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The Pros And Cons Of Moving Toward A Cashless Society


More and more of us are finding more and more ways to buy, sell and store our money, but about 70 percent of Americans still use paper money on a weekly basis. Harvard economist Ken Rogoff does not want to get rid of cash, but he does see problems with it. So we called him to ask why and ask what getting rid of cash would mean to our society.

Professor Rogoff, hey there.

KEN ROGOFF: Greetings.

KELLY: Greetings to you. So as we just heard from that 70 percent figure, a lot of us still like cash. You can touch it. It's easy. You don't like cash. Why not?

ROGOFF: Well, what I object to is people buying apartments in Trump Tower with suitcases of cash, buying $50,000 cars, engaged, of course, in drug transactions, human trafficking, whatever. A lot of people have perfectly healthy, good uses for cash. I have no moral objections to it. And I think for small transactions, it's still a big deal.

KELLY: Yeah. You can't tip your housekeeper at a hotel if you don't have, you know, five bucks on hand or 20 bucks or whatever. You can't do it with a debit card.

ROGOFF: Not in our country, anyway - in Sweden, maybe you can. But yes. But the question is, most of our cash is in $100 bills. And I don't know about you and your friends, but most of mine do not have $1,000 worth of $100 bills in their family of four. And that's really, I think, where a rethinking is needed.

KELLY: How much should we be worried about some Americans being left behind in a cashless society?

ROGOFF: If we literally go cashless, then obviously, it would be a problem. But I don't think anyone, even the Swedes, are talking about that. It's really reducing the amount of cash. By the way, something a number of countries have already done - and we should do - is give people free debit accounts. You could save a lot of money because most of the low-income people who'd be getting free debit accounts, the government's transferring money to anyway. And it's kind of expensive to process the checks.

KELLY: You mentioned Sweden. They are way farther along this path towards a cashless society than the U.S. is. We had a story out of Sweden recently on ALL THINGS CONSIDERED, where there were mixed views - some Swedes feeling like this is maybe going too far, too fast; others feeling like, what's the problem? - especially the younger generation. Do you think Sweden is where the U.S. is headed? Is that our future?

ROGOFF: We are already where Sweden was, say, five or seven years ago. And in another five or seven years, we will be where Sweden is today.

KELLY: Meaning what? How will our daily lives look different, do you think?

ROGOFF: Well, I already stand in line at Starbucks in Harvard Square. And when I get to the front of the line, I'm the only one using cash. I'm old. I still use it.

KELLY: (Laughter).

ROGOFF: I think it'll look more and more like that in many places.

KELLY: What should we be doing, as a society, to get ready for this other than - I don't know - charging up our Apple apps and our debit cards?

ROGOFF: Most people will be able to adjust at the pace that they want to. There are these new technologies that I can't even keep up with even though I work on the topic.

KELLY: Do you have a Venmo account, may I ask?

ROGOFF: My children do. I don't. Otherwise, they'd want me to Venmo them money all the time.

KELLY: (Laughter).

ROGOFF: I think we have to, say, coordinate state regulation.


ROGOFF: There has to be views about how big cash transactions should be. The U.S. is really trailing a lot of the rest of the world in getting around to this.

KELLY: Yeah.

ROGOFF: But by and large, technology will play out and will adjust. It won't be as fast as people think. And by the way, I don't believe it'll be cryptocurrencies. I think it'll be simpler digital mechanisms. There are some vulnerabilities we need to cover - like cybersecurity. We're there already on having to worry about that. But I think we are headed to a less-cash society whether people want to recognize it or not.

KELLY: Ken Rogoff is an economics professor at Harvard and author of "The Curse Of Cash."

Professor Rogoff, thank you.

ROGOFF: Thank you for having me. Transcript provided by NPR, Copyright NPR.