Welcome back everyone. I am Cass PNC.
I'm joined as usual by my partner in crime, Mr. Bennett
Tomlin. And the world is crumbling
around us, so let's just stop there.
We're joined by a special guest today, Mr. Rohan Gray, who is a
law professor at Willamette University, and he's joining us
now. I think this is the third time
we've had him on, so this is one of our favorite guests.
We he did a a particularly poignant paper.
The 4th. 4th time, 4th time that we've had him on, but he did a
particularly poignant paper digitizing the Fisk and we
wanted to have him on to talk about it as as everything goes
to hell. Rohan, thank you for joining us
on that. On that depressing note,
Bennett, what what do you where do you want to start this?
This is a dense paper. Rohan, could you tell us what
the Treasury Bureau of Fiscal Services is and why it is
important? Yeah, it's the most boring
bureaucrat you've never heard of with the most important job in
the whole of government, right. This is, there's a couple of
people in the office, of course, but it's essentially the people
in Treasury that move the money around.
Now, the best way to think about it is there's 3 levels, but the
Bureau of the Fiscal Services in the middle, and it's the most
politically sensitive. But the three levels from the
bottom are the Fed, the Fed's like the bare metal rails,
right? This is like the zeros and ones.
It moves the accounting around. The Treasury's in the middle.
The Bureau of the Fiscal Service, their job is to send
the instructions to the Fed. So the Fed pretends that it's
dumb. It's just sitting there.
If somebody sends the right payments instruction, it moves
the money around. If not, it doesn't.
Very convenient place to be in the middle of a war to stay out
of, right? Central banks are very good at
this. They're moving around money in
World War One on both sides. They're moving around Nazi money
in World War 2. You know, pretty much until you
get to the late 1970s and then brown people in the Middle East
start, you know, doing politics. Up until then, the central banks
usually don't politicize their own layer, right?
So you've got the accounting layer at the Fed, then the
Treasury is doing the payments instructions to the Fed.
And then above that, you've got this other agency called the
Office of Management and Budget, which is basically the
president's lack, you know, lap dog, you know, and that one is
really the legal authority. So you need the official
signature, then you need the instruction, and then you need
it to be processed. Bureau of Fiscal Service is the
one that does the instructions on behalf of the whole
government. And part of the idea is it's
easier than the Fed getting a million people. the Fed doesn't
even like, you know, any, any human beings.
It would rather only deal with financial institutions if it
could. It's perfect.
School has no children, like the trench bowl in Matilda.
So even dealing with other human beings in the government is
annoying. They would rather just deal with
one and have that person deal with everybody else.
So you go to the Bureau of Fiscal Service.
You've got your legal authority from the Office of Management
and Budget, and then you get the payment instruction. the Fed
goes, I'll listen to the Treasury.
So that's what the office is. It's the office that processes
about 88% of all federal payments through the Treasury's
bank account, the Fed. And so can you talk about kind
of the risks if a bad faith actor were to insert themselves
into that Bureau and the broader process it is a part of?
So hypothetically, right, completely hypothetically,
imagine you are, I don't know, say the president and you, I
don't know, gave up on the idea that there's a separation of
powers such that not only do you get to control the entire
executive branch, right? There's no such thing as
independent agencies. There's no such thing as, you
know, commissions and heads of agencies that everyone is just
your loyal subject. You know, you're in a gold, gold
plated castle and you decide that that's not enough for you.
You also want the power of the purse.
So you're not only really relitigating the New Deal with
the administrative agencies, you're not only really even
admitted litigating Lincoln, you're actually going all the
way back and litigating like the 1600s Glorious Revolution in
Parliament. Like actually, the king doesn't
have to listen to Parliament. I get to run the money taxation
without representation. Like I'm representative.
You're welcome, right? It's a democratic king.
So now I can tax from the King's seat.
So the the risk with the Bureau of Fiscal Service is that it's
the last chokehold for 88% of the government before you go and
actually get the money. So Congress can tell you to
spend. It can allow you to spend, but
you can't actually access the money.
All right, Congress has the power of the purse, but but the
actual physical purse is still in the executive branch.
Historically, this was an incredibly apolitical office.
These were the most boring beige bureaucrats.
This is the department of of lighting fixtures of the
financial system, right? And somebody went and said, what
if I start, you know, what if I start buttering up the IT guys
and maybe the IT guys can help me launch a coup, right?
And so they've found the one level of the payment system that
is about as centralized as possible and as politicized as
possible. As I said, you could go to the
bare metal, go to the Fed. You know the problem?
the Fed, there's a board, it's independent.
They're terrified of pissing off the bond markets.
Even when Trump says the entire government's under my control.
You know, the one exception he put in his executive order for
the Monetary Policy Committee of the Fed, it's the one last
bureaucrat that he's terrified. It's like the final boss.
He's working his way up. He needs like a + 6 sword before
he can get through the armor or something, right?
Everyone else has fallen flat, but the good news is he doesn't
actually have to take over the Fed to take over the payments.
He just goes one level beforehand and shuts off all the
information going to the Fed. How is what is happening right
now with Donald Trump, how is that different than impoundment,
which I like and maybe you can explain.
And I assume that most people aren't familiar with impoundment
because we haven't dealt with it since Richard Nixon.
Yeah, impoundment. It goes back to the very
founding, but it kind of got distorted or grew time until it
became a problem. So the idea of empowerment is
Congress tells the president or the executive to spend and then
passes a law and the executive gets that law.
It's a, you know, it's a valid law.
And then the executive goes, no, I don't think I will.
And, and, and, and that should immediately get your kind of
constitutional separation of powers hackles up.
That's not supposed to be how it's supposed to go, right?
We didn't say please spend unless you don't feel like it,
in which case do whatever the hell you want.
That's a different kind of law. We do write those laws.
But when we say no, no, no, I really mean it seriously.
Seriously, though, this time, guys, spend the money.
You're not supposed to say that. So going back to Thomas
Jefferson, right? And, and all through the 1800s,
there were moments where where presidents did this, but it was
usually quite limited. It was usually in the context of
things like war powers, presidential powers, like very
explicitly presidential powers, where it would be something like
we gave you money to build some war boats.
The war is now over, so you've decided not to spend the rest of
the money. Cool.
OK, we, we, we paid, we, we gave you $1,000,000 for broach
eradication. On day two of the the Roach
eradication program, you found a really cool, you know,
bioengineering weapon. You've killed all the
cockroaches. I guess we don't need to spend
the rest of $1,000,000. Seems reasonable.
Other examples like that have come up where they were usually
in regards to powers considered to be inherent to the president,
right. This is not Congress tells you
to do a thing under Congress's power.
You're the kind of embodiment of that.
You're the conduit for that. It's not that.
It's the stuff that is, is is sort of inherent to the
president's power. By the time we get to the 20th
century, it's starting to expand.
The imperial presidency is expanding pretty much ever since
Lincoln, certainly Woodrow Wilson with World War One,
right, big World War. We need a president to manage
this stuff. Just like we have the debt
ceiling starting to make it easier to do debt management, we
at the same time have the president taking over the
budget. Eventually he gets to Nixon.
And of course, Nixon just gloves off, Fuck it, who cares.
