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Electronic Everything: Crime and Control in the Cashless Society

By Ephrat Livni, Esq. on March 18, 2016 | Last updated on March 21, 2019

"Take the money and run" is not an option in a cashless society, which is why some experts say that increased use of debit cards causes a drop in crime rates. There is evidence to support this, according to a new study discussed in The Washington Post linking a switch from cash welfare payments to debit cards with fewer criminal incidents.

But there are also reasons to fear life in a society where all the wealth is held electronically, as the New York Post points out. Do we want Big Brother (read an all-powerful government) able to yank all of our money whenever? Plus, street gangs, like the rest of us, can evolve technologically and have -- they are increasingly involved in crimes that were traditionally the domain of white collar criminals.

Crime Evolution

So do we want a cashless society? A drop in violent crime is good, of course. And there is evidence to show that when there is less cash circulating on the streets, the streets are less mean.

Cash is connected to street crime because it is more difficult to trace. When people stop carrying it, there is less of a motivation to jump them for their wallets, thus fewer robberies occur. This seems to be borne out by a study in Missouri that shows crime rates fell in the 1990s in areas where welfare recipients transitioned to debit card use over cash.

Megan McArdle, in the New York Post writes, "There's obviously no point in sticking a gun in the face of some liquor store clerk when all he can give you is the day's credit card receipts. Even if these sorts of crimes are replaced by electronic thefts of equivalent value, this would still be a major improvement for society, simply because the threat of violent crime is uniquely terrifying and corrosive to a community."

Overconfident Assessment?

While violence certainly harms communities, big, legitimate businesses can also be economically violent to wide swathes of society. When banks are too big to fail and need bailouts, we the people feel the reverberations for years. Economic mismanagement and corruption impacts our work and our world, perhaps even more widely than a simple stick-up would.

Even if all the crime became sophisticated electronic swindling, that hardly seems super reassuring. As McArdle points out, the amount of power that this electronic exchanging gives the government over its citizens grows the more we rely on electronic payments. That is inherently dangerous, so we must remain wary.

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