U.S. House Committee Debates CBDC Anti-Surveillance Act Amid Diverse Interpretations
Summary:
The U.S. House Financial Services Committee discussed the CBDC Anti-Surveillance State Act on September 20, covering topics from Star Wars to the role of government in citizens' lives. Bill sponsor Tom Emmer claims it aims to prevent administrative surveillance undermining American life. Critic Maxine Waters renamed it the CBDC Anti-Innovation Act, citing threats to dollar supremacy. The bill raised questions about permissible research on CBDCs and potential power overreach. The committee concluded that a Congressional act is required to issue a CBDC. The committee also discussed amendments concerning the Federal Reserve's research authorization on the Chinese digital yuan.
During the Sept. 20th markup of the CBDC Anti-Surveillance State Act, discussions in the U.S House Financial Services Committee occasionally diverged from the strictly financial and technical to include topics like Star Wars and crypto enthusiasts. Central to the rhetoric was the importance of research, privacy of U.S. citizens, and the role of government everyday life concerning the U.S. central bank digital currency (CBDC).
Tom Emmer tabled the bill following the successful passage of several other committees' bills. He simplified the concept of his proposed bill, stating, "It aims to stop the administrative state under President Biden from issuing a financial surveillance tool that will contradict the American lifestyle." He further warned that a misdesigned CBDC could equip the federal government with the capability to monitor and limit Americans' transactions.
As he made the presentation, Emmer highlighted the Chinese digital yuan, government social credit system, and the 2022 truckers' protest incident in Canada which saw bank account freezes. According to him, his proposed bill enjoys the backing of 50 senators and numerous organizations.
Critiquing the bill, ranking member Maxine Waters dubbed it the "CBDC Anti-Innovation Act," cautioning that this proposed bill could undermine the dollar's position as the main global reserve currency. She criticized Republicans for launching unproven attacks against a nonexistent CBDC. Waters later noted that the bill could offer China the control of setting the global norm for central bank digital currencies.
The debate witnessed queries regarding the type of research on CBDC the bill would permit, and Stephen Lynch highlighting inconsistent bill language. Brad Sherman drew a negative comparison between cryptocurrency and CBDCs, while Mike Flood expressed discomfort entrusting the government with the power a CBDC could furnish it.
Both sides agreed that this proposed bill demands an act of Congress to issue a CBDC — a requirement the Federal Reserve has been consistent with. Notably, both also acknowledged the current lack of financial privacy in the country.
Waters and Lynch moved amendments to define the bill's control over the Federal Reserve's potential research on the Chinese digital yuan, which could potentially assist evasion of U.S. sanctions. A reference to the mBridge pilot across China, Hong Kong, Thailand, and the United Arab Emirates was made by Waters. After four hours of discussion, the committee adjourned at 1:30 p.m. local time.
Published At
9/20/2023 8:00:00 PM
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