Central bank digital currencies (CBDCs) are becoming a hot topic in the financial world, with many countries exploring their potential. However,  the implementation of CBDCs poses a number of serious dangers, particularly related to inflation, the power of the Federal Reserve, and the potential for political manipulation.


Inflation is one of the main concerns associated with CBDCs. Economists believe that inflation is a monetary phenomenon that occurs when the central bank increases the supply of money in circulation. The result is a decrease in the purchasing power of the currency, as prices rise and individuals have to pay more for goods and services. CBDCs, as a new form of digital money, are likely to be subject to the same inflationary pressures as traditional forms of money, such as banknotes and coins.

The Role of the Central Bank

The central bank (the Federal Reserve) would have unprecedented control over the supply and circulation of CBDCs, which could further contribute to inflation. The Fed would have the ability to manipulate the supply of digital currency in response to changing economic conditions, potentially creating artificial booms and busts in the economy. This could lead to a misallocation of resources and destabilize the economy in the long term.

CBDCs and Social Credit Scores

Another concern is the potential for the central bank to use CBDCs as a tool for political manipulation. By controlling the supply of digital currency, the government could influence the spending habits of individuals and businesses, potentially steering the economy in a certain direction, or even limiting who has the power to spend their money—and when. This could undermine the freedom of choice of individuals and lead to a loss of individual liberty and economic freedom.

Imagine if every time you shared an “unapproved” or controversial political opinion online, got a traffic ticket, or voted for the “wrong” candidate your debit card was locked for 24 hours. Imagine if it operated on a “strikes” system, where continued “bad behavior” led to more severe punishment. It sounds pretty far-fetched to most Americans, but this is the type of social credit system that can be implemented when the government controls money through digital currency.

An Increase in the Power of the Fed

The implementation of CBDCs could also lead to an increase in the power of the Federal Reserve. By having the ability to directly control the money supply, the central bank would have greater influence over the economy and could use this power to further its own interests, rather than serving the best interests of the public. This could result in a concentration of power in the hands of a few individuals, potentially leading to a loss of democratic control over the economy.

One way to help future generations understand the complexities of money and the economy is to educate them at a young age. This is where the Tuttle Twins Free Market Rules curriculum can play a crucial role. This curriculum provides a fun and engaging way for children to learn about the principles of a free market, the dangers of central planning, and the importance of individual freedom and liberty.

By providing children with a strong foundation in economics and financial literacy, we can help them make informed decisions in the future and create a more prosperous and free society.


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