Jay Evensen
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A cashless society ultimately hurts the poor the most

12/16/2022

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Pop quiz: In which year did the following appear in a news report?
“At the moment, the last bastions of cash seem to be parking meters, five-and-dime stores and supermarkets. And even the supermarkets are adjusting to a cashless society.”
You’re probably smart enough to realize I wouldn’t be asking this if it appeared yesterday, although it sounds almost as fresh as this morning’s emailed news alert (maybe the supermarket part sounds a little stale, five-and-dimes have become dollar stores, although they often charge more, and many parking meters today require an app to use). But you might be surprised to find out it was published June 24, 1960.
I found it in The Town Talk of Alexandria, Louisiana, courtesy of newspapers.com. It was under a headline that said, “Cashless society in offing.”
I’m not sure how long an “offing” is. I’m guessing it’s probably supposed to be something less than 62 years. 
We’re still not there, but a newly released survey by the Pew Research Center shows we’re getting there fast, and we probably can thank the pandemic for pushing us along. Also, this change won’t come without its problems, and not just the threat of identity theft.
The survey found 41% of Americans saying they don’t use cash for any purchases on a typical week. That’s up from 29% in 2018. Among Americans whose household income totals $100,000 or more a year, the figure today is 59%.
And that suggests the biggest problem. Minorities and poorer Americans may get left behind in this economic shift. The futurists who were so big on this topic decades ago didn’t mention that danger. They were focused on the convenience of it all, such as the 1969 news story I found that said credit cards were a better fit for the lifestyles of the under-35 set. The “mod” people, they might have been called back then.
That would be the under-88 set today — a group you’re probably not going to see using Venmo or Apple Pay. Being “mod” is a fleeting condition, apparently. The elderly and the poor share many of the same disadvantages.
Before I go much further, many of you may be wondering if it’s legal for a business to demand credit purchases only. It is, according to the Federal Reserve, unless local laws say otherwise. So far, this is an issue that has attracted concern primarily from liberals. A few big cities and blue-leaning states have passed ordinances and laws requiring merchants to accept cash, according to Pewtrusts.org Massachusetts passed such a law way back in 1978.
I don’t know if that will change, or if this will become another front in the culture war. But a recent FDIC survey found that those who don’t have bank accounts (and therefore can’t get credit or debit cards) were primarily the poor who can’t meet minimum deposit requirements (21.7%), and those who distrust banks and have privacy concerns (a combined 21.6%).
Businesses, who have the ear of Republicans, tend to support letting businesses do as they please. But the distrustful crowd may have their ear, too.
But, regardless of how either party feels, the tide toward a cashless America, just a trickle in 1960, is becoming a wave today.
Writing recently for Forbes, Brett Holzhauer argued for more investment in the Treasury’s Community Development Financial Institutions Fund, which helps private banks serve low-income areas. A group called The Business Roundtable has pledged $1 billion to help these institutions, as well as Minority Depository Institutions.
Ironically, though, the pandemic stimulus checks that started under the Republican Donald Trump administration may have done the most in recent years to help the unbanked get a hand up. The FDIC survey said the unbanked fell to 4.5% in 2021, the lowest level since the survey began in 2009.
Of those who opened accounts for the first time after March of 2020, 34.9% said a stimulus check or expanded unemployment benefits contributed to their ability to do so. 
What does this all mean? 
The first lesson is that the trends we can clearly see don’t often materialize at the speed we expect. That could apply to our view toward electric and self-driving cars as much as it did to a cashless society in 1960. It doesn’t mean we shouldn’t begin early to plan for them.
Second, we can’t use government checks to solve this problem. Inflation and a ballooning national debt will result.
And third, regardless of politics, we can’t afford to ignore the poor, the distrustful or the elderly. Society’s don’t benefit from undercurrents of people who can’t participate fully in their economies. Policymakers and private businesses need to work on that one.
There is reason for hope. The numbers of unbanked have been steadily declining for years. We just need to make sure real improvement isn’t merely in the offing.

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    Jay Evensen is the Senior Editorial Columnist of the Deseret News. He has nearly 40 years experience as a reporter, editor and editorial writer in Oklahoma, New York City, Las Vegas and Salt Lake City. He also has been an adjunct journalism professor at Brigham Young and Weber State universities.

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