Deep Dive
Shownotes Transcript
You may get a little excited when you shop at Burlington. Burlington saves you up to 60% off other retailers prices every day. Will it be the low prices or the great brands? Burlington. Deals. Brands. Wow! I told you so. Styles and selections vary by store.
Member Week is here at Lowe's. Don't miss your chance to get up to 40% off hundreds of items like paint, outdoor and home essentials, and more. Shop our exclusive deals happening in-store and online now through May 14th. Not a rewards member? Join for free today and get ready to save more. Lowe's. We help you save. Loyalty programs subject to terms and conditions. Details at Lowes.com slash terms. Subject to change.
This is the Fox News Rundown Extra. I'm Jessica Rosenthal. There's a big push to go cashless. More and more companies are embracing and in some cases only permitting digital payments. And in March, President Trump signed an executive order mandating a transition to electronic payments to and from the federal government, including tax refunds and federal benefits. While there will be exceptions, the goal is for the federal government to begin to phase out paper checks.
There are some who are leery, however, about this movement. Jay Zagorski, a professor at Boston University's Questrom School of Business and the author of The Power of Cash, Why Using Paper Money is Good for You and Society, think credit cards should not be king and there's value to keeping cash around. Zagorski recently spoke with Fox News Rundown host Lisa Brady and explained why all Americans should be concerned about the country going cashless, how moving away from paper currency hurts businesses and what Americans can do to counter this trend.
We made some edits for time and thought you might like to hear this whole conversation. So thank you for listening. If you don't already, please go to the foxnewsrundown.com to follow our daily weekday rundown podcast. Now here's Jay Zagorski on the Fox News Rundown Extra. Okay, so you've written a whole book about
with a goal of convincing people not to abandon using cash. Now, before we dig into the many reasons, I'm just wondering why now? Are you convinced now is the right time for this message? I hope so. Right now, we have a number of problems in the world, and some of these problems, not all, can be solved by each person using cash once a week.
I'm not saying abandon your credit cards. I'm not saying abandon your debit cards. I'm saying just use cash once or twice a week to ensure that it stays in circulation. Why is cash disappearing in the first place? Is it just the ease of other methods of payment?
Oh, I don't think so. I think what's happening is the financial industry has been doing a full-scale assault on cash. Last year, there was $1 billion worth of advertising trying to convince people to use credit and debit cards. And that's not including the advertising for things like cryptocurrency.
And that $1 billion is very, very effective. Walk through an airport, so you see all these giant ads, you know, free vacations, you know, use your credit card and you'll get some amazing trips, great dining, all these extra benefits. Nobody's running any ads explaining the benefits of cash, which is why I wrote the book.
So it can be very profitable for banks and credit card companies if people don't use cash. How do they make money with electronic purchases?
There's a variety of ways, but let me make this very simple. Every time you swipe or tap, some bank or financial concern is taking somewhere between 2% and 3% of that purchase. So you purchase something for $100 and some bank is getting between 2% and 3%, unless you use buy now, pay later, and that could be somewhere between 5% and 6%. So small purchases keep adding up over and over again for financial institutions.
Is that why we also sometimes see like gas stations, coffee shops, even restaurants offer discounts if you use cash instead because they're trying to get rid of or avoid the surcharges they have to pay?
They are trying to avoid the surcharges, which is why they can offer you lower payments or lower prices. But the second thing is, if you pay them cash, and let's say you go to the coffee shop and you give somebody a tip, if you give them a tip on your credit card, it might take two, three, four weeks before they actually see that tip because it has to go through the credit card company and get processed. You give them cash, they can spend that tip right away.
You point out in the book there are many pitfalls for the consumer using electronic payments, including maybe a greater potential to spend more money if you're not limited by running out of the cash in your pocket.
Let me say I encourage people to use cash, but occasionally I use a credit card. And the one place I use a credit card is at Costco. And Costco is sort of like this surprise. You never know what you're going to see there. And I often go into Costco. I'm only going to buy one or two things. I'm going to keep myself to a budget. And I have a few hundred dollars of cash. And then I see all these items I just want. And by knowing I have a credit card and using that credit card, I almost always overspend.
And that's one of the problems with electronic payments. When you're trying to keep yourself on a budget, it's really hard when you just keep tapping, swiping, or inserting that card.
