On June 30th, 2020, the Senate Banking Committee held a hearing on the future of the digital dollar. The pressures to create a digital USD are mounting as China recently began testing its own digital currency – the DCEP, which will be included in popular applications like WeChat and AliPay. Of particular concern is widespread adoption of a digital yuan in emerging markets and in international trade.
The idea of a dollar-backed digital currency gained mainstream media attention last year during the Libra congress hearings, where Facebook introduced a new type of digital unit backed by a basket of currencies and commodities.
Although David Marcus insisted that Libra users will not have to put their trust in Facebook and that Libra was a decentralized currency, regulators weren’t buying it and expressed concern over the long-term threat to the traditional financial system. On July 9, 2019, regulators requested a moratorium on the project.
In December, Libra released a new roadmap, proposing several digital-fiat currencies deriving their values from the USD, British Pound, Swiss Franc and others, thus creating an efficiency layer on top of the current financial system. Users would be able to access these digital currencies through a wallet installed on their phone, and potentially through WhatsApp chat and Facebook Messenger.
Distribution issues of the $1200 COVID stimulus checks, created new momentum for the digital dollar (and a more efficient financial distribution machine). It is no secret that many are still waiting for their stimulus checks, while $1.4 billion in stimulus was sent to dead people.
Most recently, Congresswomen Rashida Tlaib (D-Mich.) and Pramila Jayapal (D-Wash.) introduced a new stimulus proposal of $2,000 per month to residents through the Automatic BOOST to Communities Act (ABC Act). Under the ABC Act, Congress would authorize the Federal Reserve to create “FedAccounts,” or “Digital Dollar Account Wallets,” which would allow U.S. residents and business to access financial services through an app on their phone.
Building on this momentum, the Senate Banking Committee continued the discussion of the digital dollar yesterday.
Some highlights from the hearing include:
- Senator Tom Cotton (R-Ark.) stated, “The U.S. needs a digital dollar…The U.S. dollar has to keep earning that place in the global payments system. It has to be better than bitcoin … it has to be better than a digital yuan.”
- Chairman Mike Crapo (R-Idaho) expressed concerns of regulator oversight for stable-coins.
- Charles Cascarilla of Paxos testified advocating for stable-coins, stating that they address the “antiquated plumbing” of our financial system as well as financial inclusion. “Blockchain based stable-coins allow everyone access”.
- Nakita Cuttino, visiting assistant professor of law at Duke University, discussed the friction in the current payday cycle and the rising demand for costly advanced-payment apps which could be resolved with digital currencies. “In the absence of public policy addressing open access payments and real-time payments, low-income and moderate-income Americans will continue to have limited resources needed, whether by traditional fringe services like payday loans or some novel fringe service.”
- Former CFTC Chairman Chris Giancarlo and head of the Digital Dollar Project, emphasized the “social and national” benefits such as increased speed, lower costs and issues of financial inclusion. “Darwin said the most adaptable survive. And I think that is true when we transition to a new architecture. To adapt to it, will help bring benefits to the society at large.”
It is unclear how soon the digital dollar will come into existence, although increasing competition from China may be the push U.S. regulators needed.
And consider, what will it take for the Republican Party to begin to heal itself?
If Donald Trump stages another come-from-behind victory in November — helped, in all likelihood, by the collapse of public order in American cities — the Republican Party will become an oddity for the Trump Organization: the only entity it owns but does not brand. Not only will Trump remain in office for another term, but the Trumpers will also dominate the G.O.P. for another generation.
Look for Tom Cotton to be the likely nominee in 2024 (with — why not? — Laura Ingraham as his running mate).
And if Trump loses? Then the future of the party will be up for grabs. It’s time to start thinking about who can grab it, who should, and who will.
Much depends on the margin of defeat. If it’s razor thin and comes down to a vote-count dispute in a single state, as it did in Florida in 2000, Trump will almost surely allege fraud, claim victory and set off a constitutional crisis. As Ohio State law professor Edward Foley noted last year in a must-read law review article, a state like Pennsylvania could send competing certificates of electoral votes to Congress. Interpretive ambiguities in the 12th Amendment and the Electoral Count Act of 1887 could deadlock the House and the Senate. We could have two self-declared presidents on the eve of next year’s inauguration.
