CASHLESS BUYING BIAS?

Many people and businesses no longer use cash to buy and sell items, but for the 25% of New Yorkers who are “underbanked,” is this a form of bias against the poor?

Aired on January 7, 2018.

TRANSCRIPT

THIS SEGMENT IS PART OF OUR CHASING THE DREAM INITIATIVE ON POVERTY AND OPPORTUNITY IN AMERICA.

GOOD EVENING AND WELCOME TO 'METROFOCUS.'

I'M JACK FORD.

TONIGHT THE QUESTION FOR YOU, HAVE YOU STOPPED USING CASH TO BUY THINGS?

MORE AND MORE PEOPLE AROUND THE COUNTRY HAVE AND ARE NOW JUST USING CREDIT OR DEBIT CARDS WHEN PURCHASING GOODS.

ALONG WITH PEOPLE GOING CASHLESS, SO ARE SOME BUSINESSES.

BUT WHAT IF YOU DON'T HAVE A CREDIT OR DEBIT CARD?

WHAT IF YOU'RE UNDERBANKED, AS 25% OF NEW YORKERS ARE?

WHAT IF YOU'RE UNDOCUMENTED?

WHAT IF YOU'RE HOMELESS?

WHAT IF YOU JUST LIKE TO USE CASH?

WHEN YOU CONSIDER A CASHLESS SOCIETY, ARE WE ALSO LOOKING AT IN SOME WAYS A BIASED ONE?

BRONX COUNCILMEMBER RICHIE TORRES HAS STRONG OPINIONS ON THE ISSUE.

HE IS TACKLING IT HEAD-ON AND HE JOINS US WITH THAT.

IT'S ALWAYS GOOD TO SEE YOU.

IT'S AN HONOR TO BE HERE.

YOU SAID I WALKED INTO A STORE IN NEW YORK.

I'D LIKE TO USE CASH RATHER THAN CARDS FOR NORMAL LUNCH, THAT TYPE OF THING.

AND I WALKED IN, GOT SOME LUNCH AND GOT TO THE COUNTER AND SAID WE DON'T TAKE CASH.

AND I SAID REALLY?

WE DON'T TAKE CASH?

SO LET'S TALK A LITTLE BIT ABOUT WHY YOU'RE CONCERNED ABOUT THAT NOTION OF CASHLESS BUSINESSES.

WELL, MOST PEOPLE HAVE THE SAME PUZZLED REACTION THAT YOU DO.

WHEN YOU OPEN A DOLLAR BILL, IT READS 'THIS NOTE IS LEGAL TENDER FOR ALL DEBTS PUBLIC OR PRIVATE'.

RIGHT.

IF I HAVE CASH, WHICH THE LEGITIMATE UNIVERSALLY RECOGNIZED CURRENCY OF THE UNITED STATES, ON WHAT BASIS CAN A BUSINESS DENY ME THE ABILITY TO USE CASH TO PURCHASE FOOD, SHELTER, AND CLOTHING, BUT INCREASINGLY IN NEW YORK CITY WE HAVE A RISING TIDE OF WHAT IS KNOWN AS CASHLESS BUSINESSES THAT INSIST ON CREDIT ONLY AND THAT REFUSE TO ACCEPT CASH.

AND MY CONCERN IS EVEN IF THE POLICY APPEARS TO BE NEUTRAL ON THE SURFACE, IT CAN HAVE AN EXCLUSIONARY EFFECT ON THE MOST VULNERABLE NEW YORKER, PARTICULARLY THE UNDERBANKED WHICH IS 25% OF OUR POPULATION.

I'LL TALK ABOUT THAT IN A SECOND.

BUT GIVE US A SENSE OF CONTEXT FOR THE ISSUE.

WHAT ARE THE REASONS THAT HAVE BEEN OFFERED BY BUSINESSES WHEN THEY SAY ALL RIGHT, WE'RE GOING TO GO CASHLESS.

WE'RE NOW JUST GOING TO DO BASED ON CREDIT CARDS OR DIGITAL BILL?

THE REASONS CAN VARY.

SOME WILL CLAIM EFFICIENCY.

OTHERS WILL CLAIM CLEANLINESS.

AND THEN THERE SEEMS TO BE A MISCONCEPTION AMONG SOME BUSINESS OWNERS THAT EVERYONE HAS ACCESS TO CREDIT.

YEAH.

WHEN IN FACT 25% OF NEW YORKERS ARE UNDERBANKED, AND IT'S DISPROPORTIONATELY TRUE IN COMMUNITIES OF COLOR.

WHEN WE SAY UNDERBANKED, WHAT DOES THAT MEAN?

THERE IS A LACK OF BANKS THROUGHOUT NEW YORK CITY, PARTICULARLY THE LOW INCOME NEIGHBORHOODS.

THERE ARE A NUMBER OF NEW YORKERS THAT HAVE NO CREDIT RATING OR TOO POOR CREDIT RATING TO QUALIFY FOR CREDIT.

