Tags: uk | check | ban | prelude

UK Check Ban Step Toward Gov't Takeover

By    |   Thursday, 17 Dec 2009 04:13 PM

The announcement from Britain’s banking system on Wednesday that paper checks will be abolished by a target date of 2018 is being reported around the world as an enhancement of private sector efficiency that saves the financial system over $2 billion in annual processing costs — with the bonus of saving 45,000 trees used to make the paper.

What is not being reported is how government can abuse forced paperless finance.

The UK Payments Council, which oversees financial transactions in Britain, issued a report announcing the “migration from check and paper methods to more efficient electronic alternatives.” According to Payments Council Chief Executive Paul Smee, during the nine years before the deadline there will be “extensive work that we need to do to ensure that everyone has a viable alternative” to writing checks.

But the first alternative the Council’s report suggests is a disturbing government-mandated program in Denmark called NemKonto, in which the state has taken over personal bank accounts.

In 2005, all Danish citizens and companies received a classic “I’m from the government and I’m here to help you” letter from Denmark’s Agency for Governmental Management. Under the heading, “We need you to designate a NemKonto (Easy Account),” the letter announced, “Everybody in Denmark — citizens and companies alike — must have a NemKonto Easy Account.”

The account is defined as “a bank account that you already use and have designated as your NemKonto Easy Account.”

The letter continued: “In order to make it simpler and easier for all parties, future payments from Danish public-sector institutions will be transferred directly to the NemKonto Easy Account. This applies to payments from the Danish state, and from local and municipal institutions.”

With the government in direct control of the bank accounts of every single Danish citizen and company, NemKonto has become the sole method of transfer payments from Denmark’s welfare state — “tax refunds, child subsidies, pensions, student loans, unemployment benefits, housing support or social welfare payments,” as the Danish government letter noted.

With Britain and much of Europe refusing to process checks, how long would it be before the United States is forced to convert to 100 percent paperless finance? And would Washington’s big tax-and-spenders be able to resist emulating the Danish model of government control of bank accounts?

Would the federal government stop at making electronic deposits? Or would it make withdrawals too — forcing citizens to pay a litany of federal, state and local taxes and fees involuntarily, much the same way income taxes are automatically withheld from paychecks by government edict?

A decade ago, the shift to universal electronic finance was hailed as an unstoppable liberation from government intrusion.

“Enjoyment and liberation are coming,” Cato Institute senior fellow and Institute for Global Economic Growth chairman Richard Rahn wrote in 1999 in his book “The End of Money and the Struggle for Financial Privacy.” The new freedoms were coming “because the digital revolution is about to cause the death of most taxes on capital.”

Rahn believed, “What governments cannot see they cannot tax and, as a result of the digital revolution, the government will only see financial capital which is voluntarily taxed.”

But Europe is now showing that it takes more than the latest encryption software to render big government blind and keep the long arm of the state out of your wallet and pocketbook.

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The announcement from Britain s banking system on Wednesday that paper checks will be abolished by a target date of 2018 is being reported around the world as an enhancement of private sector efficiency that saves the financial system over $2 billion in annual processing...
uk,check,ban,prelude
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2009-13-17
Thursday, 17 Dec 2009 04:13 PM
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