Cuba Shows What a Disaster a ‘Cashless Society’ Could Be Like Here
I’m an unapologetic millennial. I fully embrace technology and the internet for what it provides; immediate access to information and efficiency in daily tasks, allowing me to focus on myself and my family.
This includes rarely carrying cash. While I don’t use my phone to pay for my coffee or anything else, I hardly ever have cash unless I am traveling.
Many in my generation and younger argue that our country is quickly approaching the evolution into a ‘cashless society,’ heralding it as a positive change akin to the death of using personal checks at the grocery store in exchange for a debit card. For my compatriots of the digital age, I say hold fast and heed the lessons to be learned in communist Cuba.
It’s not just old people
As many Boomers tend to do, my mom always has cash on her. Those who push against the idea of a cashless society often point to older people as just one group that would lose out, stating that the elders in our society will struggle as they clutch to their cash and struggle to adopt the new technology required for cashless transactions.
While I don’t deny the validity of that argument, the pitfalls of complete cashless operations are more diverse than just old Grandma Betty still wanting to carry around a wad of twenties in her purse. Communist Cuba has made a giant leap towards enforcing electronic banking by setting a daily cap on business cash withdrawals.
The daily cap has been set at 5,000 pesos, or the equivalent of $20. Anyone who has ever been a small business owner knows that surprise expenses pop up almost daily in the first few years.
The ease with which to solve those problems is hard enough, but it can be impossible in a country like Cuba. In addition to this daily cap, Cuban small business owners struggle with spotty electricity and internet, fuel shortages, and now no tangible way to exchange large amounts of local currency into U.S. dollars for imports.
Ironically this daily cap meant to encourage electronic banking has pushed suppliers into only accepting cash. (You know what they say about unintended consequences!) This further complicates Cuban entrepreneurs’ ability to thrive.
Way to go, Cuba; you continue to be the bastion of terrible ideas.
So much for wanderlust
You might think that the happenings in embattled Cuba have little to do with what could happen in the good ole U.S. of A – so allow me to provide you with another more equitable example. The United Kingdom has gone mostly cashless, and doesn’t only hit the old Brits sipping their tea and crumpets.
Tourists also feel the pain of cashless living in the U.K. An article in The Guardian highlights the trials and tribulations of mainland Europeans attempting to vacation in the U.K.
A Portuguese tourist explained that his five-day trip to the U.K. cost him an additional 73 British pounds in banking fees, since the cash he had exchanged was useless. National chair of the Federation of Small Businesses, Martin McTague, adds that tourists coming to cashless societies:
“…don’t have the luxury of shopping online and, in any case, the allure of hand-picking souvenirs in store offers a personalized touch to their travels.”
Mr. McTague goes on to warn:
“Phasing out cash and eliminating tax-free shopping sends the wrong message about our readiness for business, and dampens visitors’ spending enthusiasm.”
Going cashless doesn’t seem so convenient anymore when faced with obnoxious banking fees. But it’s not just mere inconvenience that should cause Americans to be cautious of going cashless.
A new acronym built on control
The Biden administration is “exploring” the pros and cons of going cashless in the form of a Central Bank Digital Currency or CBDC. Think of a CBDC as basically a “type” of Bitcoin or cryptocurrency, but controlled by the government.
If you haven’t picked up on the obvious yet, a CBDC will allow the government not just to easily track your transactions, but control your ability to spend. Certified Digital Asset Advisor (CDAA) Paul Farella explains the dangers of a CBDC:
“Through the eyes of a power-hungry state, CBDCs provide huge benefits around surveillance through the ability to track, monitor, and control all financial transactions on the CBDC’s network.”
Mr. Farella goes on to provide this chilling insight:
“This gives the government the ability to freeze or blacklist anyone using the system…”
Just think of a cashless society using a centralized digital dollar. How convenient…for the government.
All it takes is some fancy executive ordering, poorly thought-out legislation, and perhaps your purchases of patriotic gear or firearms will label you a domestic terrorist. No more spending for you citizen.
Like most terrible ideas, going cashless gained momentum during the pandemic. Claims that the virus could be transmitted on currency led to many of the few vendors allowed to stay open to go cashless. Some of you may remember coin shortages.
It doesn’t much matter I guess that currency has always been disgusting; any bill in your wallet contains alarming amounts of feces microbes and even cocaine. Money, literally and figuratively, is dirty – yet it’s still what makes the world go round.
ACLU senior policy analyst Jay Stanley explains the beauty of filthy cash:
“When you pay cash, I give you money, you give me a good, end of story. If you’re using your credit card for all of your transactions, then data is being collected about an enormous range of your activities, including medical conditions, political donations, sexual activities, how much liquor you buy, how many cigarettes you buy.”
The argument that credit cards already track your spending habits and sell them to the highest bidder so a centralized digital dollar is no different, is flawed. A CBDC would give all of the above to your government.