Don Quijones: “First They Came for the Pennies…” in the War on Cash

Lambert here: Somewhere in my recent travels on the twitter, I encountered the phrase “withhold consumption,” which is something savers apparently do. But a carded society would solve that problem, since the negative interest rate could be adjusted to lash aggregate demand until morale improved, and the withholding stopped. Far, far simpler and cleaner than bread and circuses…

By Don Quijones, Spain & Mexico, editor at Wolf Street. Originally published at Wolf Street.

But who is the governments’ strongest ally in their War on Cash? Read on…

The War on Cash is advancing on all fronts. One region that has hogged the headlines with its war against physical currency is Scandinavia. Sweden became the first country to enlist its own citizens as largely willing guinea pigs in a dystopian economic experiment: negative interest rates in a cashless society. As Credit Suisse reports, no matter where you go or what you want to purchase, you will find a small ubiquitous sign saying “Vi hanterar ej kontanter” (“We don’t accept cash”):

Whether it’s for mulled wine at the Christmas market, a beer at the bar, even the smallest charge is settled digitally. Even the homeless vendors of the street newspapers Faktum and Situation Stockholm carry mobile card readers.

A similar situation is unfolding in Denmark, where nearly 40% of the paying demographic use MobilePay, a Danske Bank app that allows all payments to be completed via smartphone. With more and more retailers rejecting physical money, a cashless society is “no longer an illusion but a vision that can be fulfilled within a reasonable time frame,” says Michael Busk-Jepsen, executive director of the Danish Bankers Association.

World’s Biggest Cashless Laboratory

While Sweden and Denmark may be the two nations that are closest to banning cash outright, the most important testing ground for cashless economics is half a world away, in sub-Saharan Africa.

In many African countries, going cashless is not merely a matter of basic convenience (as it is in Scandinavia); it is a matter of basic survival. Less than 30% of the population have bank accounts, and even fewer have credit cards. But almost everyone has a mobile phone. Now, thanks to the massive surge in uptake of mobile communications as well as the huge numbers of unbanked citizens, Africa has become the perfect place for the world’s biggest social experiment with cashless living.

Western NGOs and GOs (Government Organizations) are working hand-in-hand with banks, telecom companies and local authorities to replace cash with mobile money alternatives. The organizations involved include Citi Group, Mastercard, VISA, Vodafone, USAID, and the Bill and Melinda Gates Foundation.

In Kenya the funds transferred by the biggest mobile money operator, M-Pesa (a division of Vodafone), account for more than 25% of the country’s GDP. In Africa’s most populous nation, Nigeria, the government launched a Mastercard-branded biometric national ID card, which also doubles up as a payment card. The “service” provides Mastercard with direct access to over 170 million potential customers, not to mention all their personal and biometric data.

The company also recently won a government contract to design the Huduma Card, which will be used for paying State services. For Mastercard these partnerships with government are essential for achieving its lofty vision of creating a “world beyond cash.”

A New Frontier

In India an even more ambitious project is under way: the Unique Identification Authority of India (UIDAI), which aims to create a centralized voter enrolment system for 1.2 billion people. It will be the largest identity platform and biometric database in the world. There’s only one snag: according to its creators, the only way to make the system work effectively will be through the widespread adoption of electronic payment systems, side by side, as always, with biometric recognition systems.

Given that cash is still king on the subcontinent, the government may have its work cut out. Finance minister Arun Jaitley has repeatedly underscored the need to transform India into a cashless economy, supposedly to “rein in the problem of black money.” However, with its huge informal economy, India remains the largest producer and consumer of currency notes after China (as well as the biggest consumer of gold).

Here’s more from India’s Financial Express:

Currently less than 5% of all payments are done electronically. Results from the ICE 360 Cash Survey 2014 show that cash is the preferred mode of payment even in Delhi, the most affluent and developed metropolis. Nearly 73% of all purchases by Delhi consumers are paid for in cash and only 17% by card.

Naturally the Indian government will do all it can to change this situation. In an article in the Daily Mail Nandan Nilekani, one of the technocrats behind UIDAI, urges the government to lead the way. “The government must be the initial driver, using the heft and reach of its social security schemes to drive the adoption of an electronic payments model,” Nilekani asserts. “As momentum grows, private players can step in.”

Those private players will no doubt include banks. After all, in a world where every transaction – or at least every “official” transaction – must be electronic, the power of banks over individuals is likely to dramatically increase, as Brett Scott warns in an article for The Guardian:

With this comes the specter of bank surveillance, where every transaction you ever partake in is authorized and recorded by a privately run commercial bank, giving it a transaction-by-transaction history of your entire commercial life. If such a bank does not like an enterprise – such as Wikileaks – it can just freeze it out.

The New Cost of Doing Business

An oft-overlooked benefit of cash transactions is that there is no intermediary. One party pays the other party in mutually accepted currency and not a single middleman gets to wet his beak.

In a cashless society there will be nothing stopping banks or other financial mediators from taking a small piece of every single transaction. They would also be able to use – and potentially abuse – the massive deposits of data they collect on their customers’ payment behavior. This information is of huge interest and value to retail marketing departments, other financial institutions, insurance companies, governments, secret services, and a host of other organizations.

Another very important perk of cash is that it significantly limits central banks’ ability to continue conducting arguably the greatest financial heist of the modern age, i.e., negative interest rate policy (NIRP). The only way that central banks can maintain negative interest rates ad infinitum is by abolishing cash altogether, as the Bank of England chief economist Andrew Hadlaine all but admitted. As long as cash exists, there’s no way of preventing depositors from doing the logical thing – i.e. taking their money out of the bank and parking it where the erosive effects of NIRP can’t reach it.

So in order to save a financial system that is morally beyond the pale and stopped serving the basic needs of the real economy a long time ago, governments and central banks must do away with the last remaining thing that gives people a small semblance of privacy, anonymity, and personal freedom in their increasingly controlled and surveyed lives.

The biggest tragedy of all is that the governments and banks’ strongest ally in their War on Cash is the general public itself. As long as people continue to abandon the use of cash, for the sake of a few minor gains in convenience, the war on cash is already won. By Don Quijones, Raging Bull-Shit.

A war conducted by bankers, politicians, academics, even startup guys. Read… The “War on Cash” in 10 Spine-Chilling Quotes

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. Carlos

    Ye gads and I was upset my plumber charged me two days of my labour for 4 hours of his, then demanded payment in cash.

    Instead I should be yearning for those little tracing paper packets we used to get our pay in every fortnight.

