Market Overview

What To Know About #MintTheCoin

Share:
What To Know About #MintTheCoin

In an effort to curb the economic damage already done by the coronavirus, U.S. Rep. Rashida Tlaib (D-Michigan) has proposed a $2-trillion solution — and awakened a 2013 hashtag in the process. The #MintTheCoin campaign is trending as idled workers demand a complex response to unemployment triggered by the pandemic. 

Tlaib's Proposal

The Automatic BOOST to Communities Act would equip everyone under U.S. authority — children, non-citizens, U.S. territory residents and Americans living abroad — with a debit card initially loaded with $2,000. Each month, the cards would be reloaded with $1,000 until one year after the coronavirus outbreak ends. 

The program would be funded by the U.S. Treasury, which would direct the Mint to print two $1-trillion platinum coins under Congressional authority. The Federal Reserve would then purchase the coins in exchange for credit of $2 trillion in reserves, and the Treasury would offer the reserve funds to the Bureau of the Fiscal Service. The Bureau would then disperse the money with debit cards.

This complex mechanism would prevent the government from having to raise its debt ceiling.

“In the long term, the card infrastructure should be converted into a permanent, Treasury administered digital public currency wallet system, to serve as a privacy-respecting ‘eCash’ complement to universal Fed Accounts and/or Postal Bank Accounts for All,” Tlaib’s bill said.

“This proposal should be accompanied by progressive tax reform to ensure that emergency relief provisioning does not exacerbate income or wealth inequality in the long-term.”

Congressional peers have since proposed tweaks to Tlaib’s bill, including digital distribution.

Benzinga is covering every angle of how the coronavirus affects the financial world. For daily updates, sign up for our coronavirus newsletter.

The Campaign

Tlaib resuscitated an old hashtag for her proposal campaign.

Back in 2013, Rep. Jerry Nadler (D-New York) proposed a similar plan to get around the national debt ceiling and prevent the U.S. from defaulting on its debt. Nadler introduced a bill to mint a $1-trillion platinum coin.

At that time, critics said the expansion of money supply would cause sharp inflation and worsen a downturn. Congress ultimately rejected the proposal and instead raised the debt ceiling.

This time around, the campaign still has its critics.

But it has also picked up public support.

U.S. Rep Rashida Tlaib. Benzinga file photo by Dustin Blitchok.

 

Related Articles (SPY)

View Comments and Join the Discussion!

Posted-In: #MintTheCoin Coronavirus Covid-19 Rashida TlaibNews Politics Federal Reserve General Best of Benzinga