And so Nixon says, I'm going to use this power of impoundment to
to cut off funding to black communities, community
development grants, things like that, highway development going
to certain neighborhoods. And I'm going to justify this on
the grounds that we don't really have too much money.
We're running out, which was a lie.
But also just I'm the president and I can do what I want, right?
When the president does it, it's not a law.
It's not violating the law. Congress threw the book at him.
The Supreme Court threw the book at him, right?
A famous case called TRAIN in 1975.
And then Congress in 1974 passed the Anti Impoundment Act, Anti
Impoundment Monetary Control Act.
And that essentially said, no, sorry, president, when we tell
you to do it, you got to do it. And the Supreme Court reaffirmed
case law going back to the 1830s.
They've been saying this for a while.
They reaffirm a sort of version of it again in the late 90s
under Bill Clinton. This time, because they actually
Congress passes a law. This isn't Clinton unilaterally
doing it, but Congress passes a law saying the president can do
a line item veto. So if you don't like something
in the budget, you can cut out the pieces you don't like and
sign the rest. And, and basically the, the, the
Supreme Court says no, that completely changes the character
of the bill. And I think they're right about
that. You know, if you've ever read
Catch 22, there's a bit where the main character's in hospital
and he's censoring letters because he's so bored.
They give him a job while he's recovering as a former Army
pilot and eventually gets so bored he just senses every word.
You know, Dear, dear Janet, Janet, I yearn for you.
Tragically. That's the entire letter.
You know, at a certain point you can, you can cut out so many
parts of a thing that it completely changes what you're
saying. So Supreme Court said no, when
Congress gives you a bill, you can thumbs up or thumbs down,
but you don't get to pick and choose because you're
fundamentally changing the character of it.
Well, Trump has asserted that right all over again, right?
He's asserted the right to ignore the line item veto even
without a congressional bill. He's asserted the right to
ignore the 1974 bill. He's asserted the right to
ignore about 180 years of Supreme Court precedent.
But to your question, what's different, I would say this is
almost like the Stokey Carmichael line.
If you're racist and you got no power, I don't get, he says,
right, this is the black pen. And he said, but if you're
racist and you got power, now I'm worried.
Well, believing in impoundment and having no power to do it
right, Believing in empowerment and finding the one magic button
that lets you shut off all the money with from one seat in the
government, like you don't even need to leave your basement.
You know, that's a very, very different kind of power.
Up until now, if you wanted to impound funds at, say, the
Department of Education, what would you do?
You would go and talk to the education secretary and say,
hey, I'd like you to commit an unconstitutional act for me.
And the secretary says, I don't know about that, you know, maybe
all right. But today, President Trump can
just bypass that with his, with his, with his lackey, you know,
Elon Musk running the Department of Government Efficiency, AKA
DOGE, AKA the rebranded US Digital Service, which was
actually created by Obama to like digitize the government.
Because, you know, we're, we're the Internet president and
we're, you know, doing our exit interview with Wired magazine
and kite surfing with Richard Branson and you know, blah,
blah, blah. MIT Media Labs.
Joey Ito is our is my, you know, exit interviewer.
So. So Obama sets up the Internet
government through the USDS and then Trump moves it from the
Office of Management and Budget into the White House office,
appoints Trump, appoints Elon Musk as this sort of informal
director. There's this hilarious legal
debate right now where there's actually an administrator
written on paper. And she's just like Mia,
everybody in Congress, everyone in the news is saying Elon Musk
runs this and they go to court. They're like, well, no, no, no.
He's just completely unrelated. You know, sure.
OK. And Rupert Murdoch doesn't own
all of the companies he owns. He just hangs out in the board
meetings. Sure.
But anyway, to your question, impoundment, I would say today
is, is I have the right to not spend what I don't want to
spend, regardless of what Congress says.
But I also have a Big Magic button to do it all.
And that big, Big Magic button is my prerogative as the
commander in I am the law, you know.
Unitary executive theory plus impoundment plus like the
nuclear football of money. One of the things you kind of
touch on in the paper that feels a little bit related to this,
like the reason they wanted control of the Treasury Bureau
of Fiscal Services is because it let them basically choke out
every other part of government they wanted to.
And one of the things that's interesting in your papers, you
talk a little bit about the Consumer Financial Protection
Bureau, which was set up to be independent and has a different
funding structure, reliant more on like a amount it can pull
from the Fed and its awards that keeps it outside of those
different processes. And like, part of the reason I'm
highlighting this is because Despite that fact that it was
somewhat independently funded, I believe it was fed into a wood
chipper. It's still there.
It's just all turned into stone, like the characters on the
outside of like, the White Witch and Narnia, You know, you kind
of walk in the front door and everybody's there in the middle
of doing their office, but they're all petrified.
Yeah. No, this is a good example.
I mean, This is why you, as I try to write the paper, you need
to think of this as sort of three legs of the stool at every
point in time. It's the law.
It's the political economy, right?
It's the money and it's the technology.
And so so the CFPB was structured in a very interesting
way, which is in and credit to Elizabeth Warren.
I didn't appreciate this when I first read this about the CFPB.
So credit to her. I've been harsh when she
deserves it, she deserves some craze on this one.
They designed it so that it was off budget, which means it
doesn't have to be annually reappropriated and it was not
going through the the Office of Management and Budget.
So it has its own budgetary independence.
It doesn't have to go to the president and ask to kind of get
its monthly allocation. It's almost like grandma leaves
you an inheritance, but your parents like, we're going to
give you 100 bucks a week. That's it.
You know, we don't want to spend it all.
And you're like, well, wait a second, Which one of us got
grandma's inheritance? Because it sounds like you're in
charge of it, not me. This is the Office of Management
and Budget. Congress passes a big spending
bill. Office of Management Budget
works out how much you get in a monthly allowance or whatever
else. And it's supposed to be all very
logistical. We just don't want you to run
out of money too soon and then come to us.
So we're just trying to help you budget.
But it's very, of course, micromanaging and subjective
about how they do that. So you've got kind of that layer
and then you've got this coordinating all of the treasury
stuff. And, and, and if you kind of put
those things together, you end up with this system where
there's a lot of centralized bottlenecks.
The CFPB tries to avoid all of those.
It gives you complete independence.
And not only that, the other thing the Treasury is often
required to do is essentially do debt laundering.
So it's this other obscure subpart of the Treasury we don't
talk about along with the Bureau of Fiscal Service called the
Federal Financing Bank. But the idea is, I think of it
almost like, you know, Jesus or the E pluribus Unum in the
American, you know, sort of motto out of many into one, all
the different agencies that have to issue their own debt.
It would be a goddamn nightmare for them all to be out there in
the economy, right? Department of Education debt,
Department of Defence debt, you know, whatever else, but let's
just all launder it through the Treasury, right?
I'm the way, the truth and the life, nothing comes out to the
bond markets except through me. And now we have 1 clean,
beautiful Treasury bond, right? And so the Federal financing
bank is laundering all of that. That puts the Treasury in a
position to screw with other agencies, right?
It's another choke point that the Treasury cannot let you get
your money out. And Mnuchin did this back in
2019 with the post office. So Mnuchin said I'm not going to
let you issue debt that Congress told you you can issue unless
you pre fund your pension out till the year 2600.
You know, basically until we're in season 4 of Star Trek The
Next Generation. I need to know that you can
cover your Postal Service employees, right?
