
Why we should fear a cashless world - mantesso
http://www.theguardian.com/money/commentisfree/2016/mar/21/fear-cashless-world-contactless?CMP=twt_gu
======
carlob
Here in Italy the big issue is that many business will just not declare cash
transactions. It's pretty common not to be given a receipt when buying a
coffee and often when you visit a doctor they'll say: do you want the invoice
or a discount?

A couple of friends got married recently and I found out they paid over half
of what the owed in cash to get pretty decent discount.

So before we talk privacy and company let's remember that this kind of hidden
economy has a huge cost for society and it's very widespread in southern
Europe.

~~~
studentrob
Taiwan is mostly cash and they use a receipt lottery to encourage people to
buy from vendors who give receipts. Each receipt has a number and there's a
lottery at the end of the month with cash prizes.

Also, people here know they can report a business for not giving out receipts.
They might get a share of recovered taxes for that.

I don't know all the pros and cons of that setup but it seems there are ways
to maintain a cash based system and still collect taxes.

~~~
hawkice
I was familiar with the lotteries (didn't participate -- I just put my
receipts in the charity buckets or the trash) but had NO IDEA this was why. I
just assumed it was because the culture is just much more amenable to gambling
(which I think is also true, but might not be the reason it's tied to
receipts).

If this is truly the reason for the lotteries, is the government / tax agency
giving out the prizes? I never bothered to look closely but it always seemed
something run by those businesses.

~~~
studentrob
> If this is truly the reason for the lotteries, is the government / tax
> agency giving out the prizes?

Yes of course. Every country has trouble collecting taxes. In Taiwan they
memorialize the day when the police were too heavy handed with a woman selling
untaxed cigarettes. A citizen died in the skirmish.

This day is 2/28 and largely remembered as the beginning of a 40 year period
of martial law in Taiwan. I recommend visiting the 228 museum in Taipei's
peace park. Even though the current government, KMT, revised the history in
this museum to downplay the fact that 20,000 people went missing in Taiwan
during this period, the museum still tells a great story. It's great because
the story wouldn't exist at all in a place without free speech, such as China.

------
mikegioia
I've been "cash only" for 8 months now and I love it. Of course I need a
credit card if I buy something on Amazon or a one-off web store, but the point
is to move as many transactions offline as possible.

There are so many privacy benefits to using cash, but one that really
resonates with me is the physical nature of it. When you pay for something
with cash, you can feel the transaction of money exchanging hands and it can
have a psychological effect to prevent frivolous spending. Or at the very
least, further reinforce that YES we are spending money!

Also, store clerks, cab drivers, any anyone who accepts tips always love
getting cash.

~~~
JumpCrisscross
Funnily enough, I'm the exact opposite. Mentally, money in my account is "my
money". Cash I've withdrawn feels like already-spent money. Since it's
unaccountable, I tend to spend it more frivolously. Might be a generation-to-
generation thing.

~~~
zzalpha
> Since it's unaccountable, I tend to spend it more frivolously.

Which is fine!

Here's what you do: allot a certain amount of cash to discretionary expenses
each month. You take that money out at the beginning of each month (actually
in my case, twice a month) and then use it. And when you run out you're out.

What you've just done is used physical cash to put a hard ceiling on your
discretionary spending. This turns what are normally variable expenses into a
fixed item in your budget, which makes it a heck of a lot easier to account
for.

~~~
pc86
This is also called "budgeting"

~~~
zzalpha
I appreciate your deeply insightful comment. Thank you for your service.

------
fennecfoxen
> We already live in a world that is, as far as the > distribution of wealth
> is concerned, about as unequal > as it gets. It may even be as unequal as
> it’s ever been.

Sure, if by "a world" you mean "a hyper-prosperous nation like the US or the
UK"... and if by "unequal as it's ever been" you mean that _third-world
countries are taking our jobs and becoming much more prosperous, hitting our
middle income brackets - the global 2% - harder than anyone else._

If you really mean _globally_ , then inequality is in fact falling.

But sure, yes, the "cashless" ideas going around today are just a way for the
government to enforce surveillance and steal away citizens' money with
negative interest rates.

~~~
nmrm2
_> If you really mean globally, then inequality is in fact falling._

No.

Inequality is decreasing _between_ nations as the developing world catches up
with the west. But inequality _within_ nations -- even developing nations --
is increasing. It's possible for inequality to increase as the the developing
world catches up to the west; in fact, that's exactly what's happening.

