Malik Abu Luqman

Does coffee give you an edge in math?

Michael Pollan suggests as much, citing Wolfgang Schivelbusch:

“The Islamic world at this time was in many respects more advanced than Europe, in science and technology, and in learning. Whether this mental flourishing had anything to do with the prevalence of coffee (and prohibition of alcohol) is difficult to prove, but as the German historian Wolfgang Schivelbusch has argued, the beverage “seemed to be tailor-made for a culture that forbade alcohol consumption and gave birth to modern mathematics.”

Source: Pollan, Michael. This Is Your Mind on Plants (p. 105), 2021. Penguin Publishing Group. Kindle Edition.

Who won and who lost the Great Cola Wars?

We lost and Big Soda won:

"...what few outside the companies realized was that winning or losing was immaterial: In each of those decades, the sales of Coke and Pepsi both went up. Roger Enrico, the CEO of PepsiCo, was the first to let slip that, in reality, the Great Soda War caused neither company to shed much blood.

“If the Coca-Cola Company didn’t exist, we’d pray for someone to invent it,” he wrote in his 1986 autobiography, The Other Guy Blinked. “You see, when the public gets interested in the Pepsi-Coke competition, often Pepsi doesn’t win at Coke’s expense and Coke doesn’t win at Pepsi’s. Everybody in the business wins. Consumer interest swells the market. The more fun we provide, the more people buy our products—all our products.”

Source: Moss, Michael. Salt Sugar Fat (pp. 166-167). McClelland & Stewart, 2013. Kindle Edition.

Did you know refers to costs as "demand creation expenses"?

Is Amazon that much worse than Walmart?

Not so much: both end up owning the marketplace, one in the online space and the other physically.

As noted in the post below, Walmart uses its market power to force supplies to submit. If you want to get stocked in the #1 retailer, you need to pay up or else. As reported in the WSJ:

“Wal-Mart is pushing hard to lower prices to compete. Executives at the world's largest retailer by revenue have told suppliers that its prices should be 15% lower than competitors' 80% of the time."

Studies have also shown that Walmart is the king of efficiency. But hold your applause, it doesn't turn out to be a good thing. When it comes into a market, there is a net loss of jobs:

A study published in 2008 in the Journal of Urban Economics examined about 3,000 Walmart store openings nationally and found that each store caused a net decline of about 150 jobs (as competing retailers downsized and closed) and lowered total wages paid to retail workers."

So it's efficient, but that efficiency goes to the shareholders, not the society.

And like Amazon, they reduce the ability of the market to accommodate a number of small players. Amazon literally owns the online marketplace: there is no alternative to sell one's goods. But the "Walmart effect" is similar: Walmart today runs 5,229 stores across the United States, the equivalent of many tens of thousands of 1950s-era stores.

Either way, the overall space for the small business is steadily squeezed out of existence.

Islamically, the answer to monopolization is to force businesses to compete on their merits rather than their premier access to capital markets.

For more check out:
https://www.freshonomics.org/blog/2021/1/6/walmartpaytoplay

Is the Real Wolf of Wall Street?

WSJ reported that: "Merchant groups are forming a national coalition to campaign for stricter antitrust laws, including measures that could force Amazon.com Inc. to spin off some of its business lines...The groups, which collectively represent thousands of businesses, want federal legislation that would prevent the owner of a dominant online marketplace from selling its own products in competition with other sellers, a policy that could effectively separate Amazon’s retail product business from its online marketplace."

WSJ had reported earlier how Amazon uses the data of its “partners” against them. Although Amazon has rejected such claims, WSJ has found evidence to the contrary:

“…interviews with more than 20 former employees of Amazon’s private-label business and documents reviewed by The Wall Street Journal reveal that employees did just that. Such information can help Amazon decide how to price an item, which features to copy or whether to enter a product segment based on its earning potential, according to people familiar with the practice, including a current employee and some former employees who participated in it”

In the link, below I outline how Amazon used this tactic to ruin a small business – who at one time was making $3.5 million in sales per year.

What does Wall Street have to do with Amazon?
Amazon was made by Wall Street: without a +half-billion infusion of capital, they wouldn’t have survived the dotcom meltdown in 2000.

Islamically, there are no capital markets: no stocks, no bonds, and exotic financial markets.

