Anti-Cbdc Surveillance State Act
Floor Speech
Mr. Speaker, over the last hours we heard arguments from the other side of the aisle that the United States must prioritize innovation. The Republican crypto bills we considered will create giant loopholes in our Federal financial laws that put consumers and investors at risk in the name of innovation.
These bills would increase the chance of another costly financial crisis like the one in 2008 that led to trillions of dollars of wealth being wiped out in the name of innovation.
It comes as a surprise to me that the last bill we will debate would block any research, pilots, or consideration about how to digitize the U.S. dollar, it is the reason that I call H.R. 1919 the anti-innovation act.
We have been discussing a lot about cryptocurrency. We have talked about two different acts, which are the CLARITY Act and the GENIUS Act. We have talked about a lot of intricacies of crypto. The general public does not understand all of this because the big issuers, the big boys, literally kind of own all of the information. They are the issuers, et cetera, et cetera.
It is time for the United States Government to take charge, and our central bank must be involved in the study and the research so that we don't have issuers with crypto or anything else without the Federal Government knowing about it and being in control.
H.R. 1919 would immediately halt and prohibit the United States from any research and exploration of the benefits of a central bank digital currency, or CBDC. A central bank digital currency is essentially a digital version of the dollar, issued by the Federal Government, that uses crypto technology known as blockchain to record everything and everybody who owns tokens. Open it up. Let us know who the big issuers are.
There are two types of CBDCs, and this bill bans both of them. A retail CBDC is made available directly to consumers from the Federal Reserve, from a bank, or other Federal institutions. A wholesale CBDC is not available to the public but only to the banks and other financial institutions. This bill would ban both of these kinds of CBDCs.
Mr. Speaker, when Republicans raise concerns about CBDCs, they are talking about retail CBDCs, but because they are so averse to knowledge and averse to studying things, they have no idea that their bill blocks research into other forms of digitizing the dollar that would truly cut costs for people.
For example, J.P. Morgan Chase has estimated that $100 billion could be saved in cross-border transactions every year if a wholesale CBDC is adopted. Earlier this week in the Rules Committee, we heard Republicans claim that we need to weaken oversight of private crypto because doing so will help cross-border payments.
I ask my colleagues across the aisle: Why should we abandon any research into making the greenback ready for the future? If this bill passes, the United States would be the only country in the world to ban any research in the world on CBDC. What are my colleagues afraid of? Why do they not want the knowledge explained?
Mr. Speaker, 137 countries are racing ahead. Some are studying, and others are issuing their own CBDC. The foreign currency markets are evolving, but Republicans want to stick their heads in the stand. Those 137 countries and currency unions represent 98 percent of the global GDP, and China is one of the frontrunners in the global race to implement a viable CBDC.
Do my friends across the aisle know why China is quickly rolling out its digital currency? It desperately wants to create an alternative to the U.S. dollar to determine the dominance of our currency.
Mr. Speaker, America reaps great riches because our currency, the dollar, is the premium currency used around the world for all sorts of trade. It is used from sales of oil to commodities to financial contracts.
One of those benefits is that when we take out a loan to buy a car or use our credit cards, our interest rates are much lower than in other countries. Another benefit is that the United States can pressure bad actors from Iran to Russia to China by cutting off access to our financial system and the dollar using sanctions.
Those same countries would love to replace the dollar with their currency or something else. One way China hopes to do this is to show that the dollar is an antiquated currency, whereas the Chinese currency is the future.
It is so shortsighted to not even study how the dollar could be digitized, especially during the same week that Republicans want to let private companies create their own currency.
It is very important for all of us to understand that if we want to be innovative and if we want innovation, we will study and we will understand so we then will be able to explain. If we really want to protect the American dollar, we will not put our heads in the sand. We will allow this research to go on to make sure that the American dollar stays strong even in digital.
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Ms. WATERS. He knows more about digital assets than anybody on the opposite side of the aisle.
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Ms. WATERS.
Mr. Speaker, Democrats are not the only ones who want to study CBDC. In 2021, my dear friend, Chairman Hill, worked with Representative Foster to introduce the Central Bank Digital Currency Study Act.
Chairman Hill also wrote a letter to the Fed asking for information. After the Fed agreed to do a study, he issued a statement saying:
The Fed is finally taking actionable steps to do what we have been asking them to do for 2 years, and we are pleased to see Chairman Powell announce steps toward making a digital dollar a reality.
I ask the gentleman: What changed?
We need more research. We need to learn more, so we need to vote ``no'' on this bill. It goes in the opposite direction from what the gentleman wants and has been asking for.
Finally, we have a chance to vote, and certainly I am asking for a ``no'' vote, and I hope that the gentleman would, too.
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Ms. WATERS. Mr. Speaker, yet, again, my colleague confuses retail and wholesale CBDC. Banning wholesale CBDC is nonsensical. It has nothing to do with surveillance and everything to do with modernizing how American financial institutions and our central bank engage in intrabank cross-border transactions.
This suggestion of Big Brother and monitoring is just a fabrication, a bogeyman. We must support financial innovation and not hide from the future.
Earlier my colleagues praised our wonderful private sector, and we know now my friends do not like studies, but I would encourage them to read the study from our biggest bank, JPMorgan Chase, explaining how CBDC's can save $120 billion in cross-border payments. Please read the study. Even if you don't like studies, read it anyway.
Mr. Speaker, the bottom line is that we fall further and further behind the global economic stage with congressional Republicans' policies. We are already seeing inflation rise on consumer goods as Trump's tariffs take place. Now, Republicans want to raise the cost of auto loans, credit card fees, and mortgages for Americans by forcing the dollar to become a relic of the past. That is why I will vote ``no.''
Further, Mr. Speaker, Mr. Himes made a great argument and a great point about ignorance. He believes that this is an ignorant bill, and it just does not speak well for the Members of Congress not wanting to do research and study to determine what is in the best interest of the dollar and our country.
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Ms. WATERS. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
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