Who controls the nuclear football in that event is a question someone needs to start thinking about right now.
But let’s assume Trump loses narrowly but indisputably. In that case, the Trump family will do what it can to retain control of the G.O.P.
Tommy Hicks Jr., the current Republican National Committee co-chairman, is one possible candidate to move up to become chairman, and run the R.N.C., but the likelier choice is Hicks’s good friend Donald Trump Jr. The Trumpers will make the argument that NeverTrumpers cost them the election and are thus responsible for everything bad that might happen in a Biden administration, from crime on the streets to liberal Supreme Court picks to some future Benghazi-type episode.
Something unpleasant might come of this. It tends to happen whenever a large mass of conformists convince themselves that they’ve been betrayed by a nonconforming minority in their midst.
Then there’s the third scenario: An overwhelming and humiliating Trump defeat, on the order of George H.W. Bush’s 168 to 370 electoral vote loss to Bill Clinton in 1992.
The infighting will begin the moment Florida, North Carolina or any other must-win state for Trump is called for Joe Biden. It will pit two main camps against each other. On the right, it will be the What Were We Thinking? side of the party. On the further right, the Trump Didn’t Go Far Enough side. Think of it as a cage match between Marco Rubio and Tucker Carlson for the soul of the G.O.P.
Both sides will recognize that Trump was a uniquely incompetent executive who — as in his business dealings —
- always proved his own worst enemy,
- always squandered his luck,
- never learned from his mistakes,
- never grew in office.
Both sides will want to wash their hands of the soon-to-be-former president, his obnoxious relatives, their intellectual vacuity and their self-dealing ways. And both will have to tread carefully around a wounded and bitter man who, like a minefield laid for some long-ago war, still has the power to kill anyone who missteps.
That’s where agreement ends. The What Were We Thinking? Republicans will want to hurry the party back to some version of what it was when Paul Ryan was its star. They’ll want to pretend that Trump never happened. They will organize a task force composed of former party worthies to write an election post-mortem, akin to what then-G.O.P. chair Reince Priebus did after 2012, emphasizing the need to repair relations with minorities, women and younger voters. They’ll talk up the virtues of Republicans as
- reformers and problem-solvers, not
- Know-Nothings and culture warriors.
The Didn’t Go Far Enough camp will make the opposite case. They’ll note that Trump
- never built the wall,
- never got U.S. troops out of the Middle East,
- never drained the swamp of Beltway corruption,
- ended NAFTA in name only,
- did Wall Street’s bidding at Main Street’s expense, and
- “owned the libs” on Twitter while losing the broader battle of ideas.
This camp will seek a new champion: Trump plus a brain.
These are two deeply unattractive versions of the party of Lincoln, one feckless, the other fanatical. Even so, all who care about the health of American democracy should hold their noses and hope the feckless side prevails.
As with the Democrats after Jimmy Carter’s defeat in 1980, it will probably take more than one electoral shellacking for conservative-leaning voters to appreciate the scale of disaster that Trump’s presidency inflicted on the party and the country. It will probably also take more than one defeat for the party to learn that electoral contests should still be waged, and won, near the center of the ideological spectrum, not the fringe.
But everything has to start somewhere. A decisive Trump loss in November isn’t a sufficient condition for the G.O.P. to begin to heal itself. It’s still a beginning.
Keeping track of the Jacksonians, Reformicons, Paleos, and Post-liberals.
I like to start my classes on conservative intellectual history by distinguishing between three groups. There is the Republican party, with its millions of adherents and spectrum of opinion from very conservative, somewhat conservative, moderate, and yes, liberal. There is the conservative movement, the constellation of single-issue nonprofits that sprung up in the 1970s —
- gun rights,
- right to work
— and continue to influence elected officials. Finally, there is the conservative intellectual movement: writers, scholars, and wonks whose journalistic and political work deals mainly with ideas and, if we’re lucky, their translation into public policy.
Actually it is the president who abandoned the DACA kids. He was offered a deal by Senate Minority Leader Charles E. Schumer (D-N.Y.) — money for the border wall in exchange for DACA relief — but senior policy adviser Stephen Miller and Chief of Staff John F. Kelly, along with Sen. Tom Cotton (R-Ark.) nixed it. Or does Trump not remember?