    1. ambrit

      Is your plumber an independent actor, or does he or she work for a franchise chain? From personal experience I can attest that, if the latter, over half of that money you paid goes to the rentiers who ‘back’ the franchise. (Even these franchises will demand cash sometimes, for various marginally legal reasons, and many outright illegal ones.)
      The overhead for a plumbing service truck or van can be steep. If one is ‘legal,’ one incurs various expenses: truck payments, truck insurance, fuel for truck, truck maintenance, business insurance, city, county and or state licenses, bookkeeping, billing, ‘bad’ checks, tools (this deserves a paragraph all its’ own,) advertising, and on and on. In this regard, some of the rentiers ‘cut’ is understandable. However, when one falls into the trap of working for a franchise, one also falls into the slough of despond.
      Any reasonably mechanically inclined person is perceptive enough to realize that he or she has become a faceless tool for the rentiers. Self respect takes a big hit from that realization alone. Second, since the above mentioned costs of running the business are close to being ‘fixed’ expenses, the only place left to squeeze out excess profits for the rentiers is in the labour costs. Wages have been stagnant almost everywhere the last few decades. Aware tradespeople can see the steady erosion in their standards of living. After all, they are, preferably, chosen for these kinds of jobs for their problem solving abilities.
      What else can we characterize the destruction of the middle class and working classes as if not a giant ‘problem’ crying out for a solution.
      The second effect of this ‘race to the bottom’ is that, sooner or later, everyone reaches there (the Bottom.) As can be seen in the infrastructure debate going on in government now, things begin to fall apart. A corollary to this is that the skilled workers needed to fix the problems piling up will have, by and large, left the field. If one cannot find satisfying wages for difficult work, why do it? There are far easier ways to be poor and ‘lower class.’ The decline in infrastructure accelerates. Now, the repairs and replacements are being done by second rate workers. I wouldn’t blame the workers here. It takes time and effort to learn a trade well. The ‘replacements’ have not been given a chance to do the necessary skills building work.
      The objection to ‘importing’ skilled trades workers is that many of the societies where these workers are imported from have cultures steeped in petty corruption. Licenses and work apprenticeships can be and are often purchased. Pseudo skilled trades workers are often the result. I have seen first hand, foremen go slowly crazy trying to complete jobs with workers who are not English capable, requiring either a translator, (lots of problems there,) or bilingualism (a rare trait in America,) and or possess mediocre skill sets.
      Finally, whatever you needed fixing, do be aware that most states and provinces have Workmanship quality laws. The plumber or his company must warrant the work for a minimum amount of time. This period varies by region, but can range from three months to a year. Hold on to that receipt; it is your warranty.
      Next time, don’t be afraid to bring up the subject of barter. I’ve done it, most independent trades people do. Barter is generally completely ‘off the books’ and eliminates tax and ‘service’ charges. If you feel comfortable with your trades person, it doesn’t hurt to ask. If they ‘cop an attitude,’ you know that they are totally mercenary and should be, at the least, monitored closely. Real professionals understand human foibles and make allowances. A simple “No, I don’t do that,” should be all that needs to be said about the subject. Anything stronger indicates that Ego is involved.
      Anyway, the point of going cashless would seem to be the automatic imposition of taxes, (a general ‘Transaction Tax’ on all movements of funds is quite possible,) and the elimination of Systeme ‘D’. A secondary effect of going cashless would be the forced ‘banking’ of the entire population. Private financial rentiers would be guaranteed a ‘captive audience’ to practice their extractions and extortions on. For the Homeland Security Goons, the funds flow information would be an invaluable resource for identifying ‘non compliant’ citizens, er, consumers.
      I’ve rambled on too long.

      1. art guerrilla

        great comment, and i get why The Powers That Be would like to eliminate cash-munny and make us ALL beholden to financial institutions we have no control over, etc… THE WHOLE SYSTEM will then be TOTALLY opaque to us… (NOT that it is exactly transparent as it is…)
        BUT, the portion i’m not getting so far, is that the banksters are dependent upon dee-rug laundering cash monies; HOW are they going to make their profits if *that* ‘little’ cash cow is slaughtered ? ? ?
        our drug dealers are going to start setting up bank accounts and swipe our cards for ‘unknown services rendered’ or something ? ? ?

        1. craazyboy

          Not to mention America’s panhandlers will need to get a credit card machine and internet cell connection…

        2. jgordon

          Let’s not forget the government angle too. The government has an insatiable lust to know absolutely everything we do and everyone we interact with. Considering that banks are merely an appendage of the government, banning cash goes a long way towards meeting that goal.

          Though really I don’t think they’ll be able to ban cash, considering that the majority of people I know work under the table and use cash exclusively. These people aren’t simply going to roll over and die when cash goes away–nor are they going to join the official economy.

          1. Jim Haygood

            Should the Yellenites and Fatca fools mandate all cash to be deposited before a demonetization deadline, drugs — such as cannabis and prescription painkillers — will emerge as an alternative currency.

            ‘Medium of exchange, store of value, unit of account’ — check. Although some folks will resist accounting in grams instead of dollars.

            1. Alejandro

              “‘Medium of exchange, store of value, unit of account’ — check.”

              …’satisfy taxes’—uncheck…what doesn’t go to the taxman gravitates to the banksters.

            2. different clue

              Just because they mandate it does not mean that we will obey. Some people will hoard cash supplies to be able to be able to do bussiness with those who still use and accept cash.

              Perhaps such people will get to know eachother over time in their area before the “cash-banning” effort is made. They can then play dumm with anyone they don’t recognize offering to deal in cash in the patriot-cash economy in their area. Such a newcomer would be assumed to be a government narc fishing for genuine users of cash.

        3. Pepsi

          That’s the thing. Cashless society means that criminal enterprises need to merge into heavily capitalized syndicates to continue laundering their profits. That is a bad rather than good thing.

          1. jsn

            I would call that “normalization”. As the rich have become immune to prosecution, the distinction between legal and illegal activities now hinges on class and the elimination of cash will formalize it.

            This will make enforcement decisions transparent for the brown shirts, I mean police: paid in cash, its a crime; paid with rent to a bank, it matters not what depredation one engages in.

            1. Ulysses

              “As the rich have become immune to prosecution, the distinction between legal and illegal activities now hinges on class and the elimination of cash will formalize it.”

              Very keen insight!!

      2. Brooklin Bridge

        Great rambling, Ambret! Another cost is frequently that of runaway code additions; new requirements and modifications to old ones, literally whole books of them that didn’t exist a decade or so ago,. Some of these may be beneficial, some are arguable, a very few are simply stupid, but regardless, it adds a considerable cost to the tradesperson, either in the renewal charges and “ongoing” training classes, or simply in the time it requires to keep up to date. Penalties can be really severe. In some states it’s so bad that you need someone full time doing nothing else. As always, it hits the little guy hardest.

      3. Norb

        A society based on rent extraction and overt exploitation, supported by propaganda. That is our present and future. Viewed from the perspective of social control, the proposals of the corporate elite take on different meaning than the marketing campaigns trotted out to promote a positive vision of the future.

