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Illustration of why socialism doesn't work

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How deluded are you? Seriously? InshaAllah you will never be in a position to accept any form of minimum wage to support yourself or your family.

That is a really naive thing to say Mo. I'm actually shocked that you can have that kind of mentality.

 

I'll respond to your previous post tomorrow inshaAllah. I don't have the time to do it now.

 

What kind of mentality? The kind that says people that take it upon themselves to work are capable of forming proper decisions?

 

There are desperate people, but what would be naive would be to assume that the desperate are the majority of people.

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What about sulfur miners, diamond miners, cocoa growers. These people are exploited.

 

http://www.boston.com/bigpicture/2009/06/sulfur_mining_in_kawah_ijen.html

 

Would you be happy to do a job where you shorten your life expectancy to your mid thirties for $5 a day? No, probably not. But you would do it to feed your children when you see no other way out.

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How deluded are you? Seriously? InshaAllah you will never be in a position to accept any form of minimum wage to support yourself or your family.

That is a really naive thing to say Mo. I'm actually shocked that you can have that kind of mentality.

 

I'll respond to your previous post tomorrow inshaAllah. I don't have the time to do it now.

 

Technically Mo is right, there is never only one choice. But sadly in the real world, it doesn't work like that. The problem with economics is that when we define things, it can be so far removed from the reality that we lose sight of what we're actually discussing.

 

The truth is though that although minimum wage sounds good in theory, its actually very bad economics. The better solution would be to have a more efficient way of creating and distributing wealth more equally.

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What kind of mentality? The kind that says people that take it upon themselves to work are capable of forming proper decisions?

 

There are desperate people, but what would be naive would be to assume that the desperate are the majority of people.

 

Firstly, I did not say that this was the majority of people. How many people live and work in such conditions is different for each and every society. In some societies there are those few who choose to sit on their arses every day or who are too lazy to go out and get jobs so they beg or do menial work to get by. In other societies, the majority are the poor and in order to feed themselves and their families they are forced to work in terrible conditions because they do not have an alternative; alternatives such as begging and resorting to crime are not an option they would take.

 

Technically Mo is right, there is never only one choice. But sadly in the real world, it doesn't work like that. The problem with economics is that when we define things, it can be so far removed from the reality that we lose sight of what we're actually discussing.

 

The truth is though that although minimum wage sounds good in theory, its actually very bad economics. The better solution would be to have a more efficient way of creating and distributing wealth more equally.

Mo doesn't seem to live in the real world where people are faced with this problem. Its nice to paint a pretty picture of economics but the reality is far from that.

 

Minimum wage does sound good in theory but it also screws people over. For instance, in SA, we had a thriving textile and shoe industry. The workers at the bottom weren't getting paid great, but they were getting paid and were able to sustain themselves and consumers were also not paying large amounts for the product. Then the government put in minimum wage and opened up the import sector and this is where it all went to hell. The south african industry couldn't keep up with the low prices of the imports and they also had to increase the wages of their workers and therefore had to increase the price of the product. Folks were buying the cheaper imports and stopped buying the south african products and the sector has all but closed down. Now we have a drive for 'Proudly South African' good but the prices are so high its ridiculous. I used to work in retail and we used to manufacture some of our own goods and the prices compared to clothes that we stocked from overseas was about double. So while I do think that minimum wage and benefits sounds good in theory, I definitely know that in reality its not always that great if not handled properly.

 

 

Sister, but without the 'fat cats', these men would not be able to provide for their family. Their industry would not exist. Are you telling me that miners have the time to mine and then sell the ore? The fact of the matter is that miners accept these wages, they were not forced into the job they have. I personally believe that if someone chooses to work, it is their responsibility to ensure that this work is cost efficient to them (i'm not just talking about monetary costs).

 

I would also like to point out sister, even if you divided the millions earned by executives, it would only result in a marginal increase of pay for lower scale workers.

