Who’s Fighting The War Against Cash?
Thursday, May 14, 2020
This is a rush transcript and may contain errors. It will be updated.
Kim Brown: Welcome to The Real News, I’m Kim Brown. Do we have a right to use cash money instead of digital money? This is a question that is being debated in courts around the world. Our guest today is an economist whose appeal made it all the way to the European Supreme Court to determine whether he can pay some of his taxes in cash. Dr. Norbert Haring is studying the formation of the Better Than Cash Alliance to promote the use of digital money, and eventually eliminate cash altogether. It’s an alliance of MasterCard, Visa, Citibank, and the Bill & Melinda Gates Foundation. And it has already had some success in convincing governments to restrict the use of cash.
And joining us today from Frankfurt, Germany is Dr. Norbert Haring. He’s an economist, also co-founder and co-director of the World Economics Association, the second largest association of economists worldwide. Dr. Haring is a finance journalist, a blogger, and also author of popular books on economics. His latest book translated into English is titled Brave New Money, it was published in 2018. Dr. Haring, thank you so much for joining us.
Dr. Norbert Har…: Thank you for having me.
Kim Brown: In your writing, you refer to the biggest success of the Better Than Cash movement, getting Indian prime minister Narendra Modi to abolish large denominations in India in 2016. Can you tell us a bit about that, and what impact did it have on the Indian economy and the inequality within it?
Dr. Norbert Har…: Yeah, I mean, the Better Than Cash Alliance is not really bragging about having done that. In India, they made it seem like it was an idea of the government, but I’ve just found very many clues that there was tight cooperation and Bill Gates, who is a member of the Better Than Cash Alliance with his foundation together with the government, he really talked about having an alliance with the central bank in India, the Reserve Bank of India which is trying to do away with cash. And there’s various personal relationships like the head of the Bill Gates Foundation in India, he used to be at the central bank, and then got that position at the Gates Foundation. The US government, which is also part of the Better Than Cash Alliance has, basically, gotten Modi to become a member of the Better Than Cash Alliance, and there is a whole number of other links to the US, which make it quite clear that that was done together.
And it was quite an assault on the Indian population because Modi just gave them four hours of warning before most of the money would cease to be usable. It was demonetized, they called it. So, you were not allowed to pay with it anymore, all you could do is taking it to the bank. And so, in a country where 90% of all payments are done in cash there was suddenly no cash anymore. And everybody had to line up at the bank for days instead of working, which is a big hardship for people who live from hand to mouth. And, for weeks and even months, it was very hard to sell anything, or to make any money because nobody had cash to pay you, if you were in the informal sector of the economy. So for the informal sector, which is most of the economy in India, it was very bad, and very many people suffered very badly.
Kim Brown: So, doctor, can you talk to us about how the recent coronavirus pandemic is being used to restrict the use of cash? And some argue that, perhaps, we should be going more digital in the age of this pandemic because it will reduce hand-to-hand transmissions of handing over physical currency to a person, but also currency is crawling with germs, and all kinds of things that could possibly get us sick. So, is this not a good idea to transition away from cash at this particular moment?
Dr. Norbert Har…: I have to say that I can understand with some people who have to work out there they feel uneasy about it, but everybody who’s been looking into it is saying, health experts are saying that it’s not really dangerous. And there’s absolutely no indication that this disease is transmitted via cash, but it’s true that the banks and the financial sector, in general, are really using that argument, and they’re putting it on their web pages, they send out mailings where they suggest that cash is dirty, and that you should go digital. But there’s really no basis for that claim. It’s just something they wanted all along. We’re basically part of that drive to get rid of cash because they don’t like cash, it’s a competitor and it costs them money. They don’t make any money if you pay cash. And so, they don’t like it, so they just use that.
Kim Brown: So, one of the main arguments against abolition of cash is that the digital transactions would leave a trail, a digital trail, an electronic trail, and allow governments and other organizations to surveil us, to keep track on our every movement and every purchase. Now, some people might say that, “I don’t have to hide. Or the government may not find me that interesting, so perhaps they won’t be tracking all of my purchases and all my financial transactions.” What is your response to people who say, or who make those arguments?
Dr. Norbert Har…: There’s two things that need to be said. I mean, first of all, they’re right. Most people are not interesting enough for anybody in power to just look into them, they’ll just tailor their advertisements to them. And that’s not really hurting you, but people don’t understand, generally, is how extensive that tracking is. That everything that you do, everything involves little payments, it involves where you are, often with whom you are, what you’re doing, and that’s hour by hour, day by day. And all of that information goes into your bank account, and is storage there for decades the banks have to store it for a very long time. So, basically, your bank account becomes a [inaudible 00:07:01] of your whole life.
And anytime somebody becomes interested in you, that can be 10 years from now, they can look in and see what you did on any day at any hour that they want to know about, or they have a complete profile. And they might not do that for me, but if I’m one of these people who say, “I don’t care,” I have to be aware that if that happens I’m living in a society where everybody have any power, or any significance is, basically, totally transparent and can be blackmailed by anybody who has the power to look into that. And that’s a lot of people, so everybody can be destroyed, or blackmailed with all that data that’s out there. And that’s just not compatible with democracy and free society.
Kim Brown: And lastly, Dr. Haring, I know that you are involved in a case right now, currently, where you wanted to pay your taxes in cash and, apparently, have been denied from doing so. I understand that the case is ongoing and you’re expecting a hearing in the coming weeks, but could you just summarize why you decided to [inaudible 00:08:18], and why this issue is so important to you?
Dr. Norbert Har…: Well, I care about cash for the reasons that I mentioned, because it’s a guarantor of freedom, and actually it’s in the law. Cash is the legal means of payment, and that means that, especially, the government has to accept it. It’s the government’s money, the bank notes and coins, and they can’t refuse to accept their own money. And that’s in the European Treaty, basically. And in the German laws also. And I just want to draw attention to that, that it’s happening. And I also want to use the fact that it’s in the law to defend my right to use it. And the highest German administrative court, basically, agreed with our line, is that we are right, and it just referred it to the European highest court in order to find out how the German law relates to the European law, and whether anything might change there on the European side. But the ruling in Germany was very favorable.
Kim Brown: All right, well, please keep us updated on the status of your case as, hopefully, you will be victorious in the coming weeks. We’ve been speaking with Dr. Norbert Haring. He’s an economist, a co-founder and co-director of the World Economics Association. He’s also a financial journalist, blogger, and author of popular books. His latest book titled Brave New Money, published 2018, go check it out.
Dr. Haring, thank you so much for joining us. And, again, we hope to hear from you again soon to get updated on what’s going on with your cases. I think this is a very important issue.
Dr. Norbert Har…: Thank you.
Kim Brown: And thank you for watching The Real News network.