        Most tools and technology in modern society are marketed as improvements to human life but in reality, when in the hands of the rentier class, are the most repressive tools ever created. Why do people willingly give away their actual freedoms for a shallow appearance of individual freedom and convenience?

        I participated in a local city council meeting where citizen concerns were heard about proposals to upgrade city electrical meters to new,”Smart Meters.” Devices that allowed the city, and electrical company, to monitor electrical usage in the home and improve “efficiency” of electrical delivery. The main argument for adoption of the meters were reduced maintenance costs to the city and the potential lower electrical rates due to efficient peak delivery brought about by better knowledge gained from tracking customer usage. All potential negative health effects to homeowners or objections of being monitored 24/7 were dismissed as obstructions to progress. The meters were approved, but rates have not gone down- mission accomplished.

        The negative side of this digitally connected infrastructure is that it allows the rentiers to efficiently deny services to anyone failing to pay. In the above electrical example,this system efficiently allows for a penalty fee for both cutting off the power and turning the power back on. In our city, amounts to a 40 dollar charge.

        A cashless society is just another link in the chain of rentier oppression and free riding. As long as these tools and innovations are used to promote private ownership, the negative potential of their implementation far outweigh the benefits.

        1. DolleyMadison

          There was recently an idea floated in my town to actually GO THROUGH everyone’s garbage and, if any “recyclables” were found, to FINE the offenders.

      4. Generalfeldmarschall von Hindenburg

        It was a pretty good ramble, ambrit. Races to the bottom usually take the people supposedly at the top right into the same dung hill as everyone else. Nobody is paying any deference to the Mayan aristocracy anymore.

      5. Portia

        I have become so queasily disgusted that I barter now whenever possible. As an individual, with other individuals, the IRS need not get involved (at the moment). There have been bartering organizations for years now, and I think it will be more on people’s radar as things get worse.

    2. sdasa

      I don’t use a smart phone. My computer use is for work or gaming, something a smart phone is ill-suited for; however, I’ve noticed small vendors, like restaurants, refusing credit cards unless at least 5-10 dollars is purchased. The idea being that the credit card company takes a fee. I don’t see this happening soon, but maybe in a more monopolized world.

  2. rfdawn

    Going cashless makes bank runs difficult. Correction: they can instantly be made impossible. So, deposit insurance can be dropped and bank insolvency just means the bank continues with whatever it still has left and all the depositors just take whatever haircut is needed to recreate “solvency” and maintain bankers’ salaries and bonuses. This regime is already in place in New Zealand and may catch on elsewhere.

    1. Jefemt

      Hey, Ho, Let’s Go!

      Don’t throw in the towel.

      Anthropogenic climate disruption? Take some of the stocks, bond and fund money and buy a solar array. Ride a bike and walk.

      “Affordable Care” Act (isn’t that RICH!!!) ? Make sure you verify that the lowest cost bronze plan cost is less than 8% of your Adjusted Gross. If it is MORE, OPT OUT and self insure.

      Federal Spending on War and Empirical Misadventures abroad? Avoid taxes by playing the game as fairly and aggressively as you can.

      “Cashless Society? Use cash.

      Starve The Beasts.

      If even one in ten of the readers and visitors to this site started to Act, consistently with purpose and conscience, it would make a difference.

      “Until one is committed, there is hesitancy, the chance to draw back. Concerning all acts of initiative (and creation), there is one elementary truth, the ignorance of which kills countless ideas and splendid plans: that the moment one definitely commits oneself, then Providence moves too. All sorts of things occur to help one that would never otherwise have occurred. A whole stream of events issues from the decision, raising in one’s favor all manner of unforeseen incidents and meetings and material assistance, which no man could have dreamed would have come his way. Whatever you can do, or dream you can do, begin it. Boldness has genius, power, and magic in it. Begin it now.” W H Murray, Scottish mountaineer

      1. ckimball

        Thank you for your most energetic post.
        We have been thinking about this and have decided to create
        a card for our store which can be punched every time cash is used regardless of the amount of purchase. When the card is filled it will be worth a 20% discount on any item regardless of its price. We have noticed how fast cash has diminished in
        circulation and do not relish the specter of living in a world where an entity can include itself in every transaction in terms of information and fees. It feels as if we have ingested a parasite. We are not doing this to avoid fees or taxes although
        I would like to. We are doing this because we are very concerned. We are hoping this idea will bring attention to
        the issue and help encourage the habit of using cash at least for small purchases. It is a small beginning. We will see how
        people respond.

    2. BEast

      I’m not so sure. Sometimes I rue that my fellow USians are ornery and resistant to change, even to changes that would benefit them or cause no real harm. Sometimes it is a source of hope.

      1. Massinissa

        IMO, the whole Trump thing actually gave me some hope. Because heres a man, even though hes an asshole and idiot, who was not pre-chewed food for us like most of the politicians are. By showing their support for Trump, the republican base is showing their willingness to fight Business As Usual by the kleptocrats. Just a shame it isnt some genuine populist right politician instead of this poseur…

        IMO, the populist right >>>> ‘center left’ crap like Clinton and the other Demorats… Theyre not socialists by any means, but I take what I can get, I guess.

  3. cnchal

    The United States Post Office management is fully involved in the war on cash. The price for shipping with Priority Mail is quite a bit less when the postage is bought through the USPS website rather than paying cash at the counter. The Post Office gets away with charging two wildly varying prices for the same service, depending on the payment method. If that isn’t injustice, I don’t know what is.

    . . . Another very important perk of cash is that it significantly limits central banks’ ability to continue conducting arguably the greatest financial heist of the modern age, . . .

    The nastiest bullshit jawb holders, banksters, insurance executives, the credit card companies with their financial leg hold traps, want a cut of every transaction, and the ability to steal from customers with impunity. They are the criminal class, and now have captured our governments, lock stock and barrel. And it was done with stolen money.

    Making cash illegal, (my head spins even writing it) as these overpaid “economists” and central banksters and the financial criminal class want, would be the second great crime of this millenium.

      1. cnchal

        The $14 trillion heist by the banks from the GFC. Not surprisingly, these are the same people that want to eliminate cash.

  4. ProNewerDeal

    is there any empirical evidence to date on how loans work in these few nations that started trying negative interest rates? Do actual citizens actually “pay” NEGATIVE INTEREST on a loan, e.g. receive a DIVIDEND? Perhaps only the economic or socially-connected elites remain “eligible” for loans, thus making loans another Rich Person Welfare Queenism? Do people that would not apply for a loan under US current positive nominal interest rate terms, do so under negative nominal interest rates, “just to get this free money they’re giving away!”? Forgive me if I missing some idea here.

    1. different clue

      “Negative interest” might mean that some of your “saved un-cash” would be overtly deducted from your account every time period as an incentive for you to spend it.

