I can address this one, as this particular policy was actually one of my suggestions. Canada's bank is technically a National Bank but it operates more like a Central Bank.
This is a distinction that the economist Henry C. K. Liu has commented on in particular in his series on central banking (
http://www.atimes.com/atimes/Global_Economy/DK06Dj01.html) claiming:
"A national bank does not seek independence from the government. The independence of central banks is a euphemism for a shift from institutional loyalty to national economic well-being toward institutional loyalty to the smooth functioning of a global financial architecture. The international finance architecture at this moment in history is dominated by US dollar hegemony, which can be simply defined by the dollar's unjustified status as a global reserve currency. The operation of the current international finance architecture requires the sacrifice of local economies in a financial food chain that feeds the issuer of US dollars. It is the monetary aspect of the predatory effects of globalization.
Historically, the term "central bank" has been interchangeable with the term "national bank". In fact, the enabling act to establish the first national bank, the Bank of the United States, referred to the bank interchangeably as a central and a national bank. However, with the globalization of financial markets in recent decades, a central bank has become fundamentally different from a national bank."
This is actually something that the Bank of Canada has been taken to court over by the Committee on Monetary and Economic Reform, as their actions are regarded as having contradicted the purpose of nationalizing the bank. To quote COMER's website:
"The Bank of Canada was nationalized in 1938 and is wholly owned by the Canadian people. Between 1938 and 1974, the federal government borrowed at low or no interest from the bank. But in 1974, Canada embraced monetarism, which helped usher in the neoliberal policies of North American countries in the 1980s and 1990s. The Canadian government began to borrow from private foreign banks rather than financing its own public programs. Massive public debt was the result. "
To quote Dr. Kerry Bolton's "Breaking the Bondage of Interest":
"Canada was another British Dominion that had recourse to state credit, and for a much longer period than most others. Canada maintained this state credit system into the 1970s. The state owned Bank of Canada issued up to half of all new money at low interest, which in turn forced the commercial banks to keep interest rates low. This resulted in decades of prosperity. Now the Bank of Canada creates just 2% of the credit. From 1935–1939 the Bank of Canada was issuing most of the nation’s credit, and 62% of the credit during the last years of the War. Until the mid 1970s the Canadian Government continued to create enough new state money to monetarize 20% to 30% of the state deficit.
That ratio is now only 7.5%. While the money supply increases by $22 billion annually, the Bank of Canada now issues less than 2% of that money. It has been estimated that if the Canadian Government had continued to operate such a financial system as she had for around three decades, that nation would today be operating with a surplus of $13 billion"
The goal of this policy is to ultimately review the legitimacy of a lot of the debt our public institutions have incurred at the hands of private lending. This ultimately gives the government greater control over the monetary supply and prevents the growth of a currency based in debt while better enabling a currency based in a high purchasing power. This is a strategy that was not only employed by Germany and Italy in the 30's (allowing them to thrive while other nations were unable to prosper) but it was also employed in China by Deng Xiaoping in the in 80's.
"Under Deng Xiaoping, China changed from a centrally-planned economy to its own market-based model under government-owned banks able to issue credit for domestic development. Until the global economic crisis emerged, it grew impressively at double-digit rates.
Key is its banking system, its government-issued currency, and a system of state-owned banks. Henry CK Liu distinguishes between “national” and “central” banks – the former serves the national and public interest; the latter, private international finance at the expense of the nation and people.
In 1995, China’s Central Bank Law gave the People’s Bank of China (PBoC) central bank status, but more in name than form in that it still follows government policies by directing money for internal development, not bank profits. In addition, China is debt free and thus unemcumbered by IMF mandates and predatory banking cartel interests. It also protected its currency by refusing to let it float (beyond a minor adjustment) and be vulnerable to speculative predators.
The proof is in the results. China’s independent monetary policy works, much like colonial America, government under Lincoln, and Nazi Germany under Hitler. They printed their own money, debt free, and prospered – impossible under today’s American model of indebtedness to predatory bankers."
– (
http://www.globalresearch.ca/the-rise-and-fall-of-the-international-gold-standard/13559?print=1)
It is worth noting that at this point in time, China has a higher GDP in terms of purchasing power than the U.S.