So the old geographical distributions are very slowly eroding, but they are
being replaced by obscene levels of inequality within individual borders. This
trend is exacerbated -- especially in Europe -- by tax evasion and avoidance
managed (and practiced) by large fintech companies. So the author's fear that
concentrating power in the hands of a few large fintech firms would exacerbate
global inequality -- and lessen nation states' ability to combat inequality
with policy -- is well-founded in global trends.

edit: Instead of downvoting, go read François Bourguignon's "Inequality and
Globalization: How the Rich Get Richer as the Poor Catch Up", which states
exactly the thesis outlined above and contains pointers to the data sets used
to arrive at these conclusions.

~~~
gizi
> and lessen nation states' ability to combat inequality with policy

Ok, one person is a great programmer making good money and another person is
not interested in any of that and makes less money. I do not see any
inequality here that needs to be combated with policy. One possible result of
such policy would be that both will turn out to be less interested.

You cannot turn the losers into winners, but you can certainly alienate the
surviving winners and convince them to build their next factory in China
instead, or do their next startup from a beach in the Philippines.

Instead of reducing inequality, the outcome will become very biased by profits
made in China or the Philippines, and therefore lead to even more inequality.
Lather, rinse, repeat.

At the basis, quite a bit of inequality is caused by the fact that some people
happen to be smarter. Your policy will obviously not outsmart them. Therefore,
if your policy has any effect, it will inevitably be exactly the opposite of
what it was meant to be.

~~~
nmrm2
I hope that globalization isn't inconsistent with national autonomy,
especially when it comes to taxation and social policy. If these two things
are inconsistent, then globalization will lose out in the long run. That would
be a shame, because liberalized borders and economies -- if properly regulated
-- would benefit everyone.

 _> One possible result of such policy would be that both will turn out to be
less interested._

Tax rates on the top 1% or 0.5% of earners could double over-night and those
people would still have more than enough money to make their effort worth-
while. We are literally talking about people who have more money than the can
possibly spend on personal luxuries in their lifetime.

At some point far before the 1% mark, wealth accumulation becomes much more
about personal power and legacy than anything else. These people continue
working hard for the same reason that tenured professors continue to publish
prolifically or retired people work hard on their lawns or hobby projects --
for love of the work, and/or because they literally don't know how not to
work.

(Whether or not those people deserve to be taxed heavily is kind-of irrelevant
to the fact that your hypothesis about human psychology is wrong.)

 _> You cannot turn the losers into winners_

What is a loser? Most middle class people are of average or above-average
intelligence and work hard. The only thing separating these people from e.g.
Donald Trump is access to an inheritance or some other means of attaining
large amounts of capital.

I'm willing to bet your average middle-class accountant or actuary would much
rather (pay someone to) manage a portfolio of investments than crunch someone
else's numbers.

Also, FYI, almost all computer programmers in the world -- including skilled
ones -- are solidly ouside of 1% territory.

 _> but you can certainly alienate the surviving winners and convince them to
build their next factory in China_

So your argument for not redistributing some percentage of the wealth of
billionaires is that they're petty assholes who will take their ball and go
home? But isn't that what _losers_ do? ;-)

As a matter of fact, globalization and national autonomy _aren 't_
inconsistent. Tax havens aren't a fact of life, they are an engineered reality
created by lawyers and lobbyists.

~~~
gizi
> Tax rates on the top 1% or 0.5% of earners could double over-night ...

They are not after the 1%, never have, and never will. They are after you and
me, my friend. So, gear up for a good fight, because I am giving them zilch.
I'd rather flush my money down the toilet.

> So your argument for not redistributing some percentage of the wealth of
> billionaires is that they're petty assholes who will take their ball and go
> home?

Yes, and that is why the factories have been rebuilt in China over the last 25
years. It is not going to get any better in the future. I don't know what they
will be doing next, but it will certainly not include "redistributing some
percentage of their wealth". Why would they? But then again, who cares? I
don't want their money. I have my own.

In order to outsmart them, you will have to be smarter, but if you could, you
would be one of them. ;-)

~~~
nmrm2
_> They are not after the 1%, never have, and never will. They are after you
and me, my friend._

Oh right. Those bastards trying to close corporate tax loopholes are totally
doing so because they hate me and all the money I'm not saving due to those
loopholes...

 _> Yes_

 _> In order to outsmart them, you will have to be smarter_

NO! It's really not that damn complicated. And there are even plenty of extant
policy proposals for eliminating or greatly reducing tax avoidance schemes.

Public policy, most of the time, isn't rocket science. See e.g.
[https://www.oecd.org/ctp/BEPSActionPlan.pdf](https://www.oecd.org/ctp/BEPSActionPlan.pdf)

There's a difference between globalization of unskilled labor, globalization
of skilled labor, and tax avoidance. The first and second are, to varying
extent, unavoidable and probably net beneficial to the bulk of humanity. The
last is not unavoidable and is also decidedly unbeneficial for most of
humanity.

(There's also a difference between off-shoring for the purpose of true cost
reduction nand off-shoring for the purpsoe of tax avoidance. The former is far
more common than the latter, although a decent amount of FDI is about
tax/tariff avoidance.)

