As the article points out, some of this is cultural and some of it is simply a desire to avoid paying taxes. A lot of retailers, apparently, offer discounts to people who pay in cash and do not demand a receipt, essentially splitting with the customer the savings realized by not paying taxes on the goods sold.
Now, on general principles, I don't have a problem with this. I'm a big believer in what I've come to think of as the "circulatory system" monetary theory: a portion of any nation's economy must consistently be siphoned over to the government in the form of taxes, which then can be re-injected into that economy by the provision of needed government services. Only in this way can we avoid the inevitable wealth condensation that ultimately results in a few very, very rich families and lots of very poor people.
So if Italian tax evasion is as rampant as the article indicates, then moving Italians out of a cash-based economy may in fact be an eminently reasonable thing to do. After all, the article claims that the Italian government loses about 120 billion euros a year due to this type of tax evasion. That's a good deal of money.
But here's the rub: forcing Italians to use plastic for their purchases instead of cash means that the banks who issue that plastic are likely to get very, very rich. You see, the banks charge fees of up to 2% on credit transactions. And - quite frankly - that's fairly obscene. Electronic swiping of an account costs the banks fractions of pennies (if it in fact costs them anything at all) because computers do all the work -- it's fully automated. So really there shouldn't be a bank charge for this service in the first place. But making the charge dependent on the size of the transaction? What possible argument can be made that the more money a customer deducts from their account the more the bank should charge that customer (or, more accurately, the customer's retailer) for the privilege of doing so? If there is any cost at all to the bank from electronic transactions, that cost doesn't depend on whether the transaction amount is $10 or $100,000 -- it's still only an electronic deduction from an account.
If you want to understand who really controls the levers of power, think of how this new law (it took effect December 4th) was imposed on the Italian people without a vote or a referendum or even a poll asking if they were in favor of it, and then consider this passage from the article:
The government is negotiating with the banks to get them to cut fees on credit cards and lower costs for bank accounts to encourage the move away from cash, Grilli said Dec. 5.
Banks are willing to consider zero-cost current accounts for low-income retirees and discuss credit-card costs “in light of the government’s new measures,” , head of Rome-based ABI, said Dec. 11. However, lenders won’t “give away” services that carry a cost for them, he said. (emphasis added)
First -- as already noted -- these services don't cost the banks a goddamned thing. Second, notice that Italy's new Bankster in Chief feels the need to negotiate with the banks about reducing fees. Seriously? The Italian government is mandating that the Italian people must now use banks in order to purchase goods and services, but the government isn't doing anything to prevent a bank windfall except to ask pretty please if the banks will maybe cut back on some of their obscene profit gouging?
Yeah. Mario Monti is a "technocrat." He doesn't have an ideological agenda. Tell ya what -- pull the other one, it's got bells on it.