With the intention of making a video a day the range of topics the series that I am creating can address is wide. One of the possibilities is to answer specific questions that have been raised in response to the series. That is why today's video asks the question ‘could we be a cashless society?'.
Further questions are welcome. We're filming another batch next week.
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Question for a future film:
Is it ethical to discount to zero current day polluting legacies like radioactive legacy poisons such as man -made radio-toxic nuclear waste with half-lives of 24,000 years?
No, in a word
As is implicit in sustainable cost accounting
It’s interesting to see this from Singapore, where the Government is very much pushing towards a cashless society: https://www.businesstimes.com.sg/banking-finance/singapore-can-reduce-cash-use-and-be-cheque-free-by-2025-ong-ye-kung
That said, they also see the increasing importance of the virtual world as a facet of life and are investing in schemes to educate older people and ensure that they are not left behind.
What happens when there is a power cut? My mum in South Africa is getting load-shedding power cuts every day for maybe 4 or 5 hours at a time. The cards don’t work without power. Then this is a Tobin Tax in favour of the banks. Anything from 0.3 to 3 % on each transaction. Finally it is a great fragility for society. Any sort of war, terrorist attack or civil disturbance could target the datacentres or nodes in the payment system. I belive this is actually a very small number of buildings. If all payments suddenly became impossible …
Richard,
I think that there are also a number of ‘working age’ people who for whatever reason have difficulty with ‘technology’ and who would find a cashless society very difficult.
There was also an interesting comment by a US commentator who said ‘why should I have to pay $1000 for a computer so I can talk to my Government’ There is a massive issue over the cost of owning & running the devices that would be needed to live in a cashless world and of course the provision of the infrastructure – both mobile and landline broadband.
Also in the same way you talk about the’Joy of Tax’ I think there is also a ‘Joy of Cash’ – I remember going to my local coffee roaster one Friday to pick up a months supply & a voice shouting from the back ‘Beer Money!’ as I handed the cash over – they were all young men and may well have headed to the pub for a post work pint with my cash rather than bank it
This is why I think this twenty or more years off as yet
But did that cash go through the books and was tax paid?
Duty would certainly have been paid on the beer…………
I dont think they are a bunch of tax dodgers and anyway I dont drink that much coffee & they gave me an excellent deal so The Chancellor doesnt have to worry
My objection to compulsory cashless is that it makes it even more difficult to operate with a bad credit record – banking follows you round – rather like energy supply companies do – and even when you are not at fault. Also if we are ever to go cashless we need a payment system that does not have a percentage sliced off by an effective duopoly of card operators – perhaps a system that is nationalised or central bank based.
I think children would be another numerically significant group for whom a world without cash would be a problem. I guess they would swell the 10% proportion without bank accounts quite considerably. (?)
I have to say that i8n my experience most teenagers have no idea what to do with cash
Most want and have bank accounts
It is now known that residential buy to let investors have been evading tax on a very large scale. The FT estimates that the loss to public finances is £1.8 billion annually. Do you think a compulsory registration scheme is the answer? It might also improve safety standards.
I have been raising this issue for years
One of the main answers is compulsory information exchange from letting agents to HMRC
My daughter never uses cash, as is the case for the rest of her generation, so your prediction of 20 years to the cessation of the use of cash seems pretty much correct,but this is driven by not much thought but purely on convenience.
There is another option you have not mentioned on the video, central bank digital cash.(CBDC)
This could be a potential direct replacement for cash ,it would however, still be an electronic payment, like use of debit/credit cards. But crucially, it would not be a commercial bank transaction, but a central bank transaction, exactly like cash. The problem here would be similar to that for normal banking ,in that some small percentage of the population would remain excluded from having a bank account and so deprived of being able to access it unless it is better designed.
