I respect Timothy Noah, but I don’t think his latest column about Ron DeSantis is very good. The premise is that the Florida governor has committed an epic gaffe that should horribly damage his prospects as a presidential candidate. Noah compares it to George Romney’s statement that U.S. generals “brainwashed” him into supporting the Vietnam war, or Mitt Romney’s statement that 47 percent of the public would vote for Obama because they’re moochers who pay no income tax, or Hillary Clinton’s statement that Trump’s supporters are “a basketful of deplorables.”
To begin, what these famous “misstatements” have in common is that they were extremely easy to understand. Claiming to be brainwashed made the elder Romney sound either mentally unstable or too weak to be president. The younger Romney’s “47 percent” rant demonstrated his elitism and contempt for half the electorate. Clinton’s comments were widely interpreted the same way, even if that was not her intent.
By contrast, what Ron DeSantis said at an April 1 address to the Pennsylvania Leadership Conference was about something almost no one, including me, really understands. It was about a proposal to have the Federal Reserve issue a digital version of the dollar, somewhat like cryptocurrencies but with the full backing of the U.S. Government. To Noah, and many other knowledgeable people, DeSantis’s remarks were the rantings of either a demagogue, a lunatic, or both. Here’s the relevant bit:
One of the things we’re gonna ban in Florida this year is the idea of a Central Bank Digital Currency that they’re trying to do. [Applause.] This is something where they want the Fed to control a digital dollar. And guess what’ll happen? They’re gonna to try and impose an ESG agenda through that. You go and use too much gas, they’re gonna stop it, they’re not going to honor the transaction because you’ve already bought more than what they think. You want to go buy a rifle they’re gonna say no, you have too many of those, you can’t do it.
So it’s ceding the power of our financial freedom to a central bank which does not have our interest at heart. So I think all states need to band together, need to say we’re not doing this Central Bank Digital Currency. We’re gonna let you be in charge of your own finances. What we have seen, whether it is education, whether it’s the bureaucracy, whether it’s corporate America, is there is a left-wing agenda that is being imposed on our society, and in Florida, we just said no. We said we recognize this as a threat across the board and we pledged to fight the woke in the schools, we pledged to fight the woke in the corporations, we pledged to fight the woke in the halls of the legislature. Florida will never, ever surrender to the woke mob because our state is where woke goes to die.
Noah argues this is unhinged because a digital dollar won’t really differ from a physical one in most major respects. For one thing, your bank transactions are already subject to scrutiny and disclosure.
The Fed scheme DeSantis described in his remarks is sheer fantasy. He imagines that the Fed would use CBDCs to steer purchases in the direction of environmental protection, social justice, and corporate governance. There’s nothing in the CBDC plan that would enable the government to do that. Nor could it limit gasoline purchases or prevent anybody from buying a gun. We have entered the realm of John Birch Society–grade nuttery, akin to the Birchers’ claim in the 1950s that water fluoridation was a Communist plot to control American minds.
This may be true, but it’s not immediately obvious why it’s true. We think about our bank savings as cash in digital form, but we can always go and withdraw the paper money if we want. In this respect, the government doesn’t have an iron grip on our savings. But a digital dollar could theoretically be locked or limited in what purchases it can make. And if we couldn’t then withdraw it for paper money, then we’d have lost control of our own wealth and freedom.
I kept waiting for Noah to explain why this couldn’t happen, not because I thought it was realistic but because he needed to address the concern in order to demonstrate why DeSantis is making no sense. Instead, Noah just started throwing around invective, comparing the charge to conspiracies about fluoridation.
I suspect the reason Noah didn’t include this kind of explanation is because it’s a hard explanation to make. And that really is why this isn’t the kind of gaffe that could immediately damage a candidate. If no one knows what he’s talking about or why it is crazy then it’s not going to resonate or somehow define DeSantis.
To explain why a digital dollar should be non-threatening to right-wingers, you’d have to prove that it can be transferable to cash, although that kind of seems to defeat the purpose. Because, if it is not transferable to cash, it’s easy to see how a future Congress could say digital dollars can’t be spent in certain ways and curtail people’s freedom. If it’s not plausible that a future Congress could limit how the digital dollar is used, then that needs to be explained.
That Noah couldn’t or wouldn’t do these things points out the difficulty of doing so, and that’s why expecting DeSantis’s remarks to be disqualifying isn’t just fantasy but also just plain bad analysis.