agency become legible. Unless NPF assumptions are rejected explicitly, capacities and democratic processes appear downstream from “finding the money.” Even if it can never fully erase an awareness of actual possibilities on the ground, NPF makes people’s capacities seem redundant and solutions appear utopian when they are at arm’s reach.

A DPF reframing of taxation and bond issuance marks a departure from typical progressive discourse, which does not challenge the NPF idea of a monetary chokehold, either taking it for granted or considering the legal forms NPF takes as unchallengeable. These are the typical reasons given for not challenging the money scarcity tenet: It sounds reasonable and plausible to politicians, economists, and other members of the public. Because neoliberal claims about money scarcity are ubiquitous, how to persuade the public is an open question. It might also appear pointless at the municipal level: Given how entrenched NPF as law and frame, why bother with ideas that seem out of reach? Finally, adding another contentious issue to an already bold political project could strain resources.

These objections should be weighed carefully. At the same time, it is important to note that the emphasis on actual capacities of workers is already at the core of Mamdani’s vision, that the shift to a DPF framing can be accomplished gradually and at first, almost imperceptibly. It does not rely on declaring “We are all municipal MMTers now.” And it can leave a lasting impression with important implications for future politics: “Do you remember the mayor who consistently said that our work can always be mobilized, that money is not the limit, that we should be able to mobilize our work democratically when we decide what we want to accomplish together?”

2. Mobilizing People Differently: Public Sector Expansion, the Public School System & the Multiplicity of Credits

The central claim of Area 2 is: A municipality that seeks to maximally expand its crediting operations ought to broaden its definition of money and explore complementary crediting tools. To this end, this section introduces the hierarchy of money and discusses its possibilities and limits using the example of educational systems and their crediting operations.

Not all money/credit is the same: This is the hierarchy of money. At the top is “high-powered money”—commercial banks’ balances with the central bank and federal fiscal appropriations. One step lower is the money in bank deposits—banks’ promise to exchange our balances for dollars at par on demand, or settle balances with other money users electronically. Commercial and governmental actors routinely combine such high-level dollars with lower-level credit systems: Airline miles, Starbucks gift cards, campus currencies, and gaming money are much farther down the hierarchy of money, yet they are immensely profitable and/or strategically useful for their issuers—the entities that issue them, regulate their use, and accept them back in payment to themselves.

The money question becomes multidimensional when lower-level crediting operations come into view. Governmental institutions ceaselessly issue credit, or accredit other institutions to do so in their stead: When the government doesn’t issue money, it charters banks to do so. When the public education sector does not issue credits or diplomas, DOE and other (DOE-accredited) accrediting agencies license private schools and universities that do the same. Governments also issue credits in the form of rebates for access to public facilities for certain groups (e.g. reduced entry fees for veterans). Finally, the public sector also maintains a broader legal system through which these public and commercial crediting systems can work. Collective life is a multifaceted crediting process, and politics is how we decide about the rules according to which this is done.

The Mamdani campaign’s Zetro card program illustrates how money functions as a social tool of credit to mobilize community labor and resources. During the campaign, the Mamdani team issued Zetro cards to volunteers, crediting them for their canvassing and organizing hours. These cards could then be redeemed for campaign merchandise. The system creates an effective monetary circuit for coordinating collective capacities. It demonstrates in real-time that we do not need to wait for scarce dollars to organize our collective capacities; we can institute our own systems of credit to acknowledge labor, foster community, and work toward a shared goal. The Zetro card, then, is not merely a clever organizing tactic; it is a living example of how we can build a more just and responsive economy from the ground up by understanding money as inexhaustible public credit.

As part of this logic, municipal governments ought to fully exploit the multiplicity of crediting possibilities, and deploy it in tandem with high-level dollars. Lower-level crediting systems, such as those deployed in the education sector, are not subject to NPF chokepoints (even if curved grading echoes NPF’s artificial scarcity). While they are distinct from dollars, at scale, they are a powerful means of mobilizing, valuing, rewarding and developing capacities and people and can be used to complement dollar expenses.

