 I should begin by announcing that I too like Ike, and he is my favorite president of my entire lifetime. I don't know if there's so much reflection on his brilliance as a chief executive, as the dismal failure of some of the people who followed him, particularly the current Cretanist head of state. I hope we'll be rid of next year. I would like to begin my remarks by thanking Eric Stradegos, who is subsidizing my presence. I am especially delighted since Eric and I are friends and see each other all the time, at least once a month, at a Japanese bistro, which is about half a mile from my house. And because of my advanced age, Eric is nice enough to drive all the way from York, Pennsylvania, about 25 miles to meet me. I had no idea that he was going to sponsor me, but I shall gladly accept his act of kindness. I feel a little bit out of my element, as I tell people, speaking on an economic subject, since by training, I am in a story of political movements and European social intellectual history. But I am interested in the topic that I intend to address, which is the plan for digital currency that will be distributed by federal banks. As my remarks should make clear, I am not very happy with the prospect of that happening. And one of the things that sharpened my interest is that the November issue of our magazine, which I'm editor-in-chief, Chronicles, will deal with the future of the American dollar. And this got my mind focused on digital currency after I read an article that was very critical of it in the Wall Street Journal. And I did further research, and the upshot of which is the presentation that you are about to hear. Allow me to begin my remarks with a broad generalization. Whatever the modern, self-described, liberal democratic administrative state claims to be doing in the name of disadvantaged people is intended primarily, and perhaps exclusively, to increase government control. Further, whatever the same regime purports to be making our lives more comfortable, more agreeable, we may assume that our freedom and property rights are under assault. Therefore, when I read about an executive order issued by the Biden administration last year regarding a plan for digital currency, I naturally suspected something quite dire. A story that appeared in The New York Times on July 22, 2021. Describing a plan to help the unbanked engage in financial transaction told the discriminating reader all he had to know about government-run digital currency. Banks right now throw at just about anyone who enters their facilities, save for the most unreliable deadbeats, the chance to access their services. How many people out there just don't have the means of filling out a banking application because of some insurmountable difficulty? Possibly about as many humans as those who can't show voter identification but feel excluded from the democratic process if they can't have their votes for the Democratic Party certified and then perhaps counted twice. Another clue about the government's intention in pushing central bank digital currency, CBDCs, while cutting back on the use of paper money, is that this policy is being introduced bigly, to use President Trump's term, in China. A country hardly known for its high regard for personal liberties. Chinese are no longer required to trade in paper yuan but can access electric allocation of credit, which allow them to buy commodities and engage in business transaction. A similar process would be open to us in this country, supposedly, if central banks' uninstruction from the government were authorized to issue digital currencies. Although we might be told differently, sooner or later it might become feasible under the new arrangement to ditch paper currency entirely. And there have been plans like this discussed in other countries, in Germany in particular, I've been reading about this. And a plan that would really cut back on paper currency in favor of digital currency is something being considered by the German government at the present time. We'll then carry out all our financial dealings electronically with government-issued electronic currency and receive electronically-issued compensations for our labor. A further benefit of this innovation, or so I've been assured, is that it wouldn't be necessary under the new system to worry about non-authorized digital currency like Bitcoin. The government and central banks would be making a safer product available to us, which would benefit particularly the unbanked. We should also hope that Bitcoin would then vanish as a fake alternative to real that is government-guaranteed digital currency. The problem with this argument is what it fails to reveal. Central bank digital currency can expand the market for an unauthorized credit because it will drive investors to operate outside the purview of Big Brother. It is precisely the government's involvement in digital currency that will cause traders and investors to look for alternative means of issuing credit and even creating makeshift currency without having the government breathe down their backs. The government's intention to control financial markets and investment through this innovation should be obvious. Who invests where, how much and when will depend on obtaining the needed capital from state bureaucrats? Perhaps under the influence of party functionaries. The attempt to present CBDCs as a courtesy that the state will be providing grateful citizens as patent nonsense. The government's digital currency issued through central banks will more likely help concentrate financial activity in the hands of the state. Government officials will then drone on about equity while extending electronic credit to some but not others. This will have the predictable effect of creating clandestine financial activity. Eswar