by UnHerd Staff
Tuesday, 3
January 2023
Video
16:00

Brett Scott: Beware a cashless society

The former broker spoke to UnHerd about the risks of digital money
by UnHerd Staff

Over the last year, there have been nervous murmurings across the internet about the rise of cashless societies. While we may be grateful for the convenience of contactless or one-click payments, underneath something more sinister may be going on.

This is something that Scott, a former derivatives broker and author of the book Cloud Money, firmly believes. He worries about the rapid disappearance of cash, particularly since the pandemic when many businesses gave up on physical currency entirely. Cash use in the UK fell by 50% in 2020, with more than 23.1 million people in the country using virtually no cash in 2021 compared to 5.4 million people in 2018


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These are extraordinary figures and something that Scott believes deserves more attention. He argues that the convenience is a consequence of an anti-cash agenda being peddled by the private sector:  

The banking sector itself, for a very long time, has been anti-cash and has been slowly trying to shut down the cash system because the banking sector runs the underlying account structures. And they also make fees from digital transactions and not only that, they get data.
- Brett Scott

Cash is real — and not just in the sense that it is physical. It is, in fact, the only money of which an individual (as opposed to a bank) has private control. Digital money is more like poker chips, in that the digital numbers in an account only turn into money when they are cashed at an ATM.  Scott asks us to imagine a world where it becomes nearly impossible to cash in:

Cash is like the bicycle of payments and digital is more like the Uber of payments[…] In the short term, you may think to yourself, “Oh, I like using Uber, it’s nice and convenient.” […] Imagine now the scenario where the only way you were able to travel was with Uber. Totally different story. Now, your entire transport system is under the control of an oligopoly player. You can’t move unless they decide you’re allowed to move. And so there’ll be massive resilience problems, exclusion problems, all sorts of problems that emerge from that.
- Brett Scott

The introduction of a CBDC (central bank digital currency) — something that Rishi Sunak touted in 2021 — would give ordinary members of the public access to first-layer money in a digital form. It may redress the hold private sector banking has over the whole payment system, but would it be a step in the wrong direction in terms of freedom and privacy? Scott finds the distinction somewhat irrelevant. In his opinion, anyone using digital money has already sacrificed their privacy: 

It’s interesting to see the public angst around CBDC right now, because that same angst should be extended to the existing digital money system, which is the contactless cards with the private banks. And those banks are gathering data on you all the time; they can also do censorship and surveillance. And actually, the government can order them to stop your transactions. Everything you can do with a CBDC can hypothetically be done with the normal bank system as well: it just may entail an extra step on the part of a government.
- Brett Scott

In an interesting recent development, however, it seems that thanks to the cost of living crisis a lot of people are now returning to cash as a means of budgeting more efficiently. A silver lining of sorts. 

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Andrew Buckley
Andrew Buckley
1 month ago

I pay £20 in my corner shop and then the shopkeeper pays £20 for diesel at the garage who then uses that £20 to pay for a meal at the pub, the Landlord uses this same £20 to give the guy delivering vegetables who goes to the corner shop and buys things for £20.
At the end of this there is £20.
I pay by card at the shop and the shopkeeper has £19.60 to buy diesel and then the garage owner has £19.02 to buy his dinner and the publican has £18.65 for veg and only £18.09 to give back to the shopkeeper.
Cards are great and transformational. I have moved money around to day to pay for an upcoming holiday and pay of my card for the month. But this doesn’t mean that cash has no value, it is vital.

Dougie Undersub
Dougie Undersub
1 month ago
Reply to  Andrew Buckley

Not really, Andrew, unless your corner shopkeeper stuffs all his takings under the mattress. If he wants to use banking services his £20 is going to end up a little lighter.

Tony Price
Tony Price
1 month ago

Yes banks charge for handling cash, but ….. any retailer can churn some incoming cash into outgoings (amount of course dependent upon the business), and the charge for handling cash is less than the charge for handling card transactions. Apart from which am I the only business owner who has been threatened with digital banking services being withdrawn, thus causing immense stress etc, for no good reason other than bank inefficiency? I suspect not!

Mark Goodhand
Mark Goodhand
1 month ago
Reply to  Andrew Buckley

The figures look a bit off, but the point is exactly right.
After 375 transactions, there’s only a penny left.
.98**1*20 = 19.6
.98**2*20 = 19.21
.98**3*20 = 18.82
.98**4*20 = 18.45

.98**375*20 = 0.01

Andrew Buckley
Andrew Buckley
1 month ago
Reply to  Mark Goodhand

Your maths is better than mine Mark, and I couldn’t remember the number of transactions leading to penny left. Thanks for this.

Jeff Cunningham
Jeff Cunningham
1 month ago
Reply to  Andrew Buckley

It’s also anonymous.

Stephen Walsh
Stephen Walsh
1 month ago

The weirdly rapid ascent by Rishi Sunak, first to extraordinary wealth, and then to the highest political office, has in itself been creepy. That he has been pushing for a CBDC straight away rings alarm bells.

Last edited 1 month ago by Stephen Walshe
Fran Martinez
Fran Martinez
1 month ago

Not to mention that with a power outage (quite likely these days) cash is your only way to buy food.

Alex Colchester
Alex Colchester
1 month ago

The great danger about money related issues is how little coherence and understanding there is on the subject even amongst supposed experts, let alone the general population. Where there is great ignorance and confusion there is ample opportunity for nefarious actors to take advantage. Society really needs to educate itself fast about this deeply important subject- because if you control the money you control everything. The rise and fall of all empires throughout history, align perfectly with the rise and fall of their fiat currency. It is too easy to assume that the currency rises and falls as a result of the empire’s fortunes, but this is to believe the tail wags the dog. The really scary truth is that it is the currency that leads and the empire fortunes follow. Money equals power, sure, but money also IS the power in a deeply structural sense. If the money is sound the empire becomes strong but when the money is weakened the empire will inevitably weaken. There is no historical example where this has not occurred like clockwork. In our profligate present day the marrow has been sucked from our monetary system and the powers that be, whether state or corporate are desperate to keep the music playing. Through digital money they are attempting to do what has never been achieved before in history- maintaining power of their empire after the currency has been fatally weakened. The crucial sleight of hand they are attempting is to create programmable money
The power hierarchy ascends as follows:
3)possess money
2)issue money
1)program money
if you can successfully program the money you can program the world- but to whose benefit?

Iwan Hughes
Iwan Hughes
1 month ago

Since we can already make cashless transactions almost everywhere with the currency we already have, what is supposed to be the merit, or need, for the CBDCs? We know the obvious risks, in terms of Central control over our money, but what are supposed to be the benefits? Anyone? Rishi?

Fran Martinez
Fran Martinez
1 month ago
Reply to  Iwan Hughes

I always wonder this myself. But to my astonishment they are not even trying to justify the switch to CBDCs. They just go and say it will be better for you because we say so …

If anyone can find what the supposed benefits are please share.

Drew W
Drew W
30 days ago

My answer to final question is “yes”, I want the ability and right to use cash.
Ever fewer businesses though are willing to honour legal tender; there is no consequence for its rejection; and a critical mass of the UK population seem to like the apparent convenience of electronic money and are too busy or unwilling to invest in learning about the downsides of the death of cash.
Finally, as usual the msm and its “journalists” who could have a role in advocating and challenging are quiet/MIA, having too much fun with the “froth” elsewhere rather the substance of anything that may actually matter.