The logic of this section can be illustrated through the example of a decades-old summer camp in upstate New York, where returning campers, as they grow older and become more experienced, are gradually integrated into the supervising/instructional framework through several crediting systems. At first, campers earn badges for tasks accomplished (similar to scout ranks). At age 13, they can become Counselors-in-Training (CITs) who assist Counselors in some tasks. Now, they are already credited in the sense that their tuition is reduced and they can claim credit for their work on their CV. When they turn 16, CITs can apply to become Counselors, and become responsible for a group. This is a full summer job with dual crediting in dollars and work experience; they no longer pay tuition. Later, they can become specialized instructors, lifeguards, etc., with increasing dollar-denominated credit. At each step, they are credited in multiple ways and trained for the next step. While employment may not be guaranteed, there is a strong expectation that there is already a place for everyone who wants a job. This is a well-thought-out system that, at a small scale, captures the logic of a public education system that can expand into a larger public sector.

Outside of summer camps, the logic of dual crediting is ubiquitous in the process of “CV building”: For instance, as interns, people receive a mix of credit for work done and a modest wage; as professionals, people get “credit” for a job done (a line on the CV), and are credited in dollars. All educational systems, public and private, operate with multiple forms of credits and debits: For instance, higher education and research systems issue course credits, degrees, diplomas, awards and recognitions at all levels. They recognize “as credit” work experience, and at higher levels recognize and demand qualitative or quantitative evidence of merit, such as peer-reviewed publications. At the apex, the creditors themselves need to be credentialled (e.g., the higher education accreditation systems). In tandem with these multiple crediting systems, educational institutions rely on and administer a crediting/debiting system denominated in dollars that involves tuition, government funding, donations, fees and fines, and outlays of all kinds, e.g. as salaries for instructors or administrators. Educational systems manage the interaction of multiple crediting systems which situate them in broader social relations: Education functions because internal credits (e.g. diplomas) are recognized outside.

This section proposes expanding and formalizing the logic of multiple crediting systems, and making it part of a public sector expansion at the scale of the city. “Internal” credits can serve as an auxiliary engine to the dollar crediting system. Lower-level credit does not replace an engagement with NPF at the higher levels of money, but it makes the higher-level dollars more impactful and helps create a dynamic in which DPF can thrive and NPF becomes more implausible.

Imagine this sequence of crediting operations in which the summer camp serves as a model for combined “internal” educational and “external” dollar credit: Elementary and middle school students can become used to the idea of public service early on, for instance by involving them in custodial tasks, food preparation, or gardening for one period per day. There is successful precedent for this in Japan, and there are similar, and popular, programs in many schools in the U.S. today, e.g. when older elementary school students help teachers with the youngest. Custodians and cooks, on the model of home economics teachers, could become part of the academic staff; that is, they would be recognized as teachers. In addition to performing tasks that are unsuitable for students, they would manage and supervise students in collaboration with school leadership and other teachers.

At this early stage, students would be credited with grades (e.g. conduct grades) and through a credit/rewards system such as ice cream credits from nearby stores (a practice that already exists). Using educational credits to mobilize students in this way would have many desirable effects: If the spirit of public service is already present in kindergarten, students think of themselves less as passive consumers of educational services and more as active participants in a public process. This could be the beginning of a generational experience of public service and collective responsibility.

It could also redefine custodians, kitchen staff, and their work: They are already doing pedagogical work when they instruct students about how to dispose of waste etc., but they are at a disadvantage as long as they are not formally defined as teachers. This redefinition of workers is similar to the proposed upgrading of childcare workers to teacher status, an (ac)crediting operation that involves a higher salary but is not limited to this form of credit. It is worth noting that school districts have experience onboarding workers from “other” professions. It is also worth noting that, once this is accomplished, it is difficult to undo: If hundreds of custodians have been defined as teachers, they have contracts, union representation, etc.

In a context of a teen unemployment crisis, such internal crediting systems could be complemented by a plural credit system that includes dollars and subsidized public-purpose employment with high school credit. Initially, this could be a small-scale teen employment pilot project for the least enfranchised teens. If employers retain workers at the end of the period, their salaries could be subsidized. This program could be gradually expanded to include all teens. It is important to note that this would have to go hand in hand with a growing public sector in all areas of life (on the model of the proposed childcare expansion, and as part of the public sector expansion such as the Department of Community Safety, prevention first, Community Mental Health Navigators, EMT, violence interrupters). Similar to High School ROTC, but in the radically distinct context of local public service, youth could become familiar with possible future roles as they transition from high school credits and summer internships to public service employment. As it grows, its popular support base will also grow, and it would become more difficult to undo (similar to Social Security). Eventually, this logic can lead to a citywide Job Guarantee.