 

How do you know that some form of the industry would not exist? Why would you think that they would not be able to mine? Yeah, I do think that miners would have the time to sell the ore or they would find a way to get someone to do it for them but who wouldn't rip them off. Are you really belittling people like that? That they are too stupid to do it on their own? I heave read of enough cases of illegal mining and these guys make money out of it. They are willing to mine and sell on their own.

 

These miners accept the wages because the alternative is to live off the streets. Thats their choice. They did not receive even sub par educations and have no skills and so take the job that they know they can do. They may not be physically forced into the job but structural violence is clever like that. They work their arses off to get around 60K a year, if they are lucky, I have heard of miners getting less than that. They struggle to feed their families, and they have not only their own family to worry about but their extended families too. They work hard for a pittance and have dreams of putting their children through school and university so their kids can have a better chance but that doesn't work out in the end.

 

So for you to say that these people choose to live like this, insinuating that they don't want to be doing anything else, is beyond ridiculous.

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Yeah. And they only got those kinds of wages because they went on some crazy strikes to get it. And they went on some mad strikes last year that didn't end to well either. Who knows what this year will bring.

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What about sulfur miners, diamond miners, cocoa growers. These people are exploited.

 

http://www.boston.com/bigpicture/2009/06/sulfur_mining_in_kawah_ijen.html

 

Would you be happy to do a job where you shorten your life expectancy to your mid thirties for $5 a day? No, probably not. But you would do it to feed your children when you see no other way out.

 

Indonesia has plenty of jobs bro. I also see no pictures of men forcing them to work, etc. The average wage in Indonesia is $12 a day anyhow. For unskilled labour $5 is to be expected when the national income is that level.

 

Firstly, I did not say that this was the majority of people. How many people live and work in such conditions is different for each and every society. In some societies there are those few who choose to sit on their arses every day or who are too lazy to go out and get jobs so they beg or do menial work to get by. In other societies, the majority are the poor and in order to feed themselves and their families they are forced to work in terrible conditions because they do not have an alternative; alternatives such as begging and resorting to crime are not an option they would take.

 

You keep saying 'forced' to work. Nobody is 'forced' to work. There are other jobs, people just have to look. Do you think these men began working as miners when they got families? Or do you think they got families whilst they were working as miners? It is more than likely the latter, and I believe that also a large number of them are bachelors, either working for themselves or to help perhaps their parents.

 

Honestly speaking sister, do you believe that someone who is entirely unskilled will receive the same wage as someone who is skilled?

 

 

Mo doesn't seem to live in the real world where people are faced with this problem. Its nice to paint a pretty picture of economics but the reality is far from that.

 

Minimum wage does sound good in theory but it also screws people over. For instance, in SA, we had a thriving textile and shoe industry. The workers at the bottom weren't getting paid great, but they were getting paid and were able to sustain themselves and consumers were also not paying large amounts for the product. Then the government put in minimum wage and opened up the import sector and this is where it all went to hell. The south african industry couldn't keep up with the low prices of the imports and they also had to increase the wages of their workers and therefore had to increase the price of the product. Folks were buying the cheaper imports and stopped buying the south african products and the sector has all but closed down. Now we have a drive for 'Proudly South African' good but the prices are so high its ridiculous. I used to work in retail and we used to manufacture some of our own goods and the prices compared to clothes that we stocked from overseas was about double. So while I do think that minimum wage and benefits sounds good in theory, I definitely know that in reality its not always that great if not handled properly.

 

 

The main reason minimum wage screws people over, is that it forces employers to drop unskilled workers (in particular young people) from the work force and to employ more higher skilled labour. At the end of the day, the wage contract is an agreement between the worker and their employer, and in my opinion a worker should be allowed to work for as little or as much as they want to.

 

How do you know that some form of the industry would not exist? Why would you think that they would not be able to mine? Yeah, I do think that miners would have the time to sell the ore or they would find a way to get someone to do it for them but who wouldn't rip them off. Are you really belittling people like that? That they are too stupid to do it on their own? I heave read of enough cases of illegal mining and these guys make money out of it. They are willing to mine and sell on their own.

