Slashdot Mirror
How Feasible is a Cash-Less Society?
"Think about this: if the cumulative value of everything in the world were expressed in measures of gold, which theoretically backs the majority of world currencies, does enough gold physically exist to back the paper money value, or has the paper money itself become valuable?
And what about this: how is it that the people who depend upon cash are usually in the middle of the financial spectrum, neither the poorest nor the richest? In most extreme poverty situations, transactions are based on barter. For most middle class people and above, transactions involve checks, credit, and electronic fund transfers. For the working poor, most transactions are done in cash. How does all of this add up to the trend toward a cash-less society, where money is nothing more than numbers in a computer transferred from one account to another, to another? How far off is that future?"
Those bastards at Steak-n-Shake will never switch to accepting non-cash methods of payment.
I like cash. I also like paper. I'll bet i'm not the only one.
When it comes right down to it - there are a lot of intangibles that using cash provides - plus, is it really faster to swipe, enter a PIN and wait for authorization, than it is to get $2.15 change from a 5?
Me thinks not.
There are 01 types of people in this world. Those that understand binary, and me.
It's called "post-secondary education". They take all your money for tuition, and you live cash-less for many years. It's not as great as you make it out to be!
When the lower class sorts (you know, Joe Sixpack and friends) amuse themselves, cash often plays a part. You can't stick a dollar bill in a stripper's thong with a debit card, you can't buy marijuana with a credit card, pool games take quarters, and most bars only take cash.
Remember, just becuase you live online and buy porn online doesn't mean Joe Sixpack does.
The only time I use my debit/ATM card for actual purchases is when buying on-line.
For all other purposes I withdraw cash - from as many random ATM's as I can manage.
I'll continue to do so until I receive an absolute guarantee from my bank that my purchasing habits are completly private.
And, of course, there are some things that plastic just can't buy...
This sig left unintentionally blank.
We have to remember that money as we know it sort of evolved. It went from physical gold and other backing, to gold (and other backing) stored in banks with bank notes holding them, to paper whose only value is defined by the government issuing it, with no backing. Modern debit cards and checks are just bank notes that represent money that doesn't really represent anything other than the fact that it is money. We already are cashless, people just seem to want this state to be computerized... Well, realistically it is... I mean, a lot of the stuff we buy we never phyiscally move money around to pay for. Actual cash is just another representation of this, why get rid of it? If people stop carrying around cash on their own, I'm sure that less will actually be issued, but why make a big deal of this transition, when it will just occur naturally (if it occurs at all).
> it's no less theft-proof...it just takes a theif of a different calibur to pull it off
That's like saying steel is no less melt-proof than butter; it just takes a different temperature to pull it off.
...please, continue to use your credit cards and cheques.
I like cash because I don't care to receive any more spam in my snail-mail inbox than I already do. I particularly like cash for black market purchases...kinda difficult with credit cards. Also, if you like avoiding all the troubling paperwork of paying income taxes on that $20 that you got for mowing the neigbor's lawn, cash is good.
Can any of you imagine having to set up a paypal account when you are 13 years old just so you can get paid by the guy down the street for mowing his lawn?
Cash ain't goin nowhere...
"Money will always be paper...but gold will always be gold..." -- Hudson Hawk...Mayflower...
"Reality" in financial terms is a 1:1 trade of value. X number of pigs for Y pounds of grain, for example. Barter.
Barter became unwieldy, so there came to be used "valuable" pieces of metal that represented the value of physical objects.
Then valuable metal became scarce, so we came to use pieces of paper that represented metal stored in a fort somewhere.
After a while, the paper was valuable just for the idea, and there was no longer a need to back it with gold.
Then, because the pieces of paper were unwieldy, we came to create bank accounts where we could write one piece of paper (a check) to represent several of the formerly gold-backed pieces of paper.
Then people got tired of carrying around pieces of paper, so they replaced it with single pieces of plastic that could be used multiple times.
But pieces of plastic had to be used in person, so when people wanted to buy something from Amazon.com, all they needed to use was the number.
Our entire financial lives can be reduced to a meaningless string of numbers. That's a far cry from bringing your pigs or cheese or grains or whatever to the market.
Got Rhinos?
The thing i worry about in a cashless society is that once you have the centralized system to deal with clearing the transaction, people are going to extract marketing data. The government is going to look at your purchasing habits and decide that some people have similar purchasing habits too far to one or the other side of the political spectrum, and are too much of a threat to middle class suburban normalcy and should be liquidated.
Also that means that if they _suspect_ you of selling/using drugs, they can freeze your finances completely. It gives _way_ too much control to somebody else, based on politics, purchasing habits, etc... It makes my skin crawl.
P.S.
I don't think many (any?) major economic powers even _pretend_ to back their currency with anything real anymore, let alone gold.
---
Play Six Pack Man. I
Over the last six months I have made an effort to pay for as much as a can with cash. For groceries, gas, books, and gear, I whip out my wallet and throw down as many twenties as I need. Its has a few nice benefits.