.. Whatever his intention, Trump is communicating to Congress and the entire world that his word is worthless, that when you think you have a deal, you really don’t.
What then are the Europeans, in discussion with the administration over his threatened exit from the Iran nuclear deal, the South Koreans, the North Koreans, our trading partners and just about everyone else on the planet supposed to think?
.. “With Bolton, [Joseph E.] diGenova and [Mike] Pompeo feeding Trump’s worst instincts, we’re entering incredibly dangerous times.”
(He could add to the list Peter Navarro, Cotton, the right-wing echo chamber and his favorite Fox News propagandists — all of whom egg on Trump without regard for the catastrophe that might await us if he followed their advice.)
.. Trump is never going to get better, and chances are he’ll get much worse. Everyone should act accordingly.
In denigrating anyone who called the President out for his slurs, Senators Cotton and Perdue (pictured here in August) show their willingness to humiliate themselves on his behalf.
.. According to the Post, “Three White House officials said Perdue and Cotton told the White House that they heard ‘shithouse’ rather than ‘shithole,’ allowing them to deny the President’s comments on television over the weekend.” Is that how people sleep at night in Trump’s Washington?
And they are poisonous.
.. It should be clear that the house/hole distinction, should it even have existed, would not count as “allowing” Cotton and Perdue to deny the President’s remarks on any terms. But the ones on which they did so are particularly egregious, because they offered themselves as witnesses to other senators’ supposed dishonor.
.. Senator Dick Durbin, Democrat of Illinois, had confirmed the reported phrase “shithole countries” publicly; Senator Lindsey Graham, of South Carolina, had backed up the press accounts more obliquely but unmistakably. Senator Tim Scott, his Republican colleague, who is African-American, told reporters that Graham had confirmed the essentials of the report to him; Graham didn’t dispute that. Graham had also publicly said that there was a racial aspect to the remarks, which he said he’d called the President on, saying, by his account, “America is an idea, not a race.”
.. Cotton, appearing on Sunday news programs, specifically disparaged Durbin’s credibility. “I didn’t hear it, and I was sitting no further away from Donald Trump than Dick Durbin was,”
.. Cotton told John Dickerson on CBS’s “Face the Nation.” “And I know, and I know what Dick Durbin has said about the President’s repeated statements is incorrect.” He also said that Durbin had a history of dishonesty.
.. When Dickerson asked Cotton about the thrust of the remarks, as opposed to the President’s word choice, Cotton said, “I did not hear derogatory comments about individuals or persons.” Perhaps there was another rationalization in there: he was being derogatory about whole populations, not individuals!
.. in the next sentence, Dickerson made the terms of Cotton’s lies clear when he asked, “So the sentiment is totally phony that is attributed to him?”—meaning to the President. Cotton answered, “Yes.”
.. At the same time, Perdue was busy on ABC’s “This Week,” telling George Stephanopoulos, in even more categorical terms, that Durbin was guilty of a “gross misrepresentation” of Trump’s remarks, saying that such “language” was simply not used.
.. When Stephanopoulos noted that there were multiple sources who said otherwise—indeed, the President himself reportedly called friends to brag about what he had said
.. Congressmen Kevin McCarthy, Republican of California, who is the House Majority Leader and has not commented (but, as the Washington Post noted, stood quietly next to the President when he denied the reports on Sunday; Trump also called himself the “least racist person”
.. members of his Administration at first thought that the controversy could be settled in the shady realm of “do not recall,”
.. They were caught by surprise when he started tweeting about how the accounts of his language were outright false.
.. But perhaps he also listened to what the other Republicans were saying, and had an insight that they would, indeed, back him up. It was a bully’s triple play:
- first, he got to slur whole nations.
- Then he got his guys to gang up on anyone who called him out for it, which produced the final prize:
- the acknowledgement that the Republican lawmakers were his guys, subordinate and willing to humiliate themselves on his behalf.
.. What is notable is that, at first, Cotton and Perdue had tried, in a joint statement, to hedge by saying that they did “not recall the President saying these comments specifically.” But, as his lies escalated, so did theirs, to the point where they were backing up the idea that the media was involved in a fake-news conspiracy.
.. But it is, apparently, hard to lie halfway for Trump; he won’t let you.