That didn't work though. He eventually gave up with
pressure, but what he learned is this is this is a good strategy.
I just chose the wrong part of the treasury, right?
I just needed you a must to come in and hack the the accounts
with a with a ridiculous PR campaign.
Well, and Russ bought. We shouldn't let him get off
without. He has been planning this too.
Ross Void is the architect of the the anti empowerment
campaign. He's the head of the of the OMB.
And like with what's his name in the first first administration,
they appointed him head of the CFPB at the same time as head of
OMB. I'm forgetting his name, but he
was a former legislator. Anyway.
I'll it'll come to me. So anyway, the CFPB, it's one
big problem is that it's technically on the money side is
that it's still attached to the Fed.
So it it gets its money directly from the Fed, that's about as
good as you can hope for. There's no government debt
involved. There's no borrowing from our
grandchildren. It doesn't need to get it from
taxes or revenue or even fines if it says it needs a certain
amount. the Fed just basically has to give it to them.
And the Fed doesn't have discretion over that.
But to your point, originally, it was designed so that the head
of the CFPB was a single director who could not be
removed except for cause. And the Supreme Court a couple
of years ago said, no, that's unconstitutional.
The president needs to be able to fire at will everybody in the
executive branch, otherwise he can't do his job as the chief
executive. And they didn't go all the way
to saying everybody at that point, they, they only
invalidated the CFPB on its own terms.
And the, the, the version of an agency that's still potentially
legal is one that has multiple members rather than one single
head. So if you're in a Commission
where it's sort of three, two, you know, it's the CF, it's the
FTC, it's the SEC, they said that that might still be
allowed. And to be clear, the current
Supreme Court doesn't like that either.
They're probably about to get rid of it.
But that goes all the way back to a case in the 30s about the
FTC, the Federal Trade Commission called Humphreys
Executor. So, so I think hungry executive
probably fucked, frankly, but before that, the CFPB was fucked
along the way. So the, the fact that its
funding structure is good doesn't mean that it's actually
independent because you can just put your own lackey in the top
and tell them to turn off all the budget.
But the fact that you can design the budget to be that
independent is a model for other agencies.
And in fact, Trump tried to fire the head of the National
relations, National Relations Labor Board, and the Supreme
Court in at least the preliminary ruling, said no.
Reinstate them while this case goes all the way through.
So they haven't been been willing to let him completely
fire everybody yet. We talked a little bit there
about the problems with the current setup of the Treasury
Bureau of Fiscal Services. Can you outline at a high level
the new digital fiscal regime that you lay out in your paper?
As I said, if you think about it as 3 levels, there's the legal
authority to spend, there's the actual directive to spend, and
then there's the processing of the account layer, right?
That that corresponds to OMB, Treasury and Fed today.
My big argument is we need to basically internalize as much of
that as possible inside the legislative branch.
So partially, this can be through Congress through its own
legislation. Partially it can be through
congressional committees and staffer offices and things that
kind of negotiate with the executive branch on an ongoing
basis. And partially, it could be
independent agencies within the legislative branch.
So the classic ones there are the Government Accountability
Office that used to be called the Government Accounting Office
and the Congressional Budget Office, which I usually hate,
but we could repurpose it to be doing something useful with its
life. Certainly wouldn't be hard to be
more useful than it currently is.
So anyway, my pitch for a digital fiscal regime is 3
pieces of technology sort of accompanying those three things
that I just mentioned. 1 is what I'm calling the digital fiscal
record. The, and the idea of the fiscal
record is basically it's, it's the Congressional record of all
the laws passed, but it's digital.
So they are software, which means you can bake in
automatically executing laws, laws that expire after a certain
point, laws that are conditional on an external fact.
And that fact can point to a a third party trusted source that
says, hey, if the inflation gets above a certain point, do X or
if unemployment gets above a certain amount, do Y or whatever
it is. And that statistic could be
essentially baked into the law. Then the second layer I'm
calling Congress's Treasury ATM. And the idea here is what you
you do is you take internally the authority from the law that
Congress passes a law. You take that authority and you
basically get it in the form of credit, a line of credit.
And I'm using the metaphor of a credit card, although it
probably wouldn't be a physical credit card.
It'd be basically a set of permissions and you access this
ATM. And if you have the right
permissions, you can get digital dollars in your local account.
So the thing that you go to the ATM with from the statute is not
money. It's like internally within the
government. It's basically almost like an
IOU or a credit. So I'm calling it a public
credit card. It's the full faith and credit
of the United States that Congress gets to issue.
I'm an executive agency. I say, hey, here's a bill that
says I am allowed to spend $100 billion / 10 years.
I go to Congress. Congress says, when we wrote
that, what we meant was 10 billion a year, cool, here's
your credit card. It will work up to $10 billion a
year. You could do it.
And this is a really key point. You could do this qualitatively,
not just quantitatively. You don't have to give them a
number. We're so used to thinking of
numbers like there's a certain kind of person that lives in the
world of black Amex all the time.
Congress lives in the world of black Amex.
So you could, you could fund agencies on an as needed basis
and just tell them as much money as they need.
They can get, the CFPB is told that it can get as much money as
it needs. And last I checked, they don't
have, you know, they don't have luxury resorts in the Caribbean.
They actually saved I think $600 million that they've they've
earned. They've put it in a savings
account for a rainy day that Congress that that Trump is
about to drain for their own independence, basically.
But essentially there's a lot of agencies that operate on an as
needed basis. the Fed doesn't run out of money.
You know, if the Fed's not spending, it's because it's
exercising its own discipline. So you get you, you have this
Ledger, you pass the laws on the Ledger.
The Ledger says these agencies are allowed to spend.
The agency goes to Congress or its or its representatives and
says, can you turn this into practical spending power?
They say yes, here's your credit card.
You take the credit card to the ATM and you get digital cash.
Why do I, why do I split it up like that?
Couple of reasons. One is I want to split up the
act of determining how much you can spend from the act of
approving the withdrawal. The first one is an
adjudication. The first one is an
interpretation of the existing law.
The second one is is basically rubber stamping you doing
something. It's a different, different
authority and and importantly with that digital ATM, every
individual agency has their own wallet server locally.
So you can think about this like we talked about E cash, where
you need to have a device in your pocket to store your cash
as a consumer. This is the institutional
version of that, but it's not banks and and investment funds.
It's internally within government.
Why is it important for every government agency to have their
own money locally, in the equivalent of a safe, not at the
Fed? Because it means that if Trump
takes over the Fed, which is looking increasingly likely at
some point, then these agencies could still theoretically have a
direct link to Congress's money power.
Wasn't there an example recently of in New York?
Yes, so I'll, I'll, I'll talk about that in a second.
That's about the tax side. I've been talking about the
spending side, but this is just as important for protecting your
money on the tax side, because if you could delete dollars out
of existence, you can you can take anybody's money at any
point in time. So the last, the last piece of
the technology. So step one is the digital
record. Step 2 is the ATM.
Step 3 is what I'm calling the Federated Federal Ledger.
And the idea is that Congress has a master spreadsheet of all
the government spending that's been done in its name.
And every agency has its own accounting spreadsheet, right,
separate from its wallet. Its wallet holds its money, but
it has its own separate accounts.
