I personally don't want my identity checked unless I'm asking someone to trust me. And I'd rather use a trust-minimizing system before going there. You don't need your id checked when going to the restaurant or the theater. You need to check someone's id when they take your money and promise you something in return (and even then, there may be a better way).
> I don't see a single instance of trade being limited even if all transactions were between established identities.
Do you buy something if you need to send a copy of your id? Do you use a website if it requires Facebook connect?
The issues of tight tracking you mention would be amplified by widespread use of id checks so I think it's essential not to do them often.
I can see an objection to erasure of cash, but not these identities.
I don't understand this argument at all. In what way does the economy require that people take on risks of identity theft when they trade with each other? I don't see a single instance of trade being limited even if all transactions were between established identities.
There are other issues of tight tracking of course, but I don't see this one.