New Economic Perspectives has the article BANK of the COMMONS. by J. D. Alt. In discussing an assumption that Thomas Piketty made in his book Capital in the Twenty First Century, Alt says:

Instead of simply assuming, however—and in such an off-hand fashion!—that legitimate “democratic governance” cannot possibly be inserted into a central bank’s procedures for issuing fiat currency, why not try to imagine a way that it could? This is precisely what a “Bank of the Commons” might accomplish.

This is a very interesting idea.  One of the people commenting on the article claims that this was done in the 1930s and 1940s.

This idea isn’t far fetched at all.  We have systems almost like that in operation right now.  Think of government funded research grants.  What the NIH does right now is one example.  PhD’s at Universities and other research institutes write grant proposals, and the NIH funds some of them.  The current system is pro-cyclical though.  The amount of funding goes up when the economy is doing well, and it goes down when the economy is doing badly.  Highly qualified researches are dropping out now because of the lack of funding for good proposals.  I read of one newly minted Professor who decided to open a winery (maybe it was a brewery) because he couldn’t get funding for his biomedical research proposals.

The Bank of the Commons would not restrict itself only to research proposals by scientists with advanced degrees.  It would be open to anyone or any group that had a good proposal.  (Of course that is also true of some government grants now.)   However, the other difference is that a Bank of the Commons would be economically counter-cyclical, if that is the way we decide it should be run.