For more check out this post:
https://www.freshonomics.org/blog/2021/1/9/amazonwolf

What's the link between worshipping Allah (swt) and the economy?

RasulAllah (saw) warned us that the overwhelming nature of poverty. He warned us to "Race to do good deeds" before we are struck by "poverty that makes you forget".

And currently, poverty is a catastrophe. According to Oxfam, those "living in poverty could have increased by between 200 million and 500 million in 2020."

So how can these people focus on Allah (swt) if they see their children cry out of hunger? When their own stomachs fill with pain because they do not have to eat? Where do they pray, when they have no house?

There is no way to separate worship and doing good deeds from the economy. A functioning economy according to what Allah (swt) has revealed will address the danger that RasulAllah (saw) warned us about, in sha Allah.

For on how Islam will address poverty, please see
https://www.freshonomics.org/blog/2019/1/23/5-ways-islamic-economics-can-address-oxfams-findings-of-wealth-inequality

Anas ibn Malik reported: The Messenger of Allah, peace and blessings be upon him, said, “Allah Almighty said: O son of Adam, if you call upon Me and place your hope in Me, I will forgive you without hesitation. O son of Adam, if you have sins piling up to the clouds and then ask for My forgiveness, I will forgive you without hesitation. O son of Adam, if you come to Me with enough sins to fill the earth and then you meet Me without associating anything with Me, I will come to you with enough forgiveness to fill the earth.”

[Tirmidhi]

Better off working at Sachs?

Think again.

Here are some the quotes from junior analysts:

“The sleep deprivation, the treatment by senior bankers, the mental and physical stress…I’ve been through foster care and this is arguably worse”

“What is not ok to me is 110-120 hours over the course of a week! The math is simple, that leaves 4 hours a day for eating, sleeping, showering, bathroom and general transition time. This is beyond the level of ‘hard-working’, this Is inhumane / abuse”

“There was a point where I was not eating, showering or doing anything else other than working from morning until after midnight”

So much for the glitter of Wall Street.

The conditions highlight the all-but-forgotten idea that labour activists didn't see much difference between chattel slavery (i.e. being owned by a master and being beholden to him for one’s welfare) and wage slavery (i.e. being beholden to one's employer for one's welfare).

As American historian Eric Foner, points out in "Free Soil, Free Labor, 19th century Americans saw employment as follows:

"...do not complain of wages slavery on account of the poverty it occasions...They oppose it because it holds the laboring classes in a state of abject dependence upon capitalists."

What the labour activist is highlighting is the reality which every working person knows all too well, that a better paying job does not emancipate oneself from unfulfilling work and the whims of one's employer

For more see here:
https://www.freshonomics.org/blog/2016/8/16/policy-32-need-capital-not-jobs

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With Church out of the way, has Capitalism paved the way to economic justice?

Not a chance. And not to the average Canadian. Though no one is selling indulgences today, one can hardly say there is justice for all. According to a Justice Canada publication, less than 10% of Canadians turned to the system to resolve their issues. More than 60% avoided the system by taking no action or resolving the problem on their own.

Professor Suzanne Chiodo at Western Law points out that “cost, delay, and inaccessibility endemic to [the Ontario] civil justice system”.

Simply putting things online won’t change the underlying dysfunction, despite some officials claiming how quick legal system “modernized… by about 25 years in 25 days”.

Her paper is a great summary of the situation. I extracted the following 3 insights.

#1 A Canadian household must risk 50% of its annual income to take something to trial: As the author writes: “The average fees for a two-day trial in Canada were $31,330 in 2015 (they would undoubtedly be higher today). The median after-tax income of Canadian households in 2019 was $61,400. A household must risk half of its annual income just to proceed to trial in a legal matter.”

#2 In Ontario, it takes more than 2 ½ years to dispose a civil case: That’s 904 days, which is nearly 40% longer than it took 4 years ago. It takes about 435 days or over 14 months to resolve small claims. This is double what it used to take 4 years ago.

#3 Canada ranked 100th out 189 countries for contract enforceability: This measures the “[t]ime and cost to resolve a commercial dispute and the quality of judicial processes”. Higher score than India (ranked 163) or Pakistan (156), but far behind Turkey (24), Malaysia (35) and Mexico (43). I’d be the first to tell you that there’s a problem with the way such colonial institutions look at things. But that’s precisely the point: Canada is a settler-colonial nation and it’s doing well according to its own measures.