1) I stay in my budget. I take out cash when I get paid, and know exactly how much I have to spend until my next pay check.
2) I get less junk mail. No more grocery store fliers, no more technical junk, jut good ol' mail. Coincidence? I think not.
3) People who provide services for me (yoga, karate, acupuncture, housing, servers, etc) get instant payment, and can do what they want with it, including not reporting taxes. This makes them happy.
I only use credit cards when I absolutely need to, and am much happier for it.
The middle mind speaks!
Considering that most cashless transactions impose some sort of transaction charge, I patently refuse to accept a cash-only society until these sorts of electronic money services are free. Otherwise, you'd be paying some sort of X% tax on every 'cashless' transaction you make. I prefer cash, if only for this reason alone. (Nevermind that the tangible quality of real cash is an important part of appreciating your hard earned money.)
"Old man yells at systemd"
While it is worthwhile for the government to regulate the amount of money available through monetary instruments and fiscal policy, it seems pointless in our day and age for the government to continue to track the quality of trillions of pieces of paper.
Note that this is not simply a domestic issue - numerous other nations use the greenback for their currency, so this creates a huge bloated government apparatus that is completely unnecessary.
Nowadays, I never carry cash around. Before, I always used cash and ended up spending a lot more money, just because I happened to have it on me. With Debit/Credit, you pay exactly what the goods cost. With cash, you need to take out more than is necessary to cover the cost, and lets not forget the tons of change that (for me at least) ends up just gathering dust all over my apartment and in my car.
- Cash is really the only means that we have for anonymous/semiprivate transactions. Everything can and is tracked. Big brother is watching you.</paranoia>
- People with poor planning skills. To many many many people in this world (although perhaps the interection of slashdot readers and this particular group of people is not very large), money that you can't hold in your hand isn't really money: this means that it can and is spent on a whim with not "plan". This is why people get so down in credit card debt that they can't seem to pull themselves out of...
If people are allowed to spend "insubstantial" money that they can't feel slip through their fingers... then many people could have a problem with their personal finances...IOW, credit cards are not for everyone. :)
-Chris
We're at about the midpoint of the transition, I'd say. There are about as many places that won't take your Visa card as won't take the $20 in your wallet (or at least will give you grief over it, like a friend got the other day at Best Buy). But there's still the impetus of "legal tender" to keep cash around.
I lived in a pure-cash economy for about 3 years. I was moving and changing jobs, and closed my bank account. Then as I was about to open a new one, the bank I was moving to got swallowed up by Wachovia, so I held off. By the time I got around to it again, I didn't feel like going through the bother. (I finally had to when the company I was working for got bought by EA and my paychecks started being drawn on Wells Fargo.)
My co-workers who have always had credit cards, checks and ATMs don't understand how one can live in the "cash economy" without sacrificing quality of life, but it can (mostly) be done.
The biggest hurdle is things that require a reservation. If you travel you're going to have to resign yourself to paying up-front for your airline ticket and playing Hotel-Motel Lotto when you arrive (unless you're staying with friends or family). Renting a car will also be off-limits to you unless you have a couple of thousand dollars to spare for the duration as a deposit.
Apart from that, you really don't notice much. Sending money through the mail (to pay bills, for example) will involve getting a money order from the post office, which is in the neighborhood of a dollar per MO -- and USPS money orders have the advantage that a receipt is presentable in court as prima facie proof of payment. Getting a loan can be a little trickier if you have no previous loan history, but you can use landlords as references. Also, your utility history will most likely show up on your credit history, especially if you have a cell phone. And speaking of utilities, you may have to give them deposits before they will start service, but these are usually payable in installments.
You won't be able to buy things instantly online, but most places will be happy to bill you or ship after receiving payment.
If you can forego instant gratification and avoid things like needing to rent a car, there's nothing preventing most Americans from living a pure cash lifestyle.
-- Old Man Kensey
This has been tested in Swansea, UK, and I believe it proved reasonably successful, at least with the vendors that used it.
As I see it, credit/debit cards will die off, over time. You can't keep spending ahead of yourself, and expect to make ends meet. The recession of the Thatcher/Reagan era was largely a product of free-spending on credit. The amount spent vastly exceeded the amount available, and the economic system was not able to cope.
Further, credit/debit cards DO need a third-party, which is inherently more expensive than having the electronics do all the transacting on-site. It's therefore much cheaper for banks to churn out a bunch of "smart cards", with suffcient processing power to handle decent public-key encryption, than to maintain a clearing-house for credit cards.
Since cheaper usually wins, in the end, a system involving distributed handling of transactions will always be preferable to a centralized one.
