D.C.'s ban on cashless businesses takes effect
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There's a completely different take; Civic resilience
From an operational and strategic security POV, cash is a vastly superior technology. It doesn't need electricity, a network of cables, satellites and routers.
Therefore cash in circulation acts as a buffer that provides economic stability and continuity of operations.
Also, take a look at a modern European bank note, like we have in the UK. It's a sophisticated technology. It's not like we still have Roman coins that any blacksmith can forge.
There are many good, but more subtle reasons for preserving the use of cash, and regulating business practices if necessary to do so.
If the power goes out, I can't get any cash. I don't keep any meaningful amount cash on hand and neither does anyone I know, including my elderly relatives. Most of the stores I shop at won't actually be able to sell me anything, because none of the products have price tags and I sincerely doubt that any of their staff are trained to revert to pen-and-paper accounting. Even if they did manage to keep things running, they'd likely run out of change by the end of the day. The grocery stores are JIT and have no more than a few days of stock of anything; again, I doubt there's a manual backup to their reordering system.
Maybe things are different in countries with less reliable infrastructure, but I just can't think of a scenario in which cash would gain you any appreciable amount of resilience without much wider systemic changes. So much other stuff beyond payments is wholly reliant on technology. I'm not sure that would be a wise investment versus improving the resilience of power distribution and network infrastructure.
Well, that is well on your single data point, here is mine: I live in a bad weather prone area of the united states. I do not know _anyone_ that does _not_ have a meaningful amount of cash in the house for bad weather. Yes, stores here operate with low/no power or communications and use cash. I agree with the poster who noted that it provides a localized resilience. It is your fault, not anyone else's, that you do not have some currency.
Truth be told, I have kept about a weeks worth of spending in cash for decades in the house, just in case, and I have indeed had to use it during long term power outages. Heck, in my area just last week, all of my banks ATMs were down for the entire week due to a software issue after an upgrade (I am not making this up). While I might not have needed cash, it shows the fragility of our systems we rely on.
Another side effect of this DC rule will be to ensure that more are prepared too.
That's your choice, not a problem with cash
> Most of the stores I shop at won't actually be able to sell me anything
But many other stores will
> ... by the end of the day
Often, it is all that is needed
Not all outages are apocalypse scenarios. Sometimes, it is just about finding something to eat for the night, the kind of small things that add up in an emergency situation.
Take the 2011 Sendai earthquake and tsunami for instance, it caused big problems like flooded cities and the Fukushima disaster, but it also caused small problems for millions of people, power outages, stopped trains, etc... These people had to eat, sleep,... while most of the infrastructure was down, it got better the next day, but in the meantime, it is good not to have to worry about millions of people being able to buy their meal when thousands are in need for immediate assistance.
And, as others note, CC readers in an individual store do go down though I probably won't have much cash in my pocket even if I have some at home.
I think South Africa has had power problems in recent years, might be good to look at how they've dealt with it?
In Hungary currently it is mandatory to use networked cash registers for cash transactions and centralized digital reporting system for issuing invoices. There are some minor exemptions, for farmer's markets and some similar specific niche very low volume cash transactions.
I know about no disaster protocols. (though the Hungarian mindset wouldn't give a damn about law forbidding sales without digital invoice in case of a slightly sustained emergency situation, possibly an outage longer than a day.)
So basically even with cash you might need electricity. (until nobody starts to give a damn)
I support using cash, for the several reasons outlined in the comments and the article. Yet I think when the trust in government/public services starts to break down (as ignoring laws banning non digitally accounted transactions), the trust in cash might also start to break down (though it takes longer imo)
Something that I've learned when I worked with those devices in the past is that the tax authorities do have strong contingency plans.
I don't know about the implementation details of the system, it is working since about 8-10 years ago without any major noteworthy issue/outage apart from some minor hiccups in the initial deployment. It sounds logical that some similar disconnected operation should be available here as well.
There are a lot of scenarios where having cash as a fallback is great.
Experience has shown an even more prosperous outlook from having cash as the mainstay and credit as a fallback.
I don't think it makes sense to argue we should all use cash in case some small section of D.C. loses power for 10 weeks.
The advantages to the cashless society far outweigh that small benefit to the average person.
