Are There Dangers in a Cashless Society? (slate.com)

Slate asks why more businesses are refusing cash -- and investigates the downside. An anonymous reader quotes their report: Stores are eliminating cash registers and coin rolls in pursuit of what they say is a safer, more streamlined payment process -- and one that most of their customers want to use anyway. At Dos Toros, co-founder Leo Kremer said that more than half of the shop's customers used cash when its first location opened in Manhattan in 2009. By the beginning of this year, that number had fallen to just 15 percent. At that point, the various hassles of dealing with cash -- employee training, banking fees, armored-truck pickups, and the occasional robbery -- outweighed the cost of credit card fees on those transactions. The shift wound up being more or less revenue-neutral, Kremer said, but saved a lot of time and trouble. Dos Toros' New York locations have been fully cash-free since the winter.... "After talking to the team and absorbing the flow at the register, we felt like almost everyone who used cash had a card. It just hasn't been an issue...."

But it would be hard to find anyone more gung-ho about the abolition of cash than credit card companies. Last summer, for example, Visa announced a $10,000 reward to 50 businesses that would give up cash entirely. "What concerns me about a cashless future is how much it benefits Wall Street," Stacy Mitchell, co-director of the Institute for Local Self-Reliance, wrote to me in an email. "They can charge swipe fees of two to three percent not because that's what the service actually costs, but because they have monopoly power."
Citing services like Square and Apple Pay, the article notes that 4 in 10 purchases used to involve cash, but between 2011 and 2016 it dropped to just 3 in 10 purchases (according to the San Francisco Fed). Yet the article's author also presents this counter-argument. "In Shanghai, the venture capitalist Eric Li told me a story about trying to get his morning coffee the morning after a storm had knocked out the internet on his block.

"No one could buy coffee, because no one was carrying cash."

Comments

Forget wall street, it benefits fascists

[drinkypoo]

Someone gets uppity, freeze their ability to spend money. Want to know what someone is buying, where they are going, what their habits are? If they do it all with credit card, you can! Forget wall street, the prime beneficiaries are fascist governments.

Governments hate cash because they make it easy to do business they don't like without them knowing about it. The government you've got today may not be the government you've got tomorrow, so you shouldn't hand them that information.

Use cash whenever possible.

Re:Forget wall street, it benefits fascists

[AHuxley]

CCTV kept for years has mostly given governments that in most city and mall areas.
Every face and what they buy. The transport they used.
People wonder around with a cell phone on while using "cash".
Known and unknown people do a transaction with cash, both with cell phones on.
Every method of transport in and out of a city is collected on.
Moving around the USA to make legal large amount of cash is not going to be as easy as it once was.
Voice prints fill in the rest.
Spend too much cash beyond an average wage and its reported. Deposit cash and the gov gets a record.

The cash movement ability for normal people is already well closed.

Re:Forget wall street, it benefits fascists

[Anonymous Coward]

Electronic transactions as an option are convenient and useful. As a requirement--a tool of government and corporate control.

Cash should never be done away with, and businesses should be held to the standard that all transactions may be conducted in cash. None of this 'electronic only' bullshit..

People ought to use cash more than they do as well. I've been trying to make a habit of that.

Also, money laundering laws need to be done away with. All of them. Do they prevent crimes? Marginally perhaps, but nothing is worth all the spying and control that they enable.

Re: Forget wall street, it benefits fascists

[Wycliffe]

No it's not. You can easily buy as many gold coins as you want. But using them as a medium of exchange is problematic as they are considered an asset so buying/selling them counts as a taxable transaction just like buying stocks.

Re:Forget wall street, it benefits fascists

[b0s0z0ku]

CCTV takes more work for the fucking pigs to match a name to a location. Credit card required zero work for the filth to do so.

Re:Forget wall street, it benefits fascists

[b0s0z0ku]

Cash may have passed through ten sets of hands between withdrawal and deposit. A bit harder for the filth to track than credit card transactions.

Re:Forget wall street, it benefits fascists

[Actually, I do RTFA]

I'm confused. You said "Forget wall street, it benefits fascists". Who do you think is going to freeze the accounts? And do you think they'll only do it when the government asks, or also when it benefits them?

Re: Forget wall street, it benefits fascists

[b0s0z0ku]

Ever seen most real-world security camera footage? Crap resolution, crap focus, dirty lense. It takes real WORK to match a name to a face, and serial numbers are hard if not impossible to see. The real world is not "24", it's more like "Keystone Kops."

The phone? You can go to the store without carrying one (leave it at home) and pay cash.

