How We Pay For It | Indiana Century S1E9

We're already paying. Five billion dollars leaves Indiana every year. Every time you flip a light switch, fill your tank, buy groceries, see a doctor, deposit a paycheck. The money leaves. It doesn't come back.

The question isn't "Can we afford to build the Indiana Century Project?" The question is "Can we afford to keep watching our money leave Indiana?"

This episode is about the funding flywheel. The system that captures value that's already ours and puts it to work for us. Not higher taxes. Not more debt. Capturing value that's already leaving.

The revenue streams:

Truck tolls on out-of-state trucks generate $150-200 million a year from non-Hoosiers. Cannabis revenue captures $300-400 million a year that's currently going to Illinois and Michigan. Host Community Fees from reactors send $10-12 million per year directly to host counties. Federal grants bring our tax dollars back from Washington.

The engine: The Bank of Indiana.

A state owned bank, like North Dakota has had for over a century. State deposits go into our own bank. Two billion dollars to start. Then local governments can deposit their money. Then, eventually, you can deposit yours. That money stays in Indiana. It doesn't fund hedge funds in New York. It gets lent at 3-4% to Hoosier small businesses, farmers, homebuyers, and towns building infrastructure.

The Bank of Indiana doesn't compete with local community banks. It partners with them. Provides liquidity. Shares risk. Offers services at cost. That's the model. Not competing. Completing.

The accumulator: The Indiana Future Fund.

A sovereign wealth fund. Target: $100 billion by 2050. At 5% earnings, that's $5 billion a year. Every year. Forever.

What does $5 billion a year buy? Permanent property tax relief. The Hoosier Birth Grant: $5,000 for every child born in Indiana, invested until age 18, growing to $14,000-17,000. Infrastructure maintenance. Healthcare for people who can't afford it.

Objections:

The Chirinko study (April 2025) says the Bank of North Dakota's success is due to the fracking boom, tax exemption, and risk shifting. We design around that. The Bank of Indiana pays taxes. It gets FDIC insurance. We don't rely on a boom. We create our own.

Featured book: Doughnut Economics by Kate Raworth. Meeting needs. Circulating value. Not endless growth, but thriving communities.

This is how we stop being extracted from and start investing in ourselves.