 _> but if you could, you would be one of them_

Of course I would. But I'm not delusional and wasn't born into either
connections or cash. So I do what I can to boost my odds, but I also cooperate
whenever the opportunity arises.

And, if I ever do "make it", I'm sure as hell not going to become one of those
"got mine, fuck you" types.

------
yAnonymous
The push for a cashless society and negative interest rates doesn't paint a
good picture about the future of our financial system. It's nearing its well
deserved end.

The bubble is about to burst and they're trying to release pressure to make it
last a bit longer.

~~~
narrator
The funny thing about negative interest rates is it is one of the few good
reasons to buy physical gold, especially with the elimination of large
denomination euro notes.

~~~
iolothebard
Gold is just another fiat currency, plus at a high value it's even more
worthless as a currency since you'd need such minuscule amounts to trade for
goods/services.

~~~
narrator
"Gold is just another fiat currency". Did you come up with that or did you
read it somewhere? If you read it somewhere, I'd love to read that article.

~~~
iolothebard
All you have to do is think about it's actual uses. I have degrees in finance
and economics.

All gold is IMO is a hedge against inflation by tying your monetary policy to
the rate at which you can dig some shit out of the ground. Not remotely sane
IMO.

It would be like basing the value of the dollar on corn. At least corn would
have some real value though (fuel, food, etc.).

------
staticelf
The best tip ever for saving to only spend cash. When you have the physical
money leaving your hands it feels like a lot more than inserting a card and
pressing a pin code.

I am mostly using cash if I have the possibility to, which is kind of annoying
sometimes since in Sweden (where I live) there are many "cashless" shops. Even
in normal grocery stores checkouts it's like 50/50.

I've never visited a country that has as strong opposition to cash as in
Sweden. One time I walked into a boutique trying to purchase a cellphone and
the salesmen there were happy to help. Unfortunately they told me that they
didn't accept cash and then I just said "then there's no deal". The look on
their faces was kind of fun, even if it sucked that I had to redo the whole
process.

~~~
ersii
Just wanted to tell you that you're not alone in Sweden with using and liking
to use cash. There's at least one more - Hi!

I haven't encountered a single grocery store that refuses cash and only
accepts electronic/card payments yet. Was this a chain supermarket?

~~~
kungtotte
Many stores run a 50/50 setup these days, if they're large enough. That is,
half the registers are card only, the other half accept both. I've seen it in
Willys, Coop, and ICA.

------
eveningcoffee
Not only is the surveillance problem, but when all the peoples money is in the
banks, banks have more control to charge people for "handling" their money, so
not just negative interest rates are the problem.

Also when all the money is in the banks, governments have much more freedom to
apply higher tax levels or just take the money.

------
pm24601
With a cashless society, there are third party entities that decide:

1) if the payment will be honored ( legal pot growers / legal sex workers /
donations to wikileaks have this problem

2) the payment will be possible ( is the bank systems functioning )

3) how much of a cut the third-party will take from the transaction (visa,
mastercard, but also app stories 30% cut)

4) who gets to know what was purchased (your bank shares information with the
government)

5) who gets to know who made the purchase

6) who can access money: minors can't have bank accounts/etc, does someone
have access to a banking system at all - lots of people can only cash checks
through pay-day lenders

------
BIackSwan
Genuine question - What about a "cashless" currency based on blockchain? (a la
bitcoin). Wouldn't it be and not be under any single entity's control at the
same time?

~~~
adrianN
Cash and current forms of electronic payment have the nice feature that the
seller gets their money almost immediately. As I understand it, bitcoin
transactions take a while to confirm. I wouldn't want to stick around in the
shop until some miner got around to my transaction.

~~~
mirimir
Small payments using BitPay require one confirmation, and that typically only
takes a minute or so. Their fee (1%, I think) covers reversal risk.

~~~
stan_rogers
Now imagine being lined up at the equivalent of a cash register with every
single person in front of you taking "a minute or so" beyond what a
transaction currently requires. Nobody's hiring additional cashiers (or
whatever they'd call them) or self-checkout kiosk supervisors (to go along
with the extra kiosks) if there isn't any extra money to be had.

~~~
gonvaled
You fire one cashier and install 100 self checkout machines. Problem solved!

~~~
stan_rogers
And replace those cashiers with people who have other job titles to manage
inventory shrinkage. There's no getting around the fact that you need eyes
near the doors to make sure that everything gets paid for, and you need enough
eyes to monitor the traffic: more parallel traffic, more eyes needed.
(Anecdotally, I see more staff at self-serve checkouts than at cash registers
in stores that have both, yet the cashier lines move more quickly than the
"more convenient" kiosks.) I'm sure there's an ideal world living in some
people's minds, but it's not part of the external reality and probably never
will be.