Re: Forget wall street, it benefits fascists

[phantomfive]

I would love to see federal income tax reduced by 90% and if there are some things that still need to be done, let the local governments do it.

Look at this graph of federal government spending, and say what exactly are you going to cut? Even if you cut military spending to bare bones, you wouldn't succeed in closing the annual deficit. If you cut social security, you will be voted out of office. If you cut Medicare, you will be voted out of office. So what exactly are you planning on doing?

Re:Forget wall street, it benefits fascists

[nnull]

Many companies do, including mine. It's not unusual.

Re:Forget wall street, it benefits fascists

[Anonymous Coward]

I think that you overestimate the quality of CCTV cameras of the sort typically installed in restaurants, shopping areas and other retail establishments. The typical business owner who decides to install cameras buys the cheapest piece of junk made in China cameras that he can find and then mounts them too high on the ceiling and too far away from the doors because he wants to "cover" as much area as possible with as few cameras as possible. The end result is video so grainy and poor that unless other information about a scene is available, from eye witnesses say, it's difficult or impossible to identify anyone based on the video alone. Did I also mention that these cameras really suck in low light conditions? These are the sorts of systems that you see a few hundred dollars at Costco. I suppose it's possible that bigger corporate stores invest in better cameras, but honestly that's not likely because again the video evidence is only there to corroborate other evidence. The chance that an unidentified stranger is going to be unmasked by careful analysis of the video recorded by these crappy cameras is laughable. The resolution is too low, the camera is too far away and the lighting sucks.

One exception to this rule: Casinos. These guys really do have ultra high resolution cameras that see well in low light with full coverage, telephoto zoom, years worth of recording capacity and expert analysis and advice on placement and analysis. Then again, they spent millions of dollars on their security systems whereas most other normal businesses did not because they cannot justify that level of expense.

Re:Forget wall street, it benefits fascists

[BlueStrat]

Incarcerating racist yob trash is definitely worthwhile...

Although I agree that the racist language he used and most of the sentiments he expressed are racist and horrid on general principle and that the fault in choosing that belief structure is on him, there are contributing factors to such attitudes & beliefs in places like the UK where the government has up until quite recently mostly ignored refugee Muslim pedo/rape-gangs and child abductions & trafficking while simultaneously suppressing and censoring news and facts relating to those serious criminal activities including jailing those who try to speak out and all sorts of other illegal and quasi-legal bad shenanigans in furtherance of the suppression of the facts including but not limited to the number and scope of these crimes from being widely disseminated especially among UK subjects.

This sort of behavior from the government is a sure way to foment and enable such attitudes and beliefs among the poor and working class. "Clamping down" on such attitudes and beliefs by the government without the government altering it's own behaviors, policies, and attitudes that are exacerbating the problem and angering those who feel their children are in danger serves only to further anger, alienate, and grow the numbers of angry, unreasonable people because they will see themselves, and others will see them, as unjustly censored and unfairly persecuted regardless of the actual truth good or bad as the facts will be so muddled the average person will have no way to check facts (and most will have little inclination to do so).

Strat

Re: Forget wall street, it benefits fascists

[Wycliffe]

I would love to see federal income tax reduced by 90% and if there are some things that still need to be done, let the local governments do it.

Look at this graph of federal government spending, and say what exactly are you going to cut? Even if you cut military spending to bare bones, you wouldn't succeed in closing the annual deficit. If you cut social security, you will be voted out of office. If you cut Medicare, you will be voted out of office. So what exactly are you planning on doing?

Neither medicare nor social security are paid with income tax. They are both paid with their own separate payroll tax. Medicaid is already mostly administered by the state and the federal government shouldn't be collecting any money and giving it back to the states. Other than military spending, which could be significantly cut, most of the other stuff that the federal government does could easily be done by the individual states. We currently spend 4 times as much on our military as the next closest country (China). That would be a good place to start. If we cut our military budget in half we would still be spending more money than any other country.

betteridges rule

[bugs2squash]

No - everyone can sleep safely, all crime will be a thing of the past

Power

[thePsychologist]

Human society has never before been linked together so well. We need to guard against unintended consequences, like the unimaginable power that some will have to control dissent by electronically preventing dissenters from buying food at the grocery store.

Re: Power

[Kjella]

Germany could have cashed out Greeceâ(TM)s entire debt just like that. If the EU started the printing press theyâ(TM)d effectively make rich countries and wealthy people pay with only marginal inflation. They just didnâ(TM)t want to do that because itâ(TM)d be a terrible precedent for the future, spend money on credit like crazy and your rich uncle will bail you out. If the dominos had really started falling we would have seen a real intervention. But not until the PIGS were begging on their knees, not whining about austerity measures.

