Most Americans are well aware of the recent travails of the US Government in finalizing their federal budget. In making his case for balancing the budget, Obama argued that “every day, families sacrifice to live within their means. They deserve a government that does the same."
However, Ted Rall makes his counter-argument against this myth that American families are thrifty and keen on balancing their personal budgets. In addition to informing us of the facts (the average family has a debt of nearly $11,000), he posits this interesting scenario:
“If consumer credit vanished, the corporato-capitalist system currently prevailing in the U.S. would deteriorate from its current, merely unsustainable form into total chaos. Without credit cards and other loans citizens would seethe, trapped between the mutually irreconcilable forces of falling wages and the aggressive advertising and marketing of products they would never be able to afford. There would only be two possible long-term outcomes: revolution, or the ruling classes would be forced to pay substantially higher wages to workers. To corporate elites, the latter choice would be too unpalatable to countenance.”
Of the two possible outcomes of a credit-free society that Rall discusses, the latter (paying higher wages to workers) is a very intriguing situation. It would undoubtedly cut into the colossal wealth of the top one percent, but the resulting economic justice would provide for a far more acceptable standard of living for the majority.
Such a course of action, I believe, is promoted by the Islamic economic ethos. This is but one example of what the Shariah would provide to its participants – a more just economic system, where capitalistic greed is not given the absolute free reign it has been afforded by modern-day capitalism.
Too bad such intellectual thought exercises are missing from the discussions on Shariah.
Instead, let us continue the fear-mongering and adventures in disinformation. After all, why bother trying to understand the intricate details of Islamic economic jurisprudence when it’s so much easier to simply pass off scary images of bearded Mullahs, honour killings, and dhimmi taxes as wholly representative of Shariah?
WAW
4 days ago
5 comments:
I agree that if consumer credit vanished, the world economy would degenerate into chaos. Even if one limited consumer credit to American Express-style cards (in which the entire balance on the card must be paid by the next month), the world would still degenerate into chaos. Credit has become the "savior" (really, steel trap) of those who spend beyond their means. (Unfortunately, been there, done that.) Which is why, even in the past few days, I've made the point to my students that they should avoid going into debt at all costs.
OTOH, I don't think that global supply-and-demand will allow higher wages to happen. It is far too easy for corporations to shift jobs and take advantage of lower wages elsewhere around the world. Revolution it may have to be then. A couple days ago I made a brief comment on Facebook about Noam Chomsky's essay, Who Owns the World?, in which I stated, "The only way the people will matter once more is through a revolution from below."
BTW, your third-from-last and last paragraphs are spot on.
AA- JD,
"OTOH, I don't think that global supply-and-demand will allow higher wages to happen. It is far too easy for corporations to shift jobs and take advantage of lower wages elsewhere around the world."
Good point, but that alternative is only available to these MNC's (multi-national corporations) because they've spent millions in lobbying for free-trade agreements and other legislation that allows them to undercut American workers by moving overseas.
If on the other hand, politicians began looking out for the interests of their constituents, they would make it cost-ineffective for corporations to go overseas.
The Shariah would result in a more ethical capitalism as opposed to the more ruthless free-market version that is operating nowadays (however, its not so 'free-market' when the bankers need a bailout, eh?) :-)
Assalamu alaikum,
Nice to see some more wonderful posts from you Mash'Allah! I'm just now learning more about Islam's economic system and agree with you about the beneficence regarding this particular aspect. I believe also people endlessly falling into debt traps wouldn't happen if we weren't living extremely shallow materialistic lifestyles where what you want precedes what you need.
So while it's sometimes unavoidable to get into debt (like if you don't have cash on hand and you really need to buy food), alot of times people wind up purchasing too much of what they don't need and really can't afford through credit.
AA- R,
Thanks for the comment. I too would hope that in a Shariah-run system, crass consumerism would become a historical footnote by introducing tax laws that would encourage savings and legislation that would discourage the obscene levels of advertisment.
Not sure how that would ever come to fruition, but acknowledging the unsustainability of the current system is a good first step.
The whole currency system doesn't make sense at all. Money is just an IOU that the governments promise to pay back to the Reserve banks. It's created out of thin air.
I don't believe that even if people were payed higher wages that it would help the situation because than there would just be higher inflation, more loans would be taken out to cover needs and again higher inflation upto a point that there could be hyperinflation.
The only currencies that make sense are gold and silver, because a few people do not have complete control over their value
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