IndianaCentury.org

Transcript

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Episode 9, How We Pay For It. Part 1. Follow the Money. There's an old rule in journalism. Follow the money. If you want to understand why something happens, look at where the money goes, who pays, who benefits, who's getting richer while everyone else gets poorer. That rule applies to politics, to business, to crime, and it applies to Indiana. We've been following the money for eight episodes now, through the crossroads trap, where we calculated that $5 billion leaves Indiana every single year. Through energy bills that flow to Duke in Charlotte, to AES in Virginia, to Nysource in Ohio. Through grain that gets processed in Illinois and Iowa while we get the commodity price and the commodity price only. Through healthcare premiums that end up with Ascension in St. Louis and community health systems in Nashville. Through bank deposits that get lent out in New York and California instead of here in Indiana. The pattern is the same everywhere we look. Value leaves. We get what's left. But patterns can be broken. You just have to understand them first. You have to see the machinery of extraction before you can build something to replace it. Today, in episode 9, we answer the question that's been hanging over this entire series. The question everyone asks when you talk about building things. How do we pay for it? Not with higher taxes, not with more debt, not with handouts to corporations that will leave when the incentives expire. We pay for it by capturing value that's already ours and putting it to work for us. We build a flywheel, a closed loop, a system where every dollar that used to leave someone else's pocket stays in Indiana and works for Hoosiers. This is the funding flywheel. This is Pillar 5. This is how we stop being extracted from and start investing in ourselves. Part 2. We're already paying. Before I tell you how we pay for it, I need you to understand something fundamental. We are already paying. We are paying right now. Every time you flip a light switch, you are paying Duke or AES or NYSOurce. Every time you fill up your tank, you're paying for roads that out-of-state trucks wear out faster than you do. Every time you sell grain, you're accepting whatever price the traders in Chicago decide to offer. Every time you get sick, you're paying a health system owned by corporations in other states. Every time you deposit a paycheck, you're funding loans in California and New York instead of here. The money is already leaving. It doesn't really come back. In episode two, I laid out the numbers. Five billion dollars a year minimum. That's what leaves Indiana every single year because we don't own our own systems. Five billion. Think about what that could do. It could fix every road in the state, fully fund every school, lower property taxes for homeowners, build infrastructure like the stuff that we've been talking about. And we could still have money left over. The question isn't can we afford to build this? The question is can we afford to keep watching our money leave? Because here's the truth. When you build something yourself, when you own it yourself, the money stops leaving. It stays, it compounds, it works for you. That is the shift we are making from extraction to investment, from leakage to flywheel. Part three, the five pillars refresher. Before we dive deeper into the funding, let me quickly refresh where we've been. Because Pillar Five doesn't stand alone, it connects to everything. Pillar one is energy sovereignty. 50 small modular reactors over 25 years, publicly owned through the Indiana Energy and Resilience Authority. Each reactor pays a host community fee to its county, ten to twelve million dollars a year every year for forty to eighty years. It's power that we own, fuel that we make, and waste that we eventually consume. Pillar two is the connectivity revolution. High speed rail connecting Indianapolis, Lafayette, and Kokomo in thirty minutes, then expanding to South Bend, Evansville, Chicago. State owned fiber running alongside, connecting every Hoosier. Stations that become new main streets for towns that lost theirs decades ago. Pillar three is the agricultural renaissance, farmer owned processing co-ops, the Indiana Premium Brand, the Hoosier Heritage Land Trust, keeping farmland in family hands, the Indiana Carbon Bank paying farmers for the carbon they sequester in their soil, the Indiana Grain Reserve stabilizing prices so farmers aren't forced to sell at harvest lows. Pillar four is health and compassion, the hospital receivership authority that takes over failing hospitals and keeps them open, rural health hubs co-located with rail stations, the clinic in a van fleet blanketing all 92 counties, the animal stewardship corps, care that stays local. And pillar five is the funding flywheel. This is where the money comes from, where it goes, how it all connects. Energy powers the trains, trains carry the fiber, fiber connects the farms. Farms feed the health hub. Health hubs employ the core. The core builds the next reactor. The funding from all of it flows back into the system. A closed loop, a flywheel. That's the point. Part four The Revenue Streams. So let's talk about where the money comes from. Not from you, from the systems that are currently extracting from you. Revenue Stream 1 is truck tolls. Every day, thousands of trucks barrel down our interstates. I-65, 69, 70, 74, they are wearing out our roads. They're contributing to congestion. They're burning diesel and polluting the air along our highways. And they pay almost nothing for the privilege. Most of these trucks are registered in other states. Their cargo is headed somewhere else. They're using Indiana infrastructure to