~~~
gonvaled
I avoid self checkout - slow and inconvenient. But it's just a matter of
improving the technology: we'll get there eventually.

~~~
logfromblammo
I avoid self-checkout because the entire machine is usually set up around the
assumption that I will try to walk out of the store without paying for one or
more items, or by futzing the bar codes so that I pay $1 for a $30 beef roast.

The self-checkout technology will never improve as long as that assumption
remains. If you can't trust the customer to not steal a pack of gum, you can't
trust the customer to not steal an entire beef tenderloin.

The professional cashier does not need to keep every damned item on a giant
scale after scanning it, because they are an agent of the store, and
presumably trustworthy enough to notice and stop shoplifters and scammers. And
they usually don't have to halt the entire checkout process and wait for a
manager to come by and restart it whenever anything even mildly out of the
ordinary happens, such as using a coupon.

You can't improve the technology when the premises are wrong. And the premise
is that you can turn a grocery store into a glorified vending machine.

~~~
imtringued
If we put an RFID tag on every item and use an RFID gate then we would just
have to walk past the gate which is capable of detecting every item without
you having to take it out of your cart or bag. A turnstyle could then force
you to pay and disable the RFID tags. Cost and transmission distance of
passive RFID tags are the major obstacles, I believe.

~~~
logfromblammo
How do you detect RFID tampering or the use of RFID-blocking shopping bags or
pouches?

Remember, the store is more interested in protecting its operating margins
than in providing more convenience for the customer. If the technology does
not allow a store exec to believe that it can stop a $30 steak from walking
out the door unpaid, it will never be installed.

------
Shivetya
I think the primary reason is a loss of privacy and freedom. With a digital
currency all your purchases can be tracked. You also lose freedom in that
government at any level could suddenly make some products or service illegal,
throw in that they could retroactively do so.

Of course there is monetary policy too. Negative interest rates try to force
spending to correct bad government policies which usually are the cause of
depressed spending. Then combine this with the idea that printing digital
currency is as simply as flicking a switch which would rapidly devalue
currency in people's accounts.

Simply put, its another attack on privacy and the freedom it entails

------
arca_vorago
It's nice to see the Guardian writing negatively about the cashless push, and
they hit the main points.

To me, the main danger of our time is totalitarian governments overreaching in
reaction to changes in threat-actor models, and hence most of my primary
concerns revolve around the particular issues that touch upon this point.
There are two main issues I have with the push to the cashless society.

1\. Lack of anonymity. Cash serves as a mostly anonymous medium of exchange,
which encourages the free flow thereof. That being said though, one of the
primary reasons you might want anonymity is from government overreach. For
example, there is evidence that in the increasing surveillance panopticon, the
gov wants to know what you are reading and purchasing for reading. If you use
a cc to buy a book at a bookstore, that is easily tracked back to you and
could in the future be used to put you on $list. While cash isn't perfectly
anonymous, it ups the level of effort to find out (pulling cctv recording to
correlate purchase to person).

The lack of anonymity has been my primary disagreement with Max Keiser
regarding bitcoin as well. To me, I can very easily see a currency upset on
the horizon which is then used to push cashless on the society as a new
currency model.

2\. Revocation of access/control of assets. In a similar vein to police forces
using confiscation as a budgetary padding tool, I can far too easily see the
same being applied to cashless currencies. More than that though, is the
ability to access the option at all in the first place. As an example for
this, I give you the national bank blacklist database. For some people,
suddenly being blacklisted by banks can create all kinds of problems, because
much of our society relies on banking functions. I fear the same type of
blacklist with little oversight could be applied to a cashless currency, to
the point that, lets say you were a dissident, suddenly you lose all your
money and can't open a new account. If everything is cashless, how do you buy
bread?

The article itself touches on the surface of these matters, but I think there
needs to be a much deeper and deliberative discussion about the potential
dangers, and benefits, of the push towards a cashless society.

------
taivare
I was living in a rural area where the poor used the underground economy (
flea markets etc. ) to supplement or offset low subsistence , meager wages and
I know the poor in urban areas do as well. A cashless society will be a
regressive tax on the poor !

------
vtlynch
I am not one to argue that technology solves the problems of the poor. But,
there are lots of holes in this argument:

1\. The unbanked already exist in a world that expects them to be banked.
Almost all jobs in America are paid in checks or direct deposit. Checks are
useless to people without bank accounts. They then have to spend time and
money getting the check turned into cash at a check cashing place, like
Amscot.

So moving to electronic banking would actually HELP these people. If you
really _rely_ on cash, then you are at a disadvantage since most jobs dont pay
in cash.

Yes, there are real obstacles in the way of these people getting bank
accounts. Education, time, documentation, etc. But everyday someone continues
to remain unbanked, they are inconveniencing themselves in many ways.

2\. Cash is already dead to a lot of people (in 1st world countries), so
surveillance is already possible. Governments, banks, and payment processors
ALREADY have access to this information for a large number of people. If this
is a large concern, the author should be tackling the fact that this is on-
going, not that it might happen in the future.

But it does seem true that killing cash will open up new demographics to the
same surveillance.

3\. Bankruptcy is not a tool used by very poor people. Its often used by
middle class and upper class people who deal with the finance world. I think
this article has a very poor understanding of what "poor" means, even in a 1st
world context.

4\. This whole article is based off of bad solutions. Keeping cash around so
that _some_ people will be saved by withdrawing their money in the next
financial crisis is NOT the solution to financial crises. Better regulation,
management, and transparency is.

