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In the Name of God بسم الله

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  • Forum Administrators
Posted

Very insightful 5 min video

 

  • Moderators
Posted

The wealth inequality in America is strengthened and perpetuated by riba (interest), and this is the main reason the rich get richer and the poor get poorer, and this is increasing and I think there will be a revolution at some point, although I'm not sure when. 

Poor people in this country stay poor because when they want to do basic things, like buy a house or a car (something everyone needs), they need to borrow money with interest. So a house that they buy for $100,000 ends up costing them more than $200,000 after they pay the interest, and this is actually a good interest rate (3 to 5%) which isn't really available now. So they pay more, while this $100,000 goes to rich people who get this money for doing nothing while the poor person has to work 40,50,60 hours a week for decades just to pay this off. The rich person can then take this extra $100,000 which they don't need to live (while the poor person needs all their money to pay their basic expenses) and use it to make even more money. They buy assets like real estate, stocks, etc which all earn them even more money on top of the money they already have. 

The US, as a country, is set up in a way for rich people to earn the maximum amount from their investments (i.e. what they own) and to pay the minimum amount in taxes. Millionaires and billionaires pay a much, much smaller percentage of their income in taxes vs poor people. The people worst off are the middle class (those earning from $75,000 to $200,000 per year). They are taxed the most heavily, most paying about 34% of their income in taxes, while getting no social benefits, i.e. government benefits. They are not wealthy enough to hire expensive accountants who can show them how to pay almost no taxes. It is a system based on cheating, where the ones who cheat the most benefit the most and those who don't cheat get nothing. This is the definition of injustice. The only reason the US is the richest country in the world is because the system is set up for rich people to move their capital into the US economy in order to benefit themselves and the US government. The regular people in the US get no benefit from this money. 

  • Forum Administrators
Posted

When they labelled some societies as being capitalist they were being serious.

  • Such societies reward the owners of capital who can earn passive incomes either via rents, interest or dividends. To have been able to gain from the recent rises in gold prices and Nvidia stock etc. you needed to have the capital to invest in them.
  • So if you do not own capital you have a (financial) problem, others will do better than you.
  • There are solutions to acquiring capital e.g. not spending and saving. Collaborating with others can also work e.g. where you club together to buy a property instead of paying interest.
  • The problem many people face is that the way society is set up it encourages you NOT to save e.g. adverts for the latest products and easy credit.
  • It comes down to controlling the nafs.

All of the above does not challenge the other points about how American society loads the dice in favour of a tiny minority - I accept those points as being true. And the video shows that even if you play the capitalist game by the capitalist rules you can still end up doing much worse than the elites.

 

  • Moderators
Posted
5 hours ago, Haji 2003 said:

When they labelled some societies as being capitalist they were being serious.

  • Such societies reward the owners of capital who can earn passive incomes either via rents, interest or dividends. To have been able to gain from the recent rises in gold prices and Nvidia stock etc. you needed to have the capital to invest in them.
  • So if you do not own capital you have a (financial) problem, others will do better than you.
  • There are solutions to acquiring capital e.g. not spending and saving. Collaborating with others can also work e.g. where you club together to buy a property instead of paying interest.
  • The problem many people face is that the way society is set up it encourages you NOT to safe e.g. adverts for the latest products and easy credit.
  • It comes down to controlling the nafs.

All of the above does not challenge the other points about how American society loads the dice in favour of a tiny minority - I accept those points as being true. And the video shows that even if you play the capitalist game by the capitalist rules you can still end up doing much worse than the elites.

 

I was going to say the other part of the issue is constant and relentless promotion of consumerism amoung the poor and middle class. At the same time, this is the part that a person can control. They can't control the system (first post) but they can control what they spend their money on and not waste it on things which will not help them either in this life or the next. This promotion of consumerism is meant to keep the poor poor because any money they manage to get they will waste and they will never become owners or generate passive income so the rich will never have competition in that sense. 

  • Moderators
Posted
3 hours ago, Abu Hadi said:

so the rich will never have competition in that sense. 

No matter how frugal a poor or lower middle class (working class) person is, no matter if they get some small passive income, they will never be competition to the rich. It is not possible to earn a billion dollars in a lifetime without stealing from others.  

  • Advanced Member
Posted

So many communist talking points in this thread.

The cold hard truth is that if someone wants to be a millionaire in America, then there is nothing stopping them from becoming a millionaire other than their own personal choices.

  • Moderators
Posted
1 hour ago, Sabrejet said:

So many communist talking points in this thread.

The cold hard truth is that if someone wants to be a millionaire in America, then there is nothing stopping them from becoming a millionaire other than their own personal choices.

I see you've bought the propaganda. What do you gain from it?

Please give five examples of a person moving from poverty to wealth in the United States later than 2010. The only examples I can think of are either athletes, or rappers, and most of us just aren't capable of being a rapper or athlete, and their wealth is tenuous and comes at a steep cost.  

  • Advanced Member
Posted (edited)
17 minutes ago, notme said:

I see you've bought the propaganda. What do you gain from it?