So yes, a bulletproof cage is security technology, it works sufficiently well most of the time, there aren't many low-effort innovations to break it (bombs and such have been around forever but aren't used to rob convenience stores often), and if it does get broken it's obvious. Whereas a software exploits can be harder to detect and can be much easier to replicate and scale
Edit - Innovations in physical theft: That Kia/Hyundai car trend, which is really software. The trick bums use to steal blue bikes from docks. Writing threatening notes to bank tellers without any way of making good on the threat because tellers are directed to not fight back. Any more examples?
(And to add a cherry on top, this is usually not disturbing to actual customers, because they're busy doing usual bullshit paperwork while the safe is unlocking.)
You can have all the tech for proving that a dollar is legit, but it nobody cares if the dollar is legit, then it doesn't matter
This is about money being able to function with crippled infrastructure, not about someone stealing dollars stashed inside a mattress.
and it's superior because it usually cannot be circumvented with math or will accumulate known insecurities over time.
Back in 2018, Visa's network crashed:
https://www.theguardian.com/world/live/2018/jun/01/visa-outa...
It was absolute chaos. Most shops and restaurants lost a ton of business due to customers not being able to pay for products (many people here don't have cash in their wallets at all), and many of them couldn't sell even if they wanted to, since the card reader (and other parts of their point of sale systems) also relied on said network.
Having cash as an option at least means things won't completely shut down whenever this sort of error occurs.
It is vulnerable to counterfeiting which mean citizens lose out regularly as they don't have the means to check all cash is valid as shops or banks do.
Physically it is vulnerable to destruction and cannot be replaced if burned for example, unlike a bank card or other token of identity linking you to your funds.
It is vulnerable to devaluation (in has this in common with electronic cash)
In the event of societal collapse or degradation it becomes worthless fairly quickly, which is the opposite of resilient.
Cash is not at all resilient compared to electronic money therefore, and people are voting with their feet to get rid of it, laws like this will just delay the inevitable for a decade or so.
Bank cards will also disappear pretty quickly IMO (next couple of decades), as they're just a physical token of ownership and not really required if you can rely on say a combination of biometrics to assert identity.
But nowadays cash is hard currency, while electronic payments are fiat currency, or like NFTs.
I think of this after all the stories about paypal/square/etc withholding payments and destroying an individual or a business.
To be fair, credit cards also don't. At least didn't need to, up until very recently, when most issuers stopped embossing their credit cards.
Imprinters exist. https://en.wikipedia.org/wiki/Credit_card_imprinter
Sure, the risk here is that the charge would get declined later on, but you get the same risk if you accept personal checks.
So in some scenario where electricity is unavailable, credit cards will be just as worthless in most cases as apps and gift cards.
I don't expect any store anywhere to have an imprinter, but it's definitely an option.
Card present or online transactions only prevents you as a seller to make any money when the internet is not working.
You need trusted cashiers, need to check every received note to see if it's genuine, then you need to safely deposit that somewhere, the boxes of cash have to be transported likely in an armored truck.
And you still need communications networks for all the checks and balances and automated systems to handle the cash.
It's a massive logistic effort to shuffle around little certificates of value.
No but dollar bills are a lot less advanced. They're also all still the same size and color so it's very hard to differentiate them.
For me the privacy point is the most important though.
Deloitte calculate the per day impact of a temporary shutdown would be on average $23.6 million per 10 million population. Not that bad actually. But that figure seems based on the immediate hourly estimate from places like The Uptime Institute and LSE. Other estimates puts it at between $11Bn per day for the whole USA [0] and only $10Bn for the whole year [1]. In reality the impact quickly compounds, making day 2 (24-48 hours) significant worse, and so on [2]. I am quite sure the aggregate downtime of AWS, Azure, Google and other cloud services in the past year has exceeded 24 hours per capita civilian use.
Being able to take cash, as a "flywheel", makes or breaks businesses in those times.
[0] https://bnn.network/finance-nav/unraveling-the-impact-of-glo...
[1] https://arstechnica.com/tech-policy/2022/07/internet-shutdow...
[2] According to studies I got masters students at York Business School to undertake.
edit: formatting
That seems very low, surely the transaction volume of the average person is more than $2.36 a day?
But most businesses do. The main issue is there: why should a business be forced by law to accept cash if they absolutely need electricty and cables to work as a business ?
It's one step below forcing them to accept hand written checks. Those are also extremely resilient, you just need a pen and paper. But god no I wouldn't want to deal with them at a car rental desk.
Sure cash should be accepted in shops selling essential goods. But other shops should have the choice.
* Elderly people who struggle with technology.