White House Chief of Staff John F. Kelly told Democratic lawmakers Wednesday that some of the hard-line immigration policies President Trump advocated during the campaign were “uninformed,” that the United States will never construct a wall along its entire southern border and that Mexico will never pay for it, according to people familiar with the meeting.
The comments were out of sync with remarks by Trump, who in recent days has reiterated his desire to build a border wall that would be funded by Mexico “indirectly through NAFTA.”
.. “Certain things are said during the campaign that are uninformed,” Kelly said.
“One thing is to campaign, another thing is to govern. It’s really hard,” he added later, according to attendees.
“A concrete wall from sea to shining sea” is not going to happen, Kelly said. Instead, “a physical barrier in many places” is what the administration is requesting. Kelly used the term “physical barrier” several times during the meeting, attendees said.
.. Instead, “we need 700 more miles of barrier,” Kelly said — a concession that a physical barrier does not need to stretch the entire length of the border.
.. “Concrete wall would be good in only certain places,” he added, saying that manpower and drone technology should suffice in some parts.
.. Kelly also said that there will be no wall “that Mexico will pay for.”
.. “In one way or another, it’s possible that we could get the revenue from Mexico, but not directly from their government,” he said.
.. “Drug cartels will always find a way to get their drugs in so long as there’s demand in the U.S.,” Kelly said.
.. Kelly seemed unimpressed by the deal, attendees said, telling the group that Graham and Durbin have always agreed on immigration matters. What would be more impressive, Kelly suggested, is if Hispanic Caucus members worked with conservatives like Sens. Tom Cotton (R-Ark.) and David Perdue (R-Ga.) and Rep. Bob Goodlatte (R-Va.), the chairman of the House Judiciary Committee, who introduced a conservative-backed proposal on immigration reform last week.
The junior senator from Arkansas is a hybrid of insurgent and old guard.
At forty years old, Cotton is the youngest member of the Senate
.. when we hear that kind of ridicule, we hear them making fun of the way we look, and the way we talk, and the way we think.”
.. It was, on one level, a breathtaking leap—to equate mockery of a louche New York billionaire with attacks on the citizens of this small, conservative city, which lies across the Arkansas River from Oklahoma.
.. “Next to Trump, he’s the elected official who gets it the most—the economic nationalism.
.. Ben Sasse, of Nebraska, whose term is not up until 2020, said that, by threatening journalists, Trump was violating his oath to defend the Constitution.
.. “The President puts things sometimes in a way that I would not,” he said in early October. “But he was still nominated by our voters and elected by the American people to be our President, and if we want him to accomplish our agenda we need to set him up for success.”
.. From the beginning, Tom could play to both the establishment and the Tea Party. Everyone recognizes he’s got a firm set of conservative principles, but that makes him a polarizing figure. There are a lot of people here, too, who hate him and think he’s the Antichrist. The only thing everyone agrees on is that he wants to be President someday.”
.. To make that next leap, Cotton expresses the militarism, bellicosity, intolerance, and xenophobia of Donald Trump, but without the childish tweets.
.. He and his supporters see Trump and Trumpism as the future of the Republican Party.
.. He was the one who told us about John Kelly,” the former Marine Corps general who is now Trump’s chief of staff
.. after Cotton spoke out against a quick deal to protect the Dreamers, Trump made a formal proposal to Congress that attached many strings Cotton had demanded.
.. Trump gave Cotton a victory on the touchstone issue of his Senate career by decertifying Iran’s compliance with the nuclear-arms deal
.. “Putting aside the issue of technical compliance or noncompliance, it’s clear that the agreement is not in our national interest.”
.. “One thing I learned in the Army is that when your opponent is on his knees you drive him to the ground and choke him out.” In response, a questioner pointed out that killing a prisoner of war is not “American practice.” (It is, in fact, a war crime.)
.. in North Korea, Cotton supports Trump’s brinkmanship with Kim Jong Un
.. one recent report suggested that the President would name him director of the C.I.A. if Mike Pompeo, the current director, were to replace Rex Tillerson as Secretary of State.
.. Cotton would ratify the President’s instincts. He offers Trump a certainty that matches his own
.. “The Democratic Party has drifted away from them,” Tom told me, as his parents sat nearby. “Bill Clinton would be repudiated by his own party today.