Please give five examples of a person moving from poverty to wealth in the United States later than 2010. The only examples I can think of are either athletes, or rappers, and most of us just aren't capable of being a rapper or athlete, and their wealth is tenuous and comes at a steep cost.  

5? There are millions of such people, and most of them did not become millionaires by receiving an inheritance or robbing banks.

Look for "The Millionaire Next Door", and look up Ramsey Solution's study on 10000 millionaires. Contrary to popular perception, the top professions that end up being millionaires are not robber barons or Hollywood stars. They are your everyday engineers, lawyers, and even teachers.

The formula is pretty simple in America. Don't borrow money to buy stuff you can't afford. Don't borrow tens of thousands in student loans for useless degrees. Don't get 7+ year leases for cars that lose more than half their value within a few years. Invest slowly and systematically over a period of 20-30 years. Unless you are earning less than minimum wage, everyone is bound to end up being a millionaire. If they are not, they did something wrong.

Deca-millionaires and billionaires are different. You don't become a billionaire through slow and steady investing. There are no reasonable excuses for not being a millionaire or multi-millionaire though.

Edited by Sabrejet
  • Moderators
Posted
Just now, Sabrejet said:

There are millions of such people,

I don't think you and I are defining poverty the same.  Poverty is when a person's net worth is zero or less, and they have no resources to draw upon. These "millions of" people have come from middle and upper middle class backgrounds, not poverty.  

  • Advanced Member
Posted
1 minute ago, notme said:

I don't think you and I are defining poverty the same.  Poverty is when a person's net worth is zero or less, and they have no resources to draw upon. These "millions of" people have come from middle and upper middle class backgrounds, not poverty.  

Our definitions of poverty are pretty much the same. Keep in mind that I'm from a third world developing country (Pakistan). I have tasted real poverty. I have seen poor people rise up over a period of 20-30 years quite easily. I have seen people going from ~800 sq ft houses with no running water get 5500+ sq feet in 20-30 years.

It's even easier in America compared to Pakistan. In fact, these universal principals apply in almost every country, except for certain failed cases such as Afghanistan.

The main thing holding American's back isn't their working class background. It's their addiction to consumer credit, whether it's in the shape of student loans, car payments, or credit cards.

I'll post the American stock market graph here to make my point.

  • Advanced Member
Posted (edited)

https://www.macrotrends.net/2324/sp-500-historical-chart-data

Suppose you had invested a hundred dollars in the stock market in 1900. Even with events such as the Great Depression, two world wards, and the 2008 sub-prime mortgage crisis, you end up with ~11 million dollars in 2022, adjusted for inflation.

Is it so hard to see that a mortgage within your budget, combined with systematic investment in an IRA, will easily put you above a million dollars networth in a very reasonable timeframe?

This of course requires immense financial discipline, having a well defined budget for every paycheck, and basic common sense.

The poor are not getting poorer. The rich are getting richer, because capital generates capital. And anyone can get that initial capital.

Edit: A mortgage is a reasonable debt because you are building an asset (a house) that will appreciate in value over time. Not all of them are haram either like people erroneously assume.

Edited by Sabrejet
  • Moderators
Posted
53 minutes ago, Sabrejet said:

It's their addiction to consumer credit, whether it's in the shape of student loans, car payments, or credit cards.

Consumer credit is not available to poor people in the United States, with the possible exception of student loans, but even with the maximum permitted loan amounts students from impoverished families rarely can afford education and always are at a severe disadvantage over their middle class and wealthy classmates.  

I do not know how things are outside of the United States, where I have lived all my life. 

  • Advanced Member
Posted (edited)
2 hours ago, notme said:

Consumer credit is not available to poor people in the United States, with the possible exception of student loans, but even with the maximum permitted loan amounts students from impoverished families rarely can afford education and always are at a severe disadvantage over their middle class and wealthy classmates.  

It gets complicated because even though student loans are available to the poor in the United States, often times people have to work to support their parents and extended family and don't have the luxury of time to study. Also, in addition to the stress of school there is financial stress if a person works and goes to school.  

On another note, if someone made some mistakes in life and ended up with a criminal record during early years the person is ineligible for student loans. This makes it hard to turn ones life around for some. A significant amount of Americans revert to Islam in prison so I thought this should be mentioned. It is hard to get any job once one is released from prison much less a student loan.

Edited by Azadeh307
  • 1 month later...
  • Basic Members
Posted

Elon Musk is often cited as a good example of "rags to riches" man but this is false. His family already had significant wealth by the time he arrived in the US (millions in fact) and I think most people can agree that it's much easier to go from a millionaire to a billionaire than it is to go from poverty (or even middle class) to a millionaire.

A good book about all of this is "Capital in 31st Century" by Thomas Pikkety. The numbers are clear - vast majority of financial gains generated by the economy goes to the rich.