And those accounts essentially sync up to the government's main
accounting spreadsheet. So this is almost like a sort of
semi blockchain, semi distributed Ledger.
I'm not going to say it. We're not putting Congress on
the blockchain. But, but, but Congress is sort
of the one who keeps the master record of everything.
And everybody else just gets a little piece, right?
Someone's like, oh, it's, it's, it's got a tail.
And someone else is like, oh, it's got hoofs.
And someone else is like, oh, it's got tusks.
It's an elephant. It's just that Congress is the
only one that can see the whole elephant, right?
It's keeping the copy of all of the individual agencies ledgers
as a master Ledger and each individual agency just keeps its
own peace locally. So it's not a distributed Ledger
because that's one common thing. It's a Federated Ledger.
It's just that the central hub has access to every everything
else. So to go to your other question,
why this is in part important is so that if, if the president is
now a hostile agent within the government, that Congress can
still have a direct fiscal conduit, a direct fiscal channel
to each sub agency within the government, right?
It's the dis unitary executive. And, and what they did in, in,
in New York is they decided to punish New York State government
that they said that they'd accidentally gave them some
money they didn't deserve and they just debited $80 million
out of their bank account. They, they took it out of the
bank. The, the Citibank.
I think it was Citibank that the, the, the state of New York
banks with, they took it out of Citibank's reserve account at
the Fed and told Citibank to take it out of the, the city's
account, the state's account. So we are at the point now where
you can basically be unilaterally taxed as a penalty
and your money is not safe. So putting this stuff in a, in a
wallet that's safe in the agency means that the president can't,
can't delete it all. And if we are really at the
level where I think we're pretty getting pretty close to in terms
of 11 minutes till midnight for the breakdown of the
constitutional fabric of this country, we might really need to
be talking about what it means to like, keep up a, a, a
financing regime for like the part of the government that
isn't going with the Trump side of things when it goes that way.
We can get more into the weeds of this stuff here in a second,
but I I feel like it's worth talking to you about this.
And this is maybe more philosophical than like detailed
law. But one of the things when Ben
and I were talking yesterday about this, I, I was like, I'm
pretty worried about the future of, for instance, Federal
Reserve independence. I'm pretty worried about the
Treasury Secretary doing whatever the fuck Donald Trump
wants. Like, these are things that are,
I'm already like, well, like you just said 11 minutes to like 2
minutes to midnight, right? Like, I feel like we're there.
And I guess part of what I said to Bennett was I kind of don't
get it. Like he's doing this quite
detailed paper where he's discussing fixing a lot of these
problems that we now know absolutely exist.
But you know as well as I do that this stuff takes a really
long time to get. Yeah.
Yeah, we'll, we'll get the Super majority in Congress to pass a
bill doing a task force and research all this stuff, and
then the president will slowly implement it all.
And then we'll go, Oh no, I've got no power.
I accidentally built the machinery of my own constraint,
yes. And my, I guess my worry here is
that what Bennett responded to me and I want maybe this is
exactly what your answer is. But what Bennett said to me was,
I think this is Rohan preparing for cleaning up after the ashes
have settled. And I is.
Do you think that's? Actually, partially, it's that
partially, there's a number of countries around the world that
actually do have parliamentary systems and saying, hey guys,
watch out, right? Watch out.
It's coming for you too. If you want a parliamentary
system and think about it, right, Think about it in the
context of a country, a place like Europe where they have
proportional representation, where every parliamentary
majority is a weird amalgam of three different parties.
Imagine being able to say to them, we're going to divide the
the Fisk so that you have a Direct Line to 1/3 of the Fisk
or whatever it is. I mean, this is a very important
way of, of, of, of structuralizing, you know, of,
of, of materializing the legal divisions of power that we
actually need to keep legitimacy of government working.
So yes, partially it's like, hey, you know how America went
imperial presidency, You're all kind of on the edge of that.
If you want to have a thing called a parliamentary system
with ministerial independence. Because theoretically the
Treasury Secretary is supposed to be independent, right?
Treasury Secretary is supposed to be able to say I have my own
independent duty of the Constitution.
Yeah, Bennett's laughing, right? Of course, he's the idea of
Treasury independence in this day and age is a fucking joke.
the Fed is supposed to be independent, right?
The Fed's still doing that to a degree until it isn't, right,
until Humphrey's executive gets overturned.
And I don't think the Supreme Court's going to want to go
after the Fed. So I'll be curious to see the
jiu jitsu they do about that line, at least initially.
But but it also, it also is is to me actually a bit of a kind
of wartime vision, which is to say, if you, if we're at the
point of like Confederacy money, you know, if we're at the point
of like, which one of these agencies is going to go with
which person, you know, or if Congress says one thing.
And the problem, of course, is we don't have any of the
branches. Congress is on their side.
The Supreme Court's on there's like, who is the legitimate
branch calling out the other branch at this point?
Nobody. But if we do get to that point,
if we do get to that point where he's just gloves off and
somebody wants to say, hey, we're not, we're not going to
let this happen. Then a vision of how digital
money could work where you could essentially run a, a distributed
wartime government without needing one.
I mean, think about it also from a resiliency point of view.
You're in the middle of a civil war and you've got one place
where all the money goes through.
I mean, Congress in this situation has to be the place
where the where the authority gets made.
But that could be a football. You could be carrying that
around with you, right? It could be on the run if you
want like actual locations, making money and sending it out
to do economic organization during a, during a serious
route, then then you don't want that all going through one place
because then you just bomb or occupy that place.
So partially this is a vision for a, a sort of democratically
resilient institutional structure for the fisc.
And that's just as relevant during the troubles as after the
troubles. But we won't even know what it
could look like until we start talking about it.
So this is a vision of like, hey, if we had this working
today, we wouldn't have these problems.
The best time to do this was yesterday.
The next best time to do is today.
Well, and I can also imagine depending on how things play
out, if there are multiple governments claiming legitimacy,
it is likely there will be multiple currencies trying to
claim. Legitimacy as well.
Need to rebuild this stuff from scratch either way because the
pieces that are already in place are not actually under our
control on the chess board. Yeah, or just naked off the
chess board in general. Cow sitting there with a gun
outside of camera saying I've decided to continue.
You know, like he's sweating on the camera, you know, and, and
this, well, this sounds so extreme, except it's kind of
not, right. It really sounded really crazy a
month ago. And, and now everybody's gone.
Pepe, Sylvia, not just me. Cass and I are across the
Rubicon. We're like we're.
Crossing the Rubicon in the paper, right?
And we crossed the Rubicon a while ago.
And, you know, even since I wrote the paper, he's been
defying judicial orders. Yeah, which at the time when you
initially wrote it, one of the lines is Thus far, Trump has yet
to openly refuse to obey a federal court order.
I was reading it yesterday as I was watching the plane land in
El Salvador. Yeah.
I look, I, I, I, I, I Part of what I talk about in the paper
is that if you're smart, you can use the technology of law and
the technology of keeping accounting as the execution.
So you're not, the legislature is not taking over the executive
responsibility. It's not actually making the
money. It's not actually printing the
paper. It's not actually making the
payments, but it is keeping score.
And it's got the the right to keep score constitutionally,
right? If you control the laws, if you
can say, hey, I told you to spend $36.
