Economist Joseph Stiglitz, a former Clinton administration official who served as chairman of the Council of Economic Advisers from 1995 to 1997, ranted this week that the cryptocurrency Bitcoin should be outlawed.
“Bitcoin is successful only because of its potential for circumvention, lack of oversight,” he said during an interview with Bloomberg that aired Wednesday, a day Bitcoin rose to a record high of over $11,000 per coin in fluctuating trading.
“So it seems to me it ought to be outlawed. It doesn’t serve any socially useful function.”
The lack of oversight presents a notable problem, he argued, given that one of government’s own primary functions is to create and regulate currency.
Bloomberg host Tom Keene seemed to agree, arguing that fans of Bitcoin have been “relying on a Marxist theory of value (and) smoke and mirrors” to keep it alive.
“Precisely,” Stiglitz added in agreement.
“We ought to just go back to what we always have had … (In terms of) the medium exchange that we use for transaction,” he then concluded, adding though that he feels it’s time for government to “move away from paper into the 21st century of a digital economy.”
Listen to the full exchange below:
Some found fault with Stiglitz’s analysis, including Fergus Hodgson, the managing editor of the American Institute for Economic Research.
“Stiglitz’s contradictory call for a move away from a paper currency for the digital economy is telling,” he wrote. “Cryptocurrencies offer precisely that, and with different variations battling for adoption, including some with gold backing. Since they have beaten government officials to the punch, however, central-bank apologists are not happy about it.”
Hodgson also disliked Keene’s attempt to tie Bitcoin in with Marxist theories of economics: “The labor theory of value, advocated by Marxists, simply has nothing to do with bitcoin usage or advocacy.”
“On the contrary, proponents of bitcoin tend to be classical or anarcho liberals who believe in limited government with laissez faire capitalism, diametrically opposed to communism,” he wrote. “After all, the centralization of credit in the hands of a central bank with a monopoly is the fifth plank of the Communist Manifesto, written by Karl Marx and Friedrich Engels in 1848.”
In other words, it could be argued that so-called “central-bank apologists” such as Keene and Stiglitz are the ones actually behaving like Marxists.
This doesn’t come as a surprise, given Stiglitz’s prior rhetoric, including his attacks on President Donald Trump’s proposed policies.
“The U.S. economy would be a big loser if Donald Trump wins the presidential election and imposes new tariffs on imports from China, according to Nobel laureate Joseph Stiglitz,” Bloomberg reported a couple months before the presidential election last year.
Recent economic news proves he was wrong then, just like he’s probably wrong now.
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