 

These miners accept the wages because the alternative is to live off the streets. Thats their choice. They did not receive even sub par educations and have no skills and so take the job that they know they can do. They may not be physically forced into the job but structural violence is clever like that. They work their arses off to get around 60K a year, if they are lucky, I have heard of miners getting less than that. They struggle to feed their families, and they have not only their own family to worry about but their extended families too. They work hard for a pittance and have dreams of putting their children through school and university so their kids can have a better chance but that doesn't work out in the end.

 

So for you to say that these people choose to live like this, insinuating that they don't want to be doing anything else, is beyond ridiculous.

 

I did not say they were to stupid. I was referring to the idea of economies of scale. The facilities necessary to refine ore, the capital necessary to pay miners, the cost of leasing/buying a mine itself, etc., cannot be achieved by a single miner. If the miner had that much wealth he would probably not be a miner now would he?

 

 

And you just proved my point there sister. Because they are unskilled labour they are paid that much. The average wage in South Africa is $10,960, if they are earning $6,500 a year, it makes perfect sense. And actually sister that last analogy does work out. My fathers parents were both illiterate, the generation before them had all their wealth taken by the socialists so they inherited nothing, the socialist irrigation reforms destroyed the one thing they had which was our family farm. They had nothing. My grandfather though, worked 3 jobs, my grandmother would make small accessories and baskets to be sold in the marketplace, my uncles all worked part time jobs as bricklayers or errand boys from the age of around 9, they also helped on the farm since they were 7 and continued to do so all whilst they were at school. Yet, alhamdulilah, my dad and my uncle both have PhDs and are paid well, my other uncles are independent men (one has 17 children and 2 wives and can provide for all of them), my aunts are both married and have children and one lives in Saudi whilst the other lives a reasonable life in Iraq.

 

I have met countless people, who started from doing menial things such as having their wives cook falafel for them to sell at the mosque so they could pay off their university debts to owning large holdings companies in the middle-east.

 

People are not trapped.

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40k is plenty in the UK, its above the national avg wage. you might struggle to feed a family of 5 but you wont be in poverty

 

well that's the impression i have gotten

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40k is plenty in the UK, its above the national min wage. you might struggle to feed a family of 5 but you wont be in poverty

 

well that's the impression i have gotten

 

He said 4k lol.

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Mo, you need to get out of your econ class and into the real world. All the folks I knew who were uber-libertarians in high school or college came out of it once they entered the workforce, or at least left their little bubble where charts alone testify to ethics.

 

No one, aside for you, is arguing for socialism or capitalism - I'm pretty sure most of us are somewhere in the middle. Most of us aren't debating for or against entire ideologies. So there's no reason for a thread like this. If this is your argument in favor of completely free-market, then I keep my comment, New Zealand - which is not a free-market and has far more Government intervention than we do - seems like a nice place. As do the Scandanavian countries. They might not technically be socialist, but go look at your definition of 'socialist' in the first post... they certainly fit by that standard. If Obama is a socialist, then definitely most of the world is.

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Mo, you need to get out of your econ class and into the real world. All the folks I knew who were uber-libertarians in high school or college came out of it once they entered the workforce, or at least left their little bubble where charts alone testify to ethics.

 

No one, aside for you, is arguing for socialism or capitalism - I'm pretty sure most of us are somewhere in the middle. Most of us aren't debating for or against entire ideologies. So there's no reason for a thread like this. If this is your argument in favor of completely free-market, then I keep my comment, New Zealand - which is not a free-market and has far more Government intervention than we do - seems like a nice place. As do the Scandanavian countries. They might not technically be socialist, but go look at your definition of 'socialist' in the first post... they certainly fit by that standard. If Obama is a socialist, then definitely most of the world is.

 

 

I actually think that the discussion of economics away from the academic realm is very important. I say that as someone whose work revolves around analysing economies and economic trends, and I only mention that so you understand my background.

