Governments hate cash. Surprised? Of course not. Governments hate anything that empowers people to operate without their interference or oversight, so cash is ‘Government enemy number 1’.

Not ‘Public Enemy’ mind you, no the public seem to quite like cash. Some for the convenience, some for the immediacy, some because they find it easier to budget and manage their financial affairs in tangible cash rather than less-tangible numbers in an account, still others because of the lack of fees, and some for the reliability… you’re not at the mercy of electricity and telecommunications networks.

And yes, there’s a minority in the public who like cash because it allows them to keep their financial transactions (and income) secret from the government’s sticky fingers.

So the government likes the idea that cash may someday soon become obsolete and they’ll be able to see every transaction no matter how big or small that every Australian makes, and make sure they’re getting their ‘pound of flesh’. However it’s impractical to outlaw cash in one fell swoop, so there’s long been talk of eliminating ‘high value’ notes, with the argument that it will hurt the ‘black market’.

So no surprise it’s come around again:

The Turnbull government is to consider a ban on the $100 note and a crackdown on all but small cash payments as part of an assault on the cash economy to be unveiled in Monday’s mid-year budget update.

Governments hate cash for the same reasons they’ve banned self defence (or at least the tools by which it might be achieved), for the same reasons you can barely work a job, drive a car, build anything, or pretty much breathe, without first getting their permission in the form of a licence, permit, ‘certification’ or some similar bit of BS paperwork whose primary purpose is to prove you’ve ‘submitted’ to the government, and are doing things ‘legally’ (whatever that means, there’s plenty of people doing things ‘legally’ who are doing a s*itty job, and many people who are unlicenced who do great work… so what exactly does the ‘licence’ do besides exercise control?).

In short, governments hate the idea that we don’t need them, that we might be able to get by just fine without them. They are horrified at the thought that your plumber might have been able to learn plumbing off someone who wasn’t ‘accredited’, that a chef might be able to safely prepare food in a kitchen that hasn’t been inspected, that you might be able to protect yourself and your loved ones without needing to call on ‘big brother’ to rush to your aid, or that you might be able to erect a shed without first obtaining their permission for the position, size, material, and colour of your chosen lawn-mower-storage-facility… Governments are so sure we need them that they’ll do anything to prove it, and punish you if you prove them wrong.

There’s no law, no restriction, no ‘licence’ or imposition which is too absurd, too ridiculous, too much of a stretch, as long as it ‘proves’ how much we need them.

And the idea that we can transact business with each other without their oversight, without them being able to look over our shoulders and see every transaction, how much we’re being paid, where we spend our money, and of course, whether we’re giving them ‘what we owe’ in taxes, as payment to them for their ‘help’ (because remember, we can’t get by without them…), is insulting to them. Frightening, even. So there’s no amount of inconvenience, no amount of economic harm, no amount of pain that they aren’t willing to inflict on us to prove we’re better off with their help than we would be without.

And make no mistake, banning or swapping large denomination notes hurts a lot of people, as India recently demonstrated:

India’s government has been accused of causing ‘chaos’ and wreaking havoc on poor and working Indians as anger grows over the withdrawal of large denomination notes.

Hundreds of thousands of people have queued for hours outside banks after the bank notes – which account for more than 80 per cent of the currency in circulation – were abolished.

The government scrapped the notes in a bid to uncover billions of dollars in undeclared wealth.

But why would Prime Minister Modi care about the impact on the poor, the little people, the small and medium business operators? It’s all for a good cause… cracking down on the cash economy… weeding out those evil people who have been getting by just fine without the governments ‘help’:

Modi said he would pursue the fight against corruption and tax dodgers even if it meant scanning decades-old records.

‘If unaccounted money is found out during the current clean up drive, accounts of tax evaders dating back to the country’s independence in 1947 will be checked. If required I will hire people for this task,’ Modi told the Indian community in Kobe.

He said he recognised people faced difficulties as the transition to the new series of bank notes takes place but was confident they would stand by the decision as part of the war against corruption and to rid India of endemic poverty.

Finance minister Arun Jaitley said ATMs had not been adjusted to handle new currency notes prior to the announcement in order to keep it under wraps. ‘Recalibration of ATMs will be completed within two weeks,’ he added.

Referring to inconvenience caused to public, Jaitley said there could be some, short-term disruptive cost to the economy due to the demonetisation drive but this would prove positive in the longer term.

That’s right little people, shut up and take your medicine. We know what’s best for you, and what’s a few weeks of suffering, being unable to buy food, conduct business, get paid for your labour, if it leads to long terms gains for the ‘economy’ (which in this case is just code for ‘tax revenue’). Who cares if you can’t make rent at the end of this month, or pay your child’s school fees… it’s just a little short term pain for our… er, I mean ‘everyones’ long term gain!

EDIT – As if on cue, a friend of mine who is in India posted this today, I didn’t see it till just after I finished this blog post:

Ok…what you’re looking at here is over 400 people queuing for ONE ATM. Every single person you can see in the photo is in that queue. This is standard at every ATM I have seen in India until the money runs out (at which point the queue disappears..) The amount you can take out of an ATM is limited (and really low) even if you are a tourist which forces the daily queues. Its pretty much all some Indians can do with their day.

And before you ask, no, hardly anyone will take credit cards as unsurprisingly, everyone wants cash

This is now 5 weeks on since the sudden announcement, and people are still suffering, businesses are going broke, people are losing jobs, bills are going unpaid… People are hurting, all because PM Modi decided it was time to ‘crack down’ on the cash economy.

It looks to me exactly like the lines I saw in Venezuela outside supermarkets… people lining up for hours in the hope that something might be left by the time they get in. This kind of poverty can only be created by natural disasters, war, and governments.

END EDIT

Sound familiar? It’s the same story with crime, self defence, immigration, cultural issues such as the definition of marriage or constitutional recognition of aborigines, the same issue with education, employment, electricity, ‘climate change’, pretty much everything the government touches comes with the same attitude: We know best, shut up and take it.

I’m not someone who deals in a lot of cash myself. I’m happy enough to budget using bank accounts and pay with a wave of a card. That suits me just fine. But what I’m sick and tired of is governments inflicting pain and inconvenience on the rest of us ‘for our own good’, and for that reason I’m dead set against any plans to reduce the amount of cash in circulation, or ‘demonetize’ the high value notes.

How we conduct our business is our business, and most people who use cash still declare their income and do everything above board. They like it for reasons other than potential tax evasion, and the government has no business punishing the rest of us in an effort to target a few.

There are other, far better ways to identify and target people who are avoiding taxes, ways which don’t hurt GDP and make the situation of poorer people even worse. But the truth is this isn’t about the cash. This is about control. And getting rid of high value notes is a great interim step towards getting rid of cash… and just image how much control they’d have then…

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