Richard Rahn "Currency that Kills" The Washington Times

[Novmgtco at aol.com]

The Washington  Times
_www.washingtontimes.com_ (http://www.washingtontimes.com/)

____________________________________

Currency that Kills

By Richard W. Rahn
Published November 11,  2009

____________________________________

Converting to electronic money could prevent  disease
Can you imagine how many people have physically handled your money?
Do  you
know who has previously touched it? Did they have a flu virus or some
other
communicable disease that is transmitted by physical contact with an
infected  object? Physical paper currency is often dirty - not so much
to the
sight, but  it is a good home for dangerous microbes. It is often kept
warm by
our body heat  and even absorbs some body moisture - a perfect breeding
ground for bad stuff.
It has been well-known for decades that paper currency is a major source
of disease transmission. During the life of the average dollar bill,
it will
be  handled by hundreds, if not thousands, of people. It is hard to
think of
any  physical object that is handled by more different people than paper
currency.  Millions become ill every year as a result of handling
currency,
and a not  insignificant percentage of them die. The Centers for Disease
Control and  Prevention (CDC) estimates that 36,000 Americans die each
year from
flu-related  causes. How many people received the flu from paper
currency?
The precise  percentage is unknown, but if it is just 10 percent, that
still
translates into  a couple of million needlessly ill people and
thousands of
deaths.
The good news is that it is no longer necessary to use paper currency in
the digital age. Payments of all types can be made by electronic means
- with
electronic banking; credit, debit and smart cards; and cell phones - all
of  which help the user avoid physical contact with dirty paper money.
(Note:
Most  paper currencies are made largely from cotton cloth, which makes
them
very  absorbent.)
The bad news is that government policies are slowing down and, in many
cases, preventing the movement to the use of digital currencies. Most
electronic  payment systems require the user to have a bank account.
For decades, the
percentage of the population having a bank account grew, but that growth
stopped  a couple of decades ago as the government started its war on
money
laundering -  which, ironically, resulted in the unintended
consequence of
requiring more  people to handle dirty paper money.
Physical money is expensive to produce. It is subject to counterfeiting,
easily stolen and costly to handle. As noted, it is a major
transmitter of
disease. A rational and responsible government would be doing everything
possible to eliminate physical currency. But no - legislators and
policymakers
have put destruction of the citizen's financial privacy and tax
collection
above  reducing the costs and dangers of physical currency.
People will only move away from paper currency when they can easily
use  an
"electronic wallet" and have the ability to make non-identifiable and
non-traceable transactions. As noted above, an electronic wallet can
be a  credi
t, debit or smart card - a cell phone or a PC. The electronic money
can be
held in an electronic chip within the cell phone or other device or in a
depository account that can be in a bank, telecom company or some other
depository institution. Encryption software has become sufficiently
robust to
protect users of digital money and is far safer than holding or handling
physical cash.
In many parts of the world, monetary transfers by cell phone are
becoming
the norm - they are particularly useful for small payments. The
Philippines
has become a world leader  in cell-phone payment systems and use.
Cell-phone use is expanding at a very  high rate through the
developing world -
already, in Africa, a third of the people have cell-phone
subscriptions, most of
which can be used for electronic payments. The fact is  that the
spread of
digital technologies will soon make it possible for all paper
currency to
become obsolete, but unfortunately, that is unlikely to happen
because of
the global political class.
The politicians and international bureaucrats are increasingly limiting
the ability of people to use non-highly regulated bank institutions as
the
depositories and clearinghouses for electronic money. As the political
class
demands ever-more-stringent and costly "know your customer" and other
anti-money-laundering regulations, fewer and fewer people can qualify
for bank
accounts. The young, who have no financial track record; the poor; and
those
in  transient occupations are particularly discriminated against and
thus
are forced  to use inefficient, costly and unhygienic paper currency.
The political class is also increasingly requiring banks and other
depository institutions to spy on their customers and reveal all
transactions to
government officials - which gives individuals about as much privacy as
having  all their expenditures posted on a public Web site. Almost
everyone
occasionally  wants to keep some expenditures private; for example,
not wanting a
spouse or  loved one to know how much one spent on a gift; making an
anonymous or  confidential contribution to a church, charity or other
nonprofit
group; or even  using the Internet for legal gambling, porn, cigarette
or
alcohol expenditures,  etc.
Encryption technology has developed to the point where electronic
expenditures can be kept private if governments would only allow it.
The fact  is,
people will not give up the use of paper currency, for good or bad
reasons,
until they know they will have the same anonymity with electronic
money as
they  do with paper currency. Meanwhile, each year, millions of people
needlessly get  sick and thousands die because the folks who run
Washington and
the other world capitals are  too dimwitted to understand the unintended
consequences of their financial  regulations - or are just plain
callous.
Richard W. Rahn is a  senior fellow at the Cato Institute and chairman
of
the Institute for Global  Economic Growth.
_http://www.washingtontimes.com/news/2009/nov/11/currency-that-kills/_
(http://www.washingtontimes.com/news/2009/nov/11/currency-that-kills/)
Copyright ) 2009 News World  Communications, Inc. All rights reserved.