CBDC Emerges as a Key Talking Point in the Presidential Race
The US presidential election is just a year and a half away, but the debate about the role of central banks and the Federal Reserve System in introducing CBDC is already intensifying. Some presidential candidates have made their stance clear, unequivocally stating that they will not tolerate the introduction of digital dollars.
Republican Stance: CBDC Threatens the US Economy
Ron DeSantis, a candidate from Florida, and Vivek Ramaswamy, a candidate from Ohio, have already announced their opposition to proposals for a digital currency issued by the central bank.
However, CBDC is not a top concern for American voters, so it's unclear why Republicans are taking such a strong stance against it. It's possible that they are trying to make a splash in the presidential race with their unconventional statements.
Moreover, David Primo, a political science professor at the University of Rochester, notes that Republicans “very much view the government with suspicion and as a result it is natural for them to point to this new untested idea of a CBDC and use that as a way to galvanize their base.”
Ramaswamy, for example, claims that CBDC could make the US more like China. He is worried that a digital dollar could lead to the implementation of a social credit system, similar to the one China has had in place for the past two years with its digital yuan.
Ramaswamy, for example, claims that the introduction of CBDC could turn the US into something similar to China. He is worried that a digital dollar could lead to the implementation of a social credit system, similar to the one China has had in place for the past two years with its digital yuan.
DeSantis, on the other hand, has introduced a bill, calling it "Big Brother’s Digital Dollar". The Florida governor wants to prohibit the use of CBDC in the state in order to safeguard the private data of its residents. DeSantis argues that the digital dollar could be exploited by the government to monitor individuals' financial transactions, making it a tool for abuse.
“It is not merely “ideal” that major changes in policy receive specific authorization from Congress; it is constitutionally required. Unaccountable institutions cannot impose a CBDC on Americans. They will tell us that CBDC won’t be abused but we are wise enough to know better. This wolf comes as a wolf,” tweeted the candidate.
Source: Ron DeSantis’ Twitter
Robert F. Kennedy Jr., who rose to prominence during the pandemic for his anti-vaccination views, has also become a vocal critic of CBDCs. He has gone further than other candidates by connecting the potential adoption of CBDCs to the upcoming launch of FedNow that is scheduled to debut in July. Kennedy is convinced that the Federal Reserve’s payment system marks the first move towards the implementation of CBDCs.
Between 2008-22, the Fed partnered with a handful of big banks to print $10 trillion-ten centuries of wealth in 15 years — a bonanza for the Banksters. Cryptocurrencies like Bitcoin give the public an escape route from the splatter zone when this bubble invariably bursts. So the White House is colluding with the banksters to keep us all trapped in the bubble of profiteering and controlRobert says.
Ted Cruz, a senator from Texas and a potential presidential candidate, is also concerned about Bitcoin. He has been very direct in his criticism of a CBDC, stating that it is designed to destroy the value of Bitcoin. According to him, CBDCs will destroy anonymity and decentralization, and give the authorities access to every transaction of every American.
Biden: CBDC – panacea for the financial system?
As the US presidential elections are still a long way off, President Joe Biden's stance on the matter is crucial. Additionally, Biden has already declared his intention to seek re-election in 2024.
The March Economic Report shed some light on Biden's views on CBDC, but it is not entirely clear whether he supports the digital dollar or not. The White House is still weighing up whether CBDC should be a "wholesale" option only available to financial institutions or a "retail" option for individuals.
However, overall, Biden sees nothing but advantages in CBDC. The digital dollar has the potential to make the payment system more efficient, provide a foundation for further technological innovations, accelerate cross-border transactions, expand access to financial services, and so on. The Biden-Harris administration has already developed the corresponding "Policy Objectives for a U.S. CBDC System." In short, they can be described as "federal authorities advocating for all that is good and standing against all that is bad."
CBDC – the golden mean between crypto and fiat Source: Annual Economic Report of the US President
The idea of a digital dollar is facing criticism not only from governments but also from Wall Street bankers. They worry that the CBDC issuer will establish new, non-competitive rules in the financial market. Circle has also warned that the digital dollar could destabilize the banking sector. Interestingly, Biden's administration has challenged the crypto industry. CBDC proponents say private crypto companies will simply act as technological hubs to facilitate digital dollar transactions.
