One of the refreshing things about living in Eastern Europe is you begin to pick up the healthy cynicism of people here who spent their whole lives being lied to. In the naïve west we see some news item about how cash is boring old-fashioned stuff being phased out in favour of futuristic funky digital payments. Part of that whole maglev-trains-on-stilts, undersea-cities fantasy we were promised a few decades back, right?
Or is a “cashless society” – interrupts the gloomy East Bloc citizen – only in that magazine or on the telly because it suits someone who is pushing something to their advantage?
Of course, the former Soviet satellite dweller has it right first time. Cashless societies are very exciting things for two specific lobbies: firms developing the technology who benefit from the demise of paper or metal money + governments who love the idea of people simply being unable to buy or sell anything without them seeing every detail, recorded for ever.
Notice the wording of the ads. “Touch and pay” squeaks the copy “and get more control.” As so often, turning this on its head yields truth. What they mean is ‘get less control’.
China is doing this to its citizens right now, with its creepy weaponised version of Facebook-plus-Amazon. This works across several huge internet sites where Chinese people swap messages, buy and sell, or form clubs. As well they rate things they like with their equivalent of the ubiquitous little thumbs-up symbol on the western Facebook network. A ‘Black Mirror’ sci-fi TV episode (‘Nosedive’) aired in October 2016, describing a near-future society where everyone rates everyone else, was thought by many to be ahead of its time. Most didn’t know Peking had already been building just such a system for several years.
The Chinese system brilliantly gets its participant victims to rate each other, and thereby self-censor what they say. You’ll want to disconnect from a prominent critic of the government, so your friendship with him stops bringing your score down. You’ll want to make friends with a prominent supporter of the government so as to see your score go up. And your score gets reduced every time you jay walk, file a tax paper late, get a parking fine – or say something socially frowned upon.
Already by 2018 people with low scores in China suddenly found they could not book hotel rooms, could not buy air tickets – even could not buy train tickets. This is administrative punishment par excellence.
Lots of governments would love this kind of deep reach into everybody’s lives, the way it smoothly sidesteps the need for court cases and gets ordinary people to do the bulk of the work of oppressing each other. Some Chinese cities are now totally cashless – there are places where you cannot buy a sandwich, a drink, a stick of chewing gum, without doing the whole transaction on your phone. Of course, on your phone is where it can be seen, tracked, perhaps blocked by the authorities. One Guardian journalist reported that a colleague over a year ago in early 2018 had found that with his ‘feature phone’ (pre-smartphone) he was unable to buy a single thing in the area he visited. His crime was to be off the digital-payment grid which gives state officials enormous power over individuals. He had to have his Chinese hosts pay for everything on his behalf. Facebook itself is right now launching an online currency called ‘Libra’ so that it can track billions more pieces of information about other people, all while helping governments outside China get rid of those quaint old bits of folded paper.
Brussels is just one nexus of power we can imagine would love this level of intrusion and control. We should not fool ourselves though – plenty of British civil servants think like this too, especially the younger ones. They will wibble on about paedophiles and terrorists and people evading tax until we all agree what a wonderful thing it would be if Britain had no physical cash either.
I have previously written here that “money laundering” is a bogus crime, with the main function of increasing the control governments have over people’s money, and thereby over people. Customers are already being asked questions by their banks about how they got their money. The whole counterfeit crime of money laundering is of course a neat way to make people prove their innocence, to exonerate the state from having to prove anyone’s guilt.
A cashless society is a development of the money-laundering trick. Australia is now considering banning cash sales of any item above 10,000 Australian dollars. Some EU member states already have lower cash limits than that.
Online magazine Gizmodo reminds us (https://paleofuture.gizmodo.com/1970s-researchers-predicted-debit-cards-would-be-great-1699216972) that a 1971 Georgetown technology conference set its invited guests an exercise. They were tasked to devise the ultimate surveillance system a dictatorship might want to institute. Their answer to the challenge was digital money – a cashless society was the single best surveillance-state tool they could come up with.
The drive to phase out cash is both a sinister initiative to bring the Chinese level of state power closer, yet also an opportunity in disguise for real governments (a few are left).
The first state that decides to print larger denomination banknotes, and to make it easier to pay in cash will see increased trade and growth, from one day to the next. Further benefits would come from killing VAT, a uniquely intrusive tax that pro-EEC UK officials actually commandeered an early-1970s episode of the BBC’s Tomorrow’s World TV show to explain to Britain’s public. Best of all – perhaps it sounds hard to imagine – will be to re-enable private banks to issue their own legal tender. Crypto-currencies have made private currencies more topical, but in fact there’s no reason in principle why private banks shouldn’t again be able to print their own paper currencies too. Like Scottish and Ulster banknotes today, except with values that change like the US dollar or the Swiss Franc. Bearer bonds, another victim of the creeping digitisation of money, should also be restored without delay.
Some of this prosperity will come from criminally-obtained money, but most of it won’t. In any case, where the money comes from (a typical guilt-led attempt to poison the wells instead of debate the topic) is besides the point.
If you seriously think it’s a clever wheeze to inconvenience everybody so as to make gangsters’ mules carry two suitcases of one-hundred-pound notes instead of one big bag of five-hundred-pound notes, you’ve failed to grasp the whole idea of putting people on trial. In fact you don’t get the idea of having publicly-explained laws at all.
You’re the kind of person who thinks money really belongs to the government, and we mere mortals only have it on sufferance, if we’re good boys and girls. You’re the sort of person who thinks police states might be quite good if right-minded people – someone like you – ran them. Like socialists & euro-federalists, you believe there is a technical fix for sin, for poverty, for war. You think the human condition is more crossword puzzle than spiritual challenge.
Whichever government decides to make old-fashioned cash easier and cheaper to use, instead of trying to sneakily tax and regulate it into extinction, will see its economy suddenly enriched.
This growth in trade and wealth will be dubbed “criminal”, but in fact it will reward that country for the morally right reasons: real freedom brings real prosperity.
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Mark Griffith is a financial trader whose weblog http://www.otherlanguages.org follows news on artificial intelligence, politics, economics, and other subjects. He is researching a book about whether AI will change how people live.