Digital Dystopia: Lessons from the Global IT Outage on the Perils of Cashless Living

Posted on: Saturday, July 27th 2024 at 3:00 am

Written By: 

GreenMedInfo Research Group

As a global IT outage wreaks havoc on digital payment systems, mainstream media finally sounds the alarm on cashless society risks - but for truth-tellers like Sayer Ji, the warning comes too late.

The Growing Threat of a Cashless Society: Lessons from the Global IT Outage

In a startling shift, major British newspapers have begun highlighting the dangers of a fully cashless society following a widespread IT outage that crippled digital payment systems across the globe. This event has brought to light the inherent fragility of our increasingly digitized financial infrastructure and serves as a stark reminder of the vital role cash still plays in our economy.

The Chaos of Digital Dependency

On July 24, 2024, a content update by cybersecurity giant CrowdStrike caused millions of Microsoft systems worldwide to crash. As reported by Nick Corbishley for Naked Capitalism, this outage had far-reaching consequences:

"When a content update by the cyber-security giant CrowdStrike caused millions of Microsoft systems around the world to crash on Friday morning, bringing the operating systems of banks, payment card firms, airlines, hospitals, NHS clinics, retailers and hospitality businesses to a standstill, businesses were faced with a stark choice: go cash-only, or close until the systems came back online."

This incident laid bare the vulnerability of our tightly coupled IT-based societies, particularly in the realm of banking and payments. The fallout was especially severe in countries like Australia, where cashless transactions have been actively encouraged by the government.

Cash: The Resilient Fallback

In the face of this digital meltdown, cash emerged as a crucial lifeline for businesses and consumers alike. As Corbishley notes:

"This is one of the most important arguments in favour of cash: the resilience it provides to a country's overarching payments system. Put another way, cash does not crash. It does not fail in a power cut or seize up during a cyber attack or software outage (though, of course, ATMs might)."

This realization has prompted a reevaluation of the rush towards a cashless society, with even central banks in highly digitized economies like Sweden reconsidering the importance of maintaining cash infrastructure.

Media's Shifting Stance

Perhaps most surprisingly, mainstream media outlets that have long championed the move towards cashless transactions are now sounding the alarm. Major UK newspapers including The Guardian, The Daily Telegraph, The Times, and The Daily Mail have all run articles highlighting the risks exposed by the global IT outage.The Daily Mail, for instance, quoted Dennis Reed, director of the Silver Voices campaign group:

"If people can't pay because they can't use their phone then when systems go down - and they always will - people won't be able to access vital services, food, and the essentials of life. With this ever-more digital society, we are reliant on it all working. But we have no control over it. We are putting all our eggs in one basket. The future security of the nation is in danger."

The Personal Cost of Digital Dependency: Sayer Ji's Experience

While the media's newfound concern is welcome, for some individuals and organizations, the warning comes too late. Sayer Ji, founder of GreenMedInfo.com, experienced firsthand the dangers of digital financial control when he was debanked via PayPal and Venmo for challenging the mainstream narrative around mRNA vaccines.

Ji's experience serves as a chilling reminder of how quickly digital financial systems can be weaponized against those who dissent from approved narratives. His deplatforming and debanking echo the mechanisms of China's social credit system, raising alarming questions about the future of financial freedom in increasingly cashless societies.

The Specter of Social Credit Systems

Organizations like NewsGuard are now pushing for what amounts to a Western version of China's social credit system, encouraging the debanking of entire private entities and businesses based on their adherence to approved information sources. This development underscores the importance of maintaining cash as a means of financial transactions and savings outside the digital realm.

The Threat of Financial Deplatforming

The risks of a cashless society extend beyond mere inconvenience during IT outages. There's a growing concern about the potential for financial institutions to deny services based on political or ideological grounds, effectively creating a form of financial censorship.