  5. Ulysses

    The potential expansion– of totalitarian micromanagement of people’s lives– boggles the mind. Take a couple of friends out to lunch? Not so fast! That BigCable bill is due tomorrow, so your charge at the restaurant has been respectfully declined. Pick up that new book by Chris Hedges? Well, Big Brother only allows radical, militant, extremist literature to be purchased by approved Party members who can be trusted with it. Wouldn’t you rather use your remaining media credits on that Taylor Swift download? Too much reading only breeds discontent, in any case.

    1. sdasa

      I noticed the “Party member” line. Nice redbaiting. Kind of negates your whole point-of-view. (The other obvious lack of world understanding was Chris Hedges.)
      If we are to make any progress, we have to stop using the one percent’s propaganda memes.

      1. Ulysses

        Thanks for accusing me of redbaiting– this will reassure all of my family and friends, who fear that my anarcho-syndicalist views mean that I’m such a dyed in the wool commie that I’m beyond reasonable discussion.

        I do admit that the Big Brother theme, and Orwell’s assumption that a perverted Socialism [IngSoc] could be a likely path to a dystopian, totalitarian future is problematic. Whenever one chooses popular allusions, in order to be more easily understood, one takes the risk that your own ideas will be conflated with that of the creator of the pop culture being referenced.

        I actually think it far more likely that our dystopian, totalitarian future will be unabashedly corporatist and rightist. Socialism, done properly, could lead us into a much kinder, gentler world: something like what William Morris imagined in News from Nowhere.

        I hadn’t noticed that the one percenters had taken to using visions of Orwell’s 1984 to denounce central banksters, and other kleptocrats seeking to expand their power. Can you point me to where people like Larry Summers, Michael Froman, Jamie Dimon, etc. have been propagating this meme?

  6. Brooklin Bridge

    The way the ptb are using technology is getting to be terrifying, but I’m also surprised that people are putting up with it. Are they really that accepting or that unaware of the dangers? It seems to me it would be a bit of a hard sell not to mention hard to enforce unless the population was compliant. Barter and such. Are people really primed to just roll over for this sort of totalitarianism? It would be helpful if this were touched on more in the article. Go India!!!.

    1. BEast

      I suspect it’s easier to enforce in countries where there was no parallel infrastructure for most people before. e.g., cell phones become mandatory when there is no land line infrastructure in much of the country. If there are no bank branches or ATMs nearby, money on your phone seems like a boon.

      Sweden is harder to explain. Perhaps their government is seen to be so much more benevolent in general that people trust such initiatives.

    2. different clue

      Some people are. Some people might not be. If “just enough” people might not be, and those people use cash for every feasible thing in every feasible place, they will maintain a cashful sub-society big enough that it cannot be non-violently starved of activity by the cashless sub-society. And those people who are prepared to accept cashlessness by choice deserve whatever happens to them.

    3. washunate

      I’m curious what you mean by willing to put up with it? Are you talking special cases in Scandinavia, where they have widespread prosperity and trust in their government? Or are you talking in the US and similar places? Because here in the US there is massive action against the banks. For one thing, a lot of people don’t use banks at all. The government is so displeased by this that the dogooder authoritarians have invented a phrase for them: they are unbanked. But even among those who have banking relationships, most people don’t have that much money in the bank. It’s really a small percentage of households that have meaningful financial assets in digital form.

      Moreover, that’s just the legal financialized money system. The informal economy is enormous – and by definition, it functions outside officially sanctioned digital payments systems.

  7. DJG

    Conversely, I’m finding active resistance by stores to giving a receipt. “You don’t need a receipt, do you?” And in the case of many of these cashless systems, like Chicago’s Ventra transit card, the readers in the stations or on the buses don’t tell you how much they have charged for the ride. You have to go on-line or to one of the machines to find out how much is in your acccount. It wouldn’t require much technology to show the fare and show the balance on the card at point of sale, now would it? And last night when I added value (using dollars at a machine), the receipt, such as it is, showed only the added value and still didn’t give the account total.

    No receipts? No posting of prices? No verification of money held on account? We’re back in the middle ages. It took hundreds of years to make the system of buying and selling clean. You can argue that it was one of the triumphs of the 20th century. We are now back to out-and-out cheating. I’m not sure that what is going on here is about surveillance so much as skimming and cheating. And, yes, even in vaunted Denmark (something is rotten in the state of).

    1. tegnost

      Seattle has the Orca card. I don’t use it, the only benefit to it being that you can transfer between transit systems, metro, light rail, community transit, and possibly the Sounder. The card is given free or as a salary perk to professionals, kids and college students also guessing they get a sometimes deserved discount on price. The card is very popular and this must be profitable, partly for the reasons you state, out of sight out of mind on the cash, but the more nefarious purpose ( yes nefarious, some accountant figured this out) transfers are theoretically 2 hours with a paper transfer, but a driver who hands out 2 hour transfers will get pestered because you can’t get where you’re going in 2 hours, or just be forced to pay twice to go downtown and back. This, by the way, is what happens when you push low income people farther and farther away. Longer bus rides. Anyway, paper transfers are usually good for 3 hours and on the weekend your driver may bless you with an OWL so you can get home as late as they’re still running. The Orca card is 2 hour transfer, period. No “hey driver the last bus was late give me a break” And as with the cashless society, there will be no breaks given. indeed you won’t even know how much you’ve paid, as you point out. One last thing, how did sub saharan africa wind up with so many phones, were they given out free or cheap by some foundation hoping to prove their new system far away where no one can see? I seriously wonder what kind of world these effers think they’re making and if anyone will want to live in it, land of the free and the home of the brave indeed

      1. Will

        Well, the other major benefit to the ORCA card is that it can have monthly passes loaded on it, which means an unlimited number of rides that month are prepaid and there’s no need to worry about transfers. It works out to less cost per month than paying as you go for rides 5 days a week during rush hour.

        And of course that benefit is only available if you can cough up the money in advance to buy the monthly pass (or your employer is a big enough company that they have legal incentives to subsidize it), so it’s still a matter of Vimes’ Boot Theory in action. But I suspect they push the card more as a way to get buy-in for the full monthly cost than as a way to nickel-and-time per-ride users. The latter is just a secondary benefit.

    2. Cosmic Charlie

      First, let me say I agree with your post. Horrible system that is. Now they have a just released app. Talk about going cashless!!
      In the case of Ventra if you want transparency you will be forced to use the app, just as we were forced to use the Ventra card to take public transportation here in Chicago. I wonder how long until the CTA becomes privatized?

  8. Dave

    Brooklin, the people of this country and of this world have been falling for these traps for a long, long time now. The recent uptick in stories about eliminating cash has been the scariest thing I have been following in the last 10 years. This is 100% about CONTROL of the masses. Terrifying. And when mentioned in polite company I am met with blank stares.

