Florida Governor Ron DeSantis, a potential presidential candidate for the 2024 United States presidential election, recently made headlines when he called for a ban on digital dollars in the state. During a press conference on March 20th, DeSantis stood in front of a podium with the words: “Big Brother’s digital dollars” emblazoned across it and demanded a ban on the Federal Reserve’s central bank digital currency (CBDC). The governor expressed concerns about currency inflation, increasing interest rates by the Fed, and pressure on banks.
The Federal Reserve is currently exploring the possibility of creating its own digital currency. While some see this as a necessary step towards modernizing the financial system, others are concerned about its potential negative impact, including the risks associated with government control of the money supply. DeSantis is the first U.S. governor to call for a ban on CBDCs, but he is not alone in his concerns.
Proponents of CBDCs argue that they could increase financial inclusion and reduce the costs associated with traditional banking. They could also help to combat tax evasion and money laundering by making financial transactions more transparent. However, opponents fear that CBDCs could be used to suppress dissent by creating a centralized, government-controlled system of payment that could be used to track and monitor people’s financial activities.
Governor DeSantis is in agreement with this latter camp. He believes that a government-controlled digital currency could lead to potential abuse, with the government monitoring and controlling all financial transactions made in the state. Additionally, DeSantis is concerned that the implementation of a CBDC could lead to inflation, decreased private investment, and increased interest rates by the federal government.
In his remarks, DeSantis took direct aim at the Federal Reserve, suggesting that the bank’s monetary policies have been ineffective and have led to rising levels of inflation across the country. He went on to suggest that the creation of a CBDC as a way to combat these economic challenges is nothing more than an attempt to further centralize control over the country’s finances.
DeSantis’s call for a ban on CBDCs is not without precedent. Countries such as China have already started to roll out their own digital currencies, with other nations like Japan and the European Union exploring the possibility of following suit. However, the governor’s stance is unique in that he is calling for a prohibition not just on the creation of a CBDC, but on its use within the state of Florida.
While some may argue that DeSantis’s call for a ban on CBDCs is merely a political maneuver designed to rally support among his conservative base, there are valid concerns about the risks associated with a government-controlled digital currency. The governor’s position is not just important for the state of Florida but for the entire country.
As the Federal Reserve continues to explore the possibility of creating a digital currency, it is important that policymakers consider the potential risks and benefits associated with such a move. While digital currencies have the potential to revolutionize the way we conduct financial transactions, they also have the potential to be used to suppress dissent and violate our privacy. The debate over the use of CBDCs is likely to continue, and it is important that we all stay informed and engaged in this important conversation about the future of money.