Creeping Crypto Corporatocracy: How Libra is Authoritarianism Hiding Behind Good Intentions
Libra is more than just another speculative “market fad” crypto-currency.
While there is some argument that the decentralized nature of currencies like Bit-coin make them a valuable commodity in the modern era, the fact that they are not inherently backed by anything is a recipe for disaster, which is why the value of Bit-coin fluctuates so wildly.
Many will no doubt make the argument that many global currencies operate off of the same function, and this is more or less true in the modern day, however many countries maintain a strategic gold reserve or other means to back the economy in the event that their dollar should falter. In most cases, the dollar of a given country is backed by its most powerful export, or in the case of the United States, by oil. The backing of a currency is important, as that intrinsic value is what gives belief that the promissory note you hold is worth its equivalent in whatever the currency is backed by.
This is why the gold standard is often talked about so often by those who argue over economics, and why debates over money supply, inflation, and fractional reserve banking have been going on for decades.
It is important to understand this context when talking about Libra, Facebook’s new crypto-currency venture in collaboration with Stripe, Paypal, Mastercard and Visa, as well as any other collaborators who are willing to chip in.
Libra outline their goals to become what is essentially a monetary service for “the unbanked”, the 31% of people around the world who do not have access to a financial institution. What they don’t mention, unless you take the time to look, is that they intend to do this by backing their currency with fiat from all around the world, in a form of liquid asset exchange, and that anyone willing to chip in at least 10 million has a seat at the table for how things are decided.
Yes that means anyone.
From global governments, to private investors, anyone can theoretically buy a vote on the Libra council for the low, low $10 million USD price of entry, and each additional 10 million buys another vote, up to an as of yet unspecified cap.
Perhaps I’m being paranoid, but there seems to be massive potential for abuse in doing this; the idea that companies could buy in for massive shares, set up their products to be purchasable only through Libra, and then manipulate the market value of Libra such that the fiat you put in is not worth the Libra that you get out. This would likely be done much in the same way that company owned towns used to pay the workers living there in scrips of “company money”, which, since the company was the sole owner of everything in the town, was only worth as much as the company said it was. After all, when you control the market, what’s stopping you?
Of note, “Founding members” of the organization will only be allowed to make a vote worth 1% of total votes, or one vote, whichever is greater, when it comes to decisions made by the council. This is presumably a good faith gesture to show that in reality, Facebook, Stripe, Lyft, Uber, etc. have no intent to do anything above of the sort. However, nowhere in this document does it state that members of the companies that make up the heretofore agreed “Founding members” cannot also buy shares in Libra as private donors, and therein lies the rub.
Nothing is stopping Zuckerberg from donating $200 million of his own money for twenty votes, so long as Facebook does not nominate him as the representative on their behalf, he can go in as much as he wants, and so can any private citizen, up to the cap, whatever that cap may be.
Another notable issue is, of course, the fact that Stripe, Mastercard and Paypal have all allegedly colluded before in the past to put pressure on Patreon to remove creators from that platform they didn’t like, and then immediately pulled support from another platform that said creator moved to simply for him being there. This non-withstanding of Facebook’s own bans on figures they dislike.
These companies have a clear political agenda, and when questioned by Wisconsin representative Sean Duffy about whether or not that particular agenda and bans instituted against those who didn’t follow along would carry over from sites like Facebook into Libra, Libra CEO David Marcus failed to give any real answer.
Now, what I am about to say is wholly speculation, and I will admit as much, but I believe this is the first step in the attempt to make a “global currency” to replace fiat currency altogether. By backing their currency with global fiat in a mixed market, and attempting to replace currencies with a virtual money system, Libra is attempting to innovate through convenience. In doing so, this feels like a long-con attempt to build a currency backed by fiat (which we’ve established isn’t really backed by anything substantial anymore) that will eventually replace fiat altogether for the majority of people.
This would be made possible by allowing any global currency to be valued in Libra, and by allowing anyone to potentially use it, thereby eliminating the need of fiat from the everyday lives of people. Once this is done, the control of global currency by central banks and the IMF will essentially mean nothing anymore, because a bigger central bank owned in co-operation by corporations will have more say over the value of common currency than anyone or anything else.
This is, I believe, the endgame for Libra; a new central banking institution controlled by corporate interests, beholden to no laws, no country and no government regulations, imposing their own political agenda via market coercion, and excluding anyone from the service who disagrees with their political aims. When one considers that there are corporations with more wealth than most countries, it doesn’t seem that far-fetched of an idea, really.
As I’ve said, this is of course speculation, and though I may not have convinced you, I would invite you to consider this: there is likely a reason why Libra was started in Switzerland, a notable tax-haven for corporate greed, and not in the United States. As responsible citizens, we should oppose any measure which seeks to supplant our sovereignty for the sake of convenience, and I believe Libra to be exactly that; a cheap and easy way to sell ourselves into digital currency slavery.