    1. Brooklin Bridge

      But, as they said in the 70’s, the contradictions are mind boggling (as in mindbogglingly short sighted). There is never enough profit so a cashless society is going to be soaked penniless by profit hungry corporations, the stuff third world dreams are made of. At a certain point, there not be enough money in the general population to be worth the effort, and then, I assume, the corporations will start cannibalizing each other.


    2. tegnost

      tech friends say this is the greatest thing in the world its happening and you’d better get used to it which I don’t plan on doing, consider myself lucky to be old

      1. BEast

        Tech people live in their own little world in some ways. They think people will happily “upgrade” for whatever their new bell or whistle is, and that they, collectively, can make us do so.

        They think this because lots of people will, and those who won’t are invisible to them. (If you’re not buying their products, you don’t exist.) But it gives them a skewed idea of what can be really universally adopted. (Read: required to be adopted.)

      2. Massinissa

        I dont even understand why these silicon valley Glibertarians actually LIKE this idea. I thought they wanted freedom? How is having the government monitor EVERY FINANCIAL TRANSACTION ‘freedom’?

        I hate silicon valley “libertarians”… They never make any sense on what they support and what they dont

        1. jrs

          if you asked me what was most sincere about the silicon valley types their liberatarianism or their techno utopianism, of course it would be the techno utopianism.

  9. Disturbed Voter

    The goal has always been to make the world into Germany 1932. The first version, like first versions of software … was buggy and unpopular. It is in the nature of most people to comply … thus Hitler’s success in Germany.

    Negative interest rates is simply a new tax. with the bank as the tax man. That 14 trillion dollars put out to the banks balance sheets in 2008/2009 has to be paid back. Private profit vs socialized loss comes home to roost.

  10. TG

    And think of what happens when there is no cash, and the government decides to cut you off from the payments system because they don’t like you? It would be worse than being excommunicated in the middle ages. With no cash governments will not just be able to track people – they will be able to control absolutely everything you do. It will usher in a level of state tyranny that would make Stalin blush.

    Cash is coined freedom.

    1. susan the other

      I think we’ve placed our hopes for freedom on the wrong thing for centuries. I don’t think “cash is coined freedom” is true, but that phrase rings true because we have structured our “economy” to give the most freedom to whoever possesses the most liquid cash. Everybody else is stuck in the mud. Whether we have digital money or cash money makes no difference as long as the accounting is transparent. Good luck with accounting ever being transparent until we actually come together to cooperate honestly. So that eliminates the private capitalist banking system right off the top. The only freedom we have is cooperation; answering to one another. Digitizing money won’t make any difference at all. There is an underlying reality about money that has existed forever (Graeber): “money is debt”. Let’s change that. Because who is entitled to hold debt? Well, usuallly those who were clever enough to pillage the money in the first place. Choose your method. Or old farts who accumulated a retirement stash for 50 years. If money were not debt, what should it be?

    2. hunkerdown

      Actually, if you stop to think about the labor of others that money coerces, it’s coined peonage, and always has been.

    3. washunate

      But that’s the thing. If the government decides to make you a target and enforces that by preventing vendors from doing business with you legally, you are screwed, whether cash exists or not.

      Either way you cannot interface with the formal economy but through informal intermediaries.

  11. Eclair

    “In a cashless society there will be nothing stopping banks or other financial mediators from taking a small piece of every single transaction.”

    This was made very clear to me last June, when my spouse and I arrived at Newark Liberty Airport just before midnight. Now, we usually take public transportation to our daughter’s house, but given the lateness of the hour and the fact that we had to be up bright and early the next morning for a granddaughter’s graduation, we had the choice of Uber or a regular taxi.

    Being a dedicated reader of NC, the Uber option was anathema. So, we lined up in the regular taxi queue. Used to be, the dispatcher would tell you the price and at the destination you would shell out the cash, plus tip. Now, payment was by credit card, in advance, with a flat $5.00 fee for the ‘financial intermediary’ slapped on top. Puts me in mind of the extortionate toll takers of the european middle ages, who stationed themselves at critical bridges and roads and demanded whatever the traveller could be forced to pay. No money, no travel.

    1. DJG

      Ahhh, “convenience fees,” on computerized transactions that cost one-zillionth of a sent to execute. Yet no one comments on how absurd they are.

    2. BEast

      At least you could, presumably, afford it. (Not that this is an excuse.) All the fees charged by banks to let EBT recipients use their benefits is a scandal.

      1. Eclair

        Yes, BEast, paying the $5.00 fee did not result in our having to decide between milk for the toddler or granny’s high blood pressure pills. But, it did make me more aware of how easily the bankers and finance companies can skim off excess profits. And that made me angry.

        Years ago, I would be incensed when tradespeople and household helpers would ask to be paid in cash, feeling that they were avoiding taxes. I spent years carefully filing annual social security reports and paying into the SS fund for the woman who cared for our children. Just so she would have the retirement income … and, it was the law. Decades later, with children grown and producing grand babies, they laughed at me and said, NO ONE declares the income paid to their nannies. They are all cash transactions. Because most of the women are without papers.

        Now, it could be a small act of resistance for me to pay in cash. I don’t, of course, because that is illegal, and I would never commit an illegal act. Never.

        1. BEast

          Another reason to pay your home help by check is that it’s a built-in receipt. There’s funny but disturbing Augusten Burroughs (non-fiction) story about paying his housecleaner (not a live-in, a weekly cleaner) in cash, and then her claiming he hadn’t paid her at all when he fired her for not cleaning above halfway up the wall. His employer wouldn’t let him go on the day of small claims court, so she won the case and he ended up paying her twice. He made the duplicate payment (hundreds or thousands of dollars) entirely in pennies.

          I like paying by check for some things. Built-in receipt. But most of my day-to-day transactions, I pay cash. Everything else aside, money feels more real when it is bills coming from your hand rather than an electronic swipe, and that, on a subtle level, encourages thrift.

          Plus, merchants seem to appreciate it. In one recent transaction, they hacked $5 or more off a $50 purchase when they saw I was paying cash.

    3. Ulysses

      “Newark Liberty Airport”

      If that isn’t the most ironically named place in the world! We are watching a world emerge, ruled by Wall Street, where equality and fraternity are already dead. The only liberty remaining is the liberty the billionaires enjoy to freely plunder everyone else’s wealth.

  12. Benedict@Large

    A cashless society. Just like letting someone else hold your wallet. What could possibly go wrong?

    Here are some recent examples of cashless societies: (1) Plantation slavery. (2) Company store. (3) Prison labor.

  13. BEast

    I would like to thank Margaret Atwood for my deep distrust of a cashless society.

    No, I don’t think the government is going to freeze the money of women, as they did in The Handmaid’s Tale. That’s not where the profit to them is. Nevertheless, that book awoke me to the seizing of cash as a method of social control when I was in high school.