Danger?

[AHuxley]

Good parts:
Your banking, tax and transactions as a business owner are automatic.
The payment is made for a service, product and the money is ready to use in an account.
Every citizen has to have a bank account. Show ID to get a bank account.

The plus side for that is all illegal migrants have to get another layer of new photo ID and interact with banks and who pays them for work.
Thats a trail that can be used to discover who is not allowed to work in a nation, who is in a nation illegally.

Re:Danger?

[omnichad]

You would need even more financial regulation to enable that. As it stands, it's not just non-citizens who can't open a bank account. There are a large number of poor people who are ineligible for a bank account due to poor credit (which is a side effect of being poor).

Re: Danger?

[nihaopaul]

I can imagine a future where your insurance premiums are tied to your digital finger print. Your risk profile for credit is tied to your activities.

Your social credit (china) because you like to drink alcohol drops so low you cannot buy a flight, stay in a hotel or shop at certain places. Your position in the world is monitored to be able to collect you at any time.

Your price for goods depends on what friends you have (correlation of purchases across locations and times), your targeted advertising profile gets that much more sophisticated that you end up with a lot more crap. And then as market share increases the prices start to rise on transactions.

you can no longer buy anything as a tourist as governments clamp down, your children no longer can freely shop without a digit means.

Re:Danger?

[AHuxley]

That would be a fun change to government banking regulations.
Making a baking service to pay a wage into and that every citizen has a right to use.
Some type of universal "savings" account with a "electronic" card that could accept funds and pay out funds.
It would not be a loan account.
Think of something like an Electronic benefit transfer https://en.wikipedia.org/wiki/... from any US bank, connected to photo ID and US citizenship.
No US citizen would be "ineligible" as the bank would have to register and provide that type of account when asked to do so. The US gov could cover any costs for the very poor citizens.
After the person is working they could get normal banking services. A citizen who is not working would stay on the bank/gov supported account for as long as needed.

A wage when working or gov support would just get moved to a persons bank and to their bank card depending on a citizens needs at any time.

Re: Danger?

[hawk]

>I\ can imagine a future where your insurance
>premiums are tied to your digital finger print. Your risk
>profile for credit is tied to your activities.

credit score is already a major factor for car insurance.

Texas was going to ban it a couple of years, but in a rare fit of reason (for a legislature) they had a study done first.

The data shows that credit score is far more accurate than driving record in predicting claims.

You can come up with a number of explanations (high credit score people are more careful, or have less distractions, or . . .), but keep in mind that it's claims pad, not accidents, that interest the insurance company. My pet theory is that those with the higher scores are also less likely to submit small claims due to anticipated rate increases, and instead have the cars fixed themselves--but again, that's just an educated guess.

hawk

Re: Danger?

[b0s0z0ku]

What do you propose that the cops do with the homeless? We could offer addicts and homeless treatment and/or shelter NOW, but we're too focused on incarceration and punishment. The problem isn't cash -- it's a retarded Puritan worldview.

Re:Always

[Anonymous Coward]

There will always be something to trade if cash goes away.

During German occupation in World War II, folks around here used cigarettes as currency.

In a cashless society all legal tender is controll

[Anonymous Coward]

So there's nothing preventing the government from taxing your savings by declaring a negative interest rate or from bailing out banks using your money (a 'bail-in').

(In a society with cash, there's always the option/risk of people pulling out their savings to cash to prevent negative interest and bail-ins. This won't exist anymore. Your money is their money).

Re:Danger? No.

[WindowsStar]

@Anonymous (Danger? No.) This is what scares the hell out of me. The extreme ignorance of some people. Please take the time to research how money works and that using credit or debit cards only at the very least gives government and the banks all the power over the money. When this happens, banks now can charge a 10% transaction fee and there is nothing you can do about it. Receiving any money is now subject to government taxes. This is something YOU DO NOT WANT!.

And this has happened

[Okian Warrior]

Someone gets uppity, freeze their ability to spend money. Want to know what someone is buying, where they are going, what their habits are? If they do it all with credit card, you can! Forget wall street, the prime beneficiaries are fascist governments.

Governments hate cash because they make it easy to do business they don't like without them knowing about it. The government you've got today may not be the government you've got tomorrow, so you shouldn't hand them that information.

Use cash whenever possible.