Globally central banks are indeed looking at setting up digital currencies. The jury seems out as to whether this should be made widely available to the whole population and exactly how that would be achieved. It may require some form of “token”, like bitcoin or other form, like a preloaded debit card. Or it may just exist in a purely electronic form only, which would still require the access to a bank account.
The banks themselves of course are another party that would love to have us all stop using cash and exclusively use their electronic funny money, losing the enforced subsidy they currently now enjoy. Banks for this reason will naturally oppose a CBDC as it would allow payments to occur outside of their very profitable money creation business Digital cash would indeed be a threat to the banking system in a crisis, as folk would seek to remove their funny money from their bank deposits to the safer state backed money,for this reason central banks will probably balk at the idea of a widely available CBDC. But we should insist they do not.
I see no reason for CBDC
That would require state-granted credit as well and I see no role for it in that process
A CBDC woud require no more credit than currently is the case for issuing notes and coins. Cash and bank deposits have co-existed quite peacefully for quite some time now. We could also ,at the same time,remove the need for bank deposit insurance and actually allow reckless banks to fail,which has to be on anyones list of “things to do”.
That is wrong
You cannot expect commercial banks to grant all the credit and have none of the debit balances
I full undwertsand MMT
I also understand capital requirements
And I also doubt the state should decide on personal credit levels
The argument against only state-granted credit is a democratic one in the sense that the levers of power can be used to deny credit to those who oppose the levers of power being held by the current government. Trump’s attempted demolition of the US postal service illustrates the dangers in a tangential sort of way.
However, the hyper-inflation of house prices in the UK for nearly five decades illustrates that the state could have played a role in stopping this by providing low interest rate at-cost house mortgages at a sensible multiple ratio of earnings under-writing standard.
It’s no good MMTer’s arguing for a greater involvement of the state to create a fairer society (Job Guarantee for example) and not using it in other directions such as enabling affordable homes.
Clearly to avoid credit abuse in a monetary society requires carefully thought out safeguards. We’re a long way from that when most voters in the UK don’t even recognise we live in a Double Currency society where both state and private banks can produce the currency from thin air and the benefits that flow from this!
That is wrong
You cannot expect commercial banks to grant all the credit and have none of the debit balances
I full undwertsand MMT
I also understand capital requirements
And I also doubt the state should decide on personal credit levels
The state does not decide on personal bank levels now when issuing cash nor would it in the event of a CBDC,it would be on demand,though it may have to be limited to stop bank runs. The state currently just satisfies public demand for cash and notes, which are cheap to produce.We should be very carfeul about accepting this situation. The state also receives billions in seigniorage from issuing cash(notes and coins) ,when cash disappears all that would then go to private banks when they issue their funny money new loans instead(yet another subsidy to the banks.) So if remove cash altogether, we hand even more wads of cash to the banks….like they need it. A CDBC would be a good alternative for keeping that seiniorage earnt and also to keeping a lid on excessive bank lending and by extention reducing bank assets and making banks smaller and safer.
Capital controls are a different issue entirely. Maybe we need a video on those!
I have to admit your view of banking and mine are quite different
In my experience banks do not supply credit on demand top any9ne who wants it
I know banks do not lend to anyone, but I am trying to get to to change your mind!
Banks lend where they think is best for them, period, which is not a good thing nor indeed what is best for the wider economy. They lend primarily for property and share purchases,which only helps inflate property and share markets and little else. Very little goes toward productive wealth generation nor to the Green sector. Our banking system is of no real help at all,more of a hindrance.
MMT favours state issued money,so a CBDC would be a perfect way to introduce it. After all it would be just state issued money(reserves) that could be put to far better direct use by the state when creating/spending it, than bank created money….which as we see does little good at all. Adair Turner actually said that “most of what banks do is socially useless”.I agree.
The banks had the right to print notes taken away from them in 1844,because of reckless lending,they circumvented that ban by creating bank deposits,which no intervening gov has ever interfered with. So it has taken nearly 180 years for them to get back to effectively eroding the 1844 Bank Charter Act! We surrender the right to issue cash at our peril.
