The U.S. House Financial Services Committee on Sept. 20 voted 27-20 to approve a GOP bill led by Majority Whip Tom Emmer (R-MN) that would prohibit the use of central bank digital currency (CBDC) for monetary policy.
The CBDC Anti-Surveillance State Act, H.R. 5403, which Rep. Emmer sponsored on Sept. 12, also would prohibit a Federal Reserve bank from offering a CBDC, or any digital asset that is substantially similar under any other name or label, indirectly to an individual through a financial institution or other intermediary, according to the text of the bill. H.R. 5403 currently has 62 Republican cosponsors.
“This bill is simple: It halts the efforts of this administrative state under President Biden from issuing a financial surveillance tool that will undermine the American way of life,” Rep. Emmer said on the House floor.
Unlike decentralized cryptocurrencies, a CBDC is a digital form of sovereign currency that is designed and issued by a government and transacts on a digital ledger that is controlled by that government, the congressman explained.
“In short, a central bank digital currency is government-controlled programmable money that, if not designed to emulate cash, could give the federal government the ability to surveil and restrict Americans’ transactions,” he said. “This is not just alarming – it’s downright un-American. We’ve already seen examples of governments weaponizing their financial system against their citizens.”
For instance, Rep. Emmer pointed to the Chinese Communist Party, which he said is using a CBDC to track the spending habits of its citizens and is using data to create a social credit system that rewards or punishes people based on their behavior.
Meanwhile the Biden administration “is not only itching to create a CBDC,” it is willing to trade Americans’ right to financial privacy for a surveillance-style CBDC, said Rep. Emmer.
“We’re not going to let this happen. My bill ensures the United States digital currency policy is in the hands of the American people – not the Administrative State – so that it reflects our American values of privacy, individual sovereignty, and free market competitiveness,” he said.
Rep. Emmer said that numerous groups, ranging from the Independent Community Bankers Association and the American Bankers Association to the Club for Growth, Heritage Action, and the Blockchain Association, support the measure.