* People fleeing coercive situations like domestic abuse where their abuser controls their finances.
* People with mental disabilities, for whom cash might be the only thing they know how to use.
* Homeless people, who might literally rely on cash to survive.
* Poorer people who prefer cash because it helps them budget and limit their spending.
* People so poor or otherwise disadvantaged that they don't even have a bank account.
That last group is much bigger than you think: by one estimate, 6% of American adults don't have a bank account and another 13% are "underbanked".[0] That's tens of millions of people in the US alone who don't have access to the basic financial services that you and I take for granted.
I have no idea how they do it. I'm not sure how it's even possible to navigate modern life without a bank account, but then I'm an educated, affluent professional who has no idea what it's like to be poor. Just because I don't need cash doesn't mean that no-one else does.
So basically, I think that asking "why should a business be forced by law to accept cash?" is like asking "why should a business be forced by law to provide wheelchair ramps and elevators?" If you don't think the answer is obvious, then you need to check your privilege.
[0] Source: https://usafacts.org/articles/who-is-the-least-likely-to-hav...
> Sure cash should be accepted in shops selling essential goods. But other shops should have the choice.
That basically covers you whole list, except if your argument is that gaming PC parts shop should absolutely accomodate cash in case homeless people need an RTX3060 over the weekend.
Also fundamdentally a bank account should be a legal right (it is in many countries, if it's not in yours it's a more critical debate than cash), and with it should come a debit card. Sure some people won't be able to use it for a reason or another, but they can get help. The same way not everyone benefits from cash.
Check cashing stores. And you pay a very steep fee for not having a bank account.
My partners mum fits the bill of "underbanked". She lives in an area where cash is king (near the border of a country that uses a different currency). She has a bank account, but doesn't use her debit card or online banking.
The answer to "how it's possible" is that she relies on other people who do have bank accounts to do things that require online payments.
If you don’t think the answer is the federal government should be providing the necessary infrastructure, then you want retail business operators to pay for fixing the problems taxpayers should be paying to fix.
Ummm, for quite small values of "most" :)
I have a handle on this because I set a resilience assignment to a cohort of about 20 MBAs at a business school. Specifically I asked for a representative range of businesses;
- fast food - gymnasiums and sports - nail bars and hairdressers - auto-repair and mechanic/garages - child and day-care
.... you get the picture, _loads_ of variety.
They did 1 hour, 12 hour, 24 hour and one week case models.
As tech people, we are probably biased to think too heavily about digital and electronic systems. Many businesses can function in "survival mode" during a tech outage, including electricity in some cases.
As I recall, after "telephone", it was payment systems that were the real killer. Interestingly many access control systems fail-safe simply locking everyone out of the buildings!
"survival mode" is just that, you can accept cash during a hurricane, and refuse it for the rest of the year when you operate nromally.
That said, I can also understand businesses wanting to do away with it - no need to dealt with it; secure it, count it, deposit it, … etc.
Asking these people to handle cash instead feels like an undue burden on something that is a very selective side gig. I've seen this a lot in mildly remote locations, and I'd assume they wouldn't be doing it if it was more of a burden, like having to deal with the cash flow.
When I asked for a Clubcard a few months ago they said they're not giving out any and you have to use the app.
Funny enough just after I asked I found one on the floor; I'm using that one.
I wouldn't go to Tesco if it wasn't for that, because the price differences are just insane. Before you had the points and whatnot but not the strong discounts (IIRC), then I didn't go to Tesco for a few years on account of being in a different country, and now it's a €3 "regular price" and "€1.50 club card price" for half the stuff I buy. wtf?!
Handy enough. I get to avoid jacked-up prices, and he gets reward points.
212-867-5309. Replace area code with one near your location.
But cash handling costs a substantial amount too. We should probably all be paying by debit card and charging extra for cash or credit card.
However having the option not to is a very important privilege I feel we should protect.
Believe it or not we do have cash first businesses and I make it a point to use cash with them as they will only charge a fee if you use a credit card.
We need a stronger reason than "I want that" to force businesses to give us things — otherwise how do we decide whose preferences we should mandate?
The strong enough reason is "it's better for the people."
It's easy how we decide whose preferences we mandate - we mandate people's preferences, and businesses find ways to make money within those constraints. There's no issue making profit like this, so I'm not sure where the concern is. Profits slightly dented for a second? Oh well.
But personal preferences are a bad way to choose regulation — businesses can aggregate preferences much better than the state can.
