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X-Original-To: cryptography@metzdowd.com X-Original-To: cryptography@metzdowd.com To: Adam Fields <cryptography23094893@aquick.org> Cc: cryptography@metzdowd.com From: "Perry E. Metzger" <perry@piermont.com> Date: Fri, 08 Jul 2005 12:19:38 -0400 In-Reply-To: <20050708145949.GC31271@lola.aquick.org> (Adam Fields's message of "Fri, 8 Jul 2005 10:59:49 -0400") Adam Fields <cryptography23094893@aquick.org> writes: > On Fri, Jul 08, 2005 at 10:42:02AM -0400, Perry E. Metzger wrote: > [...] >> A system in which the credit card was replaced by a small, calculator >> style token with a smartcard style connector could effectively >> eliminate most of the in person and over the net fraud we experience, >> and thus get rid of large costs in the system and get rid of the need >> for every Tom, Dick and Harry to see your drivers license when you >> make a purchase. It would both improve personal privacy and help the >> economy by massively reducing transaction costs. > > Haven't we been saying this for years? Yes. The only unusual point that I am making is that the lack of such a system is precisely the reason why the clerk at the store often asks for your ID when you make a purchase in the US. (The other major case is alcohol or tobacco purchases, where, again, it is a question of liability, but in this case, liability to the government which holds you responsible if you do not check government issued IDs.) > The standard argument I hear against it is "the people who would have > to pay for the very large initial investment have no economic > incentive to do so". They obviously don't think they have a long-term > need to do so now, and in the short term, this only replaces fraud > costs (a relatively known entity) with infrastructure costs (a > completely unknown one). Actually, the people who would have to pay the investment -- the banks and merchants -- have an excellent incentive. The loss because of fraud is stunningly large. The real issue is that *consumers* have little incentive to cooperate with such a system, because thanks to the regulations, they suffer virtually no losses if their accounts are hijacked. Perry --------------------------------------------------------------------- The Cryptography Mailing List Unsubscribe by sending "unsubscribe cryptography" to majordomo@metzdowd.com
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