And this has actually happened.

Soon after Wikileaks released the gulf war information, including the "collateral murder" video, the credit companies froze their accounts, effectively cutting them off from donations and keeping $11 million in donations already in account.

Say what you will about Wikileaks, its activities are legal and it serves a valuable purpose in keeping certain governments in line.

At the time people kept saying "this isn't censorship, credit card companies are private companies and can choose who they do business with".

Re:And this has happened

[Anonymous Coward]

Governments hate cash because they make it easy to do business they don't like without them knowing about it.

More to the point, gov't depends on distrust for income. If I fix your sink and you cook me dinner, there's no monetary exchange at all. It's either something between friends or it's bartering. Bartering is technically taxable, but typically not traceable. If we're not friends then I charge to fix your sink and you charge to serve me a meal. Then we both pay perhaps 30% income/SS tax. If we both use plastic then we're also paying a middleman to actually make the payment to each other. A simple relationship has become very expensive for both of us. A relationship has become a business transaction. In that sense, gov't benefits from lack of social cohesion and generalized, personal alienation. In a true community there's very litle "economic" activity.

So there's privacy from gov't to think about. There's also privacy from corporatocracy. And if those are not enough reason to use cash, there's the simple fact that banks have created a lucrative middleman business out of thin air. We're all still essentially using cash. We're just paying a 3% fee to a 3rd party to make the payments for us.

Re: And this has happened

[Wycliffe]

We're just paying a 3% fee to a 3rd party to make the payments for us.

There is an easy fix for this. Require the end user to pay the 3% fee. A few places do it but I believe it's against the rules of most major credit card companies. If more places gave a discount for cash, a lot more people would pay with cash. As it stands now, with credit card rewards, there is effectively a 1% or so discount for using a credit card.

Re:And this has happened

[Jane Q. Public]

This.

While non-cash purchases might be easier in many circumstances, that doesn't reduce the importance of cash.

The downside should be obvious to all: if we were to create a "cashless society", on that very day you could kiss your freedom goodbye.

Period. The end. It might take time to be realized, but it would already be gone.

Re: And this has happened

[tlhIngan]

We're just paying a 3% fee to a 3rd party to make the payments for us.

There is an easy fix for this. Require the end user to pay the 3% fee. A few places do it but I believe it's against the rules of most major credit card companies. If more places gave a discount for cash, a lot more people would pay with cash. As it stands now, with credit card rewards, there is effectively a 1% or so discount for using a credit card.

First of all, cash isn't free to handle. If you're a small business, it might be close to free, but only because you don't have much of it. When you're handling a few thousands of dollars of cash daily, things get MUCH more interesting.

And it's easy to tell who's the "free" department - you can tell if a business simply turns off the register at the end of the day, or if they actually count the takes. If they don't count the takes, then in general they don't make enough cash (because it's not worth counting).

But once you do start raking in cash, you start to have to count it, which means you need to train employees how to handle cash. You need to tell them how to set up the register, how to ensure their takes are accurate, and how to sign off the register. This again is easy to see - when they run out of coins you note they always take a 410 roll of coins, but at the same time, they give the donator a $10 bill to equalize the transaction.(because every dollar has to be accounted for). And yes, when the register and cashbox do not agree, it's a very serious offense, minus some small percentage error (because people do realize short-changes and mistakes happen, but it shouldn't be more than a couple of bucks or so).

But you also have the problem - you have a few thousand dollars in cash now, and you have to deposit it at the bank. So someone has to go to the bank, wait in line, and make the deposit (which has to be counted, verified, etc). So that's someone's hour out of their day going to the bank, parking, lining up, etc., and hopefully not getting mugged or robbed along the way (another cost of handling cash). Or if you're lucky, you've got night depository permission so you can use those outside deposit boxes. But again, prime spot for being mugged (and it's after hours, too).

Hey, if you make enough money, perhaps you can call an armored car to take your cash for you to the bank, but that too is another cost for handling cash.

Oh, and let's not forget the whole robbery aspect - always a problem with cash-only businesses.

And finally, there's the problem of counterfeit bills. You might not think it, but large bills might be common - if you buy $50 worth of stuff, you would expect to get paid with $20 bills, $50 bills, and $100 bills. But $100 bills could be counterfeit, yet another cost (because counterfeit bills are non-redeemable, and it could've been changed with legitimate bills). Sure you can try to avoid taking in $50 or $100 bills, but if someone comes to you with $75 worth of purchase, they may not have $75 in smaller bills.