~~~
sametmax
Except laws, regulations and transparancy are changing all the time. If cash
remains, it gives you some margin to operate despite bad state, silly
leadership, idiotic laws, wrong social decisions, etc. It's also a buffer for
transitions, and help initiating things on the side that can grow eventually
into something legit and good-for-society that would otherwise have not be
possible because doing it right would have kill it.

Thing is, since no system is perfect, and no system stays the same, you need
to have a small, yet stable % of grey area to let the population compensate
and adapt.

~~~
vtlynch
Those all seem like good points, which the article does not explicitly make.

------
0xCMP
I love being cashless honestly, but I see the benefits of using cash for
transactions.

My problem is that I usually do things online and plus I'm always feel much
more secure knowing my Amex would be fully protected vs cash. Day to day I'm
not worried I'll get robbed, but in the off chance I'm somewhere where I might
I'm much happier carrying no cash and just my Amex.

~~~
knodi123
> I'm always feel much more secure knowing my Amex would be fully protected vs
> cash

Seems like the opposite should be true. Who cares about losing the amount of
cash a normal person carries in their wallet to a mugger? If you get mugged
often enough for it to have a real effect on your finances, then maybe you
should move.

Conversely, if the only thing in your wallet is some plastic that will
probably be cancelled within half an hour of the mugger fleeing, then he has
two separate motivations to kill you; 1. how dare you not give him easy cash
for his quick junkie fix, 2. if you're dead, the card will go uncancelled for
longer.

------
analog31
In my view, long before the government realizes the full potential of abusing
a cashless society, private businesses will have bled us dry -- especially the
poor -- with transaction fees.

~~~
abawany
This comment strikes hard for me given that I am also reading Sen. Elizabeth
Warren's book A Fighting Chance. It is remarkable how much greed pervades
these "stodgy old banks".

------
joefarish
_Cash, on the other hand, empowers its users._

And convenient electronic payments doesn't in anyway empower users?

Also, if people are unbanked and below the poverty line I would expect they
would be more concerned with getting by than "Orwellian levels of
surveillance."

~~~
kagamine
If people are below the poverty line then extra fees associated with
transaction-handling, cost of technology for access etc are a big deal. Cash
is closer to free to use. If you buy something used, a PC, fridge, whatever,
because you can't afford new, do you want a transaction fee in addition? It
may only be 1% or $1 (not accounting for the price of a smart phone and
network costs) but that is still $1 more than you needed with cash.

~~~
lotsofpulp
Cash is not free, there is a time cost to handling the cash, depositing it,
there is a risk cost for vendors from employees stealing it, there is a risk
cost from being robbed...there are always trade offs.

A lot of these comments mention that cash gives the government less control,
however try visiting India or China or Greece and ask people the real reason
they use cash. It's to evade taxes and launder money! Same with cash tipping
in the US. So in some ways electronic is better to help catch the cheaters,
but if it's not transparent it could pose a problem if the wrong people get in
charge.

~~~
kagamine
> It's to evade taxes and launder money!

Assuming the government have the right to tax us for everything all the time
and that you are not a free man but just a number. This past year I have seen
one new tax introduced at regional level and seen at least one other rise by a
significant margin (close to 50%). I don't see a like change in the earnings
of my colleagues. Maybe we should all try harder to evade the govt, at least a
little.

Have you read the linked article, because most of the things you mention are
not related to the point discussed in the article. Yes, there are good reasons
for electronic transactions, of course there are.

------
mapleoin
I don't understand this argument that people feel safer storing cash than
keeping it in a bank. The cash is just as ephemeral as bank credit. With the
exception that it's controlled by your central bank instead of the commercial
banks.

Cash can be made useless centrally just as easily (if not easier because of
its central nature) and there have been instances of this in the past in cash-
only societies.[1]

[1]
[https://en.wikipedia.org/wiki/Romanian_leu#Second_leu:_1947-...](https://en.wikipedia.org/wiki/Romanian_leu#Second_leu:_1947-1952)

~~~
flatline
By storing your cash in a bank, you are exposed to both the bank's insolvency
and the devaluation of the currency by a central bank. By keeping it under
your mattress, you are only exposed to the latter. Of course, by not storing
your money in a bank, you are 100% responsible for securing it, which is the
primary drawback that most people face. You are also more directly exposed to
fluctuations in currency valuation since fiat is generally inflationary and
the money is doing no work for you at home - but quite a few people still find
it worth all the drawbacks to keep a chunk of cash at hand.

