Cash will eventually go away. So will checks. Someday all you will need is a retina scan and a password, or an embedded chip, or something along those lines. Imagine a world where all transactions are digital. I'm not sure we know what's ahead.

For starters, you wouldn't have to prepare your taxes. All of your transactions would be reported to the IRS as they happened. Perhaps you'd have a separate password for business-related transactions to keep things straight.

I wonder how much of the budget deficit could be closed by eliminating the ability for cash businesses to lie on their taxes. It's probably a big number. A cashless world could create a huge shift of the tax burden to lower income folks who currently get paid in cash.

When you eliminate cash, you also eliminate a lot of crime. Criminals need cash to stay off the radar. In a cashless world, drug dealers and crime syndicates could try to set up fake businesses to launder their revenues, but it wouldn't work. Imagine setting up a fake dry cleaner, for example. The government could easily determine whether that business is buying the type and quantity of dry cleaning supplies typically needed, and whether the profit margins are at industry norms. All of that information would be available through the tax records. A drug dealer could pretend to be a consultant, but even then you expect a digital trail for buying printer ink, business travel, and the like. Perhaps the drug dealer's address and educational level would be tip-offs too.

Violent crime will greatly diminish too, because so much of society's violence happens in the context of criminal enterprises that will no longer be profitable or practical.

In the cashless world, you would never need to carry a wallet. You would never need to balance a checkbook or spend an evening paying bills. Many of you have already reached that point. But you'd also never have to drive to an ATM because some caveman paid you with a check, and you'd never need to wait in line behind someone who is paying by check. I can't wait.

Everyone's fear, of course, is that a cashless society is more vulnerable to government tyranny. But realistically, moving from a 95% cashless world, where we probably are today, to 100%, probably doesn't generate that much extra tyranny, unless you're a drug dealer.

There's a privacy issue, too. But as I have argued before, privacy will someday be a quaint footnote in history. When privacy goes away completely, we'll all be freer. There's only a penalty to privacy when your asshole neighbor can look down his nose at your hobbies while secretly masturbating to Field and Stream magazine. The best two situations for society are when you have either complete privacy or complete non-privacy. It's the middle ground that creates problems. That's where we are now.

Kids already have no privacy. Their texting and browsing histories can be monitored. Their locations can be tracked. And if they have a credit card, their purchasing can be tracked. In practice, parents don't take advantage of all the ways they can monitor their teens, but everyone understands that the tools exist. That generation will never have a memory of privacy as their parents knew it.



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Jul 1, 2010
If we go totally cashless, it'd be pretty easy for the government to regulate prices and the items you buy. If a dilbert comic book or digital book isn't allowed by the system, you won't be able to buy it (legally). Another problem is if the system goes down, gets hacked, has a glitch, etc. you could lose all your money and then have to try to argue with what would probably be the worst customer support system in the world in a futile attempt to get your money back or to make a purchase.

Say a hurricane comes in and wipes out the electrical grid for an area. It could be down for a month or two depending on the damage and all that time you have no ability to make needed purchases at businesses that are still in operation. In other words it would make a bad situation worse.

Another thing is if the government deems you are spending too much or aren't spending enough, you'll either be stopped from spending or "taxed" the amount the government wishes you to spend.

I think a 90%-95% cashless system is best just because it would give us flexibility and another option when we need it. And it keeps the government in check.
Jul 1, 2010
When will people realize that my convenience is more important that the economy collapsing?
-1 Rank Up Rank Down
Jul 1, 2010
A lot of commenters are suggesting alternate currencies or ways of beating a cashless system:

The point here is that from an Econ 101 perspective, the overhead of a criminal enterprise increases and the barriers to entry for a criminal entrepreneur become prohibitive.
Jul 1, 2010
Seems like several people are caught up in the present and can't imagine the future being different...

I guess the real question comes into the practicality of maintaining multiple accounts. Not just business versus personal. Maybe I have multiple businesses? Maybe I have multiple personalities? Will we maintain the concept of credit? If so, then we have to differentiate between credit accounts and deposited accounts. Of course, all of these things can be handled - it's just a matter of how...

For criminals to mint their own money relies on them trusting each other enough to not manipulate the supply. Imagine counterfeiting when the governments don't care if you're doing it. (Of course, maybe it would be better - if someone passes some bad money to you, you just kill them. After all, they're criminals also...)
+2 Rank Up Rank Down
Jul 1, 2010
Interesting. Two notes:

Check out David Brin's "Earth". In this fictional novel, privacy is outlawed, although an escrow is set up for certain business cases that give you a window to develop new products. Violent crime goes way down because nosy retirees wear cameras that send video directly to the police, and they can signal and record when they witness a crime. There are a lot of other consequences that line up with your ideas.

Second, I recently sold a motorcycle on eBay. I'm pretty current on most scams, and the purchaser does not appear to be a scammer. However, for convenience he offered to wire the money directly into my account. I called the bank and it turns out that if someone has your banking information (such as routing number, name and address that is on every check you send out) they can access your account to remove money. I never really realized that before. A cashless system with better security would be an improvement in this case.

Oh, I rarely use cash since I gots ta have my airline !$%*!$
Jul 1, 2010
There will always be some form of currency. Maybe it will nto be actual cash, but gold or silver, etc.

More likely it would be tobacco, drugs (illegal and perscription), fuel, and that type of thing. Ammunition would probably be worth quite a bit as a bartering currency.

I was somewhere during a power outage and most of the stores were screwed, losing a lot of business. One place had an old-school manual credit card swiper, the kind that makes a carbon copy and is not hooked up to any network. This place was raking in the business, as they were the only ones that could process transactions. They said that they would just run the numbers later when power was restored.

