King Arthur Movie Tristan

We know why Jack Layton wants bank fees reeled in, because like this ridiculous bit of trash from The Williams Lake Tribune, Jack thinks profits are obscene. But why would a long time conservative like Jim Flaherty go after the banks for ATM fees?

Maybe because it's a meaningless populist move. Standing up to the big nasty banks makes Jim appear soft and left-ish to rank and file middle of the road Canadians, and it's meaningless to the banks. Why is it meaningless to the banks? Because, as The Economist magazine reported last month, if cash is King, then the King is dead:

...cash, after millennia as one of mankind's most versatile and enduring technologies, looks set over the next 15 years or so finally to melt away into an electronic stream of ones and zeros. If an era is represented by its money, the information age is at hand.

most of the time a phone or a smart card that can be waved over an electronic reader will beat notes and coins hands down for convenience. The doubt—and the remaining obstacle to digital money—concerns a third property of cash: its anonymity.

Information-money can be handled by any information-processing device. That includes the mobile phone, which can add to money's utility thanks to its display and its power at any time to link to your bank as a mobile ATM. Visa thinks a contactless digital transaction takes less than half the time of a cash one and that people liberated from what happens to be in their wallets spend a fifth more.

Which is why digital cash is now solving its chicken-and-egg problem. In the past shopkeepers would not install systems unless shoppers had electronic cash. And shoppers would not use electronic cash unless they had something to buy. But smart cards and readers have become cheap and consumers now possess mobile phones in droves. The trillions of payments that are too small to bear the fees of paying by credit card have come within reach and almost everyone stands to gain. Some Japanese merchants have already begun to offer discounts to people using electronic cash. Others will follow.

Which leads top the conclusion that if cash is yesterdays technology, so are ATM's. ATM fees are then, just a temporary blip, and one that a conservative like Jim Flaherty can regulate without any real long term consequence.

Note: Another article here.