Trump's War on the Future, Monetary Edition
16 hours ago
- Brazil's digital payment system Pix has been highly successful since its introduction nearly six years ago, offering free or low-cost transactions and widespread adoption.
- The Trump administration plans to impose tariffs on Brazilian exports using Section 301, claiming unfair trade practices, partly due to Pix's success and perceived threat to U.S. companies like Visa and Mastercard.
- Pix, as a central bank digital currency, is argued to be analogous to digital paper money, with requirements similar to those for U.S. banks handling dollar notes, challenging the fairness allegations.
- Opposition to Pix stems from concerns over U.S. payment companies' profits, potential challenges to the dollar's international dominance, and ideological resistance to government-provided services.
- The Trump administration's broader hostility to progress, including blocking a U.S. digital dollar and renewable energy, is driven by special interests like crypto and fossil fuels, paralleling the Pix case.
- Tariffs against Brazil are unlikely to succeed economically or politically, potentially strengthening Brazil's position and President Lula, while highlighting the folly of Trump's policies.