~~~
lagadu
> By storing your cash in a bank, you are exposed to both the bank's
> insolvency

Only for very large amounts, at least in Europe, the central bank insures your
money from its own reserves in case of bank failure up to a certain amount,
AFAIK typically in the hundreds of thousands of €/local equivalent.

~~~
flatline
If a bunch of banks go under at once, or even one big bank with a sufficient
number of claims, who's to say the insurers will even be able to pay out on
that? Nonetheless, I always find this type of apocalyptic thinking to be
humorous - why do people think that their cash will be worth anything if the
financial system collapses? Another motivation would be if you are concerned
about having your assets frozen.

~~~
Symbiote
The _central_ bank pays.

As an example, in the UK personal deposits of a failed bank are guaranteed by
the Bank of England up to £75,000.

The Bank of England can always cover the amount, since they can simply print
money as needed.

[http://www.fscs.org.uk/what-we-cover/products/banks-
building...](http://www.fscs.org.uk/what-we-cover/products/banks-building-
societies/)

------
retrogradeorbit
The whole "but criminals use it" is a complete straw man. Yet you can see most
people fall for it, over and over again.

If we had a totally cashless society, you would see a level of white collar
financial and banking crime that would make 2008 seem like a picnic.

Anyone who is not convinced that the banking elite are the top criminals needs
to watch this very recent documentary:

[https://www.youtube.com/watch?v=eHgbRYgpGGs](https://www.youtube.com/watch?v=eHgbRYgpGGs)

~~~
txdv
We should criminalize the usage of water.

Criminals use it after all! Even the banking elite!

~~~
retrogradeorbit
Just enforcing the rule of law would be enough.

------
PythonicAlpha
I'd love to have only electronic money. It would have so many advantages.

BUT:

The risks of it and the potential for misuse are so many, that all advantages
of electronic money are not worth to go in this direction. We are in a
situation today, where privacy is one of the greatest assets we have and
should preserve. When we loose it, we very likely loose our freedom and
essential democracy. Instead we might get a "democracy" that is controlled by
opinion-formers and big corporations that make money with our privacy.

------
scott_s
The concern for economic fairness is, I think, a real one. There is a
disparity in most economies between the people who are banked, and those who
are unbanked. Going "cashless" favors the banked, and that is a problem. I
don't know how to address this.

But, I disagree with one of the authors' other claims: "Cash has its uses for
small transactions – a chocolate bar, a newspaper, a pint of milk – which, in
the UK, are still uneconomic to process by other means. It will always be the
fastest and most direct form of payment there is."

This is not necessarily so. Think about another example: let's say I order
something online, and the store gives me free shipping. Free! For sending me a
physical item! How can they possibly come out ahead on that? Simple: because
we have a sophisticated infrastructure for sending physical goods to many
different places, and the marginal cost of one more item on all of those
vehicles - and there are likely to be at least three or four, including
several processing centers - is actually rather small.

What if, instead, I want that item as soon as possible? Very expensive.
Because my item is no longer a marginal-add to a sophisticated system. It is
now closer to a one-off, and I have to pay for the service.

So what does this have to do with cash? Everything. Cash is a physical item
that must be stored, transferred from businesses to banks, then counted at
banks, stored and redistributed. Doing this is _expensive_. There are many
small businesses in NYC that do not accept cash, and I have assumed the reason
is that completely eliminating this cost - handling, storing and transferring
cash - is easier and cheaper for them. We have always considered handling cash
just a part of running a business, but it is not necessarily so. In the
future, handling cash may be more like overnight-express, rather than free-
ground-shipping.

~~~
Symbiote
The card companies in the UK try to encourage people to pay by contactless
card (debit or credit) for low value items. That's perhaps no surprise.

Transport for London, who run the public transport in London, are encouraging
people to use contactless debit/credit cards rather than _their own stored-
value card system_ or cash.

In Denmark I've had the man selling sausages from a wagon on the street ask me
to pay by card. I guess he didn't want to bother going to the bank, or carry
all the cash around.

------
scrrr
The whole cash less payment industry is in trouble, once people realise that
they can withdraw more than 50 [USD|EUR|GBP|..] at once..

Just kidding.

Well almost, since it was what did it for me. I started withdrawing larger
amounts, 500 or 1000 Euros, each time, after ending up with no cash too often.

And I didn't feel the need to use another payment method since. YMMV
(obviously).

------
xixi77
Many very good points there, and it's definitely nice to see this suggested
from the left.

Although:

\- "We already live in a world that is, as far as the distribution of wealth
is concerned, about as unequal as it gets. It may even be as unequal as it’s
ever been." \-- I keep seeing this kind of statement all over. It seems
really, really hard to believe, presuming that "ever" includes antique or even
more recent feudal societies, but perhaps there is something to it -- perhaps
it might be true under some measure of inequality?!

\- "Today more than 6 billion people have a mobile phone" \-- similarly, I
really don't see how this could be true, as it seems to imply something close
to 100% market penetration worldwide for most age groups. I can see how there
might be 6 billion mobile phones (or phone numbers?) active, but 6 billion
distinct people?!

