We seem to have a very authoritarian government in place. I don't understand how we've gotten here, or why people aren't more concerned.
When it comes to encryption D & Rs are both claiming "it's for the children" and scare tacits. We have incredibly invasive KYC rules that have corporations storing ids and live biometric data. We have a coast to coast driver tracker system. We also have "anti-bad thing" tracking on minor person to person transfers. (You can't say certain words in zelle, venmo, etc transfers) I don't think I fully understand why they're pushing for the digital dollar.
For person to person transfers, this seems to be highly suspect. Why does the president need to know that you exchanged 2.50 with your friend over a payment of potentially embarrassing product. (I'm talking non-illegal but no one's business for a private trade of say conterfit Star Wars actions figures)
> I don't understand how we've gotten here, or why people aren't more concerned.
Iterated "Well, sure, the other team's guy is going to abuse the hell out of that power, but my team's guy will only use it to do the best, most right, wonderful things ever!" dilemma. Executive Orders, among others. Can't do it legally? Issue an EO and by the time it winds out being illegal through the courts, you've gotten most of what you wanted anyway. Among other games played.
D & R tend to fight tooth and nail for the 24/7 media ecosystem, but if you ask them, "Hey, could you use more data on what those little peons you rule over are doing in order to fight Bad Things?" - they both agree fully. And, even better, there are lots of tech companies (looks around the current place...) who have outdone each other to excel at "doing the bidding of the current government, or what they think the current government might like them to do," in exchange for the expected favors.
And... and yet. People still manage to do Bad Things. People still manage to fund Bad Causes (honk). If only they had a little bit more. If only people couldn't still exchange value with mostly untraceable methods (I assume, for no reason beyond "It's technically possible and someone probably thought it could be useful to someone," that the serial #s on bills handed out from the ATM are tracked - especially to the sort of people who ask for $100s - though bank tellers don't obviously log them unless the ordering of them is logged on drawer insertion).
All this is why I'm happy to offer "Metal, cash, computer hardware, or digital - in that order!" when I owe someone locally money.
The last few times I asked for $100s, the teller counted it once, and then ran all the bills again through a counting machine. I'd bet a kidney the newest counting machines also log serial numbers now.
> ssue an EO and by the time it winds out being illegal through the courts, you've gotten most of what you wanted anyway. Among other games played.
I forgot about the forced voluntary program to collect biometrics from Americans leaving the country. That was inacted by Trump by EO and hasn't been removed by Biden. (Thanks Biden)
> Iterated "Well, sure, the other team's guy is going to abuse the hell out of that power, but my team's guy will only use it to do the best, most right, wonderful things ever!" dilemma
It used to be that you had to wait for decades to be able to say “told you so.” These days the flip flops are happening so fast it gives me whiplash. People cheering for nationwide injunctions against the Trump administration have turned on a dime and are decrying the idea that one random judge in a forum shopped district can overturn federal policy in all 50 states.
women not being able to vote is not an example of authoritarianism in the US. Neither is the 18th amendment. These were democratically selected and the US did not appear to resemble an authoritarian regime at the time. Note that using authority is not the same as being authoritarian. The examples you gave from 1942 onward are though. It should be noted that the FBI was also famously involved in a number of illegal activities[1] See [2] for authoritarianism.
If a country undemocratically restricts the right to vote then any decisions subsequently voted on aren't democratic.
Women didn't vote to not have the right to vote.
Just because something is democratically voted on doesn't mean it can't be authoritarian. A majority can democratically vote to repress a minority. Note that the comment I'm replying to is (correctly) calling potential laws the Senate might enact authoritarian.
Athens, the poster child of democracy, didn't have voting tights for women, and was generally pretty misogynistic. (OTOH Sparta, with its clear fascist tendencies, had very advanced women's rights for the time.)
Authoritarianism is not when citizens vote for things we currently find unpalatable. It's when elected, and especially unelected rulers oppress the populace, with the populace having little recourse, or ways to protest.
Athens is a significant example of an early democratcy. They were still working the bugs out back then.
It's authoritarian to enslave people, and it's authoritarian to deny people rights on the basis of sex. They did both.
> It's when elected, and especially unelected rulers oppress the populace, with the populace having little recourse, or ways to protest.
Yes, but the critical point is it doesn't have to be 51% of the populace. If rules oppress 10% of the populace that can still be authoritarianism.
Suppose I agreed with your definition though. That could explain away Japanese internment, but I don't see how it justifies disenfranchising women. They made up close to or even an outright majority of the country. Unless they aren't people, and thus not part of the populace? Surely a minority can't declare everyone else doesn't count and thus claim to be the majority position?