move goods that do not benefit Indiana. So we charge them 12 cents per mile. That's it. A fraction of what they'd pay on the East Coast. Pennsylvania charges trucks more than 20 cents a mile. New York charges them more. Twelve cents is modest. It's fair. It's what you'd pay if you were using someone else's roads and not contributing to their maintenance. At twelve cents a mile, truck tolls generate $150 to $200 million every year. And it comes from out of state trucks, not from you. Revenue Stream two is cannabis. Indiana is surrounded by legal weed. Illinois made four hundred million dollars last year from cannabis tax revenue from Hoosiers. Michigan too. Ohio just legalized. Hoosiers are driving across the border, spending their money, and coming back. We are funding their schools, their roads, their pensions. But here's the honest truth. Adults should be free to choose what they put in their own bodies. If you want to smoke a plant, that's your business. The government shouldn't be in the business of telling you otherwise. But if you're going to do it, the money should stay here and it should be regulated and taxed. It shouldn't be funding other states. We must legalize, regulate, tax 15% at wholesale plus regular sales tax at maturity, that's three to four hundred million dollars per year, and that's the conservative estimate. Money that's currently leaving Indiana every time someone crosses the border. Money that could be building our schools instead of Illinois. And here's the key. We don't just spend the money, however. We invest it. The revenue is constitutionally locked, so it can't be rated for pet projects. It goes to the Bank of Indiana and the Indiana Future Fund. It becomes capital, not consumption. Revenue stream three is host community fees. Remember the reactors from Pillar 1? Every one of them pays a fee to the county where it sits. $4 to $5 per megawatt hour. Let me put that into perspective. A typical small modular reactor generates about 300 megawatts running about 100% of the time. That's roughly 2.5 million megawatts per year. At $4 to $5 per megawatt hour, that's ten to twelve million dollars a year every year for each reactor for forty plus years. That money stays local. It funds property tax relief. It funds teacher salaries. It funds rural health clinics. It funds animal welfare programs. This is not a corporate handout like Indiana is used to. That's half a billion dollars per county over the life of a single reactor. Money that stays in Indiana communities instead of being sent to shareholders in other states. Revenue stream four is federal grants. This is the one that's easiest to forget. The federal government already spends billions on exactly the kind of things that we're planning on building. Infrastructure, energy, broadband, agriculture, health, workforce development. The bipartisan infrastructure law alone has sixty five billion dollars for broadband. The Inflation Reduction Act has hundreds of billions for energy. The Department of Transportation has grant programs for rail. The Department of Agriculture has programs for rural development. The Department of Labor has workforce training funds. That's our money. We pay federal taxes. We should get some of it back. The key is being ready, having plans, having applications, having federal partnership offices that do nothing but chase federal dollars and bring them home. We don't wait for grants to be announced, we actively go after them. Revenue Stream five is Bank of Indiana profits. This one's different. It's not a tax, it's not a fee. It's profit from a business that we own. The Bank of Indiana, which we'll talk about in detail in a moment, will be profitable. The Bank of North Dakota has returned billions to the state treasury over its history. Billions. Not from taxing people, from lending money wisely and earning a return. Those profits flow to the Indiana Future Fund. They compound, they grow. They become a permanent source of funding that never has to be replenished. This brings us to the last stream, which are the future fund earnings. The Indiana Future Fund is a proposed sovereign wealth fund. The target one hundred billion dollars by 2050. $100 billion invested earning returns. At 5%, that's $5 billion a year in earnings. $5 billion every year for as long as we have the Bank of Indiana. That pays for permanent property tax relief. That pays for the birth grant we talked about in episode 4. $5,000 for every Hoosier Child invested from day one. That pays for the thing we need without taxing the people who live here. The thing that turns all those revenue streams into something more than just money in a bank account. The Bank of Indiana, a state-owned bank, like North Dakota has had for over a hundred years, not some radical experiment, a proven model that's worked since 1919. Before I explain how this works, I want to talk about this episode's featured book, Donut Economics by Kate Raworth Seven Ways to Think Like a Twenty First Century Economist. Raworth's argument is simple. For decades, we've been taught that the goal of economics is endless growth, more production, more consumption, more GDP forever. But that model is broken. It's destroying the planet, it's leaving people behind, it's creating inequality and instability. She offers a different framework. A donut the inner ring is the social foundation, the basics everyone needs food, water, housing, health care, education, energy, and income. The outer ring is the ecological ceiling, the limits beyond which we damage the planet. Between them is the safe and just space for humanity. The goal isn't endless growth. It's meeting everyone's needs without overshooting the planet's limits. Now here's why this matters for banking. Our current financial system is