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Forum Post: Toward a Cashless Society

Posted 12 years ago on Jan. 27, 2012, 5:01 p.m. EST by Underdog (2971) from Clermont, FL
This content is user submitted and not an official statement

Having glanced at a Google search regarding the discussion of whether or not this country should implement a 100% cashless economy, and seeing that most of the articles (and responses if they were blogs) were against such a state, I have decided to throw some things out there for your mental digestion. I have outlined below what I believe some of the benefits would be to going cashless. I anticipate there will be many in opposition to this. This is good as it brings open discussion on the subject to light. If you do not agree with the below, kindly respond with intelligent, well-reasoned responses uncluttered with derision and explitives please :-)

ELIMINATION OF UNDERGROUND/BLACK MARKETS - With everything creating a paper trail down to the penny, questionable black market activities such as illegal drug marketing/dealing (registering in the billions each year), illegal gambling, payola, gun running, and all other forms of illegal cash-based activity would be severly impacted, if not elliminated. We can once and for all (hopefully) assign such activities to the scrapheap of history. I'm sure attempts would be made by clever people involved in those activities to seek ways around such a restriction to their business (such as electronic money laundering), but any electronic transaction in such a society would be traceable and put them on the radar for investigation. Currently it is very hard to investigate illegal activity going on in "back room deals" that are operating on a strictly cash basis.

THE CASHLESS ECONOMY IS COMING ANYWAY - With 98% of our money currently residing in financial computers, and large numbers of cashless transactions through credit/debit cards occurring every day, we are already very close to being cashless. On-line banking and paying of bills electronically has eliminated the old-fashioned requirement of writing checks and paying first-class postage to meet monthy bills.. Many businesses today provide direct deposit of paychecks into personal bank accounts, therefore completely eliminating any need for a person to touch paper currency at all. eDollars go from the business computer to the bank computer only to be paid out again to another business computer (unless the business currently lacks the ability to handle the direct transaction, in which case the banks still mailout paper checks). eMoney is not tangible, and exists as numerical abstraction. Even paper fiat money is a numerical abstraction, existing as numbers on paper. It is not backed up with anything traditionally considered valuable such as gold or silver. Paper money is stamped as Federal Reserve Note, a legal instrument for paying debt obligations. Money is, in fact, debt, as it is what is used to remove debt obligations. If there were no debt, there would be no need for money.

ECONOMIC TERRORISM - In times of war, governments have attempted to destabilize enemy economies by introducing vast amounts of counterfit cash into the money supply, thus making the money worthless. This tactic can also be applied by terrorists. However, in a cashless society, this would be much more difficult because every transaction is traceable.

INEFFICIENCY OF CASH - Cash requires people to create it (U.S. Mint), transportation to move it (Brink's trucks), guard it (bank guards), people to handle it (bank tellers), and secure places to store it (vaults). There is a lot of infrasturcture required to support cash in our society. A cashless society would go a long way to eliminating the amount of overhead required to keep it in circulation. In the case of coinage, the metal alone could be recycled for more productive purposes rather than being used as inefficient weight to be lugged around or sit in a piggy bank on shelf at home.

MORE TAX REVENUE - Strictly cash-based income is devoid of a paper trail and can therefore dodge taxes that should legally be going to the government. The increased tax revenue could be applied to reducing the national debt, although this may be an insignificant amount (but perhaps not; any amount would help).

I am aware that the Conservative Christian Right will immediately bring up Revelation 13:16-17 which reads (NASB translation):

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

This could be interpreted that the electronic transaction is associated with either a figurative "mark" such as memorized account number or physical account number such as credit/debit cards we have today ("mark on their right hand"). Those more fearful interpret this as some type of physical stamp such as tatooed bar code or imbedded biochip.

Logically, if this implies a hastening of the second coming of Christ, then also logically, they should be happy about that rather than fearful, since their King would come to take them away from what would presumably be considered an evil world.

Sorry for the religous sidetrack, but I just know that it would likely be brought up and wanted to address it right from the beginning.



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[-] 2 points by JohnCandido (2) 12 years ago

There is no stopping the evolution to a cashless society. It will be a convergence of factors such as the internet, smart cards that are Visa PayWave & MasterCard PayPass enabled, and the mobile phone that can be used in much the same way as a credit or debit card using PayWave & PayPass. These things will be the final nail in the coffin for cash.

Our smart phones will contain every debit and credit card we own, as well as all of our discount vouchers and receipts in digital form. No more bits of paper to carry in our wallets. Google with MasterCard will produce a Google wallet, Visa will have an e-wallet, and PayPass will offer a similar product as well. These are called virtual wallets, and we will all see the rollout of virtual wallets in 2012/2013. Virtual wallets are subject to future development and improvement over time, and it will be mobile virtual wallets that will be instrumental in removing the traction that cash has traditionally had.

What I think will happen is that we will have a de facto cashless society first, where a majority of transactions will be done without cash, both in numbers of transactions and in the quantity of money involved. We will probably have a de facto cashless society in about 5 years. After a period of a further 30 to 40 years, or somewhere thereabouts, cash will be eliminated from our economy after the nation has had a full debate about this issue, and our governments working with our banks will then remove every note and coin from our economy.

It will be extraordinarily convenient not to have to ask for and carry any more paper receipts or physical discount vouchers! How incredible, powerful, and convenient will both Visa's, PayPass, and Google's e-wallets be, once they are in use everywhere?

I am absolutely confident that we are on the verge of a tipping point regarding the eventual elimination of cash from our economy. As long as there is a national regime of privacy legislation and the security and integrity of the internet is assured, powerful institutions such as state and federal governments will seek and obtain taxes in full in future, as well as not have to bear the cost of printing and manufacturing cash. In addition, a cashless society does not need to be the policy of any political party, as it will evolve by itself through technology and public demand for its conveniences.

Police and intelligence agencies will advocate a cashless society in order to limit or prevent crimes associated with cash. Cash always provides criminal anonymity as in the drug trade, terrorism, burglaries, and cash thefts. The crime of counterfeiting money will be completely eliminated from our laws, because there will be no physical money in order to counterfeit.

Banks and most businesses will want a cashless society because it will substantially lower their costs, by not having to deal with cash on a daily basis. No more counting, storing, or transporting cash will mean both safer banks and businesses, and lower cost overheads for them all. A cashless society will be evolutionary, have a host of conveniences for everybody, and is unstoppable. It will provide many social and economic advantages, relative to a society that maintains cash.

[-] 1 points by jomojo (562) 12 years ago

I advocate taxing cash.

This tax should be progressive. It could be imposed at a higher percentage on larger denominations and even higher for persons withdrawing lots of cash.

Certain businesses could perhaps be taxed for accepting and depositing cash.

Very few sting operations catch criminals, (white or blue collar), writing a check, using credit cards or using ones, fives and change.

[-] 1 points by Underdog (2971) from Clermont, FL 12 years ago

Good comment. Don't know if it is slightly off subject or not. Are you saying that taxing cash would speed up it's demise? Don't know. Credit card interest could be looked at as taxing the debt on the card , albeit cc debt is paid to private banks and taxing cash would be government revenue.

Thanks for your input.

[-] 1 points by jomojo (562) 12 years ago

Yes I think taxing cash would reduce its use, and possibly destroy it. That's against my wish, that we should be free to choose to use cash, without penalty, but that would require universal honesty.

The credit card is part of the bureaucracy that has made banks too powerful, and the debtor society feasible.