It is pretty much only the civil defence authority that encourages use of cash, because they are aware of the incessant hacking attacks that could disrupt the system at any moment. Cash has become less convenient for consumers: businesses refusing to take cash made it even more so.
So many questions, with "how will you buy your coffee" very low in the order of priority. Electronic money remittance should be seen as a basic human right.
Seems like neither side really cares about these people, but they make a useful rhetorical prop.
Not sure whether Sweetgreen choosing to go cashless is an example of "decide things by who has the most money / power / guns."?
You don’t. The merchant you are buying from is choosing to pay 3% for credit card payments because they believe incentivizing people to pay with credit cards will result in them earning more (via higher prices or higher margin goods) than incentivizing them to pay with debit/cash.
If a merchant wanted to, it would be trivial for them to give you a 3% discount for paying with debit. In fact, Target gives you 5% off for paying with debit via their Redcard, but I suspect they do not advertise it because they still want their non savvy buyers to use credit cards. And they want to funnel their rewards seeking savvy buyers to the 5% discount since they bet the cost benefit for those people does not work out.
> You don’t. The merchant you are buying from is choosing to pay 3% for credit card payments because they believe incentivizing people to pay with credit cards will result in them earning more (via higher prices or higher margin goods) than incentivizing them to pay with debit/cash.
Today I picked up flooring from a place that gave a 5% discount for paying with cash or check. Many gas stations around here are around 3% less when paying with cash. At such places you pay extra for the convenience of the card.
Otherwise I think the incentive point is exactly right. My town allows you to pay for parking with a mobile app and CC. I’m sometimes charging a dollar total to the card for parking. Not much left for the town after the fees. But I always have my phone and can pay vs carrying cash or coins to pay.
My guess is the town makes more overall in parking fees because of that app
I don't believe that a merchant is allowed to do this? Probably very dependent on your deal with credit card processors but my understanding is that the default contract between a merchant and a credit card processor stipulates that you are not allowed to offer discounts to not use credit cards differently.
Of course if you are Target-sized, you get special treatment. My understanding is stuff like Redcard is basically just Target "giving back" their cut of processing fees...
A federal law was passed over 10 years ago allowing this.
https://www.ftc.gov/business-guidance/resources/new-rules-el...
> A PCN cannot stop you from offering your customers a discount or another incentive for using a certain method of payment, as long as you offer it to all your customers and disclose the offer clearly and conspicuously. For example, you can offer your customers a discount or a coupon if they pay with cash or a debit card rather than a credit card.
I think this was in the past or no longer enforced. I lost count now of the stores that will charge you a 2-3% fee for paying with a card.
The merchants that do not offer lower debit prices choose to pay the extra 3%. It is up to the customer to decide if prices at merchant that gives debit discount or merchant that does not give debit discount are better.
> If a merchant wanted to, it would be trivial for them to give you a 3% discount for paying with debit.
It makes more sense to me for it to be a surcharge for using a credit card, but the last I knew the credit card companies disallow that in their agreements. Discounts get confusing and bump up against weird cases like minimum advertised pricing and potential taxation on the discount.
Debit cards can get a bit weird when they function as credit cards. A customer may use a debit card but swipe it as Visa or Mastercard and the fees the merchant pay will be different, setting up a constant source of frustration at the register.
I have never heard of this. Merchant gets the revenue, merchant pays the tax. If the debit price is $10, then the sales tax is on $10, and if the credit price is $13, then the sales tax is on $13.
> Debit cards can get a bit weird when they function as credit cards. A customer may use a debit card but swipe it as Visa or Mastercard and the fees the merchant pay will be different, setting up a constant source of frustration at the register.
Visa and Mastercard are payment card networks (PCN), they can perform both debit card and credit card transactions. If the card says debit on it, then it will be a debit card transaction with debit card fees. And no one should be swiping anymore, so I do not know what “swiping it as visa or Mastercard” means. It either says Visa or MC on the card, and that’s the PCN it’s going to use.
don't forget skimmers
Why are you putting the onus on the retailer? Don't assume malice or intent from them.
I operate online businesses; so 99% of my sales are credit card. I get the occasional wire/ACH or a check in the mail. I'd love to not pay 3% of all my revenue to credit card processors, but most people want to use credit card / PayPal / etc. because it's more convenient for them.
I'm happy to offer a discount if someone wants to pay via a non-credit card, but I don't raise my prices because of it. I just have to suck it up and eat that cost. My margins are not high and I would've made about 27% more last year had I not had to do that. You're welcome.