Men, if ED is getting you down, you need HIMS to help you get your confidence and other things back up. HIMS provides access to treatments that can help you stay hard and last longer so you can be ready whenever the mood strikes. HIMS provides access to a range of doctor-trusted ED treatments like chewable tablets, Viagra, and Cialis, and their generics for up to 95% less. The process is 100% online, so there's no need for uncomfortable doctor's visits.
No insurance is needed and one low price covers everything from treatments to ongoing care. With hundreds of thousands of trusted subscribers, HIMS can help you find the ED option that works for you. Just fill out an intake form on their site and a medical provider will determine the right treatment option. If prescribed, your medication ships directly to you for free. Start with your free online visit today at HIMS.com slash rundown.
That's HIMS.com slash rundown for your personalized ED treatment options. HIMS.com slash rundown. The featured products include compounded products which are not approved nor verified for safety, effectiveness, or quality by the FDA. Prescription required. See website for details, restrictions, and important safety information. Price varies based on product and subscription plan.
One of the most compelling arguments you make for cash is natural disasters or other emergencies, including computer hacks, for instance, that can disable electronic payment systems.
Do those kinds of things happen often enough, though, to make that an effective argument for keeping cash? You know, it really depends where you are. If you've been in California the last few months when there were large fires, I would say it's a very compelling reason to keep using cash.
And many people say, oh, well, I know when there's probably going to be wildfires. I know when there's going to be hurricanes, tornadoes or something big. I'll just use cash then. And my response is, if you only use cash during an emergency, stores, doctors, transportation, they don't know how to handle cash.
So you have to keep using cash all the time so that people understand what's going on. I'll tell you a quick story, Lisa. I was at my local supermarket and I was supposed to get 40 cents change back because I used cash to make a purchase. And the cashier handed me four nickels, which was 20 cents, not 40 cents. I said, oh, no, that's wrong. The head cashier had to come over and explain to this cashier the difference between nickels and dimes. Wow.
Yeah, and that's not an unfrequent experience. My wife went to the doctors and she had to give a copay. The copay was $5. She handed the person a $10 bill and the receptionist pulled open the drawer and handed my wife some money. And my wife said, you just handed me $50, not $5 in change.
And the person looked at the 50 and goes, wow, I've never seen this. I didn't know I did that. Thank you very much for telling me. So it's becoming more and more frequent as fewer and fewer people use cash. So you have to use cash in order for it to work during an emergency. We should also talk about the benefit of spare change because a lot of times that's what turns into a charitable donation, right?
One of the problems of people not using cash is that in major urban areas, when someone asks you for spare change, you know, can you help me out?
It's a little tough. I'm not going to pull out an American Express card and hand it to somebody who's asking me for money on the street. But if I have a dollar or two in my pocket, I'm happy to do that. So I keep cash around because I live in an area with lots of poor people and I'm always asked on my way to school, you know, can you help me out? But this extends even to formal charities, right? Like the like the Red Kettles around the holiday season.
Red kettles around the holiday season. Some people go to church and they pass a collection plate along and you're going to take out your mobile phone and just drop your mobile phone in and say, well, you know, Venmo yourself some money. There are ways of doing it, but cash is just so much faster, so much easier and instantly provides charity instead of having any kind of holdback period. Now you do write about people who save cash at home, whether it be for the future or for emergencies. Yes.
What are the potential drawbacks, though, if people largely start using plastic to pay but then cash just to save? If you're using cash to save, as I said before, people don't know how to handle cash when an actual emergency comes up.
You also present a little bit of a risk of theft. So a number of people ask me, how much cash should I have on hand in case emergencies arise? My response is, oh, figure out how much you spend and then keep three or four weeks around. You don't have to keep huge amounts. Don't make yourself a victim of a criminal enterprise. But let's talk about crime just for a minute. A lot of people say, I don't want to carry any cash at all because I don't want to get mugged. I don't want to get robbed.
And yes, people do get robbed of cash. The latest figures we have last year was about $400 million of cash was stolen. But when we compare that to the credit card industry, about $20 billion were stolen. You know, the magnitudes just aren't the same. Then people say, well, but if someone steals my credit card, well, and I call up the credit card company quickly, then I don't have to pay anything.