By that I meant this. You're not doing that.
It's sort of like somebody keeping track of the, you know,
the soccer World Cup in their basement and something the
referee gives the other team a goal and you're like, I don't
agree with that. Here's the true score, but
you're God. So now your score in the
basement matters more than the FIFA, right?
Like that's, that's Congress. Congress isn't the one running
the stadium, but it is the only one whose opinion
constitutionally is is legitimate about what spending
has and hasn't been authorized, authorized by Congress.
Anyway, all of which is to say, my magic source, my
technological insight here, is if you do that with the
technology of law itself, if you do that with the technology of
accounting, just the act of passing the law is itself a form
of programmable software. I don't have programmable
software in my paper, otherwise I would have made that an
exploding sentence. I would have made it a self
expiring sentence requiring renewal, like you need to renew
the appropriations authority every week.
I would have had that sentence self delete unless I went back
in and reauthorized it with a bit more juice every week.
But yes, I I I underestimated how quickly it would die.
I thought it was also interesting reading this paper
and you allude to this in the paper.
Elon Musk and Mario Nafal have announced their plan to put the
treasury on the blockchain. Is that different than this
plan? Well, I would say, I would say,
I mean, first of all, it is different.
I don't think you need a blockchain in general.
And I think if you are trying to do the distributed stuff that
I'm trying to do for resiliency, blockchain's the wrong solution
for the same reason as I talked about with E cash, right.
It's the wrong solution for a digital dollar for consumers.
It's also the wrong solution for a digital dollar intra
governmentally or a digital dollar credit.
But of course, what he means is that the executive gets to
control it. So even if it is a blockchain,
like fuck it, fine, put on a blockchain, but like Congress
controlled A blockchain, not you.
And I don't think he's going to be as excited about that.
What he means is what he means is, you know, I want all of
these payments to be visible and he.
Doesn't mean anything, but sorry, he doesn't.
Know what he means? He likes blockchain.
He likes the people who like blockchains liking him.
He doesn't even particularly like blockchains.
I think, I think the best way to understand that metaphorically
is what he's saying is attack government corruption through
the tech layer. And that's what they've done.
Trump found his, Trump found his, his tech wizard, right?
He found his Jafar. He found his magician and his
magicians going doing magic shit with alchemy.
Could you talk a little bit about how the digital dollars
that are part of kind of this new digital fiscal regime are
similar to and different from CBDC's?
Yeah. So the first thing is they're
not issued by the the central bank, right?
When you try to understand what a central bank digital currency
is, you leave feeling pretty confused and gaslit.
And the only truth of it all is we don't know what it is.
We don't know what it's going to do.
We don't know how it's going to be designed.
We do know it's going to be issued by the central bank.
It's in the name. We spent 4 hours with the word
central bank on the board. And what we discovered is that a
central bank digital currency is in fact a digital currency
issued by central banks. After furious debate, we have
all come to consensus that that's what it is.
And that's the only thing we can all agree on.
What that means is that from an accounting point of view, it is
at once a legal obligation of the federal government and of
the Fed. You know, if you're one of these
Fed is private guys. The case to read is USB Wells
Fargo from 2019 in the Second Circuit where they said that the
emergency funds that the Federal Reserve lent out to bail out
banks, even though it never came from a quote UN quote taxpayer
or from the Treasury. It counts as public money,
counts as money from the constitutional treasury, the
theoretical treasury up in the sky, the treasury in our hearts,
right? Anywhere there's two people,
that's Jesus church. Anywhere there's someone moving
public money around, that's the treasury.
So that's the kind of that's the kind of general idea is that
this digital dollar would be a generic liability of the
government, a monetary obligation, full faith and
credit backed by the full faith and credit.
It's legal tender. So you can use it to pay any
public or private debt at its face value.
I could could pay interest or not, depending on how they want
to design it. Maybe different parts of it will
pay interest, different parts weren't.
And every agency, if it gets its authority from Congress, from a
spending statute, from an appropriation bill, can get its
credit card, which is to say it's set of permissions, and it
goes to the ATM and it can withdraw that money on its local
wallet or its local device. I'm calling it E purse, just to
keep with the coinage metaphor. Once it's stored locally, it's
offline. It's peer-to-peer.
It's the same as E cash. You can send it to another
device like that, or you could even deposit at the Fed, or you
could put it in a check, or you could send it to someone's E
cash, local device, wallet, or whatever else, and it would be
monetary, right? It would not be debt as we
understand it in the public sense.
So there's no borrowing from our grandkids and all that bullshit.
And the authority comes directly from Congress, right?
It's that signature, you know, from Congress.
It's that appropriation bill that matters first and foremost.
And then every individual agency would essentially have their,
their, their like piece of it. A fragmented Fisk, right?
A distributed Fisk. The other part of it, which I
will expand out in a later paper and is not really the point
right now, although it was part of the point in my original
paper when I wrote this three years ago and kind of predicted
to a degree what just happened. And again, I don't know whether
it's better to be able to see the future and never be able to
change it or not, you know, going insane like Cassandra from
from, from the Greek mythology. But the other part that I talk
about here is how do you make sure you don't fuck with
monetary policy, right? How you not mess with central
bank independence? Like I've got my thoughts about
central bank independence. This is not they, this is not
the moment. I'm not trying to litigate every
single fight in my life at the moment, but the way that I did
that or the metaphor that I've used for this is, and again, I'm
trying to use constitutional terms and almost make them
literal. So as I said, we're drawing
money from the ATM, We're coining digital coins, right?
We are doing these things is that the Fed would be authorized
to essentially take over responsibility for issuing all
forms of government debt, which is basically how it does
monetary policy today. It buys and sells government
securities, Treasury securities and mortgage-backed securities,
but it has to wait for someone else to issue them.
It's sort of like gambling with someone else's chips that they
manufacture. It's like, why don't you just
make them yourself? Oh, well, I couldn't do that.
You can. Other central banks have talked
about issuing central bank debt. About 40% of central banks in
the world do issue central bank debt in various forms, usually
in places where the Treasury doesn't issue enough of its own
to help the bond markets. Like they want the investment
asset. So the idea is if if your
regular money that you and I are spending is digital gold, make
that digital silver. So they have their own separate
parallel form of set of digital instruments.
And that allows the Fed to do its own monetary policy if it
wants interest rates to be positive, if it wants a savings
instrument, if it wants to have financial markets have an asset,
everything the treasury markets do today just put it under the
Fed and keep it out of the out of the government spending
process. So that's the idea is that you
would have all of this go into coins and they would be the kind
of retail coins that you and I use.
And then they would be this sort of highbrow whole, like
wholesale institutional coins that would be more like
government debt that that that people would use for savings and
investment and whatever else. Don't you think a lot of people,
I know a lot of our listeners, whether we agree with them or
not, I know that a lot of our listeners would be surprised by
the idea that you're having. Like your concept of future good
monetary governance is federating it more decentral.
Like essentially trying to make it so it's.
Centralizing it around Congress, it's centralizing the decision
making, and it's decentralizing the execution.
Right. But then we're also talking
about giving the Fed the ability to like, like you said, the
abilities they already have. Already has that power, right?
It just has pulling. It just has it badly.
