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American progressives, especially the high-profile group of women in Congress known as “The Squad,” have spoken very openly on issues of economic equity, the corrosive social impact of Big Tech, and the need to reimagine fiscal policy and monetary in the period after 2008 and post-COVID-19 political moment.
How do they view blockchain technologies and the subsequent debates that have surrounded the digital dollar, given the potential for some overlap when it comes to some concerns like financial inclusion, efficient distribution, and citizen privacy?
In a recent interview for Forbes, economic policy advisors from several members of the team – Alexia Ocasio-Cortez (D-NY), Rashida Tlaib (D-MI) and Ayanna Pressley (D-MA) – strongly emphasized their position. as against that of many in the blockchain space.
Chastity Murphy, economic policy advisor to Representative Tlaib, addressed the issue of the digital dollar as raised in the recent “Automatic Boost to Communities Act”, which proposed digitizing the currency by 2021 as a means of making it more efficient. public stimulus payments. Murphy said:
“There is a lot of hype around blockchain technology, mostly from people thinking about its uses in the private sector. When it comes to publicly administered digital payments, the most important question is not how to create a distributed ledger run by multiple actors, but how to create digital money, which you can keep in your pocket, that doesn’t require a ledger at all. This is the biggest priority, in our opinion. “
Murphy and other advisers from the team stressed the importance of allowing recurring payments to citizens during the COVID-19 economic and health crisis.
For progressives like Murphy, engagement with new technologies in finance and public policy focuses less on the short-circuiting of the state and other intermediate actors, and more on the biases inherent in many so-called “disruptive” or innovative solutions.
Murphy noted the systemic and damaging impact of automation and algorithmic governance on marginalized communities and people of color. To illustrate this point, he highlighted facial recognition technology and its potential to strengthen racial discrimination in areas such as law enforcement and surveillance. This technology is, for her, “an example of what happens when we separate the issues of efficiency and design from those of exclusion, access and privacy”.
Another response from Aya Ibrahim, economic policy consultant for Rep. Pressley, revealed a similar difference in priorities when it comes to private actors aspiring to propose their own “solutions” to financial exclusion. He told Forbes:
“Facebook Libra’s strength initially was that this would be a way to cash in on non-banks and better serve the weak, but that wouldn’t necessarily exist if we provided the services we were supposed to provide.”
In their emphasis on the need for coordinated, state-led and publicly accountable measures to address financial marginalization, growing inequality and secular stagnation, the team’s priorities – especially when it comes to fiscal and monetary policy – place them at a certain level. distance from advocates of decentralized digital currencies in the private sector.
Progressives have been influenced by heterodox economic thinkers like Stephanie Kelton and other advocates of modern monetary policy, as well as economists who advocate the possibilities of an “entrepreneurial state”, such as Mariana Mazzucato.
Such thinkers share a critical stance with many cryptocurrency advocates when it comes to policies such as quantitative easing and accommodative monetary policy; however, their criticism is motivated by the regressive impact these policies have on economic distribution due to excessive asset price inflation.
Similarly, the progressive support for deficit spending and macroeconomic flexibility enjoyed by many states as monetary sovereigns is a world away from advocates of “hard currency” and limited currency supply in the cryptocurrency sphere.
Big Tech critics across the political spectrum, however, will no doubt remember Ocasio-Cortez’s harsh characterization of Facebook’s proposals for Libra in 2019:
“In the history of this country, there is a term to get paid in a company-controlled currency. […] It is called “scrip”. “
“The idea that your pay can be controlled by a company rather than a sovereign government,” continued Ocasio-Cortez, risks destabilizing what should be a public good.