  • 1 month later...
  • Advanced Member
Posted

That 2% high income tier in US have almost the entire US economy that it gives an average of $565k per person.

https://www.visualcapitalist.com/top-10-countries-with-the-highest-wealth-per-person/

 

According to Forbes, 78% of Americans live paycheck to paycheck based on survey done in 2023.

https://www.forbes.com/advisor/banking/living-paycheck-to-paycheck-statistics-2024/

  • Advanced Member
Posted

Y'all america is doomed. If I was you I would have left to another country. High taxes, low wages, high medical service and education, and many more. 

  • Moderators
Posted
2 hours ago, Diaz said:

Y'all america is doomed. If I was you I would have left to another country. High taxes, low wages, high medical service and education, and many more. 

I agree.  But my people and my husband's people are here.  Family is important.  

  • Advanced Member
Posted
On 6/7/2024 at 4:03 PM, notme said:

That's why the rich have to keep the people divided. If we realized how badly they are using and abusing us, we'd revolt.

Yes. They use things like identity politics to keep the lower classes divided as it deflects all the attention away from them. We lowly peasants instead focus on tearing each other down over petty differences, lol.

  • Advanced Member
Posted
22 hours ago, Diaz said:

Y'all america is doomed. If I was you I would have left to another country. High taxes, low wages, high medical service and education, and many more. 

Taxes would not even necessarily be an issue if they were being used to fund things that better society like infrastructure, education, healthcare, etc. However, it seems that most tax dollars in the US go towards funding Israel and war.

  • Forum Administrators
Posted
11 hours ago, JannahLM said:

Taxes would not even necessarily be an issue if they were being used to fund things that better society like infrastructure, education, healthcare, etc. However, it seems that most tax dollars in the US go towards funding Israel and war.

The fundamental problem is political funding. This skews everything. Until restrictions are brought in on how much individuals and organisations can donate to American political parties - you'll have a system that allocates resources to those who pay the most, not those who vote.

There's also a set of other issues such as small state bias:

Quote

 

The root of the institutional imbalance is in the structure of the United States Senate. Our founding fathers were men of great foresight, but in drafting the constitution, they could hardly have imagined the chasm that divides today’s America between the fast growing, populous, increasingly diverse states along the two coasts and the more numerous, more homogenous, less densely populated, slower growing states in between.

Because the constitution allots two senators to each state, regardless of population, the senate has in recent decades taken on a decidedly small state bias. For example, California, the nation’s largest state, and Wyoming, the nation’s least populous state, both get two senators despite the fact that California’s population is eighty times larger than Wyoming’s.

 

https://www.brookings.edu/articles/the-challenge-to-democracy-overcoming-the-small-state-bias/

  • Forum Administrators
Posted
On 8/30/2024 at 9:19 AM, Haji 2003 said:

There's also a set of other issues such as :

 

Trump taking everything to a whole new level:

 

Quote

In 2017, the first year of the Trump administration, more than two-thirds of sales in Trump-owned or Trump-licensed buildings, tens of millions of dollars’ worth of property, went to anonymous purchasers. If any of the buyers were hoping thereby to influence the domestic or foreign policy decisions of the Trump administration, we will never know.

https://www.ft.com/content/0876ef7a-bf88-463e-b8ca-bd9b4a11665c

  • Moderators
Posted (edited)
3 hours ago, Haji 2003 said:

 

Trump taking everything to a whole new level:

 

https://www.ft.com/content/0876ef7a-bf88-463e-b8ca-bd9b4a11665c

What goes on behind the scenes as far as these things is much, much more than what any of us know about. That is one of the main reasons why we live in the world we live in and many decisions made by governments and wealthy individuals don't make any sense to us, given the information that we have. 

For example, it costs the US govt much, much more to 'support Israel', i.e. tens or hundreds of billions of dollars a year, vs what they get out of Israel (politically, economically, etc). Also, the majority of people in the US (in a recent poll) do not want the US govt sending money to Israel.

https://news.gallup.com/poll/642695/majority-disapprove-israeli-action-gaza.aspx

So if we lived in an actual Democracy (majority rule) or a Capitalist System (profit means everything) then supporting Israel would not happen. Yet it does, and the support, in terms of money, is getting stronger and stronger. So there is something going on behind the scenes that we are not aware of, and as a result of that thousands and thousands of children are dying in Gaza and other places. What we don't know about this is actually much more than what we know. 

Edited by Abu Hadi
  • Forum Administrators
Posted
2 hours ago, Abu Hadi said:

So if we lived in an actual Democracy (majority rule) or a Capitalist System (profit means everything) then supporting Israel would not happen.

 

In the following blog post, I argue why majorities will succumb to the power of minorities unless there is an active system of discrimination against the latter. Nowadays, such discrimination would be considered unacceptable. The post draws on work I did for my M.Phil dissertation many years ago, which drew on the academic literature in the anthropology discipline.

Quote

Buying and selling in the market place may provide advantages to minority groups at the expense of the majority. A State that represents the majority may need to act in order to address the imbalance in a manner that may seem on the face of it to be discriminatory.

 

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