built for endless growth. It extracts. It concentrates wealth. It rewards speculation over production. It takes your deposits and uses them to fund hedge fund gambling in New York and failed pyramid schemes in Silicon Valley. Remember Silicon Valley Bank? Remember Signature Bank? Remember how the big banks keep getting bailed out while you keep paying fees? The Bank of Indiana is built for the donut. It's built to meet needs, to circulate value, to invest in the social foundation, housing, health care, education, small business, infrastructure, not to maximize returns for distant shareholders, but to create thriving communities here at home. Rawworth's book gives us a way to think about money differently, not as something to be accumulated, but as something to be circulated, not as a tool for extraction, but as a tool for meeting needs. That is what the Bank of Indiana is for. So how does it work? Well, first look at where your money goes now. Right now, when you deposit your paycheck in a big bank, where does that money go? Chase, Bank of America, Wells Fargo, they take your deposits, pull them with millions of others, and then they lend that money out. Where? Wherever they can get the highest return. Sometimes that's a mortgage in California. Sometimes it's a loan to a hedge fund in New York. Sometimes it's funding a startup in Silicon Valley that's going to fail spectacularly and take billions with it. Your money leaves Indiana, it funds speculation, gambling, it funds things that have nothing to do with you or your community. And when those bets go bad, you get nothing. Or sometimes you get the bill. Let's talk about where your money should go instead. The Bank of Indiana provides us a place. State deposits go into our own bank. That's $2 billion to start with. Then local governments can deposit their money. School corporations, counties, cities, towns. Then, eventually, you can deposit yours if you choose. That money stays in Indiana. It doesn't get shipped off to Wall Street. It doesn't fund hedge funds. It doesn't prop up the next we work or whatever disaster is coming next. It stays here. So what would your money do when it stays here? The Bank of Indiana takes those deposits and lends them out at 3-4% interest to Hoosier small businesses, to Hoosier farms, to first-time homebuyers, to Hoosier Towns building infrastructure. 3-4%. Compare that to what you're paying now. If you have a small business loan, you're probably paying 6-8%. If you have a credit card, you're paying 15 to 25%. If you have a student loan, you're paying whatever the federal government decided that year. The Bank of Indiana doesn't have to maximize profit. It just has to be profitable enough to sustain itself and return earnings to the future fund. That means it can land at rates that are actually affordable, 40% below market value on average. That's efficiency. That's cutting out the middleman. Next, we need to talk about partnerships. Here's the part that matters. The Bank of Indiana does not compete with local community banks. It partners with them. When a local bank needs liquidity to make more loans, the Bank of Indiana provides it. When a loan is too big for a community bank to handle a loan, a factory expansion, a major farm purchase, a town infrastructure project, the Bank of Indiana participates alongside them, sharing the risk and keeping the loan local. When a community bank wants to offer mortgages or student loans, but they don't have the capacity, the Bank of Indiana provides the back-end support. We create a loan participation market where small banks can sell portions of their loans to the Bank of Indiana, freeing up capital to make more loans. We offer correspondent banking services, check clearing, wire transfers, treasury management, at cost, saving community banks thousands a year. We provide secondary market access so your local lender can offer competitive rates without taking on all the risk. And when a farmer needs operating capital at planting time, the Bank of Indiana funds the local ag lender who knows the farmer by name. When a young couple wants to Buy their first home, the Bank of Indiana provides the mortgage backing that lets the local credit union say yes. When a small town needs to build a sewer plant, the Bank of Indiana buys the bonds so the project moves forward. The Bank of North Dakota has done this for over 106 years. It's consistently rated one of the healthiest banks in the country. It's returned billions to the state treasury. And North Dakota has more community banks per capita than almost any other state because the state bank helps them thrive instead of letting the big national chains swallow them whole. That's the model. Not competing, completing. Now we need to talk about constitutional protection. This is the part that actually matters the most, because we've seen this before. Somebody builds something good, and 20 years later a legislature raids it to balance a budget. So we lock it. Constitutional amendments requiring 60% voter approval to sell any of these assets, to change the revenue allocations, to privatize the bank. That means these assets belong to us permanently. No future governor can undo what we build, no future legislature can raid the fund. The only way to change is to convince 60% of Hoosiers to vote against their own interests. Part 6. Objections and the Chirinko Study. Now let me address the objections head-on. Because there's a paper that came out recently from the University of Illinois, Chicago, April 2025, by a researcher named Robert Chirinko. It's about the Bank of North Dakota and it makes some arguments you need to hear. The paper says the Bank of North Dakota's success isn't due to some special secret sauce from being a state bank. It's due to