This is the first of two articles on the Bank of England’s plan for a Central Bank Digital Currency (CBDC) and why it should be resisted. Today’s article asks why the Bank is so keen on the idea.

IN January 2022, the House of Lords Economic Affairs Committee issued a report on the Bank Of England’s (BoE) fervent, yet somewhat furtive, desire to breathe life into its Central Bank Digital Currency (CBDC) or ‘digital pound’. The committee mocked the project as a ‘solution in search of a problem’ and concluded that the ‘concept seems to present a lot of risk for very little reward’.

The mere fact of a House of Lords Committee being unconvinced of the case for a retail CBDC is not the main reason to reject the concept. Those of us who have observed the transition over the last three years from the pretence of democracy to bare-faced authoritarianism need no confirmation from the House of Lords that CBDCs are an evil to be avoided at all costs. But the fact that a bunch of Lords, Baronesses and Viscounts – the most unlikely candidates for a financial system rebellion – have poured cold water on the scheme ought to tell us that the BoE is on a hiding to nothing in terms of building credibility for its project.

Why the cynical ‘ ’ around the word ‘consultation’ in the title of this piece? Well, in line with the increasingly authoritarian trend in government ‘consultations’, all the BoE’s consultation questions presuppose that its CBDC project should be implemented; it seeks opinions only on how this should happen. Disappointingly though unsurprisingly, it provides no option to reject the proposal in its entirety, which is of course highly undemocratic. They’re not asking whether you’d like to be punched or not. The parameters of the debate have been limited to asking you whether you want a black eye or a bloody nose. That is the meaning of ‘democracy’ today in the West. (Those ‘ ’ again.)

The authoritarian framing of the ‘consultation’ is a clear indication that the BoE plans to do exactly as it pleases. So, the purpose of registering dissent in this disingenuous ‘consultation’ is to create a historical record of our rejection of a financial system the chief purpose of which will be to restrict our freedom. If we can register a majority of responses rejecting a CBDC, its subsequent roll-out will provide proof, if it were needed, of just how smoothly our glorious ‘democracy’ is working. And who knows – if we can inundate the BoE’s inbox with a flood of firm rejections, it may spark a movement that leads to a victory over the BoE mafia.

If you agree on the need to completely reject a CBDC, I have provided a template for a response to the BoE’s digital pound consultation paper.

Here is the link to that template with instructions on where to email it. The deadline for responding is Wednesday June 7, 2023.

If, on the other hand, you think that a CBDC might not be such a bad thing, I hope you’ll read this article and reconsider.

A solution in search of a problem

I must commend the House of Lords Economic Affairs Committee on its report caption – ‘a solution in search of a problem’ – which adeptly summarises the BoE’s clumsy attempt to sell a product that only it and no one else wants or needs. To grasp this, you need  understand only two simple facts. First, a CBDC would not even begin to address any of the economic or social problems that we face. Second, a CBDC poses grave threats to consumers. In other words, as far as solutions go, it’s an emphatic lose-lose. When put like this, the whole concept seems incredibly stupid. That’s because it is. I’ll try to explain this lose-lose equation before going on to speculate on why the financial geniuses at the BoE are so keen on it.

The first part of the lose-lose equation is ‘solving’ a problem that doesn’t exist. The BoE’s headline pitch for the digital pound is both absurd and cringeworthy because it has the distinct feel of your 85-year-old granddad going before the Dragon’s Den panel with an invention that he is certain will take the world by storm – a machine that slices bread. Here’s the BoE’s pitch for its ‘digital pound’:

‘The digital pound . . . would be used by households and businesses for their everyday payments needs. It would be used in-store, online and to make payments to family and friends. If introduced, it would exist alongside, and be easily exchangeable with, cash and bank deposits. The digital pound would maintain public access to retail central bank money and, as our lifestyles and the economy become ever more digital, it would also promote innovation, choice and efficiency in domestic payments.’

If you’ve read that more than once and failed to find a single clue as to what the digital pound is going to do that isn’t already being done perfectly well by our existing money payment system, don’t worry: you’re not going mad. I think we can all agree that parting with our money, whether ‘in-store, online’, or ‘to make payments to family and friends’, has never been easier. The problem most of us face today is how to staunch the flow of money out of one’s bank account, not how to make faster or more efficient payments.

Indeed, the Economic Affairs Committee is of the same view as I am – that ‘the UK’s existing domestic payments system is secure and efficient’. The FT roundly concurs, pointing out that if the BoE’s aim is to ensure that the public has ‘access to faster, cheaper retail payments’, this need is being adequately met as ‘more and more payment services are already providing just that’.

Clutching at straws, the BoE has tried to argue that its digital pound will increase ‘financial inclusion’. Countering that, the FT points out that ‘introducing the basic bank account has already achieved that – by 2018-19, the number of “unbanked” in the UK had dropped to just 1.2m out of a total population of 67.1m.’