I agree with your points! My point is that democracy by itself is not sufficient for what we'd now call a civilized society. It also takes certain values to be shared by most of the society. And these have changed significantly since the times of Pericles.
This is of course an extremely modern view of democracy. If you think everything other than our system today is authoritarian, you are going to find a lot of authoritarianism in every place you look. It isn’t a very useful definition of authoritarianism. It reminds me a bit of the word “heretic” the way you are using it.
Which enabled a higher level of regional and local tyranny.
Edit: The last example I gave up top illustrates the problem. Every iteration of the US government has had local law enforcement. They've always been able to abuse their power, but greater centralized government power has brought about some limited accountability.
I agree the national government should be shrinked a bit, but increasing the state and local government is the wrong way to go. Sub-national government should be shrinked an order of magnitude more than the national government.
> We seem to have a very authoritarian government in place. I don't understand how we've gotten here, or why people aren't more concerned.
It's the natural tendency of governments. The founders of the USA understood this and tried to create a system of government that was very weak centrally. This has been slowly eroded over the past 250 years, and especially since WWII and the cold war.
But it's not clear to me that there will end up being better and worse places, instead of each place having its own brand of shitty local elites. And I don't want to bow down to elites allegedly on my side of the political spectrum, I don't want any of them having power over me.
Many of the founders ended up winning president elections. If Mr. Jefferson or Mr. Madison, with all their disagreement, would like to obtain more tyrannical powers for the US President, they were in a position to do so while writing Constitution. They both were elected presidents soon after.
You're missing my entire point. The founders had significant local power their entire life. So they saw national power as something bad that could counter local power. They didn't want tyrannical powers for the president, that doesn't mean they weren't slaveholding authoritarians.
there is a pretty closed circle of people who end up being picked for non-elected, federal, bureaucratic directorships. It's not really 'public servants who have the best credentials and a history of achievement and knowledge in the field' and more like 'people who have been working on an agenda in and out of academia, federal agencies, and non-profits who are particularly well connected to party members'.
they have agendas that they have worked on long before they get selected and they are often chosen specifically to implement this plan without anyone in the public knowing what it is. This explains how the anti-privacy, anti-encryption agenda manages to appear simultaneously in both the US and EU. There are people working behind the scenes to push this stuff. Then it appears and suddenly elected politicians are voting on something with thousands of pages that no one in the public has read, or a non-elected bureaucracy is suddenly rapidly implementing something with a plan that appears very well designed.
I don't understand the conspiracy theories. These fast settlement services are already provided by private banking services. The government is stepping in and providing a cheap option for all banks. You aren't forced to use this any more than you're forced to use anything that came before.
> I don't understand how we've gotten here, or why people aren't more concerned.
From what I can tell, the root issue is that most people are item-oriented instead of system-oriented.
People are animals and animals need to survive. Survival is path dependant, so people think today is more important than tomorrow. In actuality, today and tomorrow are the same thing.
The American experiment seems to be failing its two pillars of capitalism and democracy for the same reason: they require input from most people. Rather, they require _thoughtful_ input from most people - and most people ain't that good at thinkin.
As far as I can tell, the game is already lost. Competition in all key products is at best reduced to 4 players. Money's influence on politics is hiding in plain sight. At least taco bell delivers.
If you are like me and wonder, "What's the point of a centralized digital currency in economies where almost all financial transactions are effectively digital anyway?" I found this HBR article[0] provides a good overview of how an economy with a CBDC looks different than our current economy, why countries may want that, and why countries may not want that.
I read the article, but I don't see why this has to be built on top of a blockchain. What's wrong with plain old relational databases? The currency is issued by the central bank, if the central bank says that this transaction is voided, who's gonna stop them?
Blockchains are a solution to byzantine consensus, but with a central authority you can always trust the central bank (in the consensus problem sense of trust), so I don't see what problem gets solved by moving to a slower and worse database.
There's a lot of attempts these days at conflating central bank digital currencies (e.g. "digital dollars") and crypto-currencies (e.g. Bitcoin).
I think it's very important to point out something that may be obvious to some, but likely not to all: these two things are the exact opposite of one another.
One is centrally controlled, the other is decentralized.
One has potentially infinite supply an can be used by governments to grow the debt to infinity, the other has a mathematically demonstrably finite supply.
One is a potentially very dangerous way for a government to have absolute control over what money is used for, the other - while not perfect in that regard - tries to be at least obfuscate what money is used for and by whom.
