Pushed to the back of the news cycle and buried by identity politics is a significant and extremely dangerous re-ordering of our economic system.

And no, I am not referring to Jim Chalmers’ weird fetish for taxing everything that moves as if playing Whac-a-Mole with productivity.

Rather, we need to start asking if there are plans afoot to misuse future programmable money to encourage (mandate?) compliance with the government’s decarbonisation goals.

Fantasy? Well, not really.

The idea has already found traction in China via stablecoins. The potential for it to hop over to Central Bank Digital Currency is reasonably straightforward.

Money that can expire: RBA laying groundwork for a dystopian financial reality where ‘money is given a brain and then the switch is handed to someone else’, or so went the headline in Sky News Australia a few weeks ago.

As a basic idea, it is the transformation of money into gift cards, except instead of making an active choice to purchase a limited IOU as a gift, the banks will be able to turn all of your money into conditional spending.

Where this idea ends is anyone’s guess.

Once money is no longer anonymous and universal, it can be controlled at a micro level. It could expire. It could change in value. It could suffer benefits and punishments linked to the user’s identity. It could be limited to categories or even constrained by carbon credits.

Programmable money contains all the risk of a purely digital system, with the added risk of an ideological matrix.

This is not the major discussion around CBDCs yet, but it might be in the future.

As Sky News Australia wrote:

‘In Basel, Switzerland, a group of unelected officials is reshaping the future of money. The Bank for International Settlements (BIS) doesn’t chase headlines or need public attention. It shapes monetary policy by guiding central banks around the world. And Australia’s Reserve Bank isn’t sitting this one out.’

The BIS released an article on the topic at the end of June titled, Next-generation monetary and financial system takes shape, based on a tokenised unified ledger.

It says:

‘Building on the proposal for a unified ledger, the trilogy of tokenised central bank reserves, commercial bank money, and government bonds is the next logical step to deliver profound change for the financial system.’

It’s not clear when customers or the public at large asked for ‘profound change’, but here we are. The tokenisation promises to ‘enhance efficiency’ and ‘open new possibilities’ which includes descriptions such as ‘singleness, elasticity, and integrity’.

They go into more detail in Chapter III of their Annual Economic Report 2025.

‘Core to this vision of the future is trust in money,’ they write.

‘The foundation of any monetary arrangement is the ability to settle payments as par, ie at full value. Money is information-insensitive in that agents use it with “no questions asked”, ie without due diligence.’

In other words, traditional money is anonymous, especially to the government. You may know it better as privacy. If you pay cash, the banks and your government have no idea what you bought. They know what businesses are selling, just not who they are selling to. They have knowledge of the economy, but not knowledge of citizens. This is an important distinction.

Take the lesson of how invasive advertising has become with the rise of online shopping. Products and companies chase you across the digital landscape if you so much as side-eye a photo, let alone make a purchase. Imagine what governments and banks might do with this level of information.

‘Society has a choice. The monetary system can transform into a next-generation system built on tried and tested foundations of trust and technologically superior, programmable infrastructures. Or society can re-learn the historical lessons about the limitations of unsound money, with real social costs, by taking a detour involving private digital currencies that fail the triple test of singleness, elasticity, and integrity.’

The document itself is a long ramble that focuses heavily on ‘efficiency’ in complex systems involving more money than most businesses, let alone people, will ever see.

However, as the Sky News Australia article points out, implied in the general theme of the text is the principle that money can be programmed with logic. This tells the money what it can (and cannot) do and gives it a set of instructions.

This, it is claimed, will be convenient and secure, but as we all know, along with this convenience comes a raft of hidden costs.

Let’s not forget that the Labor Party (and the Liberals before them) spent a lot of time telling us Digital ID was ‘totally optional’ and mostly for making government paperwork and ‘renting a property’ easier.

Now, all of a sudden, it seems inevitable Digital ID will be compulsory for anyone who wants to use Google and YouTube.

Slippery slope? Absolutely.

That was only a couple of years.

Money that expires (to drive stimulus) or money that operates within a postcode presents serious restrictions. What if it gets a curfew? What if, the next time the government declares a pandemic, your money ends up linked to your vaccine status? Then you really will be a prisoner of the state.

One of the key talking points is the ability for real-time taxation at the transaction level meaning that not only could taxes be applied automatically, but also reported to the ATO immediately. Sounds like a Treasurer’s dream. If taxation is a feature, imagine then how it could be extended or changed. Green taxes? What about variable taxes based on your social credit score?

What the government calls ‘transparency’ could end up being a Pandora’s Box for greedy politicians with a Budget problem.

Currently, as the Reserve Bank of Australia says, we have access to two forms of money: cash and digital bank account balances.

Although there is also a world of Crypto to consider.

CBDC is a new form of money but what sounds like variety has a lot of motivation to become a replacement form of money.

The RBA’s report found ‘consumers on average would not be willing to pay anything for access to a retail CBDC account over a commercial bank account’ and that:

‘[the study does not fully address] whether Australians would be comfortable having no choice but to interact with (profit-seeking) commercial banks to make routine digital payments.’

There is an interesting comment here: ‘The international literature commonly finds a paradox in privacy attitudes from surveys like these, observing that people who state strong preferences for privacy still consistently choose to forgo it.’

Respectfully, we may guess this has something to do with the nature of ‘choice’. Digital ID is one such example. We may, as customers of X, choose to upload our identity to access paid features, but reject the government’s demand that we must identify ourselves to fulfill a government, rather than business, arrangement.

It is also discussed that while CBDC could be constructed in such a way as to make privacy a selling point, it would likely be objected to by government on the grounds of ‘crime’ (when they probably mean, ‘tax’). It is an excuse we saw when an attempt was made to limit the use of cash.

And yes, in case you were wondering, the ‘green’ industry is all over this already.

The Manila Times carried a story about the Carbon Stablecoin Framework in which a ‘blockchain-native system … converts verified decarbonisation activities into programmable carbon-backed stablecoins’.

‘It authenticates real-time decarbonisation data, converts it into carbon credit assets, and tokenises them into carbon stablecoins with audit-grade precision. In doing so, it elevates carbon from a niche asset class into a programmable financial instrument for cross-border payments and FX trading, laying the foundation for a sustainable and inclusive financial system that rewards verified Net Zero efforts.’

There is a history of this in China, linked to projects such as wind farms.

‘[The innovation] enables programmable decarbonisation. Whether it is for an office building, power plant, or major public event, each asset is given a birth certificate on-chain, with follow-on decarbonisation data linked through a time series of smart contracts. The system lets exchanges, company, investors, and external auditors check decarbonisation in real-time…’

I am not saying anything in particular about this innovation, only making the point that decarbonisation and Net Zero are already tied up in the digital currency sector, particularly with our biggest trading partner of China.

With Anthony Albanese deliberately pushing us into a copy-cat #metoo relationship with Beijing, and keeping in mind the government’s obsession with forcing compliance with its Net Zero ambitions against the personal and business wishes of Australians, there is a genuine risk that programmable money could be misused by government to force their policy goals.