.. I wrote against sacred cows, such as the cult of diversity, affirmative action, conspicuous compassion and radical participatory democracy. I wrote in favor of taboo notions, such as Promise Keepers, student apathy, honor and (most unforgivably) conservativism.”
.. The letter combined outrage, overstatement, and savvy politics in a manner that Trump would perfect a decade later.
.. “ ‘God, guns, and gays’—social issues—were driving white conservatives to the Republicans all along
.. It is impossible not to see race as a central element in the fall of the Democratic Party here
.. “It took a black President to bring out the threat.”
.. “I would always say to my liberal white friends, ‘Oh, come on, surely it’s gotten better.’ And they’d say to me, ‘Oh, no, it hasn’t. You can’t believe what white people say about Obama in private—he’s Kenyan, he’s Muslim, they’d call him unprintable racial epithets.’ ”
.. I think a lot of people in Arkansas thought he was ‘uppity,’ to use the old smear.”
.. Cotton also benefitted from enormous outside spending by conservative groups, including some affiliated with the Koch brothers
.. outside groups spent twenty-three million dollars for Cotton, compared with fourteen million for Pryor.
.. Democrats in Arkansas had a special reason to disdain Obama: “It wasn’t because Barack Obama was black, it was because Barack Obama stopped the Clinton restoration.”
.. About three hundred thousand people, which amounts to more than ten per cent of the state’s population, have taken advantage of the law to obtain health insurance.
.. The program is not called Obamacare but, rather, Arkansas Works.
.. “If you live in a big city and you work in an office building, immigration is almost an unalloyed good for you. . . . It makes the price of services that you pay for a little bit more affordable—whether it’s your nanny to take care of your kids for you, or landscaping your yard, or pedicures, manicures, that sort of thing. And you get a lot of exciting new fusion restaurants as well.
“But if you live and work in a community where they have a large illegal-immigrant population
- that’s straining the public school,
- that’s clogging up the emergency room when you’re trying to get care,
- that makes it more dangerous to drive in the roads because people don’t have driver’s licenses or they don’t have insurance,
- or if they are bidding down the wages or even taking jobs away from you, then it doesn’t look nearly so good,”
.. Most economists believe that immigrants, legal and otherwise, add more to the economy than they take from it, and that their presence in the labor force does not lead to lower wages over all.
.. “He probably knows more about geopolitics than most senators.”
.. In March of his first year in the Senate, Cotton wrote an open letter to the “Leaders of the Islamic Republic of Iran,” which was co-signed by forty-six other Republican senators, warning the mullahs that Congress might undo any agreement they reached with Obama. The letter was denounced by Executive Branch officials as an attempt to interfere in a diplomatic initiative, but Cotton regards it as a triumph.
.. he boasted about the letter
.. You simply cannot neglect security, and without security there cannot be political compromise and reconciliation, there cannot be good governance, there cannot be economic development, there can’t be anything.”
.. If Rand Paul is the leading Republican isolationist in the Senate, Cotton, in short order, has become heir to the opposing wing of the Party, the one associated with Senator John McCain, whose efforts to increase the defense budget Cotton has championed.
.. But Cotton has gone well past McCain in his swaggering belligerence.
.. “In my opinion, the only problem with Guantánamo Bay is there are too many empty beds and cells there right now,” Cotton said. “We should be sending more terrorists there for further interrogation to keep this country safe. As far as I’m concerned, every last one of them can rot in hell, but as long as they don’t do that they can rot in Guantánamo Bay.”
.. skirted the edge of demagoguery. “I don’t think any Republicans want legislation that is going to let out violent felons, which this bill would do,”
.. Cotton made his name in the Senate in a more personally poisonous way. In his first year, Cotton placed a hold on Obama’s nominations for the Ambassadors to Sweden, Norway, and the Bahamas, because of an unrelated dispute regarding the Secret Service.
.. “There is a point where winning a political battle isn’t worth it.”
.. “How many guys in town can give a speech at the Council on Foreign Relations and also get kudos in the pages of Breitbart? The answer is, one guy.”
.. Cotton has carved out a clear Trumpism-without-Trump agenda:
- limits on immigration through legislation,
- deportations, and a wall;
- longer prison sentences for American convicts and suspected terrorists abroad;
- a bigger budget for the Department of Defense.
.. The question is whether he has the charisma to sell that agenda to a broader public.