There are too many under-developed 3rd world type countries and/or economies out there that would still have to use cash, such as Latin America, etc. Most rural businesses primarily use cash and they would never have the money or resources to convert to some type of electronic payment system.

The Euro was a start in this direction. If they can get everyone to use the same currency, then it becomes easier to eliminate. (And as we can see now, the Euro was such a WONDERFUL idea...)

There is a behind the scenes puch to eliminate the USD as the reserve currency for the world. Some want a universal currency such as the IMF SDR. In my opinion the IMF SDR would be a disaster. The IMF is already a disaster, and if they were in charge of a currency, they would just screw it up very bad.
Jul 1, 2010
A cashless world will have other huge impacts. I think it will cause people to spend their money a lot more wisely.

Most people don't know what they spend their money on. Right now, if you buy a donut every day with cash, that cash disappears from your wallet and you forget you ever spent it.

In a cashless world, there will be some easy, free way to examine your spending habits, with graphs and comparisons to your demographic and it'll integrate with Facebook so you can see how you compare to your friends. This will reduce unconscious spending, which will help and hurt various sectors of the economy.

Also, cashlessness might make counting calories and nutrients easier. There are already some people who never cook, so they're always eating some standardized food that has its nutrients and calories already calculated. When you make a transaction, there could be some way to send metadata about the transaction (in the case of food, the nutritional contents), so tracking what you're eating will be effortless (assuming you eat all of what you buy and nothing of what you don't buy; you'll have to make manual adjustments to that where necessary).

Your insurance company will give you a discount if you consistently buy healthy food.
+2 Rank Up Rank Down
Jul 1, 2010
Oh, Scott. That may be the most hopelessly naive post I've seen in a while. Crime will go away when cash and privacy go away? Not likely. Let me give you just ONE example of a criminal work-around. Criminal A sets up shop as a chemical supply house, and ostensibly imports drycleaning chemicals, etc. from other parts of the world. Criminal B sets up shop as a dry cleaner and buys "chemicals" from Criminal A. Criminal C takes his "dry cleaning" to Criminal B, who sends that money back to Criminal A for more of what ever it is they are actually moving around. And that's just a wildly simplistic example. Heck, a really enterprising set of criminals could do the whole Andrew Carnegie thing and own a whole supply chain from start to finish. Every transaction would look legit, the "president" of the company would probably have a legitimate college degree, and the head accountant/"CFO" certainly would have. Then it's just a matter of picking a business that lets you move large sums of money. A fancy restaurant would probably work. Just sell lots of expensive imported caviar. You might not even need a brick-and-mortar building if you set it up right. Everything would be online.
+10 Rank Up Rank Down
Jul 1, 2010
So instead of being mugged for my cash I'll be mugged for my retina...
Jul 1, 2010
No thank you. I don't want to live in a cashless world, inevitable or not. I pay by cash and check as a way of controlling my spending. It is way to easy to whip out the plastic to pay for things. Between a mortgage, car payment, medical bills, etc. I need every little advantage I can get over my finances and cash/check is a very easy way to gain that advantage.
+3 Rank Up Rank Down
Jul 1, 2010
Nope -- This kind of transparency would also make government corruption impossible...no more dirty politicians, bribes or organized crime connections. Therefore it will never happen. If we even got close, there would also be monetization of commodities...people would find _something_ to use as a medium of exchange to stay off the books, just like prison inmates use cigarettes or cans of tuna. It will make for an interesting world....
+2 Rank Up Rank Down
Jul 1, 2010
Spoken like a true urbanite. Out here in the boonies, cash is king and always will be. Ya just don't see a farmer or rancher with a ATM card.
Jul 1, 2010
Prisons essentially become a cashless microcosm. The inmates still find objects to use as currency.
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Jul 1, 2010
Welfare would be more complicated than handing over some small change or a note, and a lot of people (probably most) under present rules would have bad credit. Cards might make petty crime harder and assist big transactions but small sums - most people's wages - become less fluid. What your saying is a natural and perhaps inevitable progression but the devil would be in the detail.
Jul 1, 2010
It is an interesting concept and one that I see on the horizon. But here's something else to think about:

Does a cashless society as you described above (retina scans, bio-chip, etc.) increase or decrease identity theft?

I'm sure criminals will come up with some way to steal !$%*!$%*!$% but would retina scans, thumbprint readers or bio chips help to eliminate a huge chunk of identity theft or just be another way we are taught that the criminals are actually smarter than us. Which is sad really. If some of the criminals out there took the intelligence they have and applied it in a corporate environment, they would be CEOs of tech companies....

Oh wait. They already have.
Jul 1, 2010
Some banks are already moving towards no longer needing a branch to conduct business. I use EverBank for my money market account and they allow you to scan the front and back of a check to deposit it. Aside from having to go to an ATM to get actual cash on the rare instances it's required, I can do absolutely everything else electronically.
+1 Rank Up Rank Down
Jul 1, 2010
An alternate form of currency would quickly pop up. Probably gold to start. But this would be a relatively smaller part of the economy.
+3 Rank Up Rank Down
Jul 1, 2010
As long as there is a demand for illegal goods and services, people will continue to produce and distribute them. I think it's a lot more likely that alternative cash systems would be set up for use in black markets than those markets just going away entirely. In fact, it could create a new black-market...in cash.
Jul 1, 2010
Don't you think that criminals and tax-cheats will simply resort to their own scrip? If we went to a cashless world I bet the crooks would simply transact in something other than legal tender, whether it's golden coupons, mobile phone minutes, or credit card points.

Perhaps a bunch of drug cartels will create their own mint, one that's linked to legitimate business.
Jul 1, 2010
What would happen during a power cut?
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