Prasad, an economist at Cornell and the author of The Best Seller, The Future of Money can hardly be accused of being a right winger. Prasad is a frequent contributor at Brookings and seems generally in favor of extensive government economic planning. But when it comes to government run digital currency, he points out its downside even while noting this plan may reflect a noble purpose of banking inclusion. There's an obvious issue of privacy according to Prasad. Quote, a digital currency could allow government to track every transaction a person makes no matter how minute. Further, quote, a government could make it impossible to spend the digital currency on things that the ruling party deems problematic. The government could also make transacting with certain people difficulty or impossible. China already has a social credit system that ranks citizens rhythmically and punishes them in various ways, unquote. Does anyone care to speculate about those political outcomes that CBDCs will likely produce? What will happen to Latin mass Catholics or perhaps those who protest the sexual transitioning of their children after the introduction of government run digital currency? Does anyone in this room doubt that the government might weaponize digital currency in order to suppress opposition to its rule? Given all that we've observed of the Democrats in power since not 2021, should we imagine anything else happening in those circumstances? And why would I believe the opposition would prevent that outcome if it were allowed to win the next presidential race, which it probably won't be. The Republican record of reigning in government overreach has been something worse than anemic. From CNN, we learned the following about the eventual widespread use of digital currency, quote, the rise of CBDCs could potentially threaten the status of the US dollar as the global reserve currency. Different countries will have a much easier time transacting with each other directly, removing the need for the US or swift a global financing messaging system. The argument, the takeaway here is the government is considering plans to introduce digital currency to offset the effects of this possible move by other major countries. But it's hard to see how government control digital currency would benefit most Americans. Many of our commercial transactions are already being conducted through digitally transmitted credit, even without the state overseeing who receives what. An article in the Wall Street Journal on February 7, 2023 makes clear, quote, that a CBDC would empower the feds, but not Americans, unquote. In the end, it may pay to consider the broader context of the government's actions in the economic sphere to understand how digital currency would advance long-established political goals. Let us reflect on how the government is presently carrying out its economic tasks. The Biden administration to its discredit has already caused inflationary cycle through reckless spending and irresponsible energy policy. Biden's secretary of the treasury clearly lied to us when she assured the public that inflation would make more disposable income available to more American families. The removal of American energy independence was definitely not a move intended to strengthen our dollar. And the predictable effect of that disaster was to weaken our currency by putting us in the situation of having to beg other countries to sell us their energy at higher and higher prices. In a carefully researched essay for Chronicles, our foreign policy editor, Sergei Trifkovich, observes that much of the decline of the American dollar as an international currency resulted from the American government's decision to restrict the use of American currency, less to many dollars fall into the hands of hostile powers. To quote Trifkovich, a backlash was both predictable and inevitable in the five years leading up to 2021. The share of the dollar in central bank reserves fell from 70% to 59%. Dollars held by non-American banks fell from 7,085 to 6,471 billion between December 2021 and December 2022. The Greenbacks accounted for 2 thirds of the world's monetary reserves in 2003, 55% in 2021, 44% in 2022. The decline of the 8% in the space of one year is remarkable, equal to 10 times the average annual rate of decline of the dollar's market share recorded in previous years. In all these activities, it is possible to see how the modern administrative state operates in economic affairs. It presses onward even when its policies fail. It is not deterred by these failures, but works to take even more control in the name of equity, climate change, or in the present case, the unbanked. This critical perspective makes more sense than swallowing predictable bromides about the government seeking to help the disadvantaged by introducing CBDCs, according to Persaud, slightly less than 5% of the American population like Blacks Banking Access. We might also consider in this vein what Michael Rectonwall designates in Google Archipelago as governmentalities, agencies that appear to have an independent existence but which function as extensions of the administrative state and execute state functions. The most conspicuous of these governmentalities, in my view, is the mass media, which define and affirm the woke state religion in which assails any interest that stands at thwart the expansion of the central government. Ditto for major corporations would serve equally the state and the state religion, and which receive and return government contracts and the privilege of not being investigated for such grave offenses as allowing employees to misgender or failing to produce the stipulated LBGT quota for the workplace. Universities and institutes are likewise included among Rectonwall's governmentalities, something