Florida's Chief Financial Officer Jimmy Patronis has taken proactive steps to address this issue. In January 2024, Patronis announced that 117 banks in Florida had signed an attestation agreeing not to politically discriminate, allowing them to qualify as Qualified Public Depositories (QPDs) eligible to accept public funds. This move followed the signing of House Bill 3, which aims to prevent banks from canceling services based on personal beliefs, whether political, religious, or any other factor demonstrating impartiality.

Patronis stated, "With the continued rise of Environmental and Social Governances (ESG) infiltrating our economic institutions, I am extremely happy to see the positive effects of HB 3. These 117 QPDs have officially made a commitment to put returns over politics. They understand that if they de-bank customers over political persuasion, they are threatening their own bottom lines."

This legislative action in Florida highlights the growing awareness of the potential for financial institutions to be weaponized against individuals or organizations based on their beliefs or speech. It underscores the importance of maintaining alternative payment methods, including cash, to ensure financial inclusion and freedom of expression.

The experience of individuals like Sayer Ji, who faced debanking for challenging mainstream narratives, serves as a cautionary tale. It demonstrates how quickly digital financial systems can be leveraged to silence dissent or punish those who express unpopular views. In this context, cash serves not just as a backup during system failures, but as a crucial safeguard for personal liberty and free speech in an increasingly digitized world.

The Importance of Payment Choice

As the dangers of a cashless society become more apparent, there is a growing call for legislation to protect the right to use cash. Johanna Noble, Money Editor at The Daily Telegraph, argues:

"Sometimes paying with cash (small shops, the tooth fairy, car boot sales) might be best, while in other circumstances paying by card (getting consumer protection when buying goods or services) will be better."

This sentiment is echoed by The Guardian, which warns that the most vulnerable in society will ultimately bear the costs of a cashless economy:

"Cutting out cash hits the vulnerable hardest: according to a 2020 survey by the Financial Conduct Authority, 46% of the digitally excluded, 31% of those without educational qualifications, and 26% of those in poor health rely on it to a 'great or very great extent'."

Protecting Cash Access and Acceptance

To safeguard against the risks of a fully digital financial system, several steps are crucial:

1. Legislation mandating cash acceptance: Countries like China and the US have implemented fines for businesses that refuse cash payments. Similar laws should be considered in other jurisdictions.
2. Maintaining cash infrastructure: Governments and central banks must ensure continued access to cash through ATMs and bank branches, particularly in rural and underserved areas.
3. Public education: Raising awareness about the importance of cash as a resilient payment method and store of value during crises.
4. Encouraging payment diversity: Businesses should be incentivized to accept multiple forms of payment, including cash, to enhance overall system resilience.

Conclusion: A Balanced Approach

The recent global IT outage serves as a wake-up call, highlighting the dangers of over-reliance on digital payment systems. While the convenience of cashless transactions is undeniable, the resilience and privacy afforded by physical currency must not be underestimated.

As we navigate the complexities of our increasingly digital world, it's crucial to maintain a balanced approach that preserves payment choice and protects financial freedom. The experiences of individuals like Sayer Ji remind us that the ability to transact outside of digital systems isn't just about convenience - it's about preserving personal liberty in the face of potentially oppressive control.

By heeding these warnings and taking proactive steps to protect cash usage, we can build a more resilient and inclusive financial system that serves all members of society, not just those with pristine digital records or approved opinions.

---

References

1. Corbishley, N. (2024, July 24). In Historic Shift, British Newspapers Begin Warning Of "Perils" Of Cashless Society After Global IT Outage. Activist Post.

2. Häring, N. (2018, February 1). How Mastercard Invented the Health Hazard of Cash. Norbert Häring.

3. Scott, B. (2022). Cloudmoney: Cash, Cards, Crypto, and the War for Our Wallets. Harper Business.

4. Financial Conduct Authority. (2020). Financial Lives 2020 survey: the impact of coronavirus.

5. The Guardian. (2023, May). The Guardian view on a cashless society: convenience at a cost.