Note that this logic is radically distinct from a range of other options. (1) This is not a mere expansion of monetary benefits (e.g. the Uruguay of the Frente Amplio government after 2005) because it would tie crediting operations not to a diagnosed need (lack of money) and present high-powered money, by itself, as a remedy; instead, it would deploy multiple crediting systems to integrate people into a democratizing economic life that fulfills needs. (2) It is even more radically distinct from neoliberal “Hail Mary” job market insertion programs that first train people and then abandon them. (3) Neither is it a New Deal-style temporary employment program: It goes hand in hand with a sustained and carefully planned public sector expansion. There are wins each step of the way, these wins are difficult to undo quickly or completely even if there is, say, an electoral defeat.

In sum, multiple crediting operations can drive a planned, gradual expansion of the public sector, a revaluation of different kinds of work, a mobilization of human capacities, and a pedagogical process that mimics, at the scale of New York City, the summer camp logic sketched above. This is the spirit of a Green New Deal at the scale of NYC and should be creatively extended across sectors.

In addition to reframing the budget process and developing already-existing lower-level crediting systems, a DPF strategy could challenge the corporate domination of banking and payments.

3. Creating Public Alternatives to Commercial Banking and Payments

This is the premise of Area 3: If crediting operations create the future, democratizing such operations is at the core of a more inclusive and just politics. Today, banking and payments are dominated by commercial banks, credit card companies, and payday lenders.

Recent New York legislative history offers bold solutions that can advance DPF in this context: The New York Public Banking Act (NYPB) and the Inclusive Value Ledger Act (IVL). The NYPB would establish a regulatory framework allowing New York municipalities to create their own public banks. These banks would be chartered to serve the public interest, not Wall Street, and could provide essential services like low-cost loans for public infrastructure, small businesses, and affordable housing. They would also provide a free, safe and surveillance-free place for New York residents to manage their money, thereby banking the unbanked.

This legal and institutional foundation will open the doors for the IVL, which would establish a public, digital payments system—a “Public Venmo”—for the entire state. The IVL would function as a public utility, offering every New Yorker a digital wallet connected to a state-controlled master account. This would enable no-cost, real-time payments between individuals and businesses, as well as with state entities for things like tax payments and benefits. This system would not only provide a no-fee alternative to commercial payment companies but could also be designed to recognize and reward public-purpose work, such as caregiving or community service, by delivering IVL credits directly into New Yorkers’ digital wallets.

Crucially, implementing an IVL does not have to wait for the passage of a comprehensive state-level bill. New York City could create its own city-wide IVL with a targeted amendment to State Banking Law § 131, which currently prohibits corporations from receiving deposits. This small but powerful legal tweak would explicitly exempt a New York City-operated Inclusive Value Ledger from this prohibition, allowing the city to provide a public payments system to its residents and businesses. This tactical approach would deliver a key component of DPF immediately and serve as a powerful proof-of-concept for the broader statewide campaign, deepening the connections between progressive NYC politics and statewide efforts.

Mamdani is uniquely positioned to make the aims of the NYPB and the IVL legible to a broader public. His strength lies in his ability to listen to communities and propose solutions that meet their needs, a talent that can be leveraged to demonstrate how these acts would serve the very programs Mamdani is already championing, such as public grocery stores. By weaving these previously obscure initiatives into a narrative of community empowerment, Mamdani can show how a new banking and payments system would broaden access to financial services to the unbanked, sideline exploitative corporations, and expand the city’s fiscal capacity. This system can be integrated with other initiatives to organize a robust people-first economy where transactions support public goods rather than private profits. Most importantly, by creating these new monetary institutions, Mamdani can mobilize labor and resources in innovative ways that directly address community needs, a core tenet of democratic public finance.