One allows a government to blacklist users that they deem unworthy, the other is designed so that can never happen.
One is a tool to curb freedom and make the job of government as easy as possible, the other is designed to enhance freedom, restrict government control over its citizens and be an escape hatch whenever governments become unbearably controlling.
I am very glad to see that at least some politicians understand that a digital dollar would be a catastrophe for freedom and are pushing back against it.
> the other has a mathematically demonstrably finite supply.
The argument I always hear against this point is that you can simply continue to subdivide the currency infinitely. We just get into smaller and smaller fractions of "satoshi's" or whatever the base unit may be.
> tries to be at least obfuscate what money is used for and by whom.
It really doesn't in any meaningful way. I'd suggest the true benefit is that there is no centralized preconditions on what transactions can be added to the ledger. Any two valid addresses can always transact if they pay the ledger fee.
> the other is designed to enhance freedom
It's designed to not have centralized control outside of 51% attacks. Whether that actually "enhances freedom" remains to be proven. Having to tether yourself to the internet and pay a fee on every transaction may strongly work against this actual point in practice.
>> the other has a mathematically demonstrably finite supply.
> The argument I always hear against this point is that you can simply continue to subdivide the currency infinitely. We just get into smaller and smaller fractions of "satoshi's" or whatever the base unit may be.
That's a different problem, that's the market-cap / # of coins issue. You don't spend an integer number of bitcoin, you spend the fraction you need, so it's not really a problem.
The PP was talking about how Bitcoin was devised to not allow anyone to arbitrarily make more coins. (Some BTC forks have different minting policies, but BTC itself can't be changed.)
Our central banks on the other hand, were devised precisely to allow the government to create money when needed.
There's no way the USA would adopt BTC as its central currency for example because it would lose that ability.
> There's no way the USA would adopt BTC as its central currency for example because it would lose that ability.
Yup. A government surrendering their ability to print money is unthinkable. They'd be giving up a major policy enforcement tool.
To quote the obviously relevant: "“Give me control of a nation’s money supply, and I care not who makes its laws.” So said Mayer Amschel Rothschild, founder of the Rothschild banking dynasty.
> The argument I always hear against this point is that you can simply continue to subdivide the currency infinitely. We just get into smaller and smaller fractions of "satoshi's" or whatever the base unit may be.
You can subdivide Bitcoin to a very tiny fraction indeed, and in that sense, the supply is quasi infinite.
However, if you own _one_ Bitcoin, you own exactly 1/21millionth of the entire supply of the stuff there will ever be, and that will never change for as long as you hold on to it. In that sense, the supply is absolutely finite.
A close analogy is gold: if you assume for a second that there is a finite amount of gold on the planet (not an unreasonable assumption), then: you could cut up a gold coin down to its individual atoms, and that would be a whole effing lot of them (not practical, obviously, which is why gold didn't last as a currency. OTOH, Bitcoin, being digital doesn't have that problem).
And if you own one ounce of gold, you own a never-changing fraction of the supply.
So: Gold supply, according to definition one (divisibility) is infinite.
But according to definition two (they don't make any more of the stuff), it's finite.
I am of the opinion that the second definition is the one that matters when it comes to understanding the properties of Bitcoin as a financial instrument.
A currency which naturally grows in value is self defeating. Currencies, by their nature, are abstract constructs devoid of value.
Now imagine that just by holding onto money, you made more money- no need for pesky investments or risk. If btc became the dominant currency, it would quickly become a regressive tax on people who actually need to spend money.
> A currency which naturally grows in value is self defeating.
An opinion, neither backed by any obvious nor posted arguments.
> Currencies, by their nature, are abstract constructs devoid of value.
My above remarks goes triple for this one. Bordering on the dogmatic as a matter of fact.
> If btc became the dominant currency
I don't think that'll ever happen.
First because Bitcoin isn't very practical as a currency - it's pretty obvious at this point -.
Second and much more importantly: Bitcoin is an should remain an escape hatch.
Every functioning human organization needs checks and balances to be functional.
For every power, there needs to be a counter-power so that said power can't be abused.
Until very recently, there was pretty much no counter power when it comes to the ability of governments to debase their currency (aka imposing a hidden tax on their citizenry).
Bitcoin is exactly this: it is a counter-power that finally allows folks to run with their wealth if a government starts to mismanage their currency (and historically they have always proven that given enough time, they will).
I would never wish for Bitcoin to become the dominant currency.
> One has potentially infinite supply an can be used by governments to grow the debt to infinity, the other has a mathematically demonstrably finite supply.