~~~
bryondowd
6 billion out of a global population of 7.125 billion is just over 84%, so not
that unbelievable, particularly considering how quickly a usable phone becomes
worth approximately zero in the first world.

~~~
xixi77
Yeah, but (e.g. looking at
[http://www.census.gov/idb/worldpopinfo.html](http://www.census.gov/idb/worldpopinfo.html)
in 2014) 6bn people means that literally everyone over age of 14 has a mobile
phone (plus about 100 million of those under 14, too). Even accounting for all
the phones first-world children have, it seems like quite a stretch.

~~~
imtringued
It's not that unreasonable. The iphone costs apple only slightly more than
$200 to manufacture per unit and there are obviously even cheaper phones out
there.

------
dangjc
If stores weren't required by law to charge the same price to credit card
users vs cash users, you would see most stores slap a 2-5% surcharge on credit
card transactions, because that's how much they have to pay to
Visa/Mastercard/Amex. Many people only use credit cards to get points, which
is an unfair tax on customers who don't use credit cards. I find cash to just
be easier to use, and I forego the rewards chasing. Once I pay with cash, I
can throw away the receipt and not worry about the transaction ever again. No
worry about identity theft. No need to check my statement every month and
remember whether the transaction was me or not. Easier to split bills or pay
people back. Knowing that more of my money is going to the shop keeper than a
large financial corporation.

~~~
mercutio2
It is no longer illegal to charge a surcharge for credit cards [0] in most,
but not all US states. As far as I know, it has always been legal to give a
cash discount.

Until recently the sticker price had to be the credit card price, but all in
all it appears merchants don't prefer cash despite the option of discounting
it.

[0] [https://www.nerdwallet.com/blog/credit-cards/credit-card-
cha...](https://www.nerdwallet.com/blog/credit-cards/credit-card-charged-more-
gas-station/)

------
dimitar
"Cash means total financial inclusion"

The author doesn't know what financial inclusion means. In fact financial
inclusion has seen a boon thanks to cashless payments like m-pesa in Kenya.
Thanks to not having to lug around cash and maintain expensive bank branches
and offices, some of the poorest countries have made great strides in
furthering financial inclusion.

People want to eliminate €500, not €5. But even if they eliminated all cash I
doubt there would be a catastrophe of the type the article claims; people will
use different implementations of the same technologies to find privacy and
convenience. In fact wives married to alcoholics in Africa often prefer to
store their money in cashless wallets and saving groups, because it is easier
to hide from their husbands who might find the cash under the mattress.

------
galfarragem
IMO the real issue on tax evasion is not that people don't like to pay taxes.
People don't like is to be obligated to give money that will be spent in ways
that they don't agree.

------
known
Cash is the only way Govt can implicitly
([https://en.wikipedia.org/wiki/Petrocurrency)/explicitly](https://en.wikipedia.org/wiki/Petrocurrency\)/explicitly)
([https://en.wikipedia.org/wiki/Zimbabwean_dollar](https://en.wikipedia.org/wiki/Zimbabwean_dollar))
control 99% population;

------
phlip9
In theory, cryptocurrencies like Zcash [1] should solve the issues with
transaction privacy. However, enforcing taxation when using a totally private
and anonymous currency disconnected from government control would be
nontrivial if not impossible. Likely the reason why governments are so against
them.

[1] Zcash: [https://z.cash/](https://z.cash/)

------
mark_l_watson
I recommend Douglas Rushkoff's book "life inc, How Corporatism Conquered the
World and How We Can Take It Back":

Centralized money has been the means for sucking profit out of local economies
since about 1300. Rising income inequality has been an 800 year process. I
thought I knew how the world worked, but Rushkoff changed my world view.

------
squozzer
The article itself is somewhat misleading - cash, i.e. currency, does depend
on the issuing institution's integrity and the willingness of people to accept
it.

Was a bit surprised to see The Guardian echo certain viewpoints heretofore
only heard from preppers.

------
Silhouette
I think this is a symptom of a wider malaise in our societies today.
Technology can be an enabler of wonderful new things, but it also affords new
opportunities for power and profit to those who control it.

The average person is not a financial expert and so there are very lucrative
opportunities for those who know the system well to make a lot of money at the
expense of those who do not. Payday loan companies and high interest credit
cards come to mind as extreme examples, but every time you put money in a
savings account at your bank they are making a lot more on it than they are
paying you in interest, and every time you use an on-line payment service or
swipe your card in a store you're giving a significant cut to the payment
services involved, not the person you thought you were paying. This is before
we even get into the privacy implications and so on.

The average person is also not a technical expert and so there are analogous
opportunities to take advantage of them, but we are becoming so dependent on
technology that if anything the opportunities here are even more one-sided and
certainly much greater in number. Day-to-day functionality and communications
increasingly rely on isolated, closed ecosystems, run by commercial operators
that have every incentive to lock people in and then exploit them, yet which
are typically not subject to regulation as essential public services the way
that traditional phone and mail systems typically have been. The "war on
general purpose computing" is well underway, again with even basic things like
the software you can run on your own devices locked up through a combination
of proprietary repositories or app stores, cloud integrations, DRM and similar
technologies, and legalised anticompetitive behaviour thanks to ever-
increasing distortions of IP laws.

Much of this comes down to the same recurring themes with new technologies: as
well as providing useful new capabilities, they can also become a threat to
privacy, to ownership, and ultimately to the freedom of smaller businesses or
private individuals to create and use technologies and data as _they_ wish
rather than as the controlling mega-businesses and governments dictate.

This does not seem healthy to me at all. However, since most of it is
predicated on the average user of these technologies not understanding the
full implications and often not having any meaningful choice apart from giving
up on a technology altogether anyway, there is only so much the little guy can
do.

We _should_ fear a cashless world, but we should fear more the kind of world
that cashless transactions exemplify.

------
nibs
Proposal: remove cash, add constitutional amendment defending the right to
transact.