three things. First, the fracking boom that made North Dakota's economy explode. The fact that the bank doesn't pay taxes, and the fact that it shifts risk to taxpayers instead of paying FDIC insurance. Those are all fair points, so let's address them. First, the fracking boom. North Dakota had an oil boom. Indiana doesn't. That's true. But we're not counting on a boom. We are building one. The Indiana Century Project is designed to create its own economic momentum. Fifty reactors, high speed rail, fiber to every home, farmer owned processing co-ops, rural health hubs, a sovereign workforce. These are not things that we hope will happen if the economy booms. They are the boom. They create the jobs, the demand, the growth. The Bank of Indiana doesn't need a fracking boom. It needs a building boom. And we're providing that. Second, taxes. The paper points out that the Bank of North Dakota doesn't pay any federal or state income taxes. So that's a subsidy. Here's the thing we can design the Bank of Indiana differently. We can make it pay taxes. We can make it operate like a normal bank in that respect. The goal isn't to hide subsidies. The goal is to build an institution that works on its own merits and competes in the market. Third, risk shifting. The Bank of North Dakota is not FDIC insured. If it fails, the taxpayers eat the loss. That's real. So we don't do that. The Bank of Indiana would get FDIC insurance. It just pays the premiums. It operates like any other bank in that respect. No hidden risk, no taxpayer bailout waiting to happen. The Charinko paper is useful because it forces us to be honest about what works and what doesn't. The Bank of North Dakota's success is not magic. It's a well-run bank that benefited from some unique circumstances. We can build something better. Something that doesn't rely on non-replicable factors, something that's designed from the start to be transparent, accountable, and sustainable. And here's what the paper doesn't say. It doesn't say the Bank of North Dakota is a failure. It doesn't say it should be shut down. It doesn't say state banks can't work. It just says the secret sauce is not magic. It's good management plus some advantages. We can replicate the good management and design around the advantages that don't fit. Part seven. The Indiana Future Fund. If the Bank of Indiana is the engine, the Indiana Future Fund is the accumulator. Think of it like this. Every year, revenue flows in from truck tolls, cannabis, host fees, federal grants, and bank profits. Some of that money gets spent right away on roads, schools, clinics, but most of it goes into a future fund. The future fund invests not in speculative bets, in safe, diversified assets, stocks, bonds, real estate, infrastructure, the same way a pension fund invests, the same way a university endowment invests. The goal isn't to get rich quick, it's to grow steadily over decades so that the fund becomes self-sustaining. The target is one hundred billion dollars by twenty fifty. The target is one hundred billion dollars by twenty fifty. Let me put that number in perspective. What does five billion dollars a year buy? It buys permanent property tax relief, not just a one-time rebate. Permanent. Your property taxes go down and they stay down because the future fund pays the difference. It buys the Hoosier Birth Grant, five thousand dollars for every child born in Indiana invested from day one. By the time that child turns eighteen, it's grown into something meaningful. College, trade school, a down payment on a house, a business startup, a stake in the future. It buys infrastructure maintenance, not just building new things, but taking care of what we've built. Roads, bridges, rail, fiber, all maintained forever, without asking for more money. It buys health care for people who can't afford it, not from a private patchwork system, a permanent fund that fills in the gaps. And it does all of this without raising your taxes, without cutting services, without asking anything except that we be patient, be disciplined, and let the flywheel turn. Part 8. The flywheel Now let me show you how this all fits together, because the funding flywheel isn't a collection of separate things. It is a system. Each part makes the next part work. So here's the loop. Truck tolls and cannabis revenue flow into the Bank of Indiana. The bank uses that money to make loans. Some of those loans go to build the reactors in Pillar 1. The reactors generate host fees which flow back to communities, and the bank's profits flow to the future fund. The future fund's earnings pay for property tax relief, birth grants, infrastructure maintenance. The trains in pillar two need power. The reactors in pillar one provide it. The trains carry the fiber optics that connect the farms in pillar three. The farms in pillar three grow food that feeds patients in pillar four's health hubs. The health hubs in pillar four employee graduates from the ICC and use food from the farms. The ICC builds the next reactor. Energy, connectivity, agriculture, health, and funding. A closed loop, a flywheel. Each turn makes the next turn easier. This provides us with a multiplier. Here's what happens when you build this way. Every dollar that stays in Indiana gets spent multiple times. Let's say you pay a toll on the interstate. That toll goes to the bank. The bank lends it to a farmer. The farmer buys equipment from a local dealer. The dealer hires more workers. The workers spend their paychecks at local restaurants. Each transaction generates more economic activity, more tax revenue, more opportunity. Compare that to the old model. You pay your electric bill, that money goes to Charlotte. It gets spent there and never comes back. One transaction and it's gone. The flywheel