Ted Cruz Takes on the Fed
The dangers associated with a Central Bank Digital Currency (CBDC) are some that we should really take seriously. Take for example the fact that there is would be a complete absence of physical cash. There would be no backing for it at all and would be insanely volatile. But even with Bitcoin, users can move it to different off-ramps if they memorize their seed phrase, but “it’s only electronic, or only in the Federal Reserve System” when it comes to a CBDC.
A study from the CATO Institute last month further identified potential issues with a CBDC, illustrating that it could constitute “the single largest assault to financial privacy since the creation of the Bank Secrecy Act and the establishment of the third-party doctrine.”
This would allow governments to more easily freeze someone’s financial resources as Canadian banks did in concert with Prime Minister Justin Trudeau in 2022 when he implemented measures against peaceful protesters. Moreover, policymakers would be able to set negative interest rates, thus compressing individuals into spending money they may not have while also prohibiting certain purchases like alcohol.
The Blaze reported,
Sen. Ted Cruz (R-Texas) introduced a bill Tuesday aimed at preventing the Federal Reserve from following the lead of totalitarian regimes like China in establishing a central bank digital currency. The legislation (S.887), co-sponsored by Sens. Mike Braun (R-Ind.) and Chuck Grassley (R-Iowa), cites as cause the eventuality that a CBDC would be used as a “financial surveillance tool by the federal government.”
“The federal government has no authority to unilaterally establish a central bank currency,” Cruz said in a statement.
Cruz noted that the bill, which has been referred to the Committee on Banking, Housing, and Urban Affairs, “goes a long way in making sure big government doesn’t attempt to centralize or control cryptocurrency and instead, allows it to thrive in the United States. We should be empowering entrepreneurs, enabling innovation, and increasing individual freedom — not stifling it.”
Federal Reserve Chair Jerome Powell suggested in June 2022 that an American CBDC could “potentially help maintain the dollar’s international standing,” noting that the Fed was considering whether it might “improve on an already safe and efficient domestic payments system.”
Meanwhile, Senator Chuck Grassley insisted that decision making regarding such an influential matter should not be left up to government bureaucrats, but rather elected representatives for American citizens who should have free will over how they spend their money without fear of government tracking.
In response to this potential development at a federal level, Florida Governor Ron DeSantis announced legislation banning CBDCs in his state and declared this initiative as “the most recent way the Davos elites are attempting to backdoor woke ideology like Environmental, Social, and Governance (ESG) into the United States financial system.” Tarren Bragdon of The Foundation for Government Accountability praised Governor DeSantis’ action saying: “Our money says In God We Trust. The central bank digital currency changes that to In Government We Trust…I am grateful for the Governor’s continued pushback of an out-of-control DC bureaucracy.”