To explain why the “war on cash” is misguided, I have a seven-part series (here, here, here, here, here, here, and here) explaining why it is dangerous to eliminate currency and rely solely on government-provided digital money.
Using the information in those columns, I gave a speech earlier today in Sweden as part of the Free Market Road Show.
In this PowerPoint slide, I summarized (fairly, I think) the left’s arguments in favor of getting rid of cash.
Simply stated, they want the ability to impose a turbo-charged version of Keynesian monetary policy, and they also want the government to have a record of every transaction so that politicians can collect more tax.
But a ban on cash would enable politicians to go way beyond normal Keynesian monetary policy.
Instead of low (or zero) interest rates, the government could impose negative interest rates. In other words, financial repression.
In simpler terms, governments could – and would – confiscate part of your savings.
All for the purpose of coercing people into spending more, based on the mistaken Keynesian notion that consumer spending somehow stimulates growth.
Later in my presentation, I also had a slide that summarized why it would be a bad idea if government forced us all to use a central bank digital currency.
Since I already debunked Keynesian monetary policy, I’ll conclude by reiterating something I said today in Stockholm, which is that not every government is equally untrustworthy.
China, for instance, already is monitoring purchases (and everything else) as part of its totalitarian social credit system.
I don’t think the folks in Washington are nearly that bad, but policies such as Operation Choke Point and various anti-money laundering rules show that our politicians and bureaucrats are willing to impose bad policy via the financial system.
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