It's like someone's already asking you to drive your kids to
school. It's just that the car's stuck
in first gear. Weird.
Right, right. And now it's being threatened,
right. Like I, I guess a lot of our
listeners say stuff like, oh, the, the Fed control, the Fed
controls the world, whatever, like whatever.
Not a lot of our listeners like three loud listeners in YouTube.
Most of our listeners are not saying that.
They can barely control inflation.
I wish it had more control over the shit that it claims to
control. It knows how to throw workers
out of work eventually. You know, in, in the sense that
if I like, if I turn the temperature up in my house,
eventually I'll kill all the plants.
But like, that doesn't mean I know how to garden.
Like, I just know how to nuke things, you know, It can nuke
the labour market. I haven't seen it actually deal
with inflation directly very well.
The Fed regional banks are mediocre and even agreeing with
their other regional banks. Yeah.
And The thing is, the Fed regional banks don't exist
anymore in a legal sense. You know, they exist in a very
boring practical sense. But like, it's the, it's the,
it's the Board of Governors in DC that runs the show.
And they're a bunch of bureaucrats.
Like, I wish it was this conspiracy theory about bankers
running the world. It's, it's far more boring.
It's, it's Ashman in Jerusalem. It's a bean counter with a
statistics degree earning 200 grand and going home at 3:00 PM
on a Friday. That's the that's the face of
evil at the Fed. Stepping away from the evil, the
evil Federal Reserve here for for a second, but my, my, my
point here being that I think a lot of listeners, regardless of
their thoughts on Federal Reserve conspiracies.
Yeah, the banality of the evil of the Federal Reserve, Yes.
Yeah. Outside, outside of that, I
think a lot of our listeners probably think that there is a
centralization problem or that, you know, that they disagree
with the way money is controlled, the dollar is
controlled. And and I think it's just really
interesting and stunning to see it.
It's so fragile actually, I guess is is what I'm what I'm
coming to understand in these last few months, things that
Bennett and I were saying in November are coming true
already. And, you know, that is not
something you expect that has been the reserve currency of the
entire world for this long to fall apart that quickly.
And yeah, it's like, I assume that this is like you being
influenced by current events. But you know, you also said
that, you know, you feel like Cassandra and that you you
predicted this. So I guess I'm kind of wondering
how you're how you're feeling and why you think it's important
to take the monetary, the monetary governance system in
this direction? Yeah, I mean, I, I think first
of all, the like, rumours of America's decline as a global
imperial hegemon are always grossly over exaggerated.
Do you know what I mean? Like I think it's one thing to
say the country's fucking itself up.
It's another thing to say like the minute that Rome starts
fucking itself up, something else is going to take its place.
Like, it takes a few 100 years sometimes.
You know, I'm not going to say it's take that long in this day
and age. But like, there is going to be a
while in which this is just a really shitty hegemonic dynamic
because there's still nuclear bases all around the world.
There's still the entire Western United Nations regime that's
wrapped around American power as if it was a tumor that you can't
get rid of without killing the patient.
So I'm not convinced that there's going to be a reserve
currency tomorrow because the entire thing is built with
America at the center. That doesn't mean they're not
going to try It doesn't mean we're not going to see a sapping
of power. But you know, I think probably
my favorite TV show, sci-fi show for sure at the moment is
foundation because it's sort of the end of an empire, you know,
based on the based on the sci-fi.
But I highly recommend if you haven't watched it.
But but you know, the idea is this sort of galactic empire is
collapsing and it's going to collapse in 500,000 years and
it's going to cause 30,000 years of darkness.
And maybe we can slow it down a little bit.
You know, maybe we can make it 8000 years of darkness.
We're not going to stop it collapsing.
The very bleak starting point, but you end up having a sense of
the scale of what you need to do to try to arrest or, or, or, or
lean into imperial decline. So all of that is to say, I'm
not sure that America is going to die tomorrow.
But when we think about it, you know, there is a centralization
problem in a lot of different ways.
But I part of why those problems could persist in my opinion is a
is that they obscure themselves. They hide themselves.
And a lot of the time we end up thinking it's the central bank
because we think of it as the place that makes money.
Oh my gosh, of course that's the place to go.
Why'd you rob the bank? That's where the money is.
You know, that's the joke, but if you actually understand where
the, where the government works, it's the budget, It's fiscal
policy first. Monetary policy is like a
laundering device. It's like taking, it's like, I
don't know about you, but when I set up my, you know, my bank
account at the credit union, they gave me a savings account
1st and then I got a checking account, right.
And you get multiple checking accounts if you want to, you get
one savings account per person. The, the, the, the Treasury debt
is like the savings account. The checking account is a more
practically useful version of it, but all your money goes into
that savings account 1st. And so if you're wanting to know
how much money the government is creating, how much of an impact
it's having on the world, it's the budget, it's Congress, the
Fed comes later in the story. And So what I am trying to do is
sort of be really clear where the power is, be really clear
who's responsible. Part of the big problem, as you
probably know, is this what they call the exorbitant privilege of
the United States, where it's simultaneously a domestic actor
doing its own domestic shit like the rest of us, and
simultaneously supposed to be this benevolent God sitting
above us all, managing the global, you know, world on
behalf of everybody. I just hadn't Dash, a law
scholar, come to my school and give a talk about that kind of
stuff, about how they're, you know, benevolent Cantians.
And I'm like, last I checked, you're Americans, not Cantians.
And there's a pretty big difference in, in, in, in, in
where you universalize your rules, right?
But this is the problem is as long as this is all in some
neutral, technocratic Federal Reserve, that ideal, you know,
thinks of itself as part of some global class.
We hide these problems. If it's Congress, nobody's going
to pretend that Congress gives a shit about the rest of the
world. Have you met Congress?
I've met him so so I, I think, I think the, the risk at this
moment is that we focus in the wrong places.
We ignore the important stuff and we we miss these sort of
huge big red buttons that are able to be Co opted.
We spent how many years talking about CBDC's?
Who the hell talked about the Bureau of the fiscal service?
Me. What you're highlighting there
is kind of interesting to me. And you parallel this, I think
with debt ceilings in the paper where this boring thing, whether
it's the Treasury, Bureau of Fiscal Services or the debt
ceiling that is meant to exist primarily for just logistical in
managing the functions of government thing.
Eventually one person like looks at the actual rules governing
that thing and goes, oh, that's a gear.
If I pull that out, the whole thing stops working.
Wait wait, are you saying we can pass backwards in NFL?
What if we just tried passing backwards for an entire game?
And so and does that and like wins three games until we work
out how to, like, block that hole, right.
Yeah, it's, it's a totally, it's a hack, right?
It's a hack in the most fundamental, definitional sense.
It's a creative repurposing of something to achieve a different
end and increase your kind of control.
And I think one of the things that it's done is it's totally
redrawn the map of the administrative state.
The administrative state had had these thousand different
individual islands and archipelagos and things.
No, it's got 33 buttons now. That's the administrative state.
You just turn it off. You just there's power off, you
know, if you've ever see, if you've ever seen that Gary
Larson cartoon of like electric chair operators night school and
there's a person with their hand up and the teachers like no,
stand down, then up again real fast isn't the right answer.
You know, does anyone else have the right answer?
You know, it's sort of like that.
How do I run a government? I just go in and press buttons.