that should not surprise anyone who has bothered to notice these entities. It is also hard to miss the fact that Brookings Institute, whose fellow staffs move in and out of government, have been among the most enthusiastic advocates of CBDCs. According to Brookings, CBDCs would facilitate international commerce, reverse the dollarization in contrary to putative misinformation, not be accompanied by the gradual removal of paper currency. And least of all must we fear in this instance further government control of financial activity, state actors are supposedly helping us engage in safe transactions during a peaceful transition to a more global economy. Another obvious example of government agencies claiming to be dealing with finance but punishing enemies and rewarding friends is the IRS. This may be an even more brazen partisan actor than the Federal Reserve because there is nothing clandestine about how our tax collectors harass and shake down opponents of the state party. The Obama administration engaged in this activity uninterruptedly for years with impunity, and I'm still waiting to see if Lois Lerner and other IRS officials who targeted conservative religious organizations and Republican and libertarian critics and subjected them to painful audits that reveal that most minor tax infractions will be brought to justice. Perhaps we shouldn't count on that happening Lerner and her associates. We're doing the bidding of the state party which treats financial activities as a mere means of extending its power. We made note with satisfaction that some presidential candidates, namely Ron DeSantis, Vivek Ramaswamy and Robert Kennedy Jr. have expressed opposition to government-controlled digital currency as a tool for allowing the federal state to restrict our financial activity, to gather information on spending and to deny financial resources to those who displeased the state party in its minions. Minnesota Congressman Tom Emmer, a member of the House Financial Service Committee, has gone even further in opposing this plan which is already in the works. Emmer is sponsoring a bill that would deny the Federal Reserve the right to produce or manage the digital currency. According to Emmer, the simple legislation, quote, stops the administrative state under President Biden from introducing a financial surveillance tool that could undermine the very essence of our way of life, unquote, the assumption is that our way of life has still not been undermined, which may be an overly optimistic conclusion. On May 12, 2023, Florida Governor Ron DeSantis signed a bill that forbids the use of CBDCs in his state. The explanation accompanying the signing is that the governor and state legislature oppose any attempt by the federal government to oversee our disposal of money. Equally telling is this admonition against the immediate introduction of CBDCs issued strangely enough, well, not by the American Banker Association on September 13, issuance of CBDC would fundamentally change the relationship between citizens and the Federal Reserve, undermining the important role banks play in financial intermediation and exacerbate the economic and liquidity crisis and impede the transmission of monetary policy. In all fairness, it must be said that the Federal Reserve is not rushing that full throttle to introduce digital currency and report issued in January 2022, federal board members dwelled on the technical barriers that prevented the completion of the currency project in the near term. According to the Federal Reserve report, while the CBDC could provide a safe digital payment option for households and business as the payment system continues to evolve and may result in faster payment option between countries, there will also be downsides. They include how to ensure CBDC would preserve monetary and financial stability as well as complement existing means of payment. Most of the political support for digital currency, government run digital currency, let us make this clear, is not coming from the Federal Reserve. It is coming from the Democratic Party and from President Biden's handlers. But according to the Fed, when this is sort of surprising, they believe this should be done in a measured way without creating financial instability. Not surprisingly, the Federal report never mentions the obvious concern that the plan would put the government firmly in control of our financial activity. We were also given the misleading impression in this report, which I have not read to you in entirety, that the lockdown was something that just happened. The last time I checked, post-democratic governments almost everywhere in the Western world imposed those dictatorial measures. As a governmentality, however, the Fed who issued this report wisely avoided any mention of certain delicate matters. The cheerleading for this innovation is coming from the White House and from progressive legislators like Maxine Waters. Waters in particular seems dazzled by how expeditiously the Chinese are moving beyond their one-time dependence on paper money while centralizing all financial activities in the hands of the state. Since worst case scenarios usually turn out to be true, when we're talking about public administration, whose officials, as we know, vote overwhelmingly for the left in the extension of public control, we can understand why this cheerleading is coming from a leftist legislator. Waters and other congressional advocates of CBDCs have taken the side whether their politics would drive them. For the rest of us, however, it may be good to keep in mind with regard to government-run digital currency what Ronald Reagan once declared to be the most frightening words in the English language. They are. I've come from the government and I'm here to help you. Thank you.