

Don’t show me the money: Why eliminating cash may be the secret to prosperity - daegloe
http://www.washingtonpost.com/blogs/innovations/post/dont-show-me-the-money-why-eliminating-cash-may-be-the-secret-to-prosperity/2010/12/20/gIQAOkT1bS_blog.html

======
MetallicCloud
_A cashless society is also a society where there is no longer any anonymity_

This is what concerns me the most. I think most of what this article proposes
is great, but knowing that absolutely everything I buy can be traced back to
me makes me uncomfortable.

~~~
prodigal_erik
Whatever one may think of systems like ecash or bitcoin, it's disappointing to
see a journalist writing as if nothing like that has even been conceived.

~~~
caf
As has been said many times before, Bitcoin is not anonymous either. It is at
best weakly pseudonymous.

Where Bitcoin _does_ improve over the centralised system described is that you
cannot arbitrarily lock someone out of Bitcoin.

------
retrogradeorbit
"resulting in over $8 billion in transactions that _never would have occurred
otherwise_."

Yeah, sure! Am I the only one who thinks this article feels a little like pro-
fiat PR for an era where central banks are "printing" ad-infinitum to indebt
future generations to address the current political expediency? Something real
to back your wealth? Bah! Promises to repay stored in a computer system is
_the only way_.

Someone should post this on zerohedge and see what kind of responses you get!

~~~
fennecfoxen
Consider the scale of the money supply as managed by a central bank using fiat
money. Consider the fraction that's not already electronic, paper currency. Do
you really think that turning that to electrons will make a difference?

For reference, in the US,
[http://www.federalreserve.gov/releases/h6/current/default.ht...](http://www.federalreserve.gov/releases/h6/current/default.htm)
(That's ~$1028 billion in currency, of ~$9755 billion in M2, to say nothing of
other assets.)

And when you get down to it, all that makes assets like "gold" (and other
commodities) valuable as currency is the promise of being able to exchange it
for something in the future. (Unless you were planning to do something useful
with the commodity itself, which seems mostly unlikely.) Whether this promise
is actually more credible than your favorite fiat currency is a _discussable_
matter, but not perfectly clear.

~~~
retrogradeorbit
What about reliability and security? How do you buy food when the computer
system has crashed. (Or the banks have collapsed?) Even paper fiat allows you
some robustness to this. Precious metals even more so.

------
iwwr
People could just use other currencies (like USD) for their cash transactions
then. I imagine this could be made illegal too, which only gets more alarming.

Is there no value in a government that knows less than everything about their
citizens?

~~~
ojbyrne
[http://www.theatlantic.com/business/archive/2012/03/why-
are-...](http://www.theatlantic.com/business/archive/2012/03/why-are-
criminals-stealing-tide-detergent-and-using-it-for-money/254631/)

------
wisty
A technological solution to a social / economic problem? I don't think so.

It's like the people talking about how micronations like Sealand will solve
social problems. Nup, you can go to a country with fewer laws now (Somalia?)
if you want to live in an anarchy. Guess what - there's still people, and all
the problems people tend to make for themselves.

You can buy foreign currency from many banks. You can even create your own
pseudo-currency (though it may be illegal). Good luck using it.

Micro-payment proponents haven't yet found a cure for stinginess.

Crime is a factor. A lot of criminals will just find other payment methods,
like the online payment rings that already exist (how else do spammers get
paid?). It will cut the theft of cash, and probably cause more theft of
mobiles / identity theft. If your mobile phone _is_ your wallet, that won't
stop a pickpocket from taking it.

As for all the "fiat capital" arguments .. no-one is seriously going to think
it changes everything. All major currencies these days are fiat, and online
ones will be no different. They can be effectively backed by gold and / or oil
(just like current ones are / are not depending on whose cool-aid you're
drinking), but I wouldn't bet on them being any different.

It will be nice to be able to order a coffee using a mobile phone at somewhere
other than Starbucks. It won't be a revolution.

------
kiba
Cashless or cash is not a distinction about technology, but a property of
money.

If something is cashless, that mean it is under the custody of third parties.
When something is cash, it means that the control belongs to you.

This marks the distinction between bitcoin in your wallet versus bitcoin on a
wallet controlled by a bank. Or having paper bills versus having money in
paypal.

------
carsongross
No, no. We all know that printing money is the secret to prosperity. OTOH,
going completely cashless will make it a lot easier to do just that, so maybe
it will help.

Oh, I didn't mention _for whom_ it is the secret to prosperity, did I?

Details, details.

------
freshhawk
Don't forget that human beings treat abstractions of money differently the
more levels of abstractions there are layered on top.

More likely to steal it, spend it and a bunch of other things. If you want
more fraud, more waste, and people more likely to spend it on a whim then this
is the direction to go I suppose.

~~~
UK-AL
On the other hand tech could be used to make things more visible. Imagine your
phone warning you that your cutting it a little close on your eating out
budget this month.

~~~
freshhawk
Yeah, there are definitely some upsides. Especially with reminders and graphs
and planning and all the stuff applications are good for.

The downside is, if the neuroscience research is correct, more of a disconnect
between actual value and the money system. Where more people will steal or
embezzle and risk assessment abilities get even worse than they already are.

Combine that with the surveillance opportunities, which is the more obvious
concern, and it just seems like something to be careful of. One reason I'm
glad the bitcoin experiment is going on now. An alternative to giving all my
financial information to google and cell phone companies (because everyone
loves how ethical their business practices are) deserves more people working
on the problem.

------
geezer
Lets just make cell phone battery reliable more reliable before replacing cash
with cell phones.

~~~
unimpressive
Why is this being downvoted? Besides the "reliable" typo geezer makes a good
point. Cash doesn't require electricity, or run out of batteries, or require
an Internet connection, nor can it be cracked/hacked/etc. From a pure
usability standpoint, cash would seem to be the more convenient option.

(I'd rather be robbed of my wallet than forced to make large transactions out
of my Networked bank account.)

------
tagawa
Agree with the concerns about privacy, but I also wonder what happens if I
visit such a country as a tourist. Do I have to buy a pre-loaded device on
arrival, or do I use my existing phone and pay whatever fees my operator sets?

------
alexseman
No way I would be ok with this in my country. I'm not going to break any laws
soon, but I don't want to be obliged to leave a paper trail.

------
pasbesoin
Here's a counter-point. A cashless society enables dominant private parties
and government to _introduce_ friction when and where they chose.

"Your payment cannot be processed."

We saw this recently with the Wikileaks contributions embargo. We've seen it
codified in legislation such as (but not solely) SOPA.

So... it may be very convenient to swipe, bump, (grind?), whatever... until it
isn't.

I'm certainly not the only person to think of this, In any number of otherwise
insightful science fiction stories, cash lives on -- sometimes as a black-
market economy, but not only for nefarious activities.

