A new report from Fox Business has unveiled that a group of US Senators is rolling up their sleeves to challenge the Federal Reserve’s capacity to roll out a Central Bank Digital Currency (CBDC). This move, spearheaded by GOP Senators with Texas’ own Ted Cruz in charge, is firing up to curb the inception of a digital dollar, especially with the 2024 Presidential election on the horizon.
This effort by Senate Republicans is no small stir in the political pot. They’re setting their sights on boxing the Federal Reserve’s ability to introduce a so-called central bank digital currency into the ring, potentially making the digital dollar’s debut a hot topic for the upcoming presidential campaign.
It’s evident that conservative lawmakers are doubling down on their opposition to a CBDC. The crux of their argument? They fear the federal government could turn this technology into a double-edged sword, using it to pry into Americans’ financial lives and possibly putting a chokehold on access to their own funds.
Despite these concerns, the Biden administration has green-lighted the Fed to dive deep into the research pool for CBDC issuance. The goal? To potentially streamline and make payments more wallet-friendly and accessible for Americans, though the wheels haven’t started turning on its implementation just yet.
Leading the charge, Texas Republican Senator Ted Cruz, along with a cadre of Senate colleagues — Bill Hagerty, Rick Scott, Ted Budd, Mike Braun, and Kevin Cramer — are stepping up with new legislation dubbed the Central Bank Digital Currency Anti-Surveillance State Act.
Cruz is primed to introduce this bill in the Senate, making it clear that, in their view, the Federal Reserve shouldn’t have the carte blanche to issue a digital version of the dollar to Americans without a nod from Congress.
The bill’s got the backing of heavyweight advocacy groups like Heritage Action for America, the Blockchain Association, and the American Bankers Association. It’s sailing in tandem with companion legislation introduced by House Majority Whip Tom Emmer, gathering a significant crew of 97 Republican members of Congress in support.
Cruz’s legislative gambit is aimed squarely at preventing the Fed and its banking allies from launching a CBDC to steer monetary policy and tighten their grip over the economy’s reins.
Cruz was worried that the Biden administration seemed ready to copy China’s strategy of using CBDCs as a way to limit people’s freedoms and keep a close eye on their buying habits, which is similar to how China uses them. His stance is clear: Congress needs to make it clear that the Fed can’t move forward with a CBDC without permission from the legislature.
China’s digital yuan is a big problem because it can be used to track how much people spend, which makes conservative politicians nervous. They are worried that approving the digital dollar could allow the Federal Reserve to spy on the private financial deals of U.S. people. This could lead to widespread monitoring and a change in who controls monetary policy.
While the Fed hasn’t put its foot down on pursuing a CBDC just yet, the Biden administration has placed CBDC research high on its priority list. However, any anti-CBDC bills might hit a wall if Biden stays in office.
The anti-CBDC sentiment has become a battle cry among Republican presidential hopefuls, keen to tap into voter discontent with government surveillance. The GOP is eyeing this as a crucial issue to rally voters.
Notably, former President Trump, fresh from a South Carolina primary win, voiced his apprehensions to Fox News, labeling the potential for a digital dollar as “very dangerous” and a scenario where money could vanish from bank accounts. He firmly stated his opposition to a CBDC’s creation.
Echoing Trump’s sentiments, former GOP presidential contenders, including Florida Governor Ron DeSantis and entrepreneur Vivek Ramaswamy, have voiced similar concerns. Even Democrat-turned-Independent presidential hopeful Robert F. Kennedy Jr. has slammed CBDCs as a disaster for human and civil rights, pledging to halt the march towards a U.S. CBDC.