Oh no, I've broken the whole budget, you know.
Yeah. And like, part of the reason I
found the paper so compelling is that I don't think there's an
easy path back to September 2024, right?
Now politicize it. You can't unpoliticize exactly,
just like you politicize the, the filibuster, just like we
politicize judicial nominations. This is a escalation that keeps
going until it breaks and, and you know, it is all very boring
and very technical unless you know where to look, then you
don't know. You know, I, I, it's that
Leonard Cohen song I love a lot. They sentenced us to 20 years of
boredom for trying to change a system from within.
Now we're coming coming to reward them, you know, and like,
Elon Musk is the hacker guy, right?
This is, as I said, this is Trump's magician.
I don't know how all that stuff works.
Everything is computer. Well, you've got a computer guy
and that guy knows how to hack shit.
And what he did quite fairly is look at the government and say,
I don't care where you tell me the vulnerabilities are.
I'm going to look at it like an engineer.
And there are the vulnerabilities.
And I'm like, those are exactly the engineering vulnerabilities.
You know, you're a terrible person doing it for terrible
reasons, but you, you did identify a piece of this that
everybody missed because they were just, you know, I try to
get my colleagues to use Element, a secure messaging
service that is Federated. It's like Signal, but you can
self host now. We wanted to talk about it for
years. Well, now everything's getting
shut down. It's starting to be now now a
distributed Federated system. Starting to sound a little bit
more important, isn't it? And I think what's also
interesting is in re engineering these technical things that can
work more fundamentally, like longer and better than
legislative solutions, because there's already an anti
impounding act. We did that after Nixon.
It's it's on the books. It exists.
It hasn't been overturned by the Supreme Court yet.
But with a sufficiently bad actor who's willing to grab the
lever and say, no, this is my lever now the laws can be
overturned. The technical infrastructure
requires more of like, you need physical people to go physically
do things. And that's a different tenor of
thing. And so that was another thing I
appreciated when reading through this paper.
Thank you. Yeah.
I mean somewhere in between the ninety 39,000 words or something
I I try to put a few memes in there to keep it palatable.
And, and there was an Onion headline, which I love, which
was sort of Trump asserts little known, no one's going to stop me
loophole to break the Constitution, you know?
And the other one was the the, the line from, from the Big
Lebowski, you know, well, that's just your opinion, man.
Yeah. Like the courts can say, hey,
you can't do that. And I don't know if you ever
remember that bit from the now disgraced comedian Louis CK, but
he's talking about how he goes to the airport and he has to
drop off his car and he's running late and he calls the
car people. It's like it's in the car park
outside the the terminal. They're like, no, you've got to
deliver it to us. He's like, well, I'm on the
plane. So what are you going to do
about that? They're like, man, all right,
we'll pick it up. And he's like, that's when I
realized I could do anything I wanted because they needed the
car more than I did. And I was like, that's a
terrible realization for you, knowing who I know now who
you're going to become or who you're in the process of being.
But that's what Trump found out, right?
I can just do what I want, and people have to stop me.
And it's actually a lot of work to stop people doing things,
especially with the system that's built to not make that
very easy. And so to your point, it's not,
I don't think technology is a substitute for law, right?
I don't think it's a substitute for collective political action.
I'm not a techno solutionist, but the, the, the technological
architecture, the, the, the topology of the landscape
matters, right? It matters whether you're on the
top of a mountain and you're the Swiss defending everyone
attacking you. Like, there's a reason the Swiss
get to be neutral and it's not because they're amazingly great
politicians. They're fucking goat goat
herders. They just happen to live in the
mountains. You know, it's a useful place to
live if you're trying to avoid being attacked.
So I think the the, the technological regime shapes the
power politics, it shapes the debate.
While you're fighting at the courts, it matters who has
control over the escrow account, right.
While you're fighting these things, it matters who gets
first mover advantage, who gets to control the data in the
meantime, etcetera, etcetera. Reminds me of the likely
apocryphal Andrew Jacks Jackson story.
The court has made its ruling now let it see it enforce it.
Or the Stalin 1 castle? Yeah.
How many divisions does the Pope have?
Yeah, How many divisions does the Pope have?
That's his ruling Letterman faucet.
Yeah. And, and, and we saw this with
the switching time that saves 9 in in the 30s if you have enough
material support. The problem is now sitting in
one seat with one button. It's an incredibly powerful move
that by the time you challenge it, you can do too much damage.
You know, you can stop basically oxygen.
You know, I think I remember reading somewhere recently and
terrified me again after I first read it, that we're sort of 96
hours away from a revolution in any country if you stop feeding
people. Oh right, yeah, it's 3.
Four days if. You shut if you shut energy off
or something like that for. We're four days of food
production away from a crisis in any country.
Yeah, energy as well. But like the government, how
many days can it survive when its payment system shut down?
Right. How many days can any agency
launch any effective resistance to this imperial takeover when
its payment system shut down? You just you, just you just zero
out every agency. That was the reason I I
particularly wanted to have you on to discuss this was because I
think a lot of people, maybe not people who listen to this show,
but but but I think a lot of people who don't maybe even take
in that much media at all don't understand that when you start
messing with the monetary system, you I mean that that's
everything that is everything else.
And so when you start clicking with that.
You can't coordinate an economy this complicated without it,
right? Even in World War 2, even when
all of the planners inside the Department of Defense, it's all
how much steel, how many planes? Like, even when they're thinking
at that level, they're still paying people in money.
You have to. Yeah, you have to.
And so I'd like I, yeah, I, I thought it was really important
to to discuss this just 'cause I think, yeah, you're right.
There's a lot of this that is intricate and a lot of it that
is maybe tough to grapple with and understand, but like, it's
unfortunately now our duty as citizens of America do have to
familiarize ourselves. We're all sentenced to 20 years
of boredom trying to change the system from with.
Yeah, complex monetary policy, you know, two to four years.
Yeah, 21st. I I did 20.
So you only take six months. That's my curse.
But yeah, I mean, the other, the other line I had in there.
Well, there's 2 two other funny memes.
One is from 1 is from Family Guy with the blue harvest episode
about about Star Wars, where they're like with Stewie's Darth
Vader. And he's like, we finally, he
built the Death Star. It's the most amazing.
He's like, yeah, so no problems. The guy's like, yeah, no, none.
He's like, couldn't help but notice you.
You hesitated to me. He's like, oh, it's not a big
deal. He's like, wouldn't be doing my
job if I didn't ask about what? That 1%, you know, .1%, He's
like, well, it's just an aesthetic choice, really.
But there's this one shoot where if you put a missile down and it
kind of blows up the whole thing.
And he's like, whoa, whoa, you know, really?
Can't we get rid of that? Oh, it looks so ugly, you know,
well, let's just do it. He's like, well, we can do it
tomorrow. If if money is no object, we'll
get estimates. Yes, get estimates.
You know, it's just like a
perfect ending to the bit. But the other one is the the bit
from Rick and Morty where they like where he he takes over the
galactic government. He's like, I'm gonna blow up the
he's like, I've hacked into the mainframe.
Like what are you gonna do? You gonna destroy all the, the
bombs? You gonna, you know, he's like,
no, something better. I'm going to make the dollar.
You know, the currency is one of itself, worth 0 of itself.