Building out state-level banking and payments systems are especially critical forms of regional resilience and resistance to the current political moment defined by the second Trump presidency. The current administration’s approach to public finance can be described as a radicalized form of neoliberalism, where austerity is not merely a de facto policy framework but an authoritarian directive. This is epitomized by the assertion of a unitary executive theory of money, where the President claims the unilateral right to impound—or simply refuse to spend—funds that Congress has appropriated. This unconstitutional power grab makes the federal fiscal process, but also previously “unpolitical” institutions such as the Automated Clearing House—vulnerable to a president who uses it to target political opponents and dismantle public programs. The aim is insulation from crisis bargaining: threats of shutdown, impoundment and legislative slow-walking lose their leverage when public payments continue uninterrupted. Pursuing state-level initiatives like public banking and payments systems offers a clear path to securing economic flourishing and self-determination for New Yorkers.

These bills cannot be revived and won overnight. But integrating the goals of these acts into a broader DPF narrative, Mamdani can make them not only socially meaningful, but also vital and exciting. The language and ideas we champion today shape what becomes imaginable tomorrow. Even if this struggle meets immediate resistance in Albany, it is crucial to shape the horizon in which the future will be contested. This proactive effort ensures that the conversation around public finance shifts from one of scarcity and austerity to one of collective capacity and possibility, laying the groundwork for a truly democratic financial system down the line.

4. Challenging the Deep Structure of Neoliberal Finance in Municipal, State & Federal Law

To fully realize DPF, we must dismantle the foundational legal and ideological structures that uphold NPF. These deep-seated frameworks, often embedded in federal and state constitutions, represent the most formidable obstacles to transformative change. To leave them unchallenged in political discourse is to tacitly accept their premises of money scarcity and austerity, thereby limiting what is perceived as politically possible. While some of these deep structures were implemented during the neoliberal period, which began in the 1970s, others are rooted in the long history of the United States and owe to the anti-democratic impulses in the Enlightenment philosophy that informed the writing of the U.S. Constitution. Our goal is to expose these legal and ideological chokepoints not as unchangeable facts but as a political terrain to be contested, creating a pathway for long-term reform.

The core of NPF is a legal hierarchy that prioritizes private financial institutions over public bodies, especially at the state and municipal levels. The hierarchy consists of two basic, mutually reinforcing, structures. The first part of this structure is the legal framework that grants corporate banks the power to create credit, a privilege legal scholars Robert C. Hockett and Saule T. Omarova call the “finance franchise.” The second part constrains sub-federal public entities with balanced budget rules and limited powers of taxation and debt issuance. This system fosters a negative feedback loop where public entities, starved of democratic financing tools, are forced into a politics of austerity, while private markets are prone to credit-fueled bubbles.

The effort to challenge these deep structures must focus on two key areas: (a) sub-federal constitutional and legal constraints, and (b) federal constitutional and appropriations law.

(a) Overcoming Sub-Federal Constraints: At the state and municipal level, NPF is largely enshrined in balanced budget requirements and other fiscal rules. Such rules, often embedded in state constitutions, make it difficult for cities like New York to respond to the needs of their residents without resorting to regressive taxes or market-dependent borrowing. Mamdani must frame these constraints not as a sign of fiscal prudence but as a form of social and ecological irresponsibility, preventing the city from mobilizing its vast human and material resources to address urgent needs. Balanced-budget rules function as pre-installed political levers that can be yanked to break progressive coalitions when livelihoods and essential services hang in the balance.

While changing state constitutions is a long and arduous process, involving methods like legislatively referred amendments, citizen initiatives, or constitutional conventions, the conversation must begin now. By consistently highlighting how balanced budget amendments and other rules impede the city’s ability to serve its people, Mamdani can build public support for a future where these rules are challenged and ultimately transformed.

(b) Reforming the Federal Financial Architecture: The federal level presents its own set of constitutional chokepoints. Article I, Section 10, Clause 1 of the U.S. Constitution, which prohibits states from coining money or emitting bills of credit, is a primary legal barrier to sub-federal monetary power. Furthermore, the federal appropriations and payment authorization process itself contains anti-democratic bottlenecks that leave it vulnerable to executive overreach. A unitary executive can weaponize the government’s centralized IT infrastructure to illegally impound funds, overriding Congress’s constitutional power of the purse.

To address these issues, a transformative agenda would require:

A New Constitutional Amendment: The ultimate goal is to amend the U.S. Constitution to extend the finance franchise to states and municipalities. This would grant them the power of credit creation, moving them from being mere borrowers and taxers to being active participants in DPF. This is not a call for an unregulated free-for-all, but rather a new, regulated system where sub-federal entities are empowered to create money under strict rules to promote social inclusion, environmental sustainability, and affordable pricing. A new federal agency would be needed to coordinate this process and prevent destructive competition among states and cities.