  14. Mel Fish

    If a binding division could be manufactured between the “haves” and the “haves not so much”, the cashless society would probably already exist. Just remember however, the “haves” and the PTB still need cash desperately, or an alternate means of moving undetectable money.

  15. Switchblade

    If I tried to tell anyone that the goal of our owners was to take us back to the time of William the Conquerer, they would look at me like I was nuts, but that is exactly where we are headed. A time when Serfdom was brought to England, usury was controlled by the kings” Servi camerae”, enclosure was starting to throw people off their ancient lands, and individual rights were none existent. As long as American males can download porn, and mainline football, the male population will never recognize the danger until it is too late. American females will gladly model their chains as long as their Starbucks app, and favorite websites are still available.

    The American public is so propagandized, mesmerized, and beguiled by technology that they lack any knowledge of history, and how their ignorance greases the gears of their inevitable enslavement. To be honest, it is extremely depressing to have watched this process for almost 51 years, knowing the public is far more ignorant than when I woke up in December, 1964.

    What is most telling is the incredibly small number of views you see on intelligent youtube pieces on what is happening to the economy, banking, and individual rights. The number of views that are registered by Google are absolutely minuscule, and that is why they bought youtube in the first place, a desire for godlike control.

    1. Jim Haygood

      Fatca makes it quite inconvenient for middle-class Americans to live overseas. If they somehow manage to open a foreign bank account, they will face a maze of filing requirements with harsh civil and criminal penalties for noncompliance.

      Watching a dramatized 1961 escape from East Berlin in the movie “Bridge of Spies,” I thought that’s what Americans will face in a few years, trying to scramble over Trump’s wall into Mexico as they’re raked with bullets from Homeland Security watchtowers and drones.

      In 1996, the U.S. changed its immigration law to include a provision to “name and shame” renunciants. The Department of the Treasury became obligated to publish quarterly in the Federal Register the names of those citizens who renounce their citizenship.

      Since 1998, the Federal Bureau of Investigation has also maintained its own list of people who have renounced citizenship under 8 U.S.C. § 1481(a)(5), as this is one of the categories of people prohibited from purchasing firearms under the Gun Control Act of 1968.

      Depriving them of guns prevents renunciants from trying to shoot their way out.

      1. craazyboy

        Mexico has been working on their immigration laws lately, and most Americans don’t qualify!

        So once you climb the wall, survive the hail of bullets and hellfire missiles, and make it to the promised land in Mexico, the Mexican government will deport you right back to Amerika!

        It’s a cruel world.

        Then even if you do qualify for legal immigration, the banking cartel charges around 12% or more to change dollars to pesos. You can then live in a country where the government seems to have no problem with devaluing the currency, if you are one of those people that think that’s a good thing.

      2. different clue

        Does that law prevent renunciants from learning gunsmithing and making their own guns from separately purchased gunparts?

        1. ambrit

          Not yet, but the government is working on it. (The craziest ‘conspiracy theory’ was that the Feds would let you keep your guns, and make the ammo hard to get. The ammo makers took advantage of the ‘panic’ and raised prices. (As Lambert is fond of saying; “The Market in action!”))

  16. Synoia

    I do not believe all Africas are close to having cell phones, and so eliminate cash. I’d be willing to place a large bet on most african children not having money.

    I’d also place a large bet on the average African Merchant only accepting cash.

    I suggest a visit to the market in Ebuta Metta, near Lagos – over the bridge, in Nigeria for information.

    Followed by a trip to the villages along the Badagary Creek, or a Visit to the countryside in the Mountains east of Maseru in Lesotho.

    1. Generalfeldmarschall von Hindenburg

      It’d be really ironic if the rest of the world destroys itself and Africa suddenly is last wo/man standing.

      1. craazyboy

        Ben Carson knows more about this than me, of course, but I have my own theories too.

        Like clearly, God is a black dude. We have fossil evidence proving humans appeared first in Africa. God made man in his image, therefore God is a black dude. No question about that. Jesus is the son of God, so he’s a black dude too. Maybe a “brown person”, but someone more knowledgeable than I about how immaculate conception works will have to opine on the outcome there.

        So. When we have the Second Coming, which obviously is gonna happen soon, Jesus is heading straight for Africa and will save everyone that doesn’t have a cell phone plan. The rest of the world is going straight to hell.

        The only thing left will be self driving cars, driving on autopilot from one Starbucks to the next.

        The Space Alien Intergalactic Exploratory Federation will finally discover Sol and find planet Earth. They will not believe their good fortune at finding a planet with public transportation infrastructure already installed. Being silicon life forms, they care nothing about atmosphere, or heat as long as it remains below 150F. The space alien kids are delighted with the cute pets included with the self driving cars – the happy audible frequency woof-woof (translation to human: “Please fasten your seatbelts”) and meow-meow (translation to human: “You are now 1.3 kilometers from the next scheduled Starbucks stop.”) Mom and Dad space alien look forward to the tasty charge of wifi energy that Starbucks has become famous for.

        The Earth lives happily ever after.

        1. craazyman

          Have you visited a psychiatrist recently? :-)

          I’m a social psychiatrist and I diagnose and treat diseases of group consciousness. Medicine that works for some patients is harmful for others. Cashless is good for Africa since its a solvent that breaks down the clogs of tribalism in the flow of group consciousness. But it’s bad for us because the vendors of the very same medicine have asserted themselves as avatars, in our society, of the same energies that produce tribalism and have become the modern tribes and forces of constriction not circulation. QED

      2. Massinissa

        Im having a hard time believing that Africa could survive but Australia couldnt… Or maybe you just meant Africa would be the last man standing with Australia being an honorable mention because noone actually lived there to be able to die in the first place? Whole damn country only has 24 million people, compared to South America’s 400k…

        If all Australians died tomorrow, it would be two weeks before anyone noticed…

  17. jerry denim

    This is something I have been worried about for a long time. It’s frightening to read how rapidly we are moving towards a cashless future now. The endgame is even more frightening than the scenario depicted in the post. Anyone who thinks the people behind this push towards ever more invasive tracking and a monopoly on centralized digital transactions aren’t interested in control are extremely naive. (2003)

    I believe the goal of bankers, government and the global elite is an implanted tracking chip that will be your sole identity, your sole source of currency for every transaction, and a requisite for any and all vital services both public and private. Larry Ellison attempted to use the post-9/11 security hysteria to implement a Oracle software national ID card with RFID and imbedded biometric data. The card would have been fully capable of completing financial transactions.

    After some future engineered crisis when all of your government IDs and magnetic strip plastic cards you carry in your wallet now have been consolidated into a singular physical object it will only make sense to implant your digital identity because carrying it will be deemed too risky.

    “It marks the beginnings of a slow move toward a world where everything will be accessed from a single RFID microchip. If that day comes, I can’t think of a safer place to keep it than inside my own body.”

