It says “legal tender for all debts private and public.” But cash is out. Indeed, some businesses now refuse cash, including a hair salon in Los Angeles, a few pretentious chain restaurants and several small shops. Visa has declared “a war on cash,” reports New York Times (12/6/18). Other credit companies are implicit allies in that war. Only 30% of transactions by one survey currently involve cash, says Wall St. Journal (12/30/18). Most cash transactions are in small amounts; 55% of them are for less than $10. The popular alternative to cash is called a credit card. However, cards are also out. Nowadays a purchaser obtains ready credit through an app on a mobile device. It is not swiped; it is tapped.
We crusty old-timers prefer cash. This is not only because a cashless economy further impoverishes those without access to credit. There are other troubling consequences of going cashless, ones that threaten middle-class families.
Number One. Cash is or was a nearly universal societal benefit. The trend these days is to allow private companies to own public life. The outcome of this trend is generally no good. Prime evidence here in Chicago is the expensive parking facilities in the Loop and elsewhere. Citizens do not benefit from the revenue; a private entity does. Likewise, the ubiquitous cameras that catch any and all minor traffic miscues would be annoying enough if the tickets’ revenue went to our city. But a private company has the contract. Prohibiting cash in favor of private currency is another destruction of the public realm.
Number Two. A cashless private economy is premised on automation. Working-class jobs at what were once called cash registers are disappearing. It is entirely possible to stock one’s grocery cart and put the produce, meat and bread in one’s car without dealing with a grocery clerk. The same impersonal approach is taking over in restaurants. Banks don’t have tellers.
Number Three. Another result of cyber-automation is increased violation of privacy. The private company that extends credit and the retailer join forces to develop one’s consumer profile. This is used by the retailer to pitch more products or it is sold to other private companies. Also, cyber-banking and cyber-transactions expose one’s cyber-wallet to thieves. The best robbers these days eschew cash; they prefer hacking.Number Four. It is true that credit, wisely obtained and carefully managed, can be a form of wealth. A home mortgage obtained from a neighborhood bank or credit union is an investment. Credit perhaps leads to wealth in sophisticated margin trading in 90-day stock options. Right? Most credit obtained by working families, however, is basically usury. There is no credit app (formerly called a credit card) that comes without a line of credit (if only 30 days) and interest fees. The singular factor that hampers the financial standing of working class families is credit app/card debt.
Is it possible to manage a household without credit? It is possible, but it requires resistance to the new capitalism—a capital economy in which products are not that important but in which investment rules. How to manage without credit? Get a checking account from a neighborhood bank or credit union. Don’t deal with Wells Fargo or other national entities. Do not accept any line of credit on the account. Don’t cyber-shop too much. Use the currency that comes with a picture of President Andrew Jackson (1767-1845), President Ulysses Grant (1822-1885) or other notables. If you already have a credit card/app and you made only a partial payment last month, see a reputable, neighborhood-based finance advisor immediately.
Droel edits a free printed newsletter on faith and work,
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