Prevent Total Monitoring/Control over Money and Energy
Recently Dick and I went to lunch on Bowen’s Wharf. Like many cities, large and small, parking is often costly or non-existent. I decided to bite the bullet and electronically pay for a parking space. When asked if I’d want a receipt, I said no because the machine assured me that it had been sent electronically to the parking meter police so they could monitor our 1 hour + 15 min. (Actually, quite a bargain in busy Newport). Still, the whole process t had a disturbingly Big Brother feel to it.
One of the most fundamental expressions of freedom many Americans take for granted is the ability to conduct transactions using cash. Do any of us really appreciate the importance that ordinary Americans can settle debts and sell goods using cash? As Edward Ring warms in American Greatness, the privacy cash allows is irreplicable.
Don’t Let the Government Take Away Cash
What if cash was suddenly taken away and disappeared? The ability to conduct cash transactions is one of the most fundamental expressions of freedom. Easy to take for granted, cautions Mr. Ring.
Cash for Cash
It’s not that concerned citizens are looking to encourage an underground economy.
It’s that the existence of cash can at least prevent the arm of government from coming down to even the most petty transactions. Did you use cash to pay your gardener or an occasional babysitter or a handyman? If so, you might decide not to give them a 1099. Did you sell some old utensils, books, CDs, and furniture at a garage sale, and collect cash? If so, you might decide not to get a resale permit to collect sales tax. Once cash is eliminated, those choices will be made for you. Wasn’t that de minimis? It won’t matter.
Punishing Those Deemed a Threat
The anonymity offered by cash is a safeguard against a growing and serious problem. But even more troublesome is the ability of corporation/government agencies to stifle transactions by people deemed a “threat to democracy.”
Confined at the moment to intemperate bloggers and other supposedly seditious conspiracy theorists, and restricted so far to canceled online financial services and frozen bank accounts, imagine what could be accomplished with central bank digital currency.
The Risks of CBDCs
One investment firm explained the “risks” of CBDCs (Central Bank Digital Currencies):
CBDCs may pose a threat to privacy. The central authority that will be responsible for collecting and distributing identification and transaction data will have access to all monetary transactions. In addition to the threat of central banks disallowing or curbing transactions between citizens, the data could be vulnerable to hacks or misuse, if leaked.
The existence of cash can at least prevent the arm of government from coming down to even the most petty transactions., continues Mr. Ring.
Sickening Implications
If CBDC replaces cash, it will be possible to precisely target and control what and how much every individual is permitted to buy or sell. Not only government agencies but major corporations will have this control.
It will be possible to vary how much someone has to pay for goods based not only on their social credit score but also on their income. It will be possible to ration individual consumption of any commodity that might be deemed to endanger the planet. It will be possible to control movement by putting geographic restrictions on where any individual can spend their digital currency.
How’s this? Every transaction, regardless of how small or on too the gird a small business is or individual is, will have to navigate instances such as issuing 1099s or collecting sales tax. Probably there will be doubtless other regulatory requirements, which will multiply once CBDCs make all this micromanagement feasible. But it won’t be universally feasible. It will place a burden disproportionately on the small players that lack the scale to pay for the compliance overhead.
Don’t forget this: the whole system falls apart with one big cyberattack or electromagnetic pulse.
Cash is freedom, Mr. Ring reminds us. Don’t let government take it away.
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