Because it is their choice.
> I'm happy to offer a discount if someone wants to pay via a non-credit card, but I don't raise my prices because of it
This makes no sense to me. As the leader of the business, you have the option to
1) deny all credit cards
2) accept all credit cards, but not offer discount for debit cards
3) accept all credit cards, but offer a discount for debit cards
It is just a business decision, and if you are not choosing 3, one would hope it is because you are earning more profit by going with option 2.
You thought... prices were dynamically changing per acquisition channel, or that credit borrowers were "privileged" because they took a credit risk and got a "reward" coming from... the merchant ??? Man, what a beautiful world that would have been :(
People seem to forget processing cash isn't free. If you're small, it's a trip to the bank. If you're large, it's an armored truck. Employee theft is a problem. Counterfeit money is a problem. If we pretend it's 1% instead of 3% (since you can get 2% cash back), 1% for not dealing with the downsides of cash sounds ok.
The closest I can think of is when a bank tried to charge my son for using their coin counting machine because he didn't have an account there (he's a minor, but I had an account).
Which they use to fund cash back programs...
Net income is a weird number so I tend to ignore it for this kind of stuff.
Certainly I could have missed the payback style stuff they do but I thought that was included in the number I checked.
It's a real problem that some people cannot afford the fees on a bank account, but I would prefer that we find some way to provide everyone with minimum banking services. Like a no-fee government-provided debit card.
I know, the government doing things is bad, but Wells Fargo, Citibank, etc are so heavily regulated, they are essentially a wing of the government now anyway. Maybe in exchange for being "too big to fail" they could be required to provide all American citizens with a standard, transferrable, no-fee debit accounts.
The government shouldn’t even need to get involved here. In the UK accounts have no standard charge and come with free debit card. There’s no reason banks in the US can’t offer this other than the fact people think paying for an account is normal so they can get away with it. Do the “app” banks like Revolut and Monzo offer free accounts in the US? Curious if they’re bringing some competition that could force change.
Well, in the UK, fee-free basic bank accounts are the result of government regulation(1).
It was part of the UK's implementation of Directive 2014/92/EU (2), which mandated access to basic bank accounts across the EU (of which the UK was then a part).
(1) https://www.gov.uk/government/news/fee-free-bank-accounts-la... (2) https://europa.eu/youreurope/citizens/consumers/financial-pr...
The 2016 change seems to be about fully fee-free accounts, i.e. no overdraft charges or similar fees.
The libertarian version of the I Made This meme.
Malicious compliance is fun.
Besides, having to have change is the really big cost of cash handling. Almost all your customers come in with big notes from an ATM and leave with smaller notes or coins, so you have to keep getting change from the bank. Just rebrand "not giving change" as "mandatory tipping" and it's even a pro-worker move!
rounding-up to avoid handling change is the norm when paying cash in "tippable" situations like at restaurants or farmer's markets.
leave it here!
people who are statistical outliers. I.e. people with low income
To some extent I believe the larger financial institutions lobby for these regulations in order for them to not have to serve low income customers.
From experience I can say that it reduces crime, but it does create massive issues too.
Problems are current regulations aren't risk based, which results unproportional compliance costs.
Plenty of banks offer no minimum checking accounts. Whenever this gets dug into, the fees they supposedly can’t afford are when their balances go negative, which is harder to justify being free.
Ally Bank offers no minimum, but they're online only and reimburse for (some) ATM fees rather than it being free upfront.
Many ordinary people who try to get an ordinary bank account at an ordinary bank they take the bus and the walk to end up paying fees.
[1]: https://www.wellsfargo.com/checking/everyday/monthly-service...
https://www.consumerfinance.gov/rules-policy/regulations/100...
I have a lot of experience with low-income people and people not great with money (and the overlap between them). The problem is most want this feature. They would not want the transaction declined. They know they don't have any money.
The fees exist in the UK but the UK never had the cash culture that the US does so very few consumers made a fuss about it. Plus the UK has a much longer history of debit card use than the US.
The US banking sector is less regulated than the UK sector so can get away with adding fees. The UK banks would love to move to the same model but would get strung up by the public and regulators.
Disclaimer: Haven't checked the details now.
Well that's dumb. The UK version is fee-free and of course it includes a debit card; how would you use the account otherwise? Passbook account like the 1970s? They don't want you tying up valuable cashier time.
