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Why we should fear a cashless world

theguardian.com

81–90 of 257 posts

Re: Why we should fear a cashless world

#81
post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

> cost for society

You meant "cost for government," right?

It sounds like the slice of society that gets the cash discount is benefiting greatly from this "hidden economy." Saving 50% on a venue is a big win for the newlywed's pocketbook, leaving more money in their pocket to buy goods for their new household.

Re: Why we should fear a cashless world

#82
post #52
post #20

Earlier quoted context omitted.

> If you really mean globally, then inequality is in fact falling. No. Inequality is decreasing between nations as the developing world catches up with the west. But inequality within nations -- even developing nations -- is increasing. It's possible for inequality to increase as the the developing world catches up to the west; in fact, that's exactly what's happening. So the old geographical distributions are very s…

> and lessen nation states' ability to combat inequality with policy Ok, one person is a great programmer making good money and another person is not interested in any of that and makes less money. I do not see any inequality here that needs to be combated with policy. One possible result of such policy would be that both will turn out to be less interested. You cannot turn the losers into winners, but you can certai…

I hope that globalization isn't inconsistent with national autonomy, especially when it comes to taxation and social policy. If these two things are inconsistent, then globalization will lose out in the long run. That would be a shame, because liberalized borders and economies -- if properly regulated -- would benefit everyone.

> One possible result of such policy would be that both will turn out to be less interested.

Tax rates on the top 1% or 0.5% of earners could double over-night and those people would still have more than enough money to make their effort worth-while. We are literally talking about people who have more money than the can possibly spend on personal luxuries in their lifetime.

At some point far before the 1% mark, wealth accumulation becomes much more about personal power and legacy than anything else. These people continue working hard for the same reason that tenured professors continue to publish prolifically or retired people work hard on their lawns or hobby projects -- for love of the work, and/or because they literally don't know how not to work.

(Whether or not those people deserve to be taxed heavily is kind-of irrelevant to the fact that your hypothesis about human psychology is wrong.)

> You cannot turn the losers into winners

What is a loser? Most middle class people are of average or above-average intelligence and work hard. The only thing separating these people from e.g. Donald Trump is access to an inheritance or some other means of attaining large amounts of capital.

I'm willing to bet your average middle-class accountant or actuary would much rather (pay someone to) manage a portfolio of investments than crunch someone else's numbers.

Also, FYI, almost all computer programmers in the world -- including skilled ones -- are solidly ouside of 1% territory.

> but you can certainly alienate the surviving winners and convince them to build their next factory in China

So your argument for not redistributing some percentage of the wealth of billionaires is that they're petty assholes who will take their ball and go home? But isn't that what losers do? ;-)

As a matter of fact, globalization and national autonomy aren't inconsistent. Tax havens aren't a fact of life, they are an engineered reality created by lawyers and lobbyists.

Re: Why we should fear a cashless world

#83

I don't understand this argument that people feel safer storing cash than keeping it in a bank. The cash is just as ephemeral as bank credit. With the exception that it's controlled by your central bank instead of the commercial banks. Cash can be made useless centrally just as easily (if not easier because of its central nature) and there have been instances of this in the past in cash-only societies.[1] [1] https:/…

By storing your cash in a bank, you are exposed to both the bank's insolvency and the devaluation of the currency by a central bank. By keeping it under your mattress, you are only exposed to the latter. Of course, by not storing your money in a bank, you are 100% responsible for securing it, which is the primary drawback that most people face. You are also more directly exposed to fluctuations in currency valuation…

> By storing your cash in a bank, you are exposed to both the bank's insolvency

Only for very large amounts, at least in Europe, the central bank insures your money from its own reserves in case of bank failure up to a certain amount, AFAIK typically in the hundreds of thousands of €/local equivalent.

Re: Why we should fear a cashless world

#84
post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

Exactly the same thing happens in Greece. It used to be very common for shop-owners to "forget" to give you the receipt. After the crisis broke up though people are way more likely to ask for receipts as there are some incentives to do so (minor tax cuts for a specific amount of receipts etc.). Credit/debit card transactions have also tripled since 2008 or so which is good I guess. Things are different with doctors,…

Does the government not prosecute obvious cases of tax evasion (9000 euros example)? That's what would likely happen in the U.S.

Re: Why we should fear a cashless world

#85
post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

> cost for society You meant "cost for government," right? It sounds like the slice of society that gets the cash discount is benefiting greatly from this "hidden economy." Saving 50% on a venue is a big win for the newlywed's pocketbook, leaving more money in their pocket to buy goods for their new household.

