Bobcat Bonanza @ Central

Congressional Research - February 2017

Legislation Label: I- Digitize the Dollar Researcher Name: Amy Zhou

Pro:
I. Cash promotes crime

The Chicago Tribune, Sept. 9, 2016. <http://www.chicagotribune.com/news/opinion/editorials/ct-

cashless-debit-credit-card-payment-edit-0910-jm-20160908-story.html>

Cold cash has another drawback: Criminals like it. Thanks to its anonymity and portability,
cash is an efficient way for crooks to keep transactions off the books. In a recent op-ed in The
Wall Street Journal, Harvard economics professor Kenneth Rogoff listed crimes facilitated by
paper money: racketeering, extortion, money laundering, drug and human trafficking, corruption
of public officials and terrorism.

II. Cash is more efficient/more adapted to today’s society

Brookings, Jan. 22 2015. <https://www.brookings.edu/blog/techtank/2015/01/22/taking-down-

the-entry-barriers-to-digital-financial-inclusion/>

Even in areas with flourishing mobile banking usage, people tend to cash in every time they
want to make a mobile payment, and to cash out immediately and in full every time they receive
digital money. Rather than displacing cash, digital platforms have made local cash ecosystems
more efficient. Without full backward compatibility with cash, digital payment systems could not
take root.

Con:
I. Digital currency is more prone to hacks

Fortune, Dec. 26 2015. https://extemp.prepd.in/#/dashboard/article-view/1824498;page=ess

Not everyone is cheering. Sweden’s embrace of electronic payments has alarmed

consumer organizations and critics who warn of a rising threat to privacy and increased
vulnerability to sophisticated Internet crimes. Last year, the number of electronic fraud cases
surged to 140,000, more than double the amount a decade ago, according to Sweden’s
Ministry of Justice.

II. A/T: Has worked in Sweden → Sweden’s economy is different

Fortune, Dec. 26 2015. https://extemp.prepd.in/#/dashboard/article-view/1824498;page=ess

The report continued that physical bills and coins amount to just 2% of the country’s
economy. The U.S., meanwhile, is at 7.7%.

1
 Bobcat Bonanza @ Central
Congressional Research - February 2017

Legislation Label: I- Digitize the Dollar Researcher Name: Amy Zhou

III. Customers don’t actually own what they buy through digital transactions

Los Angeles Times, May 13 2016. <http://www.latimes.com/business/lazarus/la-fi-lazarus-

digital-content-20160513-snap-story.html>

He told me consumers received a wake-up call in 2009 when Amazon electronically erased
George Orwell's "1984" and "Animal Farm" from people's Kindle e-readers because of a
copyright dispute. Although Amazon gave refunds for the deleted books and subsequently said
it wouldn't pull a stunt like that again, the point was made.

"It showed that things are different when it comes to digital content," Perzanowski said. "This
wouldn't happen in the physical world. No one comes to your door and demands that you give
back a book. But in the digital world, they can just go into your Kindle and take it."

The issue, Perzanowski said, isn't whether publishers and tech companies have a right to
license and control digital content, or to ensure that copyrights are protected. They have that
right.

IV. People lose control over their currency

Foundation for Economic Education, July 1 2015. <https://fee.org/articles/money-will-be-digital-

but-will-it-be-free/>

Digital currency with centralized control means the eradication of property as a right. Instead,
your money exists only as a database entry where the balance is controlled entirely by a third
party.

By managing the payment networks, a government has effective control over all participants,
including banks, corporations, and individuals. Already, banks are extorted into adopting global
financial blacklists for fear of being disconnected from networks like the Society for Worldwide
Interbank Financial Telecommunication (SWIFT) and Automated Clearing House (ACH). This
web of control is expanding and is used more and more frequently as a weapon of geopolitics.