For more check out this post:

https://www.freshonomics.org/blog/2021/3/22/can-it-be-that-bad-a-look-at-how-expensive-your-day-in-court-can-be

If Capitalism is so great, why did it fail to prepare for the pandemic?

That's where I would start when responding to the WSJ's OpEd: "Capitalism Is What Will Defeat Covid"

Epidemiologists, like Dr. Mike Osterholm, have been ringing the alarm for a while (see his 2005 Foreign Affairs article and his 2017 book 'Deadliest Enemy: Our War against Killer Germs'). But Capitalist companies did not “invest” in pandemic preparedness. They ignored the science, spending $1 trillion on stock buybacks instead (in 2019 alone).

And why are the top 10 causes of death mostly health/diet related?

Because it’s profitable to make us /unhealthy. And the Capitalists know it.

In 1999, Michael Mudd (Kraft's VP of communications back then) presented to heads of food companies in North America, including Coca-Cola, Kraft and Nestle Canada, "demonstrating the link between processed food and diseases such as cancer and heart disease."

The Capitalists are unparalleled in trying to distort reality. They can shamelessly praise the system that completely failed to protect the people. Americans are lining up for food banks, millions are on the brink of eviction and they had to generate billions of dollars to paper over their problems. And yet, they can claim victory.

For links see: www.freshonomics.org/blog/capitalistfat

How would RasulAllah’s (ﷺ) treatment of salt save lives?

You’re probably thinking it’s diet, but it’s driving.

In the US, “1300 people die in car accidents due to snowy, slushy, or icy pavement, with another 117,000 injured. Snowy weather is also a huge waste of time and money, costing roughly $500M a day, and 544 million vehicle-hours a year of delay. Road salt doesn’t eliminate this problem entirely, but it comes close, reducing collisions by up to 88% and injuries by 85%.”

But in Capitalism the insatiable desire for profits has resulted in the monopolization of the companies that mine salt. Matt Stoller (who I quoted earlier) writes that “…ex-convict and junk bond king Michael Milken’s alleged private equity firm, Stone Canyon, bought two major salt producers over the last year.” The latter was worth $3.2 billion.

Milken’s consolidations will reduce suppliers of salt from “4 to 3 and in some geographies from 3 suppliers to 2.”, which will not just gouge the average consumer, but also municipalities in Canada and the US who need the salt to the winter roads.

So, what’s the link to RasulAllah’s (ﷺ) treatment of salt?

“Abyadh ibn Hammal came to the Prophet (ﷺ) and asked him to grant him a salt laden land and he granted it to him. And when he left, one person in attendance with the Prophet (saw) said, “Do you know what you granted him? You granted him the uncountable water (Al-‘udd)”. He (saw) then took it away from him.” [At-Tirmidhi]

In Islam, mineral wealth – salt, copper, gold, etc. – is commonly owned. No one company or individual – - Milken, Thiel or whoever – own ANY mine. Rather, the Khaleefah must administer such commonly owned resources to the benefit of the citizenry. That’s not just about salting roads. But also using the wealth generated to fund public goods, like health care, education, pandemic preparation and so on.

For more on this check:
https://www.freshonomics.org/blog/2017/9/10/policy-61-power-to-the-people

How do you turn $5.8 Billion into $4.4 Trillion?

In this post, we look at how the monopolies curbed legislation through lobbying. Anyone can lobby. But as with all things in democratic-Capitalism you got to pay to play. For example, Google was a critical funder of Obama in the 2012 election. According to WSJ, Google visited Obama “230 times, or an average of roughly once a week” from 2008 to 2015.

So is it a surprise that Google was not charged with anti-trust violations?

As reported in The Intercept: the "FTC commissioners took the unusual step of overriding their staff’s recommendation to sue, and voted to settle the case instead – the White House official even sought Google’s talking points in the matter.”

But how would Islam stop this?

#1 The rich can’t influence legislation.
#2 Islam is not a ball of wax that can be reshaped at will.
#3 It's an obligation to be an activist.
#4 Islam's approach to resolving legal matters.

For more details on each of these 4 measures, check out this post:
https://www.freshonomics.org/blog/2021/3/14/the-logic-of-lobbying-how-do-you-turn-58-billion-into-44-trillion

Imagine a ruler that would send in the army to collect asset taxes?

That's what Abu Bakr (ra) did.

