Tom Emmer, the Republican House Majority Whip in the United States House of Representatives, has claimed that various opposition Democrats secretly support his anti-central bank digital currency (CBDC) bill. As Emmer stated, many members of Congress oppose the introduction of a CBDC in the US, primarily because of the increased potential for surveillance that could result from it. Emmer’s bill, known as the CBDC Anti-Surveillance State Act, has gained significant traction among lawmakers from his Republican party. However, the support is not limited to Republicans; during a recent webinar hosted by the conservative law group The Federalist Society, Emmer revealed that there is substantial support on the other side of the aisle.
Emmer, a Republican representative from Minnesota, further explained that if a CBDC could be designed with privacy in mind and in a way that resembles cash, he would not necessarily be so opposed to it. He stated, “we should all be willing to hear what our central government is talking about.” However, Emmer continued, “as long as you can’t do that, then you should not be in the business of creating a central bank digital currency.” For now, the bill has only publicly received support from 23 members of Congress, all Republican, but Emmer’s comments suggest that the number will grow to also include Democrats.
Tom Emmer is widely known for his pro-cryptocurrency and anti-centralization stance. The purpose of his bill is to prohibit the Federal Reserve from issuing a CBDC in the US and improving oversight on all CBDC-related work done at the Fed. The introduction of a CBDC could revolutionize the way money is handled in the United States, with implications for financial stability, monetary policy transmission, and how the Federal Reserve operates. CBDCs have become a hot topic in the global financial community because of their potential benefits, such as reduced costs and increased financial inclusion. However, their adoption also carries risks, such as privacy concerns, financial instability, and the possibility of disintermediating commercial banks.
Emmer’s comments come during a time of increased debate and interest around the world in central bank digital currencies. Countries such as China have already launched their own CBDCs, while others, like Sweden and the Bahamas, are in advanced stages of testing and implementation. Some CBDC supporters argue that a digital dollar is necessary to maintain the US dollar’s dominance as the world’s leading reserve currency. In contrast, others worry that a CBDC could undermine financial stability and potentially enable the government to monitor financial transactions more closely, infringing on individual privacy rights.
Privacy concerns have been raised over other CBDC proposals, such as the digital yuan being rolled out in China. There, the central bank can track every transaction, leading to fears that the government could use the CBDC to surveil and control its citizens’ financial activities. Emmer’s CBDC Anti-Surveillance State Act aims to address these concerns for a potential US digital dollar by promoting the design of a CBDC with privacy protections in place that closely resemble cash transactions, where the anonymity of users is preserved to a large extent.
If a CBDC is to become a reality in the United States, it will need bipartisan support in Congress. Emmer’s comments suggest that there is a potential consensus between both major parties on the importance of privacy protections for any digital currency. However, it remains to be seen whether enough Democrats will openly support the CBDC Anti-Surveillance State Act for it to become law.
In conclusion, the debate around central bank digital currencies is becoming increasingly complex and politicized. While many lawmakers worldwide see the benefits of adopting CBDCs for financial inclusion and efficiency, others remain opposed due to potential privacy concerns and the risk of disintermediating commercial banks. The US has so far not committed to the introduction of a digital dollar, but Tom Emmer’s CBDC Anti-Surveillance State Act provides an interesting battleground for privacy-focused policy debate in the future.