I doubt a debit card is included.
They put in an ATM, can't charge that back.
More likely, thieves were using stolen cards, and the chargebacks were probably legitimate (a thief trying to make money on a chargeback would be pretty dumb anyways, since it would be tracked back to their identity regardless, and the bank would shut them down quickly they made an unusual habit of it).
Customer's bank says "customer says they have no knowledge of this charge"
Square allows a dispute, including with video and photo evidence of the guy signing the tablet himself. That was submitted.
Customer's bank kept the money.
It's a late-night business, though,and adjacent to early-open businesses, so it's probably hard to find a convenient time.
> Businesses can offer cash-to-card services for in-store purchases with a lot of stipulations including no associated fees or time limits.
A congressman was just carjacked in SW DC. The city was really great in the aughts and teens and has gone to shit post-2020. I wish they'd focus on cracking down on crime, which is working really well in NYC.
It is up to the gov't to enact policies (carrot or stick) to prevent robberies.
Banning cash to allegedly keep workers safe is the ultimate whitewashing of corporate greed at the expense of workers and the public. This is a good law.
Forcing people to have a bank account or a credit card to buy food enforces a monopoly on money.
Cash serves an important purpose. It is a safety valve in case of such extrajudicial overreach. Yeah, because it's private, it also enables some bad stuff (tax dodging, drug trade), but the same can be said about not requiring ID verification to use the internet.
"In August 2014, U.S. Representative Blaine Luetkemeyer introduced a bill that would limit law enforcement's ability to restrict access to the banking system as a response against Operation Choke Point.[12]"
So it was stopped by Congress, another part of government.
The existence or non-existence of cash wouldn't have made a difference to the ability of pay day lenders or firearms dealers to continue operating because I'm pretty sure they wouldn't be able to get access to cash to conduct their business unless they had bank accounts!
My point is that a government supplied electronic payment system would make no difference to the ability of a government to engage in anything more or less nefarious than they can already do, and the legislative process is capable of dealing with that (and if it's not, cash won't save you either).
I'm pretty sure the US can do the same if the system is run by the government. That kind of thing only happens there because it's run by private companies.
They already supply a payment system (cash), it's just not electronic. Last time I checked we're not hurting for lack of competition in the "minting currency" industry, and in fact when this was competitive (ie. before the Federal Reserve was formed) the US was a total shit show and it couldn't get anything done.
The point is that there are many benefits for businesses to not accepting cash payments, especially if they're maintaining the service for a decreasing portion of their customers.
Also, if customers had access to a government run cashless payment system (the same privilege that private banks enjoy) then they might find themselves less interested in carrying cash in the first place.
They are technically wholly unnecessary in the 21st century for the purposes of sending/receiving/keeping a running total of funds in an electronic database entry ascribed to an entity.
Mandate the USPS (federal government) to offer electronic money accounts to everyone.
Anyways, extending this idea to also include an ECH account attached to the payment account is probably not difficult to accomplish and is probably where federal reserve efforts could improve outcomes without forcing banks to take on customers.
These people often don't have a bank in their neighborhood.
https://www.nbcwashington.com/news/local/new-laws-on-guns-ca...
At first I thought they were banning cash-only businesses, but it is in fact the opposite. Businesses must now accept cash in Washington D.C.
'Driving the news', 'Zoom in' and 'zoom out' seem just like spurious titles.
Let's not be so quick to say that card payments are all bad.
people don't want the government seeing what they spend their money on, or if it was saved.
almost everyone does this to some extent due to the insanely high tax load and double economy that exists in every facet of our lives.
for example, when someone is buying real state, big part of the negotiations are how much is the declared price of this transaction (how much our "IRS" sees), because clean money and undeclared money have different costs. So when our "IRS" comes asking "where did you get the money from?" you say "from all these cash extractions of course, I saved most of that, I ate rice only", you can't say that if you spend your money with a credit card, they don't need an investigation to see your spending habits, in fact a change in spending habits will trigger an investigation.
I'd like to clarify that I don't have experience with anything of this, a friend told me about it.
The argument is more centered around business who flat out refuse to accept cash. Which is on the face just ridiculous.
India and China use cheap QR code transactions, but a lot of the overhead is taken in by VC money. So I think these companies are hoping to make money on these someday, just not right now.