It's a small world and it smells funny; I'd buy another if it wasn't for the money; Take back what I paid (SoM)
Funny, I relocated to the SF area a couple years ago, and as an experiment, I didn't order any paper checks. I managed to get by the first year using only one of the temporary checks they gave me. I finally ordered paper ones, and I've used four of them, of which three were for goverment agencies (DMV, IRS, State tax). Nearly everything else is paid online... I use a credit card to buy gas and food, and pay that bill online weekly. I carry some cash (cigarettes and junk food account for most of that), but it's a small percentage of what goes through my bank account. So I'm nearly cashless.
Still, even though it's plausible to go without cash, in order to eliminate it, you'd have to get the sellers to stop accepting it. How would you do that? The only way would be if the government eliminated cash completely, for example, if they offered to redeem it for credit up to a certain date, and refused to back it thereafter.
For starters, the implications for personal privacy would be substantial, and there would likely be widespread public outcry. But more to the point, cash is a simple method of anonymous exchange that allows economic activity to take place at a very low level. Eliminating it would impact many transactions, as some have observed. Some are illegal, such as drug deals, but others are benign... flea markets and garage sales, poker games, tipping, lemonade stands, and a lot of everyday economic activity among poorer people.
So I just don't see how it's possible, no matter how close we come, to being able to eliminate cash entirely, nor should we want to. We will be pretty close, in fact, we already are pretty close... if we choose to, we can live with minimal cash. But I don't want to go without it completely, and I don't think many others will either. Anonymous paper cash is a pretty profound invention, and electronic transactions will only replace it for transactions that offer substantial improvement in convenience or that require some sort of accountability.
Is that like a hores of a different colur?
- A.P.
"Remember when the U.S. had a drug problem, and then we declared a War On Drugs, and now you can't buy drugs anymore?"
Has anyone else noticed that it's actually hard to use cash in some situations? For the most part, I'm totally cashless. I have a central checking account and a debit card w/ the Visa logo. So rather than go to the ATM, withdraw some 20s, and spend them. I just go to a place of business and they withdraw the exact amount for me.
But what about the people that prefer to exclusively use cash?
I worked in a computer retail store for a while. And when people came in and bought a high-high-end PC or laptop with just cash, you'd better believe we noticed it. When someone peels 20-30 $100 bills off a stack, everyone in the store craned in for a better look. And we checked all that money verrry carefully.
A similar story was told to me by a friend who worked at a candy factory. The janitor at the place had just bought a brand-new car, but was complaining that the dealership almost wouldn't sell it to him. Why not? Because he had paid in CASH. $26,000 in cash. He actually brought the stacks of bills to the dealership in a briefcase, all ready to go. And, of course, the dealer was a little suspicious about someone carrying that much cash.
So you see my point? How is it that we have come to trust pieces of plastic or signed pieces of paper as opposed to cold, hard, cash? Somehow America has embraced a further level of abstraction from specie to the point of almost rejecting other forms of payment. It just seems like curious situation to me. I'm not sure if I like it or not, though. Like I said, I'm almost totally cashless. But I'd like to believe that if I wanted to switch to cash-only, I'd be able to use that money for whatever I want. Now I'm not so sure I could.
4-star general in a one-man army.
However, the more I think about it, I realize that with some careful consideration and common sense legislation, both could be a great boon to us.
If the government is able to receive real time, compleatly accurate consumer and business spending information (in the aggregate, of course), it suddenly has access up-to-the-second and 100% reliable data for forming economic indicators, which are at best currently formed quarterly.
At that point, the governments economists can catch onto economic trends quickly and react before any major problem begins to occur. From an economic standpoint, it would be wonderful.
The other issue surrounds marketers collecting information. I can't seem to understand the danger in this. I for one really want marketers to know what I'm interested in; We have a real chance to change the role of advertising from a broadbased attack on our senses to facilitate brand reconition for products and services we don't need or want (current) to a tool that educates us to the availibility of products and services we genuinanly would like to know about.
The only key to making this work is a continued diligance in making sure our lawmakers are very specific in the drafting of legislation so information does'nt belong in the wrong hands: For example, governments can only collect data in the aggregate and cannot submit individual information to law inforcement. Or Advertisers can only collect the most basic of demographic information (zip code, income range) about us.
The Internet is generally stupid
tracking your purchases has elements of big brother...
-
marketing folks will love the idea of knowing every little thing you purchase, and when
-
phone records are sometimes used as evidence in court, your purchases may follow
-
abuse will come, spouses tracking each other, watching those purchases of suspicious items, like perfume, fine dining on work nights etc
-
lies, damn lies and statistics. could your unusual purchases get you listed as a suspect criminal?
-
could insurance companies raise your life insurance premiums due to your recorded high caffiene intake?
-
could your employer look up your history and decide you take more holidays than your co-workers?
-
if it's all electronic, where's the security? if I could fake you being at the scene of a crime, or having purchased something illegal or dangerous
-
blackmail... with any type of tracking, blackmail is always a danger, especially when things may be implied and not actually be true, but the implication is enough to ruin another's life...
Maybe none of this could or would happen, but when humans are involved, it's a risk.