~~~
kardos
Any proposal on how to ensure that it doesn't end up like the right to a
speedy trial [1,2]?

[1] [http://fusion.net/story/5419/right-to-a-speedy-trial-this-
in...](http://fusion.net/story/5419/right-to-a-speedy-trial-this-innocent-
teenager-waited-3-years-in-jail/)

[2] [http://www.theatlantic.com/national/archive/2013/04/do-
louis...](http://www.theatlantic.com/national/archive/2013/04/do-louisianans-
have-the-right-to-a-speedy-trial/275385/)

------
throwaway21816
It is all about control. If you remove the independence of cash and you end up
with government regulation deciding how much, what and where you spend your
money. Such regulation can be used to put stress on businesses that the state
deems 'unsuitable'[1] as well as punish those with differing opinions than the
state[2].

Cashless society would essentially turn the world into one giant PayPal.

1 -
[https://en.wikipedia.org/wiki/Operation_Choke_Point](https://en.wikipedia.org/wiki/Operation_Choke_Point)

2 -
[https://en.wikipedia.org/wiki/IRS_targeting_controversy](https://en.wikipedia.org/wiki/IRS_targeting_controversy)

------
Olscore
A good conversation of "why we should fear a cashless world" should at least
mention the Book of Revelation and the Book of Daniel in The Bible. It would
be negligent to omit them from discussion like this.

~~~
blowski
I assume that you're referring to Revelation 13:17:

> And [the Beast] causes all, the small and the great, and the rich and the
> poor, and the free men and the slaves, to be given a mark on their right
> hand or on their forehead, and he provides that no one will be able to buy
> or to sell, except the one who has the mark, either the name of the beast or
> the number of his name.

Like most of Revelations, I think this needs to be interpreted in the context
that it was written. Jews during the time of Nero saw Nero as the "the Beast".
From what I understand, these "marks on the hand" were a plan by the Romans to
control Jewish citizens in much the same way that modern governments try to
control slum populations. I doubt the author foresaw contactless credit cards
and Apple pay, though I admit that the authors of both the article and of
Revelations were worried about similar consequences.

~~~
theandrewbailey
> to be given a mark on their right hand or on their forehead, and he provides
> that no one will be able to buy or to sell, except the one who has the mark

How else would you describe 21st century RFID using 1st century vocabulary?
Revelation was written 2,000 years ago, and is supposed to be about things in
its future, after all.

~~~
blowski
> How else would you describe 21st century RFID using 1st century vocabulary?

Why did it need to use 1st Century vocabulary?

I am a practising Christian, and in my heart, I suspect Jesus would say
something like "don't worry about how you pay for physical stuff".

~~~
theandrewbailey
It used 1st century vocabulary because that's all that could be had when it
was written (about AD 90, Greece), using a different language, culture,
context, and mindset than anything that exists today. If one were to update
it, it would be impossible without fundamentally changing it, due to
subjectiveness and the gulf in descriptions.