Modernizing the Appropriations Process: Following the blueprint laid out in legal scholar Rohan Grey’s paper “Digitizing the Fisc,” the federal appropriations process must be redesigned to be more democratic and resilient. Key proposals include:

A Congressional Fiscal Record: A digital database and ledger, managed by Congress, that records all public funds and spending directives.

A “Treasury ATM”: A centralized, secure terminal for agencies to withdraw newly issued digital currency (“eCoins”) directly from Congress’s authority, bypassing the traditional Treasury and Federal Reserve intermediaries and their associated political vulnerabilities.

Public Credit Cards: Congressionally-issued digital “keys” that define the legal and operational limits of an agency’s spending authority, ensuring that funds are used in accordance with legislative intent.

A Federated Federal Ledger: A decentralized record-keeping system that synchronizes agency-level data with Congress’s central ledger, increasing transparency and accountability while protecting against a unitary executive takeover.

By advocating for these changes, Mamdani would not only challenge NPF at its deepest legal and ideological roots but also lay the groundwork for a truly democratic financial system where money is a public utility used to mobilize people and resources for the common good. This approach redefines responsibility, shifting the focus from arbitrary budget rules to the well-being of people and the environment. It is worth noting that identifying problematic legal norms, including and the constitutional level, can in and of itself have important effects: For instance, the fact that the ERA has not been adopted remains a useful reminder of widespread opposition to women’s rights. Therefore, it has pedagogical effects that are important and make it a worthwhile cause regardless of when or whether it is adopted.

Conclusion

Without a doubt, Zohran Mamdani’s vision for New York City represents the most politically savvy and fiscally robust undertaking in decades. This document argues that Mamdani’s transformative vision can be further enhanced if it directly confronts the myth of money scarcity and frames our collective capacities as the source of shared prosperity. Democratic Public Finance at once delegitimizes and bypasses neoliberal sabotage from the center, as well as authoritarian subjugation and exclusion. Mamdani can move beyond a defensive debate over funding and offer a hopeful, coherent narrative that shapes what we can achieve together in new ways. It can also, potentially, help reshape the political landscape beyond New York City by modeling a different approach to fiscal policy and assisting other municipalities. Implementing the proposed strategies–reframing the budget, mobilizing people through lower-level forms of credit, creating public financial infrastructure, and challenging the deep legal structures of austerity–is a long-term struggle. But even when immediate victory is uncertain, the very act of publicly contesting these rules is vital because it shapes what becomes politically legible and achievable for future generations. This fight will ground Mamdani’s ambitious platform in a shared sense of purpose, forging a stronger community and a powerful mandate to build a truly democratic and prosperous New York City.

Bibliography

Beaman, Will. “How to New York Times-Proof Mamdani’s Playbook: Turning Coalition Specifics into Fiscal Possibilities.” Superstructure Vertical, July 6, 2025. https://moneyontheleft.org/2025/07/06/how-to-new-york-times-proof-mamdanis-playbook-turning-coalition-specifics-into-fiscal-possibilities/.

Bell, Stephanie. “The Hierarchy of Money.” Working Paper No. 231, The Levy Economics Institute of Bard College, Annandale-on-Hudson, NY, May 1998. http://www.levyinstitute.org/pubs/wp/231.pdf.

Carrillo, Raúl, and Jesse Myerson. “The Dangerous Myth of ‘Taxpayer Money.’” Splinter, October 19, 2017. https://www.splinter.com/the-dangerous-myth-of-taxpayer-money-1819658902.

Desan, Christine. Making Money: Coin, Currency, and the Coming of Capitalism. Oxford: Oxford University Press, 2014.

Doctorow, Cory. “Blue Bonds: State Debt Is Generative.” Medium, October 2025. https://doctorow.medium.com/https-pluralistic-net-2025-10-04-fiscal-antifa-post-trump-753c0010f317.

Feinig, Jakob. “MAGA, the Job Guarantee, and Post-Neoliberal Public Knowledge.” Economic Democracy Initiative. Accessed September 1, 2025. https://www.postneoliberalism.org/articles/maga-the-job-guarantee-and-post-neoliberal-public-knowledge/.