So who does make credit decisions?
On what basis?
Banks should make credit decisions,but I wouldn’t restrict that to just banks,all sorts of businesses and non banks make loans Anyone can lend money, but there is always the risk. Who accepts that risk is the issue. If we want to ultimately back bank lending as opposed to any other type of lending, then we have every right to say how that lending is done. Currently we do not ,despite having to back every loan banks make. The banks tell us they understand risk and we know nothing, so just back us and shut up. Since 2008 that is no longer acceptable.
Actually as an added thought, I like the idea of a Green Investment Bank as you have previously mentioned,as well as local investment banks funded by local authorities, this should help get credit to where we really need it and where the banks have made themselves vacant.
Agreed
Physical money is very important for certain people, such as those with a learning disability, in order to budget. Cashless also means its so much easier to exploit people. If you can see that if the money from your purse is not there you know its been stolen.
I have had some students tell me they use physical money because it imposes discipline a card cannot
I get angry about the impact of the card issuer’s charges (which range from 1% to 5%) on the trader’s profits. For a small corner shop this could be significant: a 5% hit at Gross Margin level will have a much bigger % impact on the bottom line. There have also been concerns raised about the impact on travel agents with Covid causing massive cancellations of bookings. The agent suffers the commission at the point of sale and not only doesn’t get a refund when the sale is cancelled, but then gets charged again on the refund payment: https://www.travelmole.com/news_feature.php?news_id=2043240
I get the argument that cash trading incurs hidden costs, but why should a bank somewhere get a hefty commission from the sale of a newspaper or a bottle of milk? The convenience to the purchaser also brings a security cost – no computer or computer system is hack-proof. It’s all part of the creeping financialisation of everything and should be resisted.
I’m glad I read this as much of the video was actually about ‘Should’ we have a cashless society, rather than ‘could’ we have one. And I think that the former is the more important question.
My thoughts on should we from a trip to Gothenburg https://stevenboxall.wordpress.com/2019/01/30/further-thoughts-on-gothenburg-a-cashless-society-is-not-for-me/
I quickly moved to the appropriate question..
As a 73 year old who would very much prefer a cashless society can I make a few comments on your major issue of the (mainly) elderly who may have problems.
Nearly all bus passes are contactless cards. I have yet to see anyone have a problem with them.
I, along I suspect with many others, have stood behind an elderly person at a checkout or the post office while they have great difficulty counting out the requisite amount in coins, often needing help. Touching a card on a machine never causes that much of a problem. Most such transactions these days do not require a PIN, but the technology now exists, and is increasingly being used, to use fingerprints or other biometrics.
If we look at Sweden, which is generally about 10 years ahead of us technologically, they have been all but cashless for some while; most places just will not accept cash. My son took £100 worth when he moved there 2 years ago. He still has most of it left and what he has spent has just been deliberately searching for somewhere that will take it. As a society they make a point of ensuring everybody can cope and providing any necessary help, but we, given a suitable change of government and emphasis, could easily do the same.
In 50 years in IT, I have on several occasions been involved with projects to help people cope with technology. I have yet to encounter anyone who was incapable of managing once they decided to try.
I visited Sweden last year and never exchanges physical currency and would not now dream of doing so
Likewise on Denmark
Not that I imagine going again for some time
All very well moving to a cashless society but when most voters in the UK can’t produce the evidence that we don’t live in a Double Currency society where both government and private sector banks are able to create currency from thin air then put bluntly we’ll continue to have a cesspit society where power is abused and equitable outcomes neglected not a democracy. The widespread recognition that we live in a Double Currency monetary economy is vital for the future of this country.