Now, the laws changed here recently (Canada) where retailers can charge the extra 3%, but it turns out most don't. Not because they can't, but because they realize that most of their transactions are credit and debit (which incur a fixed fee at least), and they fear losing that business. (And yes, businesses that were formerly cash-only have gone into accepting debt and later on, credit cards did see an uptick in business - both in number of customers through, and increases in size of transactions).

And to be honest, the ones that do charge, I tended to shop there less - about the ones that did were computer stores and they always did "cash discounted" pricing. It was always annoying to have to plan a visit to the bank to do a cash withdrawal in order to shop there, and they eventually lost me out to online shopping where the credit prices were included AND I had to pay shipping. (Not having to find parking in some obscure neighbourhood was a bonus, too).

ALWAYS keep cash...

[Anonymous Coward]

My life was ruined by the tax department, during a dispute with them. They froze my bank account, so cheques started bouncing, bills went unpaid, etc. Had to use cash to buy food, etc. So government incompetence, corruption, abuse, etc., will always mean cash for me.

Not to mention, when in China last year, a luxury high end shopping area couldn't use/accept any of the cards I was carrying. Cash worked, cards didn't.

Many smaller vendors, areas, towns, countries are cash based societies/communities.

And then, in a restaurant when the power failed...

Et cetera, etc.

Cash is king.

Re:ALWAYS keep cash...

[bn-7bc]

You stil use cheques, oh yea the US never mind, here in norway, and i supect in the test of western Europe, as farcas I know, they are noot in wide use any more,due to high prosessing fees, bank to vabk transfers are easy quick an relativlu low cost even cross border, normaly a transfer is creditid the recievers account the nex buisness day (som places it is ibnstant if the payer and the payee have accounts at the same bank. Cross porder (at least for SEPA transfers) 1-3 buisness days. Out of curiosety how long does it takr for a cheques to clear an be deposited?

Cash gives you freedom

[Anonymous Coward]

Freedom to be (relatively) anonymous and not reliant on any 3rd party to make good on your transaction. And freedom from giving a cut on every payment to the same thieving, criminal bankers who have already stolen our tax money in bailout after bailout. If you liked what they did for your investments in 2008, wait until you see their plans for a "cashless" future.

Of course

[PopeRatzo]

Are There Dangers in a Cashless Society?

Yes. Spiders. You could still get bitten on the arm by a brown recluse and end up dying.

Oh, and meteors. Most people don't realize it, but there are meteors constantly hitting the Earth. Eventually, they're gonna get around to you and then you're gonna be a grease stain on the sidewalk. Unless you live in the suburbs, where you'll be a grease stain on the driveway.

Also, food-borne disease is always a danger. I'm pretty sure there are lots more, but I started drinking a few hours ago, and I think I'm going to go binge watch Lost in Space.

and when the system goes down? or they don't take

[Joe_Dragon]

and when the system goes down? or they don't take your card for some odd thing?

Re: In a cashless society all legal tender is cont

[Wycliffe]

You could still have a run on the banks in a cashless society. It would look more like a run on the stores where people would buy large amounts of food, jewelry, or whatever else they thought would be useful or easy to sell/barter/trade.

Re: In a cashless society all legal tender is cont

[b0s0z0ku]

Which is actually worse, since it will affect availability of real-world goods faster.

I'm actually not that worried about it

[rsilvergun]

see here. If the gov't has it out for you there's plenty of ways for them to come down on you like a ton of bricks.

This is what's made me a Democratic Socialist. People don't oppress other people for the hell of it. They do it because they're monopolizing all the money to the point where folks lack economic security and when you do crap like that you've got to do all sorts of nasty things to get away with it. The surest fire way to make that a moot point is to guarantee everybody food, shelter, healthcare, education and transportation (the latter needed to access to former). Tyrants lose power when they can't threaten you with starvation, the elements or dying of disease.

Re: I'm actually not that worried about it

[astrofurter]

Realistic implementations of democratic socialism will make it *easier* to starve dissents.

All a corporate oligarch needs to do is complain to his ivy league dorm buddy at their next golf game, and WHAM - a kangaroo kourt declares the dissident a criminal. No more UBI, no more benefits, no more food, no more shelter.

Kneel and lick the boots of the oligarchy - or die in the street like a dog.

Re:Always

[Z00L00K]

Around here you can't even use cash when there's a power outage since it will not be possible to get the price of the products anymore.

Re:Is this a trick question or something?

[houghi]

Next: Are there dangers in a cash only society?

The answer will still be the same: "yes, definitely".