The supply being finite is not that relevant. The relevant part is that the supply is predetermined, and that yearly supply inflation is acceptably small [1].
> The supply being finite is not that relevant. The relevant part is that the supply is predetermined, and that yearly supply inflation is acceptably small [1].
Yeah, some folks - notably the Ethereum crowd IIRC - are of that opinion.
I'll confess that I'm sort of undecided on the topic. In fact, I believe the overall effect are identical (because the currency can be divided to quasi infinity).
But my gut tells me that finite supply is better. Also, with finite supply, the math involved in anything forward looking is most certainly simpler.
However, I do agree that predetermined is way nicer than the amount of currency injected in the economy being controlled by whomever corrupt asshat is in control of the central bank at a given point in time.
> One is a tool to curb freedom and make the job of government as easy as possible, the other is designed to enhance freedom, restrict government control over its citizens and be an escape hatch whenever governments become unbearably controlling.
The flaw there is that if too many people use something like Bitcoin as an escape hatch from an unbearably controlling government, that government can close the escape hatch by becoming evenmore controlling.
You can't actually do anything physical with Bitcoin. For all your physical needs you have to trade your Bitcoin with someone for the physical goods, either directly or indirectly.
An unbearably controlling government could focus its monitoring on the physical goods, and make it illegal to buy physical goods using anything other than the official government currency. They could require all banking to be done at a government bank or at banks that report everything to the government.
If I live in my country I need my physical goods to be my country with me. If my country becomes unbearably controlling they can restrict imports so that I can only buy and import foreign goods if I can prove I paid for them in my country's official country earned in the official economy.
The existence of other countries does give me the option of emigrating from my country if there is a less controlling country that will allow me in.
On a related note, why haven't stablecoin 'eurodollars' (1) (for lack of a better word) taken off yet? In theory because the dollar is already the world's reserve currency, and in enormous demand, it should be an easy transition to digital dollars outside the control of the US. I'm not sure people in developed countries understand how much demand there is for dollars in countries with unstable currencies. Why don't the citizens of Argentina, Nigeria, Pakistan etc. just pay each other for goods with digital dollars? I understand it's frequently illegal there, but ultimately it's not practical for the government of say Argentina to lock up all of their citizens that want to pay each other with dollars for groceries, gas, households goods, etc. Seems like you could have a smartphone payment system in dollars that evades local control?
Worth noting that several countries have just adopted the US dollar as their official currency, including El Salvador and Panama
1. https://en.wikipedia.org/wiki/Eurodollar 'Eurodollars are U.S. dollars held in time deposit accounts in banks outside the United States, which thus are not subject to the legal jurisdiction of the U.S. Federal Reserve'
Why would anyone use a digital dollar over USDC when one is frictionless and works as long as the recipient isn't OFAC material and the other one is going to have requirements up the ass? Banks are probably being going to be intermediaries to distribute digital dollars anyways so I don't really see the benefit.
USDC almost lost a good chunk of its reserve backing when SVB went bust. It was only the bailout that saved it. They had $3 billion of their reserves there.
When you use regular Eurodollars you only need to trust your bank and you may have deposit insurance. With USDC you need to trust:
* Circle
* Your exchange
* Your own security
The latter generally isn't a factor with fiat, as transactions are reversible
Yes, there are risks when using USDC that are not present when using the traditional banking system. My point is that the proposed digital dollar would not offer any benefits over the regular banking system to its users (except saving wire transfer fees maybe?), and to me appears like it would not even handle the edge case of servicing the "unbanked" any better than banks already do.
Does somebody have good resources on what a digital dollar would even mean? The dollar already digital, most dollars are held at banks, which are in turn held as entries at the Fed. How does a digital dollar change any of this? Why is a blockchain better than a plain old relational database somewhere in a Fed datacenter?
> Move reflects desire to galvanize base ahead of 2024 election
What if there is an understanding at all levels, base and otherwise, that the unintended negative consequences of a digital dollar might exceed the benefits?
Anyone on HN working on CBDCs? Would you be willing to give us some insider info about it’s inner workings and how similar it’s architecture is to existing cryptocurrencies?
You're not the beneficiary of the "features" of it.
Your local, totally trustworthy, benevolent government that just needs a teensy tiny little bit more data to deal with terrorists, child pornographers, and crypto ransom gangs is.
Hence why it would be forced on you. And why we see an irritating reduction in the usability of cash these days. At least in the US, the "value per maximum bill size" has gone down dramatically over the years, to the point that a modern $100 isn't worth much more than a $20 when a lot of our grandparents were growing up.