And my response is, you might not have to pay anything, but we all collectively have to pay for that $20 billion. So that when you're not careful with your purse, when you're not careful with your wallet, and it gets stolen, collectively prices go up for everybody because of your carelessness. And if you're careless with cash, well, only you have to bear the burden of that. A lot of this feels kind of like it falls under an umbrella of carelessness.
loss of control. Because on the one hand, it may feel in the moment like it's easier to pay electronically, but you're really giving up a certain measure of control on various levels by doing that. And that kind of leads into my next question about how going cashless could impact not only personal privacy, but national security. Is that something that governments are factoring into any of this?
I don't think governments are factoring any of this into it because many governments are pushing very hard for electronic currency. It's called central bank digital currency, CBDCs. And what many governments are interested in is trying to understand all the purchases everyone makes.
And they say they want to do this to reduce crime in society. And I'm very, very concerned about this because the hypothetical question I ask pretty much everybody is, if cash was eliminated, do you think the mafia, do you think drug lords would all suddenly say, oh, I'm not going to do evil activities anymore. I'm just going to fold up shop because cash isn't around. And I think the simple answer is no.
If cash is eliminated, then people who are doing criminal enterprises will just switch and they'll use something else. Maybe they'll use Bitcoin. Maybe they'll use diamonds. I can't tell you, but people who want to do evil acts are going to continue to do evil acts whether cash exists or not.
Since 2017, Disney has grown its U.S. workforce by nearly 20,000, employing 160,000 people across all 50 states. And with more than $30 billion in investments in U.S. parks, Disney is creating nearly 10,000 jobs. Learn more at thewaltdisneycompany.com slash economic dash impact.
One of the things you highlight is that there's really no federal statute requiring private businesses to accept currency or coins as payment. So, you know, you go into some stores and they could say, we're not accepting cash, we're only taking Apple Pay, for instance. Are there places around the U.S. or around the world that are drafting laws to address that? There are a number of places that have been drafting laws to address this issue.
But at the same time, there's a number of laws being pushed through quite quickly that people aren't noticing. Donald Trump, a few weeks ago, signed an executive order and buried in the middle of that executive order says, "In order to pay the government, it has to be electronic unless you get special dispensation from the Secretary of Treasury." So I, in the past, have actually gone to the IRS and paid my taxes in cash.
Because if you look on every single bill, it basically says this note is legal tender for all debts, public and private. And Donald Trump signed an executive order not long ago that basically says, no, you can't pay the federal government in cash anymore. And the whole idea of this is basically to eliminate cash. Hmm.
What are you hoping that people take away from this book? And are you also hoping it sparks more of a debate about all of these, you know, cash related issues? Or is there more of a debate happening behind the scenes already? I think there's been an incredible push by the financial industry to make non-cash purchases, your credit cards, your debit cards, these kind of things into a game.
right? Spend money, earn rewards, keep tracking your rewards. And finances are not a game. Finances are something we have to take pretty seriously. And because of that, I think using cash helps people sort of step back and say, wait, this is not a game. I'm not collecting miles that some airline will devalue in the next six months. And I think keeping cash around will provide a little bit more of national resilience.
And we need more resilience in the nation. We need a little bit more privacy today in the nation. And we need people not to treat finances like a game. Instead, we need to treat them a little bit more seriously so that people can save money and protect themselves when any kind of disaster, either natural disaster, man-made, or just your car breaks down, happens.
Are you hopeful at this point that enough people will keep using cash so that it continues to shine a light on the issue? I'll be honest, Lisa, I'm not particularly hopeful. It's one academic up against an entire financial industry that has incredible, incredible amounts of profits at stake. They're not going to go down lightly, especially writing a single book. But I can try my hardest.
Jay Zagorski, Boston University professor and author of The Power of Cash, Why Using Paper Money is Good for You and Society. Thank you very much for your time.
Thanks for having me on the show, Lisa.
From the Fox News Podcasts Network. In these ever-changing times, you can rely on Fox News for hourly updates for the very latest news and information on your time. Listen and download now at foxnewspodcast.com or wherever you get your favorite podcasts.
Hey, I'm Trey Gowdy, host of the Trey Gowdy Podcast. I hope you will join me every Tuesday and Thursday as we navigate life together and hopefully find ourselves a little bit better on the other side. Listen and follow now at foxnewspodcast.com.