Helen, I don’t think that either cheaper credit or more credit is going to help with affordable housing. Anything that tends to push up demand will just add to the price increases. The obvious solution is to drastically increase the supply of houses. Owning a house (or flat) is not sensible for many, for example the young who want to move around a bit. The transaction costs of buying / selling are huge relative to median incomes, so the German system where you save up and then buy the ‘Familienhaus’ once you are married and starting a family is better. Private renting was a bit of a disaster before WWII so the obvious solution for affordable rented homes is council (or other state) housing. We built hundreds of thousands a year in the 1950s / 60s (though I know some ended up not very good when short-cuts were taken as various Minsiters tried to speed up production). I think since Thatcher it has more or less been government policy to restrict supply (of both social housing and land for private housing) and thus to force up prices (to fool the middle classes into thinking they are getting richer) and to force folk into private renting.
Tim Rideout.
But isn’t the creation of ever larger loans a big part of the problem that has “fuelled” the housing market and caused hyperinflation within the sector?
Banks can lend wads of cash and then sell the mortgages on to third parties. They are then no longer liable for the mortgages and can create pretty much as much money as they want for future loans.
It’s the combination of a shortage of housing (in the right parts of the country) and a banking industry with few restrictions on the size of the loans that they create that makes housing unaffordable for lots of people.
Why exactly Tim would you be wanting a society in which the under-writing ratio of average house price to an individual’s or couple’s gross annual income has nearly doubled in five decades? Of course, although I didn’t raise it, I was also taking into account the slashing of the social house building programme in the latter half of those five decades in my comment.
Interestingly this raises for me a main reason for supporting MMT which is the widespread lack of recognition that a society with a monetary economy needs a Double Currency in which both currencies, government and private banks, are created from thin air. The government created currency is particularly needed for reciprocity, or caregiving if you prefer. See Phil Armstrong’s paper, page 107, where there is a very strong argument for the state introduction of money because there was a need to “monetise reciprocity” or put more simply the honouring of obligations we engage in with each other for individual and mutual adaptive fitness:-
http://www.paecon.net/PAEReview/issue89/Armstrong89.pdf
This in turn reminds me of a paper by David C. Bell & Co. which argues it’s primarily the innate drive in most human beings for caregiving which allows democratic government to flourish:-
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3471369/pdf/nihms401950.pdf
On page 15 they write:-
“When government officials are motivated by caregiving as well as other motivations, then government action can be directed effectively towards the needs of society….”
Clearly where the utilisation of resources is directed within a monetary economy not having government power to create money from thin air puts government in a straitjacket in terms of effectively addressing the needs of the society it purportedly governs. Most UK voters seem incapable of making these connections! You have to ask why. A good candidate would be the rich starting to push Libertarian/Neoliberal ideological propaganda at voters starting during the Sixties and Seventies with governmental implementation of this ideology beginning with Thatcher taking office in 1979. Some, like me, would say the implementation started sooner under a Labour government which, for example, unnecessarily went running off to the IMF in 1976 for a loan and commenced unnecessary austerity squeezes.
Cashless societies require a benign and democratic state for all to be able to access their cash. (There are other issues of access to technology; access to signal to connect; access for people who are differently able; etc, as some have already touched upon).
Without sounding like a raging tin hat wearer – I do not trust our State to act benignly in this regard. We have seen the illegal actions regarding data usage of those who are in the highest levels of government; we are treated daily to lying, cheating and corruption. No, I think I would rather have a modicum of control over money.
Furthermore, for full dystopia – look east. In China, you earn points for good behaviour – and are disenfranchised for behaviour viewed by the State as not acceptable _ like peaceful demonstrations. Hongkong is very much an online services country. There is a very effective method of control & compliance to be exercised by State engineered destitution.
As I said – it even feels to me a bit “tinfoil hatish”. But then, I never would have believed that we would elect a government that would do us deliberate economic harm………….
I get your concern
Could a cashless society be a means to wield total control over the population? Any civil disobedience, any dissent could be crushed by simply switching off all electronic income, pension and savings to punish any opposition towards government policies
Possibly
Yes, it could
Yes I blame neoliberalism
Yes I blame neoliberalism too..in fact I blame it for everything. Including the weather
May Ayers.