And, of course, there are places that are card only. There remain a few restrictions on that with regards to "debt payment" (you can't serve someone a meal and then demand card only, but you can refuse to let them order up front with cash), but a lot of businesses are happily going the "No icky cash!" route.
It's quite the problem if you'd rather various data aggregators not collect all your spending data, and, of course, you pay a bit more if you're not willing to let stores aggregate your data with "loyalty" programs. Local area code, 867-5309 still works for most, though!
You made me curious so I found an inflation calculator online to check:
> $20 in 1900 is equivalent in purchasing power to about $718.66 today, an increase of $698.66 over 123 years. The dollar had an average inflation rate of 2.95% per year between 1900 and today, producing a cumulative price increase of 3,493.29%.
We'd need a denomination like a $5k bill just to be able to put as much cash in your pocket as a person could a century ago.
Cash is terribly inconvenient to the powers that be. In addition to the irritating ability for me to transfer value to other people or companies without an overt trace, it puts a reasonable lower bound on the effective interest rate - you can't go much below 0% without people just paying to hold cash. It's not relevant right now, but a few years back, the noises about how awesome negative interest rates would be to properly stimulate demand were rather loud. There are a few books written as cover fire for this concept as well. If you put $1000 in your bank account today and will have $995 next year, may as well spend it to stimulate the consumer economy instead of "hoarding" it, right?
Maybe that's how cash will go out - not with a ban, but a whimper. Once a cheeseburger hits $100, people will probably collectively decide that dealing with bands of cash for small purchases is more trouble than it's worth.
I know plenty of people, some I'm related to, who are full in on what amounts to "Well, they know everything anyway, why shouldn't I use the most convenient payment option?"
> Your local, totally trustworthy, benevolent government that just needs a teensy tiny little bit more data to deal with terrorists, child pornographers, and crypto ransom gangs is.
If I didn't know that my kind, loving, wise government had my best interests at heart, I might detect some sarcasm in your post.
> This paper examines the pros and cons of a potential U.S. central bank digital currency, or CBDC, and is the first step in a discussion of whether and how a CBDC could improve the safe and efficient domestic payments system. Money and Payments: The U.S. Dollar in the Age of Digital Transformation (PDF) invites comment from the public. Importantly, the paper does not favor any policy outcome.
> The paper summarizes the current state of the domestic payments system and discusses the different types of digital payment methods and assets that have emerged in recent years, including stablecoins and other cryptocurrencies. It concludes by examining the potential benefits and risks of a CBDC, and identifies specific policy considerations.
> Consumers and businesses have long held and transferred money in digital form, via bank accounts, online transactions, or payment apps. The forms of money used in those transactions are liabilities of private entities, such as commercial banks. Conversely, a CBDC would be a liability of a central bank, like the Federal Reserve.
> While a CBDC could provide a safe, digital payment option for households and businesses as the payments system continues to evolve, and may result in faster payment options between countries, there may also be downsides. They include how to ensure a CBDC would preserve monetary and financial stability as well as complement existing means of payment. Other key policy considerations include how to preserve the privacy of citizens and maintain the ability to combat illicit finance. The paper discusses these and other factors in more detail.
> The Biden admin wants to create a surveillance-style digital dollar that is NOT:
> Open / Permissionless / Private
> That's why I introduced legislation to prevent unelected bureaucrats from stripping Americans of their right to financial privacy.
Call me crazy but I heard Biden was actually elected
Certainly a breath of fresh air. I consider myself a rather conservative person, but politically as neutral as I can. I feel like the right and left dug in and went crazy to their own sides. We have the left trying to collect diversity points like Pokemon, and the right for some reason picking fights with companies like Disney and Budweiser...for reasons?
So far, Kennedy is the only one who sounds sane to me.
Or the people who are labeled "buffoons" (or whatever pejorative) aren't actually buffoons but are labeled that way by people with their own political biases.
When it comes to encryption D & Rs are both claiming "it's for the children" and scare tacits. We have incredibly invasive KYC rules that have corporations storing ids and live biometric data. We have a coast to coast driver tracker system. We also have "anti-bad thing" tracking on minor person to person transfers. (You can't say certain words in zelle, venmo, etc transfers) I don't think I fully understand why they're pushing for the digital dollar.
For person to person transfers, this seems to be highly suspect. Why does the president need to know that you exchanged 2.50 with your friend over a payment of potentially embarrassing product. (I'm talking non-illegal but no one's business for a private trade of say conterfit Star Wars actions figures)