True. If you don't believe the government has any role to play in, say, paving roads, maintaining bridges, etc, then there's no "cost for society".

Well, until the bridges start falling down, anyway...

Re: Why we should fear a cashless world

#86
post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

> Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount?

1) Require receipts for all transactions.

2) Offer 10% of recovered cash for anyone you report who doesn't follow #1. Add the penalty on top of any recovery [e.g. Current Fines + 10%]

3) https://www.irs.gov/pub/irs-utl/cashchapter4_210632.pdf

4) Taiwan-style receipt lottery [ http://www.tealit.com/article_categories.php?section=living&... ]

Re: Why we should fear a cashless world

#87

Cash, on the other hand, empowers its users. And convenient electronic payments doesn't in anyway empower users? Also, if people are unbanked and below the poverty line I would expect they would be more concerned with getting by than "Orwellian levels of surveillance."

If people are below the poverty line then extra fees associated with transaction-handling, cost of technology for access etc are a big deal. Cash is closer to free to use. If you buy something used, a PC, fridge, whatever, because you can't afford new, do you want a transaction fee in addition? It may only be 1% or $1 (not accounting for the price of a smart phone and network costs) but that is still $1 more than you…

Fees for card payments are a US thing, mostly because they predominantly use credit instead of debit I believe.

Re: Why we should fear a cashless world

#88

Earlier quoted context omitted.

If people are below the poverty line then extra fees associated with transaction-handling, cost of technology for access etc are a big deal. Cash is closer to free to use. If you buy something used, a PC, fridge, whatever, because you can't afford new, do you want a transaction fee in addition? It may only be 1% or $1 (not accounting for the price of a smart phone and network costs) but that is still $1 more than you…

Cash is not free, there is a time cost to handling the cash, depositing it, there is a risk cost for vendors from employees stealing it, there is a risk cost from being robbed...there are always trade offs. A lot of these comments mention that cash gives the government less control, however try visiting India or China or Greece and ask people the real reason they use cash. It's to evade taxes and launder money! Same…

> It's to evade taxes and launder money!

Assuming the government have the right to tax us for everything all the time and that you are not a free man but just a number. This past year I have seen one new tax introduced at regional level and seen at least one other rise by a significant margin (close to 50%). I don't see a like change in the earnings of my colleagues. Maybe we should all try harder to evade the govt, at least a little.

Have you read the linked article, because most of the things you mention are not related to the point discussed in the article. Yes, there are good reasons for electronic transactions, of course there are.

Re: Why we should fear a cashless world

#89

I've been "cash only" for 8 months now and I love it. Of course I need a credit card if I buy something on Amazon or a one-off web store, but the point is to move as many transactions offline as possible. There are so many privacy benefits to using cash, but one that really resonates with me is the physical nature of it. When you pay for something with cash, you can feel the transaction of money exchanging hands and…

Funnily enough, I'm the exact opposite. Mentally, money in my account is "my money". Cash I've withdrawn feels like already-spent money. Since it's unaccountable, I tend to spend it more frivolously. Might be a generation-to-generation thing.

> Since it's unaccountable, I tend to spend it more frivolously.

Which is fine!

Here's what you do: allot a certain amount of cash to discretionary expenses each month. You take that money out at the beginning of each month (actually in my case, twice a month) and then use it. And when you run out you're out.

What you've just done is used physical cash to put a hard ceiling on your discretionary spending. This turns what are normally variable expenses into a fixed item in your budget, which makes it a heck of a lot easier to account for.

Re: Why we should fear a cashless world

#90
post #53

Here in Italy the big issue is that many business will just not declare cash transactions. It's pretty common not to be given a receipt when buying a coffee and often when you visit a doctor they'll say: do you want the invoice or a discount? A couple of friends got married recently and I found out they paid over half of what the owed in cash to get pretty decent discount. So before we talk privacy and company let's…

> cost for society You meant "cost for government," right? It sounds like the slice of society that gets the cash discount is benefiting greatly from this "hidden economy." Saving 50% on a venue is a big win for the newlywed's pocketbook, leaving more money in their pocket to buy goods for their new household.

> You meant "cost for government," right?

Well, depends on if you want a government capable of affording to pay for public education, roads, military, etc.

I mean if you care about none of these things and want the government completely destroyed, a 50% revenue cut might seem okay to you.

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