In truth the ability to do all that you fear already exists.
Your bank account could be frozen tomorrow if required by the State.
Your gas/electric/internet and water could also be cut off.
(Or contaminate the water! See what happened in Flint Michigan, though that was more incompetence than malice (one hopes!!!))
A bit of cash in your pocket won’t get you very far if a totalitarian State really wanted to go after you.
I agree with much of the argument, but I remain unconvinced even twenty years from now. My reason, I do not think you covered in the video Richard, but Windsorlass touched on it.
I do not wish to provide a lengthy argument here; it is much better provided by Shoshanna Zuboff, ‘The Age of Surveillance Captialism’, (2019). In the book’s dedication Zuboff writes for her children: “I write to fortify your futures and the moral cause of your generation”. I think Zuboff ‘gets it’.
A cashless society delivers everybody in to the hands of the banks, oligarchs and Big Government. It allows them to know everything and manipulate everyone in ways George Orwell’s primitive Big Brother could not even dream of in ‘1984’. I think this is even more serious than most perople reailse, because it is all so easy, so facile, so useful, so helpful, so seductive, so silent, so insidious, so pernicious; so impossible to escape from, once entrapped within. Then it is too late. Even to know what has happened. You have become Winston Smith.
John S Warren
The ability already exists.
Wether cash no longer exists or not, the State can come after you if it feels the need.
To a point it exists but to another point it does not., Firstly the state cannot just freeze your bank account without a proper reason. For example, they cannot stop you from getting access to the AC, just on their says so it has to have legal backing. This is why the tories want to be rid of the human rights act. Also, power companies can not switch off your supply without a court order, and even then it can ben nullified by switching to another company. Then you have the ability to use cash for everything as the final way out.
A cashless society is all about tracking and tracing, is also about control. I want all options on the table, for example as a person on a very low income. I get the bank deciding to block my AC when I check my AC just before I go to the shop, and I kid you not by the time I get to the shop, they have a “payment” that has been processed. Or they stop payment via card for “security reasons”. They did that once while I was at an airport at 3 am in the morning. I was not pleased and I gave them an earful. Cash is a lifesaver it stops the above control, and its stops the banks from interfering in goods exchanges. So no way do I want cash to end.
They can’t now
But then until a week ago they couldn’t say you got a U in an exam where you would have got a C
This was not my point. My main concern is not about “coming after you”. It is far more sinister than that. It is about controlling you, without you even being aware of it. It is about knowledge of you (probably more than you know about yourself) and about using the knowledge you have naively given them for their own purposes. You will not oppose it because you will not know where or how you are being led; you are being led by your inclinations; but not by you, and not in your interest. That is where we are going.
Cambridge Analytica provided a lurid clue, but it is much more widespread and much of it quite legal. Read Zuboff, or even Mayer-Schonberger and Cukier, ‘Big Data’ (2013); but read them with a very critical eye.
It relies in the age of the smart phone, on ‘wrap contracts’ and what, borrowing from Joseph Schumpeter (1883-1950) is best described as “permissionless innovation”, using the power of ‘data exhaust’, the casual detritus your usage throws away to acquire all you want on personal electronic media. The power is in the hands now of intermediaries, which use powerful algorithms to identify blocks of people, to predict what they can do, from the data they generate to guide human choice and decsions from consumer business to politics. Then the population can be manipulated by those who control the data and the algorithms; add to this that with a cashless society, they Banks will know all your financial dealings (every single one), not to accuse but to control, or better silently manipulate; and they will, over time and with added sohistication eventually have more soft, silent, unkown power over people than any historic absolute sovereign power ever exerted.
Well said
Darren Sharrocks.
I agree.
They can’t now.
There are laws that protect us from the State.
However, laws can be changed. If the State wants to go all “China” on us, it would just change the laws.