captures value and keeps it circulating here in Indiana. That's the magic, not some financial trick just keeping our money here instead of watching it leave. Part 9. Constitutional Protections. None of this works without protection because the forces that extract from us don't give up easily. They will try to take back what we build. They'll try to raid the funds. They'll try to privatize the bank. They'll try to undo everything. That is why we lock it. Amendment three is the revenue lock. 60% voter approval required to change the allocation of revenue from truck tolls, cannabis, and host fees. That money belongs to the people, not the legislature. If they want to spend it differently, they have to ask us. Amendment four is public banking authorization. Explicit constitutional authority for the Bank of Indiana. No ambiguity, no future attorney general ruling that it's unconstitutional, the people vote to authorize it, and it gets locked in. Amendment two is the public asset lock. 60% voter approval required to sell any state-owned infrastructure asset. The rail line, the fiber optic network, the reactors, the bank. Once we build it, it's ours. No future governor can sell it to pay for a tax cut or to balance a budget. We mentioned Amendment 1 a couple episodes ago. That's infrastructure corridors. Clear process for designating corridors with strong property protections, fair compensation, relocation assistance, community benefit agreements. No one loses their home without being made whole. Four amendments, four locks, all requiring sixty percent voter approval to change. That means these assets belong to us permanently, not until the next election, not until the next legislature, forever. Part 10. Extraction or investment. Here's where we are. For decades we've been told there are two paths. Beg corporations to build here, or accept that decline is inevitable. Both paths lead to the same place. Extraction. Our money leaves and we get the leftovers. There is a third path. It's the one our ancestors walked. It's the one that built the Transcontinental Railroad, the Interstate Highway System, the Rural Electrification Networks. It's the one that says we can build things ourselves, own them ourselves, and keep the value ourselves. That path is sovereignty, and sovereignty requires funding. The funding flywheel is how we do it, not by raising your taxes, by capturing value that's already leaving, truck tolls from out of state trucks, cannabis revenue that adults should be free to spend here, host fees from the reactors we build, federal grants that are our money anyway, bank profits from lending our deposits instead of funding Wall Street speculation, future fund earnings from wise investing. All of this is a closed loop, a flywheel. Each turn makes the next turn easier. Kate Raworth's Donut gives us the goal meeting needs, circulating value, building communities that thrive without destroying the planet. The Bank of Indiana is how we get there. Not extracting, investing, not gambling, building, not sending our money to New York, keeping it here. Imagine Indiana in 2040. You drive on roads maintained by the Future Fund. You pay lower property taxes because the fund covers the difference. Your child was born here and got a $5,000 grant that's now growing into something meaningful. Your small business got a loan from the Bank of Indiana at 3%. The corporate bank down the road, they offered you eight. Your town built a new sewer plant with financing from the bank. Your county gets tens of millions of dollars a year from the reactor down the road, funding your schools and your health clinic. Your money doesn't fund hedge funds in New York. It funds farms in Tipton County. It funds factories up in Kokomo. It funds startups in Indianapolis. It works for you. That is not a fantasy. That is a choice that we can make, a choice to capture value instead of letting it leave. A choice to invest instead of extract. A choice to build instead of beg. Part eleven. Conclusion and preview. We've covered a lot today. The revenue streams, the Bank of Indiana, the Future Fund, Constitutional Locks, the objections and answers. But here's what I want you to take away. Not the details, the principle. We are already paying. Every time you flip a switch, fill up your tank, buy groceries, see a doctor, deposit a paycheck, that money leaves. And most of the time, it doesn't come back. The funding flywheel is how we stop that. Not by taxing you more, by capturing value that's already ours and putting it to work for us. Truck tolls from out-of-state trucks. Cannabis revenue that adults should be free to spend here. Host fees from reactors that we build, federal grants that are our money, anyways, bank profits from lending our deposits instead of funding Wall Street speculation. Future fund earnings from WISE Investment. A closed loop. A flywheel. Each turn makes the next turn easier. This is Pillar 5. This is how we pay for it. This is how we turn extraction into investment. Next week in Episode 10, the host community fee. The mechanism that sends $10 to $12 million a year directly to every county that hosts a reactor. Property tax relief, school funding, rural health clinics, animal welfare, how it works, why it matters, and why it's the most direct form of sovereignty you will ever see. But before we get there, I want you to think about something. The money that leaves Indiana every year, that $5 billion that could be fixing our roads, funding schools, lowering taxes, building the future. Where does it go? Who benefits, and what would it mean to keep that money here instead? That's the question, and the funding flywheel is the answer. I'm Corey, this is the Indiana Century Podcast. And remember, sovereignty isn't given, it is built.