Central Bank Digital Dystopia

Sometimes it seems we are living in a choose-your-own dystopian adventure book. We have endless choices as to what catastrophe we want to experience.

I don’t want to get too deep into fear porn as it's probably the stupidest form of porn. A major reason why things feel like they are on the brink of dystopia is that we have access to so much information. We are not the first people to have a rough go on this planet. We are likely the most informed (and misinformed ) about all the particulars of our problems. If we're smart we will use that information to avoid the problems previous generations had no choice but to blindly walk into. If we are not smart we will paralyze ourselves with fear. Either way, it's our choice.

One of these potential problems is CBDC or central bank digital currencies. To anyone not familiar with CBDC as the name implies it is a digital currency that is issued directly from a central authority, like a government. They would allow us to make financial transactions no differently than we do with a credit, debit card, or money app.

What would be different is that because this money is nothing more than code controlled by one entity that code could be edited. This means the people who issue our money can delete our money. Of course, our benevolent ruling class would never abuse their power in such ways. Except that people have already had their financial assets frozen for political reasons.

There is no reason to think widespread adoption of CBDC would not usher in an age of social credit. The state could issue you more or less money for behavior it deems desirable or delinquent. No more could you not be in the good graces of the state and still have the freedom that your money allows.

I’m sure there are good reasons presented as to why this is good, necessary, or just inevitable. People always have good arguments as to why they should have more power over our lives. But history proves that just because some intellectuals can cobble together reasons why you should give up your power doesn’t mean you should.

One does not have to speculate about potential abuses. Just look at what life is like for people living in China where such a system already exists. Read the wrong book, fraternize with the wrong people, express the wrong idea and you will lose the ability to use money. Not having the ability to use money makes modern life next to impossible. And no "The Constitution" is not going to protect you from this.

But this is only one side of the coin. Yes, the government will be able to take away our rights for what they deem infractions. But CBDC also allows them to incentivize behaviors among people in such a system. No one talks about this, despite it being at least equally alarming.

Suppose you are spilling too much government tea as the kids say, what's to stop the state from simply issuing a bounty on your head? A year's wages to the person who films themselves “silencing” you. Maybe it won’t be that blunt. Maybe they will just reward people for issuing effective reputational damage. Either way, it's naive to say such proactive behavior would be off limits to an entity that regularly declares campaigns of mass murder, I mean war.

And speaking of war, would such a system not be a great way to incentivize civilian soldiers? Most people tend to think of war as something that happens between nations. But wars within nations are common. Every war regardless of whether it's contained to national borders or not, can be boiled down to a bunch of people fighting for the benefit of a small group of people who desire power. Whether the conflict is between nations or between peoples in a nation is almost irrelevant.

Anyone who's been paying attention to politics probably has noticed how fractured our society has become. Many people see themselves as members of a political tribe in a nation rather than a member of a nation that has political tribes. The more one adopts such tribal identities the more it makes sense to expel anyone who is not ideologically aligned with them. The only things that hold them back are social norms. But people on all sides are busy eradicating those norms.

In such a reality why would those who have power not weaponize a social credit system against their enemies? Voting the wrong way can be interpreted as displaying dangerous behavior requiring proper punishment. Burning down an organization's center of political foes can be seen as brave and deserving of rewards. Think things would never go so far. Just remember the war on terror started from people flying commercial airlines into crowded buildings and a generation later is being used against people protesting elementary school policy.

This is something to think about. The point of bringing this up is not to flood our nervous system with fear. At the same time, I don’t think we should just pretend there is no problem. The silver lining in a powerful group of people trying to gain control over our lives means we are still in control of our lives. There are solutions for this. Local currencies, Decentralized Digital currencies, and Cash while it is still around. We have the information we need. The choice is up to us.