How much legal protection do you think the average Chinese citizen has against the intrusion of the Government?
John S Warren.
I don’t dispute the concerns that you raise.
We are potentially heading into a dark place.
I’m just not convinced that using cash is going to shield us from any of it.
Facial recognition, smart phones etc.
Our every move can be followed as well as every transaction.
How long after we go cashless will it be before someone comes up with a startling new idea – Paper Money! Money that works without your phone or card! Brilliant!
🙂
If you think about it one of the reasons for a rush into gold or bitcoins apart from A) trying to preserve the value of your money or B) speculation is C) to prove to someone else you have liquidity. If this latter case is regarded as a valid consideration then some means of holding onto liquidity outside of electronic money, treasury bonds or speculative or fluctuating price gold or bitcoins needs to be invented. Hjalmar Schacht invented MEFO certificates (a parallel currency) to allow Hitler to rearm under the noses of the Allies, for example. The MEFO certificates were convertible into the official currency at the bank. Not sure GND certificates would do the trick but bears thinking about!
An interesting video, but just to echo the thoughts of others that before we go fully cashless an investigation into the extortionate fees charged by Visa and MasterCard should be carried out. It’s wrong that the trends away from cash have piled significant sums into their bank accounts if what they are doing is effectively state-mandated. Businesses inevitably pass these costs on to the consumer, so we are all paying for the convenience. Banks operate under licence and are heavily regulated. Card issuers need to be put under the same microscope.
Agreed
One question comes to mind?
Sovereignty? How do we preserve national sovereignty in a cashless society?
My worry is that sovereign money becomes no more sovereign than Bitcoin in a cashless society. That money could become a total creature of the markets – unfair, illiberal, jaundiced and imperfect as they are.
Not just a total creature of the markets but can also be a creature of corrupt and/or moronic governments that don’t recognise the need for a sovereign government to play the role of monetary obligations or reciprocity reinforcer by being able to create money from thin air. Every time a crisis happens and there’s a fear that monetary obligations won’t be met because of asset bubble blowing (fair or unfair) that bursts, or the volume of obligations suddenly collapses like the coronavirus effect, then there’s panic the value of the currency and other assets will go down. Who else can remove this panic other than a currency from thin air creating government. Certainly the Libertarian’s “glorious” private sector won’t be doing it!
“Whether…the word credit or debt is used, the thing spoken of is precisely
the same in both cases, the one or the other word being used according as
the situation is being looked at from the point of view of the creditor or of the
debtor” (Innes 1913).
and
“Money, then, is credit and nothing but credit. A’s money is B’s debt to him,
and when B pays his debt, A’s money disappears. This is the whole theory of
money” (Innes 1913).
https://www.researchgate.net/profile/Kalim_Siddiqui/publication/337858800_2019_The_Case_for_Ontology_of_Money_as_credit_Armstrong_and_Siddiqui/links/5df8a33ea6fdcc283726b9db/2019-The-Case-for-Ontology-of-Money-as-credit-Armstrong-and-Siddiqui.pdf?origin=publication_detail
So credit and debt are opposite sides of a coin if you like but both work together as obligations or reciprocations.
Whether cash or cashless or a mixture of the two – the clincher is always going to be ‘How fairly is it distributed is it in our society?’.
I like having a combination of electronic and cash – for budgeting reason (direct debits are very convenient, and Internet banking for transferring money between accounts etc. Cash I prefer for daily and weekly budgeting of consumables).
Some concerns being expressed in comments – what if there is no electricity, why should we beholden to banks – well, should we consider the possibility of an embedded chip that holds our cash – powered biometrically, can be transferred directly between chips like cash, can be deposited in bank accounts, can be withdrawn from bank accounts – but we use this as our ‘cashless ‘ alternative to pay for goods and services, but separate from the bank accounts. It doesn’t resolve the problem if shops, say, have a power cut and can’t accept payment, and it doesn’t help the government surveillance of how money moves about, but for personal use that doesn’t involve a heavy purse (all 2p coins, of course) it sounds fine. We could all have our own personal mini-bank account that still records all the comings and goings, but we keep it to ourselves unless we want to, or have to, reveal it.
