GOVERNMENT

Opinion: Is it time to retire the $100 bill and move to cashless society?

Sep 18, 2020, 2:21 PM
A person hands over cash to another person....
A recent study by BYU found going cashless during the pandemic did not make an impact on slowing the spread of COVID-19. Photo: Joe Raedle/Newsmakers

This is an editorial piece. An editorial, like a news article, is based on fact but also shares opinions. The opinions expressed here are solely those of the author and are not associated with our newsroom. 

When was the last time you used cash? Some businesses won’t take it. (Contact-less transactions only, please.) I couldn’t tell you the last time I made a purchase with cash.

Cash is King — NOT!

Like everybody else, I shop online.

According to the Pew Research Center, 24% of Americans say that they make no purchases using cash during a typical week.

Where is the money and what are people doing with it?

In times of crises, people hoard cash. This is good for a person’s savings account, but not good for a merchant’s business. Money transactions turn the cogs and gears of the economy. Once the oil stops flowing, the machine stops going.

The Federal Reserve’s job is to fight the hoarding instinct by lowering interest rates, which make it less appealing to hold money and more enticing for businesses to borrow, invest and hire.

Criminals, terrorists like big bills

Can you catch COVID-19  on paper money? 

More paper money is in circulation now —  an added $200 billion — than before the pandemic swooped in and disrupted life.

By 2017,  the $100 bill had eclipsed the $1 bill to become the most widely distributed U.S. currency, according to the Washington Post.

There are so many C-notes out there that if you were to gather all the hundreds circulating on the planet and divide them equally among U.S. citizens, you could give each and every American $4,000.

People in developing countries convert their life savings to U.S. $100 bills because it is so much more stable and reliable in contrast to the currency of their home countries.

The Federal Reserve Bank of Chicago estimates as much as 80% of the $100 bills in circulation reside outside the country, according to the Post article.

Drug smugglers like the $100 bill as well: $1 million in $20 bills weighs more than 50 pounds vs. 10 pounds in $100 bills. Fewer bills to carry and few bills to launder as well.

Last spring, when stores in Southern California closed, drug dealers had a problem. The stores were fronts for laundering money, so their “problem” was piles of cash they couldn’t convert to “clean” money.

Terrorists seem to like the big bills, too.

The 500-euro banknotes, which are worth about $567, at one point were called “Bin Laden notes” because of their rumored use in financing terrorism.

People wanting to avoid paying taxes prefer cash transactions. 

Now may be a good time to start moving toward a cashless society by saying goodbye to the Benjamins.

 

Live Mic with Lee Lonsberry can be heard weekdays from 12:30 p.m. to 3:00 p.m. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app.

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Opinion: Is it time to retire the $100 bill and move to cashless society?