US Government Is Going To Monitor AllYour Financial Transaction Very Soon |
Ever since Nixon took the United States off
the gold standard, the US dollar has continued to lose it’s redeemable for gold
or silver. Now, money derives its value purely from
faith, a dogmatic faith in our government and the laws of the land.
This no good given how many rights
we’ve already lost.
Even as the Federal Reserve tries to maintain
control over the physical cash system, various companies (IT giants and
financial backers) are hacking at the system, trying to kill it in an attempt
to make a ghost of its former self.
It will create a digital ghost, one that
would then roam in the new cashless society.
At one extreme are the world’s leading IT giants
and financial companies tirelessly working to completely replace paper money
with a wireless payment system for the smartphones Apply Pay set to drive
contactless payments up to $300m by 2016, rivaling with Samsung Pay, and Google
Wallet, to name a few. On
the other extreme are the technology giants such as IBM
developing highly sophisticated biometric systems that create a highly unique
personal ID using (do hold your breath) a person’s eyes, fingerprints, face,
facial expressions, voice, heartbeat, and more.
The end result is the same: loss of not just
paper money, but also plastic money.
It will lead us into a new world order with a
cashless society.
It may sound fantastic, and within this
cashless system are various traps ranging from loss of our freedoms and rights
to leaving a significant part of the society in a tough situation.
Let’s start with stating the cases being made
for the cashless society, identifying the proponents, and dissecting the
reality of it all.
The Cases for Cashless Societies
across the globe
Cashless is gaining momentum. It is often
portrayed as an ode’ to progress and development…
Here are the primary cases being made for a
cashless society, let’s start with the one’s given by its biggest proponent,
the United
Nations’ Better Than Cash Alliance who has partnered with Bill
& Melinda Gates Foundation UNCDF, CITI, MasterCard, Ford Foundation, USAID,
Omidyar Network, and Visa Inc., and offers the following reasons:
1.
Transparency — In a cashless society where payments can
easily be tracked and traced, theft of payments and hence corruption can be
dramatically reduced
2.
Security — The money goes where it is meant to. The
biggest threat to a digital transaction is the loss of information. Hence in
case of the digital payment systems, it is extremely easy to shut down a
digital wallet if it gets stolen whereas in case of biometric, your ID is yours
alone and very hard to copy.
3.
Financial
inclusion — The unbanked of the
society will be able to create a record of their timely payments, allowing them
to get other services including loans for instance
4.
Cost
savings —Digital payments reduce
bank processing fees
Apart from these, early adopters have a lot
to say about convenience.
There is no doubt about it, the system does
offer convenience. Money simply becomes another function of the smartphone, an
app that eliminates the need for carrying and protecting cash or plastic money
and which allows payments at the touch of your fingers.
If you think the case for the cashless
society is becoming longer, then bear with me. Because only from knowing all
these “pros” can we see the new methods of surveillance they are establishing.
Now from the perspective of the economy, a
cashless payment system will:
1.
Enhance our tax base
because the government can easily trace almost every transaction throughout the
economy from a centralized location.
2.
It can put down the
parallel economy, especially one based on various illicit activities.
3.
Increase GDP and perhaps
employment by forcing people to convert bank savings into either investments or
consumptions, and
4.
Create an environment
where people start adapting cashless and wireless technologies.
Despite how it sounds (an easier and more
convenient method of purchasing goods and services) fear is in the air across
the globe.
Why?
The Problems with Cashless
Society
The risks posed by the new cashless society
go far beyond simple loss of money or an inability to use the system.
Yes, let’s not go into the debate that the
technology is not perfect, not yet, and that hackers could easily get into it
or that your information can be stolen.
It’s more than that now.
Let’s begin “Google Wallet makes it easy to
pay - in stores, online or to anyone in the US with a Gmail address. It works
with any debit or credit card, on every mobile carrier.” That means more and
more information about you is being centralized and gathered at a single place.
As Bill
Gates makes a case for cashless society yet again in his 2015 Annual Letter “By
2030, two billion people will be storing money and making payment with their
phones.”
And here’s the most alluring part “Already,
in the developing countries with the right regulatory framework, people are
storing money digitally on their phones and using their phones to make
purchases, as if they were debit cards.”
The regulatory frameworks are very important
to this debate.
So what happens when the society goes
cashless?
- We Go Greece — in a cashless society, the government loses a robust
alternative for paying debts. We’re already observing how Greece’s
unwillingness or inability to print more Drachma bills to pay its debt (a
precondition for securing the euro loans) has put it on the plank
- We Face Incremental Risks — The only incremental risk paper money carries with it
is physical theft. However, when you move to a cashless society and
convert it into bank deposits you not only pay a fee but are also exposed
to negative interests, and a substantial loss in case of bankruptcy. I
mean, by going cashless we’ll be giving our currency that was backed by
the central bank and swap it for a currency backed by the local bank.
- Consequences for the Retirees and Poor — What do you think will happen for the
people incapable of transacting using plastic money? The retirees who have
liquid savings will have to bear a disproportionate costs for holding it
in bank accounts, whereas the poor who have no access to the banking
system will become dependent (more than ever) on government handouts.
- Unemployment —
What about illegal immigrants? They’ll be out of job creating significant
civil unrest.
- Cyber Risk —
The cashless society is solely dependent on electronic forms of
transactions, if any form of disruptions occurs, the economy will come to
a halt.
- Penalties and New Regulations — How will the new government mandates for a cashless
society be enforced? With a ban on cash transactions right? This implies
penalties which in turn means more stringent regulations, compliance
costs/penalties, disclosure requirements, and even jail.
But consider how banning cash transactions
will affect the position of US dollar as the world’s reserve currency. It will
roll the downhill.
This would mean that regulatory frameworks
are being implemented on the world. A much different approach than simply
forcing it on just US citizens. What do you think the foreigners will think and
do with their US dollars?
Dump the bills and flock to the new currency
capable of offering the needed liquidity.
It is true that the cashless society trend is
rising and at an alarming rate because of its convenience:
Image curtesy of Highcharts.com
Cash seems to be dying slowly.
Countries such as Denmark (which has already
become the first
developed country moving towards becoming a cashless society and is
followed suit by Sweden), the people believe in the system for their security,
and unlike us (or the rest of the world) are much less concerned about what the NSA
revelations had meant for us.
For US citizens that is the
biggest problem.
A cashless society with implanted microchip
with a new mode of discipline and monitoring people, tearing what remains of
our privacy after various customer tracking technologies have been implemented
for retargeting ads and tracking behavior.
With the fast paced lifestyle and faster
creation and deployment of technologies, we will soon be at a standoff, where
the market itself will only have technologies that offer no other alternative
but a cashless payment system.
The United Nations, alongside the Bill and
Melinda Gates Foundation, is already moving across the globe wanting societies
to forego cash for more virtual transacting. It is playing its trumpet: of a
cutting costs and improving transparency.
The stakeholders are already working with the
private sectors and governments to create the new market for the new regime.
Here’s a list of the various
constitutional rights we’ve already lost, a showcase of the government’s
power (including the right to indefinitely detain and assassinate any American
citizen without charge).
Now it’s come to a cashless society and near
total surveillance using our digital transactions.
With all this said, there are ways to protect
our capital, assets, and investments and we can actually prosper from the
change if you understand how to take advantage of the system.
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