IF YOU HAVE NO ACCESS TO CREDIT, YOU HAVE NO MEANS TO PURCHASING GOODS AND SERVICES IN A CASHLESS SOCIETY.

YOU MIGHT HAVE THE MONEY IN YOUR POCKET TO DO IT.

YEAH.

YOUR WAGES MIGHT BE SUFFICIENT TO ALLOW YOU TO GO TO A GROCERY STORE AND BUY AND TAKE CARE OF YOUR FAMILY, KEEP FOOD ON THE TABLE, A ROOF OVER YOUR HEAD, BUT IF YOU DON'T LIVE IN THE CREDIT CARD WORLD, THEN SOME OF THESE BUSINESSES ARE SAYING TO YOU CAN'T DO BUSINESS WITH US?

AND YOU'RE EFFECTIVELY EXCLUDED.

IT'S FAIR GAME IN A CAPITALIST SOCIETY TO DISCRIMINATE ON PRICE.

BUT I WOULD REGARD IT AS UNFAIR TO DISCRIMINATE BASED ON METHOD OF PAYMENT.

DO YOU THINK THERE IS ANY INTENTIONAL DISCRIMINATION GOING ON HERE WITH THESE DECISIONS BY BUSINESSES TO GO CASHLESS, THAT THEY'RE TRYING TO LIMIT IN SOME WAY THE CLASSES OR THE TYPES OF CUSTOMERS THAT ARE COMING INTO THEIR STORES?

I THINK AS A GENERAL MATTER, IT TENDS TO BE DISCRIMINATION IN EFFECT.

BUT I SUSPECT THERE ARE SOME BUSINESSES THAT KNOWINGLY ADOPT THESE POLICIES KNOWING THAT IT WILL FILTER OUT A CERTAIN CLIENTELE FROM THEIR BUSINESS.

IF YOU LOOK AT IT, AND I MENTIONED TO YOU, I JUST HAPPEN THAN NOT, I'VE SEEN IN SOME OF THE STORIES ABOUT THIS SOME PEOPLE WHO ARE SAYING, LOOK, I DO THIS AS A BUDGET MECHANISM FOR ME TO KEEP MYSELF ON BUDGET.

THERE ARE STUDIES THAT HAVE SHOWN THAT PEOPLE WILL SPEND MORE WHEN THEY'RE USING A CARD THAN THEY WILL IF THEY'RE TAKING CASH OUT OF A WALLET.

SO YOU HAVE PEOPLE SAYING IT'S A BUDGET TOOL FOR ME.

OTHER PEOPLE SAYING ESSENTIALLY, IT KEEPS THEM FROM OVERSPENDING, EVEN THOUGH THEY COULD, THEY COULD AFFORD IT IF THEY WANT TO.

AND THEN OTHER PEOPLE ALSO SAY, AND BY THE WAY, THIS IS -- SETS UP A SCENARIO WHERE THE BUSINESSES CAN BE MAKING MORE MONEY TO THEIR BOTTOM LINE.

YEAH.

SO HOW DO WE RECONCILE THOSE TWO?

I WOULD ARGUE THAT WHATEVER EFFICIENCY GAINS COME FROM A CASHLESS BUSINESS IS OUTWEIGHED BY TWO CONSIDERATIONS.

FIRST IS PRIVACY.

THERE ARE PEOPLE WHO PREFER CASH FOR REASONS RELATING TO PRIVACY, BECAUSE IT DOES NOT INVOLVE THE SHARING OF THEIR PERSONAL INFORMATION.

CREDIT CARDS HAVE HUGE QUANTITIES OF INFORMATION ABOUT OUR LOCATIONS, OUR WHEREABOUTS BECAUSE WE'RE CONSTANTLY ENGAGED IN CREDIT TRANSACTIONS.

AND THERE ARE MANY NEW YORKERS WHO PREFER TO USE CASH BECAUSE IT'S MUCH MORE PROTECTIVE OF THEIR PRIVACY.

SECOND IS CIVIL RIGHTS.

SINCE 1965 THERE HAS BEEN A RECOGNITION THAT EVEN PRIVATE BUSINESSES ARE PUBLIC ACCOMMODATION AND HAVE AN OBLIGATION TO TREAT ALL OF THEIR CUSTOMERS EQUALLY, REGARDLESS OF WHETHER YOU PAY BY CREDIT OR BY CASH.

SO HOPEFULLY MY BILL IS ABOUT AFFIRMING THE PRINCIPLE OF EQUALITY IN THE MARKETPLACE.

TELL ME WHAT THE BILL WOULD SAY AND THEN LET'S TALK ABOUT WHAT KIND OF SUPPORT YOU HAVE FOR IT.

THE BILL WOULD REQUIRE EVERY RETAIL AND FOOD ESTABLISHMENT TO ACCEPT CASH, RIGHT.

