Here comes the Bribe!

This is exactly what it does, and the people perpetrating this see it as a feature, not a bug. It is potentially the greatest means of fine-grained surveillance and control by rulers over a populace ever invented.

Two days ago, on 2022-10-14, the International Monetary Fund held a powwow in Washington, DC to discuss “Central Bank Digital Currencies for Financial Inclusion: Risks and Rewards”. Here is a clip from the event. The speaker, Bo Li, is the Deputy Managing Director of the International Monetary Fund, discussing the “programmability” of central bank digital currencies (CBDC) and what this means for their issuers.

So who is this “Bo Li” dude? Well, before coming to the IMF in August, 2021, he was deputy governor of the People’s Bank of China and

Li holds a PhD from Stanford University and an MA from Boston University, both in economics. He also holds a JD, magna cum laude, from Harvard Law School. Li studied at Renmin University of China for his undergraduate degree in Beijing.

China is the pioneer in the Social Credit system, which is already largely rolled out through their wireless payment system, even before the introduction of a CBDC.

There are various punishments for low trustworthiness. As of June 2019, according to the National Development and Reform Commission of China, 26.82 million air tickets as well as 5.96 million high-speed rail tickets had been denied to people who were deemed “untrustworthy(失信)” (on a blacklist), and 4.37 million “dishonest” people had chosen to fulfill their duties required by the law. Delinquent debtors are placed on blacklists maintained by Chinese courts and shared with the Ministry of Public Security which controls the country’s entry-exit checkpoints. Individuals with outstanding debts can be subject to exit bans and prevented from leaving the country as a way of encouraging or forcing the collection of debt. According to the Financial Times, as of 2017, some 6.7 million people had already been placed on blacklists and prevented from exiting the country as a result of the new policy. In July 2019, additional 2.56 million flight tickets as well as 90 thousand high-speed train tickets were denied to those on the blacklist. If the parents of a child were to have low enough social credit, their children would be excluded from the private schools in the region or even national universities. A person with a poor social credit may be denied employment in places as banks, State-owned enterprises, or as a business executive. The Chinese government encourages checking whether candidates names’ appear on the blacklist when hiring.

Economists of the totalitarian bent have also been gushing over the prospect of money that “rusts”—where the balance in CBDC erodes over time at a rate determined by the central bank, obtaining all the benefits of inflation for the state without a rising price level to bring out the torches and pitchforks.

This is why the coming battle between Bitcoin and other decentralised, non-inflationary currencies versus CBDCs is a central arena in the struggle for liberty in the next decade.

Here is the entire IMF conference. The clip about “programmability” starts at the 19:50 mark.

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Not only, then, will public accommodation law never be applied to banking; the act of denying banking to political opponents is clearly a base desire of today’s CCP brand of statists. Anyone surprised at the educational credentials of Herr Bo Li? I am thus not surprised at the state’s wish to fine grain institutionalize the “de-banking” of those whose politics displease the new-and-improved, lemon-freshened, chlorophyll-infused, vitamin-enriched, green fascists. This really must be stopped, to quote the left - by any means necessary. To acquiesce is to become an out-and-out slave of a thoroughly malignant state.

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I am reminded of the sticker on those old hippie VW buses – “Gas, grass, or ass. No-one rides free”.

When human beings can’t use cash to pay for what they want, they will barter. Of course, it is economically much less efficient – and tax-free too!

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There are many good reasons why having more friction in transactions can be a good thing. Higher taxation of tobacco and alcohol than of books on the supply side is a given, but it can also be done on the demand side through negative taxes / welfare.

There are other examples why more friction is a sensible thing: for example Chinese state could easily create volatility in European energy markets and profit from it with the application of the gambler’s ruin principle - the same way China has employed economic dumping to destroy European and American manufacturing while taking over the IP for free.

But there are other instruments for this, I’m especially fond of Liataer’s decentralized thinking on this, it’s simply more robust and resilient than ‘programmable money’:

Similarly, @civilwestman argues for data friction: it should not be allowed to use political affiliation, for example, to determine the issuance of a loan. And I think it should also not be allowed to track political affiliation to analyze to whom loans have been issued, in contrast to the current “affirmative” practices.

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