To understand the motivation for pushing a CBDC, we must see it in the overall context of government interventions over the last three years. Whether it was scorching the earth with ruinous lockdowns; addling the population’s already confused and fearful minds with oxygen-depriving masks; coercing everyone to get injected with ‘vaccines’ that killed and maimed more people than any other pharmaceutical product in history; enforcing media censorship on a scale that would have made Goebbels blush; fanning the flames of a proxy war that sent energy bills up by 80 per cent in the space of six months, or presiding over the highest rate of inflation since 1982, the last three years have seen the most concerted, and successful, attempts by the government to plunge a jagged, rusty knife into your back, twist it violently, and have the gall to tell you that it’s all for your own good or some greater good.

Now is not the time to be fooled, again, by deep-state spooks like Sir Jeremy Fleming, GCHQ Director, telling us that a digital currency presents a ‘great opportunity’ to democratise payment systems. The main point revealed by statements like that from GCHQ spies or BoE bureaucrats is just how low they rate your IQ for thinking you would swallow such garbage. Reflecting my own bemusement about the case for a CBDC, the House of Lords Committee concluded with charming understatement: ‘We have yet to hear a convincing case for why the UK needs a retail CBDC’.

CBDC is not a currency: it’s a digital payment system

The second part of the lose-lose equation captures the main way in which a CBDC would harm us. Understanding this is the key to understanding why the BoE and every other central bank wants one in the first place. The key feature that distinguishes a CBDC from the system currently in use is that the CBDC will be programmable. Even if that feature is not deployed in the initial phase of roll-out, it is built into the system and can be activated at the metaphorical flick of a switch. The FT sums up the problem:

‘The [BoE] could restrict the future use of money for activities seen to be “socially harmful” in some way. But who will judge what is socially harmful? This has the potential to become as severe a restriction on personal freedom as China’s “social credit” system.’

It’s vitally important to be clear about what a CBDC really is and what it is not. And oddly enough, despite its name, it is NOT a currency. Sterling is a currency. The correct term for the BoE’s proposed CBDC or ‘digital pound’ is a Central Bank Digital Payment System or CBDPS. That’s not my opinion: it’s the unequivocal view of Sir Jon Cunliffe, the BoE’s Deputy Governor for Financial Stability. When challenged by the House of Lords Economic Affairs Committee on the ‘currency’ canard, he replied:

‘I agree with you entirely on currency [i.e. the use of the word as a misnomer], but the term is out there now and it is difficult to change it. I would probably refer to it as central bank digital money, because money is a means of payment, rather than central bank digital currency.’ (emphasis added)

The word ‘currency’ creates the misleading impression that something new is being mooted when in fact what is happening is a dystopian revamp of the existing payment system. Just to re-emphasise the lose-lose equation: first, a new payment system is being introduced when there is nothing wrong with the existing one. Second, the new payment system is programmable by the issuer. It is no exaggeration to say that a CBDC allows the government of the day to determine how, when, where and even if you can spend the money in your digital wallet. Are you smelling a rat yet?

The component of this looming nightmare that will give it ruthless efficiency is digital ID. An important security feature of any payment system incorporates being able to identify the authorised owner of the account (or ‘wallet’ in CBDC parlance) to prevent crime. Here we are talking about standard identification which is unique to the platform and used purely to ensure the person attempting to transact on the account is the authorised owner. However, the direction it’s bound to go in is a broader ID system linking activity on your CBDC wallet to a wider digital ID that will integrate your financial CBDC identity with your wider online activity and identity. This is what will turn a payment system into a social credit system. Again, don’t take my word for it. Here’s what the BoE governor said in response to the digital ID question as it relates to his digital pound:

‘To what extent that digital ID would be unique to that platform or something that was broader in terms of your identity, it is rather like Jon’s [Deputy Governor for Financial Stability] point about the iPhone: the technology will probably move us on very rapidly in a short time, so it is a bit of speculation to some degree.’ (emphasis added)

He’s being a bit coy in talking about ‘speculation’ but you don’t need to be a mind-reader to get what he’s saying: ‘the technology will move us on very rapidly’. It won’t be his fault when we’re sanctioned for not eating our quota of bugs; it’s just technology. The god of technology is of course the go-to alibi of authoritarian technocrats. If you’re not obeying it and making sacrifices to it, then you’re a pagan Luddite, worthy only of scorn, abuse and ultimately removal from society.

In short, a payment system is being used to transform a key function of money from a medium of exchange into a medium of control.

The BoE’s remit in its own words is to ‘keep the whole UK financial system stable’. And how does it do this? Again, in its own words, ‘by keeping a close watch on any risks and taking action, if we need to’. Full marks for plain, easy-to-understand English. Using this as the yardstick for what it should be doing, tomorrow I’ll give a quick summary of some financial system instability that the BoE should be keeping a close watch on but isn’t.

In the meantime, here is the Template Response to the Bank of England’s Digital Pound Consultation.

This article was originally published by The Conservative Woman and is republished here with permission