    All of this will be eagerly embraced by techno-fetishists and brain dead consumers who always looking to increase their “convenience” and “security” by surrendering ever more of their personal freedom and anonymity to finance institutions and the state. “Oh wow, I don’t need a wallet to buy a Macchiato anymore? And I don’t have to worry about leaving my wallet in a cab after I get drunk either? That’s awesome!” Never mind what you’re buying, it’s what you’re selling.

    I’m an agnostic Buddhist, but I find it interesting just how similar all of this sounds to the previously confusing biblical “mark of the beast prophecy” It never made sense until recent technological developments made it feasible if not inevitable.

    “The second beast of Revelation 13 will cause ‘all, both small and great, rich and poor, free and slave, to receive a mark on their right hand or on their foreheads, and that no one may buy or sell except one who has the mark or the name of the beast, or the number of his name”

    Irregardless of whether accepting such an implant entails eternal damnation I don’t like the idea of not being able to buy, sell or otherwise function without being implanted with someone else’s chip that does god-knows-what. I’m beginning to think these self sufficient doomsday survivalists may be on to something. I have no plans of being chipped, ever.

    1. different clue

      These chips will also be designed to cause cancer in everyone who gets one implanted . . . a cancer designed to kill the recipient in time to prevent the recipient from collecting social security or pension.

      Will religion-based Conscientous Objectors be legally allowed to refuse the chip implant?
      If not, will there be so many chip rejectors and will the chip rejectors be so heavily armed that the government would have to use Assad methods against whole regions of the country to round people up into Chip Implantation Centers? Would those people be able to use Area Denial Methods to render whole regions into No Go areas for the Cashlessness Government ChipLords? (Ian Welsh wrote some speculative articles about how such a war might play out in America. The government using al Assad methods on those people using Iraq Insurgency methods right back on the government).

        1. different clue

          Massive indiscriminate bombing against broadspread civilian areas where rebels are entrenched and/or mixed in. Roundup and torture of thousands and thousands of suspected cash-users and chip implant rejectors.

          I never said that I approved of Assad methods in general. I have said that I accept Assad methods and whatever else besides that might be needed to exterminate the liver-eating cannibal head-chopper rebellion in Syria itself.

    2. Ulysses

      “I have no plans of being chipped, ever.”

      I’m with you!!

      I think the most likely way the surveillance-state propagandists will try to push this (or mandatory retinal scans all the time, whatever) will be to hype up some child kidnapping that “could have been prevented.” If only little Jimmy could have forced that guy to submit to a retinal scan, and checked it against his databank of known associates of his Mommy, he would have never have gotten into that car!

  18. shinola

    Eliminating cash is not a new goal or idea.
    In 1979 as part of new employee orientation at the Fed. (Kansas City) we were told that one of the Fed’s long term goals was the elimination of cash. Reasons given at the time were reducing costs related to cash handling at the bank & better tracking of the economy.
    At the time I thought “Yeah, right” but now…

    1. different clue

      Running that backwards . . . 22-Catch would say that they can’t do anything we can stop them from doing. How many people would have to be committed to preventing forced-cashlessness in order to keep forced-cashlessness prevented? What would enough millions of such people do without the kind of overt communication and co-operation which could be found and suppressed by the government to prevent cashlessness just by the hostile inertia of millions of people all separately following the same behavioral rule-set?

  19. Oregoncharles

    As I understand it, there’s a big legal hurdle to this happening in the US: fiat currency. That is, the law REQUIRES merchants to accept cash (except for pennies – all along, I gather.) Or more precisely, it says that the debt is paid once cash is offered. That’s exactly what gives currency its value, since it obviously has none intrinsically.

    That law would have to change to introduce a cashless economy – which would markedly hobble the underground economy, mind you. But pennies have been a exception all along; they’re now treated as essentially worthless – stores keep a little bowl of them next to the cash register, to simplify making change. Why they still post prices in pennies ($9.98) escapes me.

    IOW, the fate of pennies says much about inflation over time, little about the fate of cash. I don’t know what Swedish law says about fiat currency; it would have to be different for stores to refuse cash.

    1. BEast

      Because $9.98 or $9.99 registers subconsciously as cheaper than $10.00. Not just the one or two cents it is cheaper, but significantly cheaper.

      Of course this makes no sense, but marketers probably have reams of data showing more sales at $7.99 than $8.00.

      1. John Zelnicker

        It happens because the brain registers the dollar amount and barely notices the rest of it, so $9.98 registers as “nine dollars and something” which is a lot less than “ten dollars and something” such as $10.01 even though it’s really only 3 cents.

    2. JerryDenim

      Ha, you said, “the law”. As if that applies to bankers! Haven’t you heard? He who holds the digital fun credits makes the rules. I wouldn’t hold out much hope for “the law” stopping any of this. Digital fun credits are the law.

    3. washunate

      Yes, that is my understanding as well. The FRN is the cornerstone of the global cash system. You have to remove legal tender status of FRNs to go to a cashless society. And the elites will never do that.

      Which is why the sensationalism around the war on cash is way overblown. It doesn’t matter if Sweden goes all digital. It’s a tiny country. Anyone who doesn’t like it can turn their digital bank balance into physical euros and dollars and pounds if they want. And if you have a lot of 1s and 0s in your bank account, you buy stocks and castles and paintings and gold and cars and all the other things rich people buy with their bank accounts.

  20. different clue

    American Indian tribal social-economic systems might well be studied for how people arranged the trade in goods and services without “cash” but WITHOUT ANY GOVERNMENT-BANK CARD-BASED VALUE STORAGE EITHER.

    1. craazyboy

      Economists have decided barter is inefficient. Take the case where you go to the grocery store with your least favorite pig. You finish shopping and go to the checkout line. Your bill adds up to .734 pig. You now pull out your cleaver and make change in the grocery line.

      Once in awhile, economists get it right.

        1. Massinissa

          This may be embarassing on my part, but I cant even tell if youre being sarcastic or if youre being serious.

          I mean, I dont mind if youre being serious, but I cant tell if its a joke or not.

          Edit: I assume youre actually not joking, which is fine, I just cant tell.

            1. skippy

              Standing ovation for the entire thread…. bravo – !!!!!!!!

              Skippy… alternatively assume a creator… they were the first economists imo….

    2. Massinissa

      Barter is great when you can do it, but it really IS difficult to do for EVERY transaction.

      How many Chickens is a Pig really worth? Its hard to know for sure, and you cant really give him half a chicken. So who decides whether the pig is worth 4 chickens or 5?

      1. washunate

        What you are describing is why merchants exist and offer credit. For example, you have a tab at the bar and settle up at the end of the evening because paying for each drink separately is inefficient and buying directly from the brewery takes a lot of time.

        1. Massinissa

          Merchants, really? You realize merchants come with ‘transaction costs’ of their own.

          Its not like you can have a reliable and unbiased merchant present for every transaction.