The USA has a pretty well developed system, and debit and credit cards have been pretty ubiquitous for a few decades now. The issue is that our system is expensive, and no one is subsidizing it for future gains (the gains are today). Debit cards are cheaper, but credit cards have done some marketing to get people to prefer them.
I tend to agree that physical cash should always be a viable option. Using a card or phone to pay at a terminal is a choice.
If you say, “but cash should be removed for <reason X>”, look at the Square outage a few weeks ago. About a day and a half of no ability to use mobile ordering or paying for goods and services. What happened? DNS issues. If DNS issues can cripple an economy and business livelihoods then there should be a backup.
I find the difference in opinion between the HN crowd and Reddit kind of interesting. Part of it is probably because that is a local to DC subreddit, but I also believe they're not really considering the privacy / civic resilience angle.
From my perspective, having lived through a near total power outage in Texas for a week in February 2021, having some cash, food, and drinking water on hand is just basic common sense these days. Some local grocers were letting people take groceries without paying, anecdotally, but I don't think that was everywhere or even corporate policy. You also don't want to rely on that to feed your family or pay for basic goods in an emergency. At one point, even the cell network was starting to go down in my area because the generators powering the cell towers were running out of fuel.
> Created 2021, free of over-moderation
The more popular community, and the one I'm familiar with, has 332k subscribers. It can be found here https://old.reddit.com/r/washingtondc/
I'd bet there's quite a bit of overlap between the group of users who felt they were over moderated on the original DC community and those that disapprove of these types of regulations.
But why ? For things like a coffee that's maybe $2, why should I, as a customer, possibly incur a fee from my bank for a $2 coffee? You as a business can do what you like, maybe you could just limit the max bill denomination to 20 or something.
I feel your limiting your customers options when not allowing cash. I know I personally would actively avoid a coffee shop like that.
I think many would consider Washington D.C. to be governed solidly by American progressives. While the rationale for this law fits solidly within their views on egalitarianism, I wonder why no one is discussing another proclaimed progressive area of concern environmental impact and climate?
I have to think in this case cash must be significantly environmentally more impactful than the electronic payments. Cash requires a surprising amount of raw materials to produce, not all of which I expect to be environmentally friendly. Cash requires specialized transport, not just of the actual cash to and fro, but also of those raw materials. Sure electronic payments require power to operate, but I assure you hard cash is just as counted electronically as electronic payments. Disposal of used cash I expect to have its own unique environmental impacts.
In essence making each unit of currency physically real rather than electronic would seem to have unaccounted for negative externalities, something my more progressive friends go on and on about when convenient, which I don't even see getting lip service in relation to this law. Or maybe in the eyes of the progressive establishment enacting these laws climate just isn't nearly so important as equity/social justice?
Again, not my fight, and I think the vast majority of "negative externality" arguments are made for rhetorical points rather than referring to some well considered analysis not to be ignored... but I would be curious to understand how progressives decide which priorities are of greater urgency than environment and climate given how those issues are typically couched.
> unaccounted for negative externalities
The scale of these is uncertain, as are countervailing externalities. Looks like someone wrote a paper on it in the UK and came to the conclusion that it's not clear which is worse (i.e., the externalities either way aren't big/clear enough to matter) [1]
> I would be curious to understand how progressives decide which priorities are of greater urgency than environment and climate
I don't think progressives think this way, rank ordering a hierarchy of preferences (to their credit and detriment, at different times). I think it tends to be more "we noticed [problem X] in [Community Y] - let's solve it!" leading to an amalgam of policies.
[1] https://www.actuaries.org.uk/system/files/field/document/Iss...
This might not be clear... but I very much liked your response. I skimmed the report that you linked. I think they may have missed something in their analysis. I might be reading it wrong, but I think they've underplayed the transport of physical cash. They do mention it, but I didn't see it really discussed very thoroughly and daily transport of cash in the normal course of business is where I would think the greatest efficiency variances would be found. I kinda got the sense the transport they were talking about was between the mint and the banks and the banks and the mint: essentially the cost of transport to the government itself and not more broadly across the economy. That's not unreasonable for the report if they were trying to figure out the difference from their own perspective rather than the broader economy. However, there's significant transport for businesses that trade with cash. The first ~15 years of my career was spent in the corporate management of a few retail chains and providing professional services to others. Cash management was resource intensive relative to electronic payment processing. In one chain I worked in, armored trucks would do cash pickups from each of our stores daily (and sometimes more) and in many locations we had to have extra security staff to escort cash off the retail floor and watch the cash office (which means more people to transport, etc), not to mention other specialized equipment for dealing with cash (counters, etc). All of the chains I was involved in had some variance of this... at least the trucks showing up.