And then everyone in the room's like, you can't do that.
The empire is great. Wait, who's paying me to say
this? I can tell you that for money,
you know, And then they all just start shooting each other and
turn on themselves. But like, it's amazing when you
take that engine out and realizing how many pieces here,
you know, this is Milton Friedman's great idea that
everybody making a pencil doesn't give a shit about each
other. Well, once the money stops
working, everybody stops giving a shit about each other again.
You know, I really appreciated the line in there.
The If political independence requires budgetary independence,
and budgetary independence requires being able to actually
spend money, then political independence is in turn at least
partly a function of payment system design.
Like if we believe. That's my syllogism, right?
Tattoo that on my ass on my gravestone, you know?
If we believe what's allegedly written in the Constitution, it
makes sense to hand these powers to Congress very explicitly to
function the way these things are supposed to function.
Yeah, and, and, and you know, the thing that's crazy is also,
if you look at the Constitution, it mentions a bunch of stuff
that you actually can't understand without reference to
physical stuff. You know, you what is coining
money? Well, you ask a kid in 2200, you
know, unless we have a digital coin to metaphorisize, they'll
have no fucking clue what you're talking about.
What is drawing money from the treasury?
This is a physical process, right?
Even if it's metaphorical, you know, it's it's if you've ever
seen Monty Python's Life of Brian, they're all standing at
the back of the the Sermon on the Mount.
What's he saying? Well, I think he's blessing all
the cheese makers. Cheese makers?
Well, it's a metaphor. Obviously he means manufacturers
of any dairy product. Took me to, I was about 14 to
realize he was talking about peacemakers and they just
couldn't hear him properly. But like the Constitution
specifically mentions physical acts, borrowing on credit, you
know, paying money, drawing down stuff.
So there's always been this material infrastructure that the
constitution lies and that material infrastructure can
evolve, it can change, but it's still there.
So I had a colleague who read the first third and was like,
you know, he's showing the, the kind of the, the material
infrastructure necessary for constitutional imaginary myths.
And I think that's the truth. To tell a myth, you still need
to set it in a period, right? There's a difference between
Star Wars and Lord of the Rings. So we, we've been telling the
Lord of the Rings story of the Constitution.
We need to tell a Star Wars story of the Constitution.
Or maybe maybe maybe maybe a gold place latinum of Star Trek
or something, you know? Rohan, are you excited for Trump
to mint the trillion dollar coin?
Man, God, I think I've told, maybe I mentioned this last time
I was on, but it's been a terrifyingly accurate way of
living, which is I've come to, I've got to work out how to kind
of get a good line of it. But the most maximally literally
hilarious and absurd timeline is, is usually the timeline we
end on like not all the time, but like it's it's the it's the
electron kind of ring that that's the the most resonant,
you know, it's the lowest frequent.
If we can go fucking absurd, if we can be like a FX series where
you're like, that's a bit out there and someone like just
wait, they'll lap it up. The public will love this.
We'll go, we'll, we'll go weed Season 6.
Like it's gonna go weird. Like that usually is the right
answer. So if somebody said to me, yeah,
Trump's going to mint the coin as a way to avoid the shutdown.
It's going to have his face on it too of.
Course it will of. Course, it's going to have his
face on it. You know what we're going to be
talking about? We're going to be talking about
the legality of putting a living person on the coin.
We're not going to talk about the one trillion on the other
side. We're going to talk about his
face. We a great bit.
It'll be a great bit. Put his face and Musk face on 2
coins and then have everyone debate which one they like more.
And before you notice, we meant $2 trillion points.
And then you can bet on polymarket which one they're
going to pick. Exactly right.
And then you know what? Then?
Then he can try to deposit at the Fed and the Fed can say no,
and he'll actually have a legitimate legal basis for
getting mad at the Fed. He'll say, hey you.
Don't have the right to say no. You're a.
I'm glad. I'm glad you're going crazy with
this 'cause I had to cope with this, with the Penny decision
when the when he was like. No more.
Everybody who knows me, my photo online, it's all gone.
It's it's completely pulled out now.
And he did the penny I but I love that I was my whole thing
was like, we got to get rid of the penny and the nickel and
then he got rid of the penny and everyone's like, ha, ha.
I feel like you, you happy about this, Cass?
And I'm like, well, at least he, at least he fucked the nickel
part up. So he still looks like an
asshole, you know? Yeah, yeah.
I mean, and, and and frankly at this point, like watching him
with all this stuff about going after Canada and Greenland and
stuff, you know, he said the other day it would look so nice
on the map. And I'm like, I love that for
him. I love that this is a man who's
playing Risk with the world and coloring in like a 8 year old.
And it's like, I don't like having to draw this line.
It should all be one color up here.
And like, that's his thinking. So.
Yeah, Could the coin work like when I when I wrote my coin
paper, I said part of the reason it's valuable is because you can
tell the story to 7 year olds. I just didn't think that it
would be the president as as the seven-year old in in mind.
But yeah, find the most absurd story that's going to keep
people eating popcorn and not turning back to HBO prestige
drama. That's probably the one.
So yeah, I'm, I'm not, I'm not, I'm not putting the meeting the
coin at 0%. Of course, that would require
the Democrats to have a backbone and actually resist on the on
the shutdown. So that's the actual major
reason that Trump wouldn't mean the coin is 'cause they wouldn't
get an opportunity. At least our listeners can go
out and purchase the brand new platinum cast coin.
All your favorite Put a trillion.
Dollars on it now and when when Congress is is in hiding and
running away like Estonia's digital government, you know you
know and it's it's the anti Pope living out in the in the in the
in up in Canada. You can tell them you've already
pre funded the war for them. There you are.
Listen, at some point in the next year, some currency
pretending to be a dollar, it's going to be a trillion to 1 cast
coin. This is this is partially why
all this crypto technology is interesting because it is a lot
harder to say hey, we should build our own, you know anti the
anti Trumpan government currency in lifetime if you don't even
know how to build 1. But we have the capacity to
actually sort of bootstrap 1 relatively quickly now in a way
that not as. Fast as Trump can make another
Trump coin, though. Not as fast as he can just shut
down every government agency. Yeah, I mean, this is to go back
to where we started with this, the Bureau of the Fiscal
Service. The guy was a guy named David
Lebrock. He was the most senior civil
servant in the Treasury. He'd been there for 20 years
plus, right? He was the guy with the keys to
all this stuff. And when Trump came in with his
Doge boys, right, Peter Pan, his lost boys came in and said, give
us the keys to the castle. He said no.
And they said, well, why not? He said, well, I've got, you
know, legal obligations. I'm like, I can't do this.
And they, he said there'd be liability.
And they, and the response from the Doge team was there'll be
liability for you if you don't. And he resigned.
And then he kind of did his little PR tour telling everyone
how terrible they are. But the fact that there's one
seat, there's one seat in that treasury office, one guy with
one set of passcodes, what does that say?
I mean, this is the Death Star. This is the Death Star with one
shoot going down in the middle. Why the hell did we build a
system where there was one signature that could stop 88% of
all federal payments? And that guy is a bureaucrat.
Terrifying. Thanks for having me, it's a
pleasure to chat. Hopefully.
Hopefully in a few more months we'll be able to do around too
without it being too late.