Feinig, Jakob. Moral Economies of Money: Politics and the Monetary Constitution of Society. Stanford, CA: Stanford University Press, 2022.

Ferguson, Scott. Declarations of Dependence: Money, Aesthetics, and the Politics of Care. Lincoln: University of Nebraska Press, 2018.

Ferguson, Scott, and Benjamin Wilson. “Stop Trying to Find the Money. Create It!” Academe, Fall 2022. https://www.aaup.org/academe/issues/fall-2022/stop-trying-find-money-create-it.

Freund, David. Colored Property: State Policy and White Racial Politics in Suburban America. Chicago: The University of Chicago Press, 2007.

Grey, Rohan. 2019. “Monetary Resilience.” Western New England Law Review 41:505-518.

Grey, Rohan, Digitizing the Fisc (March 11, 2025). Rutgers Law Review (forthcoming), Available at SSRN: https://ssrn.com/abstract=5239760 or http://dx.doi.org/10.2139/ssrn.5239760

Hawkes, Rob. “(Un)conditional Openness: Towards a Neochartalist Theory of Money and Trust.” Money on the Left: History, Theory, Practice 1, no. 1 (2025). https://moneyontheleft.org/2025/05/21/unconditional-openness-towards-a-neochartalist-theory-of-money-and-trust/.

Hockett, Robert C. “The New York Inclusive Value Ledger: A Peer-to-Peer Savings & Payments Platform for an All-Embracing and Dynamic State Economy.” Cornell Legal Studies Research Paper No. 19-39. Last modified October 16, 2019.

Hockett, Robert C., and Saule T. Omarova. “The Finance Franchise.” Cornell Law Review 102, no. 5 (2017): 1143–91.

Kelton, Stephanie. The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy. New York: Public Affairs, 2020.

Mehrling, Perry. The New Lombard Street: How the Fed Became the Dealer of Last Resort. Princeton University Press, 2011.

Money on the Left Editorial Collective. “Blue Bonds: A Fiscal Strategy for Overcoming Trump 2.0.” Superstructure Vertical, May 9, 2025. https://moneyontheleft.org/2025/05/09/blue-bonds-a-fiscal-strategy-for-overcoming-trump-2-0/.

Money on the Left Editorial Collective. “How the Zetro Card Can Save NYC (Really).” Superstructure Vertical, August 24, 2025. https://moneyontheleft.org/2025/08/24/how-the-zetro-card-can-save-nyc-really/.

Money on the Left Editorial Collective. “Tax the Rich Campaigns Need Coalition Credits.” Superstructure Vertical. August 19, 2025. https://moneyontheleft.org/2025/08/19/tax-the-rich-campaigns-need-coalition-credits/.

Money on the Left Editorial Collective. “Zohran’s #ZcavengerHunt was a Rehearsal.” Superstructure Vertical, August 25, 2025. https://moneyontheleft.org/2025/08/25/zohrans-zcavengerhunt-was-a-rehearsal/.

Saule T. Omarova, The People’s Ledger: How to Democratize Money and Finance the Economy, 74 Vanderbilt Law Review (2021).

Paul, Sanjukta. “Antitrust as Allocator of Coordination Rights.” UCLA Law Review 67 (2020): 328–401. https://www.uclalawreview.org/antitrust-as-allocator-of-coordination-rights/.

Steininger, L. Eden. “Late Wittgenstein’s money.” Finance and Society 11, no. 1 (March 2025): 1–8. https://doi.org/10.1017/fas.2024.27.

Tcherneva, Pavlina R. The Case for a Job Guarantee. Cambridge: Polity Press, 2020.

Vaheesan, Sandeep. Democracy in Power: A History of Electrification in the United States. Chicago: The University of Chicago Press, 2024.

Wilson, Benjamin. “Assignment Prompt: A Classroom Currency Experiment.” Superstructure Vertical, June 16, 2025. https://moneyontheleft.org/2025/06/16/assignment-prompt-a-classroom-currency-experiment/.

Wilson, Benjamin C., Taylor Reid, and Max Sussman. “Food, Money, Democracy.” Money on the Left, July 31, 2022. https://moneyontheleft.org/2022/07/31/food-money-democracy/