 

The reason I say its important is because, like it or not economics is now a very heated battlefield and the more we understand it the more conducive it is to finding a solution.

 

To make my position clear, I am not a proponent of either socialism, libertarianism or capitalism. I am very firmly in the Islamic economics camp.

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Mo, you need to get out of your econ class and into the real world. All the folks I knew who were uber-libertarians in high school or college came out of it once they entered the workforce, or at least left their little bubble where charts alone testify to ethics.

 

No one, aside for you, is arguing for socialism or capitalism - I'm pretty sure most of us are somewhere in the middle. Most of us aren't debating for or against entire ideologies. So there's no reason for a thread like this. If this is your argument in favor of completely free-market, then I keep my comment, New Zealand - which is not a free-market and has far more Government intervention than we do - seems like a nice place. As do the Scandanavian countries. They might not technically be socialist, but go look at your definition of 'socialist' in the first post... they certainly fit by that standard. If Obama is a socialist, then definitely most of the world is.

 

As usual, when we discuss economics you result to a veiled condescending tone and refer to your high school buddies.

 

As baldy said, economics is an important issue, and by discussing my views with MM members, I am furthering my understanding. I could read all the academic journals I like, yet nothing will be more relatable than the discussion I can achieve on MM. This thread only exists for that purpose. I am also aware that many Muslims have an outright hate for capitalism, which in my opinion is relatable to a long standing Muslim dislike for America. Thus naturally, with capitalism being viewed as an American value, many Muslims in turn have a negative attitude towards it.

 

My argument for a free market is due to the hadith where Allah is described as the price setter, and that the Prophet (SAW) himself refused to meddle with the prices in the marketplace. And as I explained to you, New Zealand only increased intervention etc. during the previous government, which was a Labour government advocating Third Way. Prior to that, the New Zealand government were neoliberals and conservatives for most of it's history since WW2. And as to Scandinavian countries, they are simply free markets with welfare aimed specifically at providing skills for the workforce (i.e. education).

 

Obama however, wishes to impose greater taxes on those who earn more. This is something that simply isn't fair (imho opinion though, most American politicians suck as they are into the whole 'big government' thing, and Obama is certainly from the nicer of the bunch).

 

 

 

 

I actually think that the discussion of economics away from the academic realm is very important. I say that as someone whose work revolves around analysing economies and economic trends, and I only mention that so you understand my background.

 

The reason I say its important is because, like it or not economics is now a very heated battlefield and the more we understand it the more conducive it is to finding a solution.

 

To make my position clear, I am not a proponent of either socialism, libertarianism or capitalism. I am very firmly in the Islamic economics camp.

 

 

What I know from an Islamic perspective, is that zakat is given at a persons discretion (i.e. private charity), that markets are free and that class exists the way it does as a test from Allah to test what we do with what he has given us. I think that the study of new institutional economics is fundamental in relating the academics of economics to the real world, in that it gives analysis of social norms and ideological values.

 

 

But aside from the institutional differences brother, are there truly any (significant) differences between Islamic economics and capitalism?

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but Mo, you are not open to what others are saying. Several people including me said the illustration is biased and does not represent the correct socialism. If you are not at least gonna agree to that you are not going to get a discussion.

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I see plenty of discussion

Indonesia has plenty of jobs bro. I also see no pictures of men forcing them to work, etc. The average wage in Indonesia is $12 a day anyhow. For unskilled labour $5 is to be expected when the national income is that level.

Fair play. Relative to their own environment they earn enough to live. My only contention is that they don't see a reasonable percentage of the actual value of what they are mining. They don't have safety equipment. But I am sure if they all clubbed together they could change that.

 

It's also an interesting point you make about people having a choice and if they really want to they can achieve some level of greatness. I suppose the dominance of American companies in the world markets is testament to the success and innovation that capitalism can breed. One such example: http://www.bridgetostrength.com/articles/rags-to-riches/

 

Also, I think Mo is making some very good points, and the discussion - at least for me - is both interesting and useful.

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