As technology evolves, more and more of us are relying on credit cards, debit cards and even apps like Venmo or Zelle to make payments. Gone are the days of physically cashing your check, now almost all of us use all direct-deposit. So what is the future of cash? We talk to one expert who lays out some of the nefarious uses of bills and coins.
Kenneth Rogoff, professor of economics at Harvard University and author, The Curse of Cash
Most of us rely on our debit cards, finding it easier to not use cash for transactions, however, the United States Treasury still printed up to 80 billion dollars of paper money last year. Where is all this money going? What is it being used for?
In his book The Curse of Cash, Harvard economics professor Kenneth Rogoff describes that printed cash often causes citizens to be poorer and less safe. He claims that printed cash is used for evading tax and committing crimes like buying and selling drugs. He believes that cash needs to provide value to citizens rather than authorizing crime. He believes that if society used less cash, then perhaps crime could be reduced.
One solution Rogoff proposes is “financial inclusion”, a system where people on welfare receive debit cards. In countries like India, the fast majority of the population receive a debit account through welfare. This saves the government money because they no longer have to print checks, and those receiving welfare do not have to transfer checks into their account. With the debit system, the money from welfare goes directly into a debit account which the recipients then can spend. This would make transactions easier for people and could lead to less reliance on cash.
Rogoff predicts the termination of cash bills in the next 10-20 years.
Kenneth Rogoff, professor of economics at Harvard University and author of The Curse of Cash