        2. hunkerdown

          Yep. And the eldritch-sounding “day of reckoning” was in fact just one of those handful of days sprinkled over the year when everyone gets together in the village square and reconciles all those half-chickens.

  21. Chauncey Gardiner

    Wonder what would happen in a cashless society if the electrical grid were to fail?

    Recalling what occurred a few years ago following a major regional storm, I suspect it would be similar to what happened to the gasoline pumps.

    1. Massinissa

      What would happen to the cashless society if one of those major EMP events from space happens and it fries ALL THE ELECTRONICS IN AT LEAST THE COUNTRY? There are scientists that say an event like that is inevitable over the long (100 years?) term, and our grid is not protected. At all.

      And stating that the world will collapse in 20 years isnt really helping, because even if it does, we sort of have to keep carrying on like its going to just in case it does.

  22. Peter Boardman

    And if someone uses your details to access your account unlawfully how long will you be out of pocket until the financial institution makes restitution; if it does at all? They don’t rush to do it now and it’s bound to escalate.

  23. Synoia

    Oh please, please, please eliminate cash.

    Bring on the barter economy. Untraceable, unauditable, untaxable, and uncounted.

    Or bitcoin.

    Can’t wait.

    1. Massinissa

      Bitcoin? You mean that thing rich chinese capitalists use for their investment portfolios?

      80% of bitcoin trade volume is denominated in Yuan, and to my knowledge its mostly used by the rich capitalist class, not the Chinese worker.

      I dont understand why people still act as if bitcoin is still going to liberate Americans or something when the only adopters have been foreign capitalists…

      1. jrs

        I suspect the post was sarcasm. But actually I appreciate the sentiment of wanting to screw empire in any way possible. Only it has pretty big downsides.

  24. washunate

    I’ve been fascinated for some time now about these articles on the war on cash. The move to digital payments is a very different thing than the move to make large amounts of cash suspicious, which is very different from the move to remove cash from routine, smaller transactions in the formal economy.

    Quite simply, I don’t follow the hysteria around this. Digital payments are not replacing cash (generally speaking). They are replacing other noncash payments systems, especially checks, which are obnoxious, slow, costly to transport, and particularly prone to fraud.

    As far as some government conspiracy, do people forget that “cash” itself is a creation of the government…? If you want to exist outside government, I have no problem with that, and there are many options, from art to baseball cards to pet rocks, that are not made by the government (well, ironically, some of the biggest monetary sovereigns actually do make special pet rocks…) The war on cash is only meaningful if the US ends the legal tender status of FRNs. Such will be never, because FRNs are the mechanism at the margins by which the empire sustains itself.

    1. hunkerdown

      Please refer to Venkatesh Rao’s writing on Ribbonfarm about “legibility”, if you are in fact interested in understanding this phenomenon and not merely confusing the issue. Most of us, I think, would like to be free of the workplace and its perverted authoritarian customs for “16” hours a day.

      1. washunate

        That’s what’s so bizarre about all this hand-wringing of a war on cash. Cash is legibility, not illegibility. It is a creation of government to create orderliness, not a creation of nature. That doesn’t mean it’s necessarily bad, either (some orderliness allows us to martial resources at scale to do fantastic things that could never be done without such collective action); rather, it’s an incomplete picture of the full range of economic activity, missing the value of diversity and chaos much like MMT undervalues natural wilderness and free time.

        One of the core critiques of all quantity-based theories of monetary economics, from Milton Friedman to Warren Mosler, is that they are too focused on the narrow artificial rationality of controlling the money supply. The actual economy is much bigger, much more complex, much more nuanced, much more interesting, much more unpredictable, than any central planner or price anchor can capture, from gold standards to NAIRU to JG. The more force used to apply a particular preference, the worse the outcome tends to be.

  25. rusti

    The Credit Suisse article is so incredibly wrong.

    No matter where you are or what you want to purchase, you will find a small ubiquitous sign saying “Vi hanterar ej kontanter” (“We don’t accept cash”).

    I live in Sweden and I have literally NEVER seen one of these signs, nor have I been to a business that doesn’t accept cash.

    One of the last places where cash can be obtained is at the supermarket checkouts.

    Um, yeah, you can do that or you can go to one of the many ATMs that are usually located near supermarkets? And unlike the US there’s no surcharge for taking out cash.

    Most Scandinavians have not carried any cash or been to a bank in years.

    I know people who seldom carry cash, but this is also just made up bullshit.

  26. EoinW

    A good article for a NC Lovefest! We can all post comments and agree as to how much we dislike governments and hate banks.

    Yet it does leave me wondering about fear mongering. In Canada if you withdraw $1500+ from the bank you must show id. Simple, withdraw $1499.99! The thing is, how many people ever need to withdraw $1500? I don’t. In fact, if I asked most of the people I know they likely don’t even have $1500 in their account.

    Yes there are changes which resemble a move towards a cashless society. However, are we really closing in on it any time soon? Even if it comes, how long will it take before their new society starts to fall a part as people rebel against such control? Certainly the last point in the article is an excellent one – and maybe explains the angst we all feel when such articles are read. The majority of people are choosing not to use cash at all. Perhaps they need to lose that freedom of choice before they regain an appreciation for cash?

  27. GuyFawkesLives

    For all of you ignorant people who say “this is where we’re headed” and act sad, while using your goddamn phone to deposit checks and buy your over-priced coffee, a big “fuck you, Hypocrit!”

    I ONLY deal with cash for the very reason that NO ONE will be able to subpeona my bank records, nor allow the bankers and the fucking government access to my money ever again!

    Shame on all of you who bemoan the “inevitable” while making it inevitable!!!

  28. Pavel

    I have recently tried to pay for more things with cash, and as others have noted it leads to more frugality when one sees precisely how many banknotes are needed to pay for that lunch or dinner out.

    There has been a recurring scandal in the UK about how the restaurant managers skim off percentages of the tips when they are paid via credit card. Sometimes I pay the bill with the card and tip in cash, if only to confuse them :) It’s amusing to see how surprised many waiters are when I bring cash out instead of a card to swipe in their device.

    In London for the past year or so the buses no longer accept cash; one must use the “Oyster card” which can be prepaid for a set amount or used for e.g. a month. (There are also one-day versions.) One problem is it’s hard to know how much is on the card, so a few times I’ve had to get off the damn bus and top up my card at a newsagent or Tube station. Is this called “progress”?

    Now one can pay directly via a modern credit card, dispensing with the Oyster card. Of course this means a complete loss of privacy with regards to personal movement. I believe one divorce case hinged on using a man’s Oyster card database of travel (yup, they keep it all) to see where he went to meet a mistress.

    Privacy RIP.

    With regard to Sweden, I’m glad to hear it isn’t completely cashless according to rusti above. I was in Copenhagen recently and after hearing all the Swedish rumours I was amazed to find the buses still took coins.

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