A possibility?
Interesting….and seemingly plausible
A biometrically accessed parallel currency that can be exchanged or converted into “bank” money even maybe a government’s “bank” money (a bit like the old Post Office account) was what I was thinking about but I wondered if there was a way to turn this into a “hard” currency copy that had a built-in verification facility. The problem is how do you create a reader of that “verification facility.” People used to bite into gold coins as one method of verification but hardly acceptable today with coronaviruses around. It’s hard to think outside the box for a solution that doesn’t involve electricity and wireless transmission. Maybe a smell or chemical detector? Anyone for a modified pregnancy kit detector!
I think I meant bioelectrically powered, sorry, not biometrical, you get watches that can work this way already. If you put a chip that keeps all your data embedded in muscle, or under the skin, it would be more reliable. Our bank cards already can transfer information and holds a lot of information, that can be kept on the chip. We could also have an interface device, like a watch-style thing that could be solar powered (I have a solar powered watch and it works well), that you can use to control the data. But yes, you’d need some kind of wireless transmission – but it would not need to be a strong signal. The main thing is, it is personal to you, and can’t physically be transferred (without difficulty), and doesn’t need to be attached to any bank account.
I really really don’t want to give any mobile phone company my fingerprint data – that’s just getting too personal.
Hardly anybody understands the sociological or human relations aspect of money. As Mitchell Innes said over a hundred years ago:-
“What is stamped on the face of a coin or printed on the face of a note matters not at all; what does matter, and this is the only thing that matters is: What is the obligation which the issuer of that coin or note really undertakes, and is he able to fulfill that promise, whatever it may be?”
https://www.community-exchange.org/docs/The%20Credit%20Theoriy%20of%20Money.htm
We should read into Innes’s use of the word “issuer” to mean individuals, corporate entities and government.
Government is especially important because you need a creator of money that can reinforce the obligations or more simply reinforce reciprocity (the latter being the means the human species dominates this planet.). Who else can be that reinforcer other than a sovereign government and to be able to do so by creating money from thin air? This should be obvious from the economic depressions that have hit human monetary economies over the centuries, the Great Depression, the Great Recession and now the Coronavirus Recession being but three obvious relatively recent ones most of us have some knowledge of.
The problem though is that governments can be captured by politicians who don’t understand this reciprocity reinforcing role for government using money creation. Both Thatcher, Cameron and May, for example, have gone on record saying government has no money of its own. This all leads me to the point that until a majority of voters clearly understand government’s reciprocity reinforcing role it would be wiser that citizens have as wide a choice of financial assets to save in to cope with disfunctional government and/or the financial sector’s negative effects on the economy and one of these main assets needs to be cash in the form of bank notes. You can also observe this need in the way mainly the wealthy hop on and off gold in an economic crisis.
I much enjoyed reading that paper…
Most shops would close anyway during a power cut. Any that would wish to stay open in that event could use one of the card reader attachments for a phone or tablet, as used by many market traders. The personal mini bank account sounds very like “Swish” in Sweden which allows for person to person and person to business transactions directly using phones with the fingerprint reader for identification.
OK, some old phones do not have fingerprint readers, but that will change in the next year or so. Many people do not have phones, but I would guess that the expense saved by not having to create, transport, secure and count cash should be enough to provide a basic phone or phone-type banking machine for everybody who needs one.
I suspect that most of the supporters of cash come from us old fogies. It will happen anyway as we all die off. It is just a pity that our passion for keeping hold of all things old, no matter how ugly, expensive and inefficient prevents us from getting all the advantages, just as we reach the time of life when we need every advantage that we can get!