CREDIT SHOULD BE AND CAN BE ONE OPTION AMONG MANY, BUT IT SHOULD NEVER BE THE SOLE OPTION BECAUSE IT HAS AN EXCLUSIONARY EFFECT ON UNDERBANKED AND VULNERABLE NEW YORKERS.

SO YOU WOULD BE REQUIRED TO ACCEPT CASH.

AND WHAT SORT OF SUPPORT ARE YOU GETTING ON BOTH SIDES OF THE AISLE?

THE RESPONSE HAS BEEN OVERWHELMINGLY FAVORABLE.

I HAVE THE SUPPORT -- WE SEEM TO HAVE THE TENTATIVE SUPPORT OF THE MAYOR WHO HAVE VOICED SUPPORT FOR THE CONCEPT OF BANNING CASHLESS BUSINESSES.

I HAVE THE SUPPORT OF THE CHAIR OF THE COMMITTEE ON CONSUMER AFFAIRS WHICH WILL HEAR THE BILL IN FEBRUARY.

SO THE SUPPORT HAS LARGELY BEEN FAVORABLE.

WHAT WOULD BE THE TIME SCHEDULE, THEN, FOR THIS TO GET DONE?

SO IF WE WERE ABLE TO SECURE HEARING IN FEBRUARY AS I SUSPECT WE WILL, THEN WE CAN GET THE BILL ENACTED BY MID- TO LATE NEXT YEAR.

WE'LL HAVE YOU COME BECOME AND TALK ABOUT THAT.

BUT I CAN'T HAVE YOU HERE WITHOUT BRINGING UP THE TOPIC THAT WE TALK ABOUT SO OFTEN HERE.

BASICALLY, GIVE US AN UPDATE.

WHAT'S GOING ON?

LOOK, THERE HAS BEEN SOME BREAKTHROUGHS.

THE GENERAL MANAGER AND THE NEW CHAIRPERSON WERE ABLE TO STRIKE AN AGREEMENT WITH THE TEAMSTERS WHICH REPRESENTS THE MAJORITY OF THE EMPLOYEES WHICH WOULD -- WHICH WOULD REQUIRE THE EMPLOYEES TO WORK EARLIER ON WEEKENDS.

FOR THE FIRST TIME IN 50 YEARS WE'RE GOING TO HAVE CARETAKERS EARLY IN THE MORNING, LATE IN THE EVENINGS, ON WEEKENDS, AVAILABLE TO DO WORK.

THE MANY OF THE PROBLEMS ARE RELATED TO SKILL TRADES LIKE PLUMBING, PLASTER, PAINTING, BASIC REPAIRS.

AND THE NEW CONTRACT FAILS TO COVER MAINTENANCE SKILLS TRADES WHICH REPRESENTS THE NEED FOR REPAIRS.

SO THAT'S THE DOWNSIDE OF THE CONTRACT.

BUT THERE IS ALSO THE THREAT OF THE RECEIVERSHIP.

THE FEDERAL GOVERNMENT IS THREATENING TO TAKE OVER PUBLIC HOUSING.

AND NOW IF THAT HAPPENS, THAT WOULD BE THE FIRST TIME IN THE HISTORY OF NEW YORK CITY THAT THE FEDERAL GOVERNMENT HAS STRIPPED A MAYOR OF CONTROL OF PUBLIC HOUSING.

DO YOU THINK THAT'S AN EMPTY THREAT OR WOULD THEY FOLLOW THROUGH?

IS IT LIKELY TO HAPPEN?

NO.

BUT THE RISK OF RECEIVERSHIP HAS NEVER BEEN MORE REAL BECAUSE NYCHA IS IN A STATE OF EMERGENCY.

THERE IS REASONS FOR PEOPLE ON THE OTHER SIDE TO LET'S DO WHAT WE HAVE TO DO TO AVOID.

THE MAYOR HAS NEVER BEEN UNDER GREATER PRESSURE TO IMPROVE CONDITIONS ON PUBLIC HOUSING BECAUSE HE HAS THE THREAT OF RECEIVERSHIP HANGING OVER HIM.

WE'LL SEE WHERE THAT GOES TO.

RICHIE TORRES, GOOD TO SEE YOU AND ALWAYS GOOD TO GET YOUR THOUGHTS ON ALL OF THIS.

THANKS FOR JOINING US.

YOU BE WELL.

Funders

MetroFocus is made possible by James and Merryl Tisch, Sue and Edgar Wachenheim III, the Sylvia A. and Simon B. Poyta Programming Endowment to Fight Anti-Semitism, Bernard and Irene Schwartz, Rosalind P. Walter, Barbara Hope Zuckerberg, Jody and John Arnhold, the Cheryl and Philip Milstein Family, Janet Prindle Seidler, Judy and Josh Weston and the Dr. Robert C. and Tina Sohn Foundation.

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