This all seems to have a significantly greater effect than the creation of a new physical bill that lasts 6-10 years.
- Cash and electronic payments both are accounted for in pretty much the same way; there are some differences when you zoom in enough, but in terms of energy consumption not materially different: both are accounted for using computers and the same mechanisms are used in communicating results.
- Electronic payment mechanisms use electronic terminals to collect payment, but cash (mid-20 century onward) uses electrically driven devices such as cash drawers or data entry terminals to track. We won't get into retail cash office details too much other than to say that for our purposes cash is either break-even in terms of energy consumption vs. pure electronic payment (though really cash is probably at a slight disadvantage since there other devices are often at play).
-- Transfers of capital between banks and banks, and banks and reserve banks, are typically all electronic, though cash will need additional transport steps which will consume additional energy to the mere communication of transactions which all payment types require. We still could consider this break-even.
-- Bank to retailer and retailer to bank conveyances are where I expect electronic payments to dominate in the energy efficiency contest. Retailers need to carry a minimum cash on hand for making change in transactions (we'll mostly ignore crime related externalities for this discussion). When the retailer falls below their minimum cash on hand, they need to have cash physically delivered. Retailers also, because of crime issues, need to clear the excess cash out of the store quickly as well, another physical transfer. This often means big abnormally heavy trucks prowling around city streets; in fact you might draw some inverse relationship to the energy efficiency of the transport mode to the suitability of its use in transferring cash. But remember that any physical transfer of tangible cash is also backed by an electronic transaction accounting for the transfer.
And I think that last point hits the biggest error in your reply. Cash transactions may supplant some electronic transactions, but do so with physical movements which also consume energy... and unless your prepared to say moving a kilobyte or two across town over a wire is less efficient than moving that same cash across town in a big truck my guess is you might agree that electronic payments will tend to be more energy efficient... and remember even with the physical move you probably don't save the electronic transaction anyway because of accounting needs: you just change its nature.
The reasoning I’ve heard behind this basically comes back to whether you have a choice: if my coffee shop says “no cash”, you can walk away just as you could if the sign says “formal dress required” or “no cell phones in use” – weird, perhaps, but it’s private property and both parties have the ability to walk away if they can’t agree on terms. Debts are different because they happen at a time remove, and the economy works a lot better if you don’t have something like a loan requiring repayment in notes from a particular bank which failed or, worse, was bought by your lender and is now playing games.
I’ll gladly pay an extra 5% for a donut if it means I don’t have go to an ATM, withdraw the minimum, and forget the change in my car anyway.
Also... Yes, cash is expensive to handle. Theft, keeping change, a register, maybe a safe, transport to bank, fees from banks etc
The car is god, lol. I don't understand why they get an exemption.
Why not also then force cash only businesses into taking card and mobile payments also?
Taking cash costs money as well: more security, more auditing, more cash transport, higher insurance costs, etc
Even better, because of forced cash now every business incurs those costs even if the overwhelming majority of their transactions aren’t in cash.
The solution to “discrimination against homeless” is not forcing people to take cash, it’s forcing banks to allow homeless people to open bank accounts.
Banks only "work" because they can earn interest on deposits. Homeless people will likely not have enough deposits to make it worth serving them, and they will likely also cost more in support and fraud.
If you compensate them too little, banks will do their best to wriggle out of it or make it inconvenient. If you compensate them too much, they will become predatory in opening homeless accounts. In any case, the incentive structure is all wrong once you try to force the free market in the wrong direction. And who's going to be paying? I hope it's not me.
There is no way this would end well.
https://dharmamerchantservices.com/faq/visa-consumer-interch...
Scroll down and check out the debit rates. 22 cents a transaction for credit union debit cards isn't cheap.
By contrast, allowing direct businesses to not take cash harms a not small section of our society.
There are costs involved in dealing with both forms of payments.
It's a common misconception that arises from state legislatures doing nothing for several decades, but the power is there.
For the record I don't support either and believe it's up to every business to decide what form of payments to accept.
I realise it begs the question a little, the state can mandate cash because it's the state's mandated and controlled medium of exchange, but state power often begs the question.
If all businesses were cashless then they would find something else to grab. It wouldn’t be as easy or convenient as cash, they would need to use a fence, so maybe more shoplifting and smash and grabs.