When he was the Khaleefah some people thought they would stop paying the zakat. They would continue to pray but they would not pay the 2.5% asset tax, they used to pay RasulAllah (saw). They thought wrong.

When Umar bin Al Khattab (ra) questioned Abu Bakr (ra) about fighting such people, he firmly stated his stance:

"I swear by Allah that I will certainly fight with those who make a distinction between prayer and zakat, for zakat is what is due from property. I swear by Allah that if they were to refuse me a rope of camel (or a female kid, according to another version) which they used to pay the Messenger of Allah, I will fight with them over the refusal of it. " [Tirmidhi]

And what's the situation in Capitalism? You buy the legislator through lobbying: for $1 the wealthy spend on lobbying they get $760 in revenue.

But that's not all. They also buy the judge. When the American elites wanted to stop oversight from Consumer Financial Protection Bureau (CFPB), they bought $68 million worth of testimony to get the Supreme Court system to "deliver[ed] wins for the corporate and partisan interests".

It is only the Khilafah System that can stand up to the rich. It is only the Islamic Legal System that can withstand the man-made manipulation we see in Capitalism. It is only through the Islamic system that we can get economic justice.




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If a lot of Capitalism is bad, can a little of it be good?

Such is the problem : corporations who follow the mantra of " " end up becoming a problem.

In the US, the problem of monopolies is known. Using the anti-trust legislation, like the Sherman Anti-Trust Act, Standard Oil was broken up into smaller companies. In 1945, the US government failed in breaking up the Alcoa aluminum monopoly. However, it forced Alcoa “to license its patents on a royalty-free basis to competitors”. The government also provided financing to Alcoa’s competitors “that resulted in the emergence of Reynolds and Kaiser as aluminum powers”.

Fast forward to today and we see that monopolies take a cut of almost everything we do daily.
As noted in this post, the tech monopolies dominate our lives:
* dominates search at 90% of the market
* has over 70% of the social media market.
* has over 75% of desktop OSes
* controls 60% to 80% of the e-book market and 64% of regular books.

So why has failed to reign in ? Or was anti-trust legislation passed to ensure people didn't go ?

Read this post to see 4 reasons why:

https://www.freshonomics.org/blog/2021/3/9/why-has-capitalism-failed-to-solve-the-monopoly-problem-a-look-at-4-key-reasons

How do corporations kill the wage?

It is part of the Corporate DNA: corporations will pay you as little as possible to maximize profits and more importantly shareholder value.

But as I explain in my latest post, the real trick lays in the ability of companies to use the stock market to create monopolies. For example, Delta was able to use its "bank-like-powers" to issue shares and effectively use that as a currency to buy out a rival.

What happened to the wage of Delta flight attendants?

Check out the latest post to find out.

https://www.freshonomics.org/blog/2021/3/7/cheap-inc-why-must-corporations-pay-you-as-little-as-possible

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Can you imagine the US is projected to be $133 trillion in 2051?

WSJ also noted: "Net spending on interest will triple relative to GDP in the two decades leading up to 2051, and spending on programs such as Social Security and Medicare will also rise."

Odd way of running an economy?

If there's a shortfall in need (social security) or people getting ill/old/etc (health care), the rich don't pay from their excess wealth to help. Rather, they loan the money.

And don't blame the Chinese or whoever. Foreigners do NOT loan most of the money. That's right, only 30% of the debt is foreign-owned. The remainder is American as apple pie.

Does that really make sense?

We can blame greed, but the root goes back to how the US government was set-up to protect the "minority of opulent" from "symptoms of a levelling spirit". Meaning the system was designed to ensure that those who have excess wealth do not pay their fair share.

What if people advocated for an asset tax, like Zakat, which taxes 2.5% of assets? What would rich people like Bezos pay?

Check out this post, where I explore that very question:
https://www.freshonomics.org/blog/2017/7/27/policy-52-trump-v-buffet-who-would-pay-more-zakat

Of course, this is more of a thought experiment to understand how unfair things are. The only system that can implement a fair taxation system is the Khilafah State.

What are 'Blood Bitcoins'?

They are the mined with the blood of in East Turkestan, referred to by the press as Xinjiang.

Bloomberg reported that: "Almost a quarter of Bitcoin is produced in China’s Xinjiang...There’s a pretty good chance that any new Bitcoin generated after the cryptocurrency’s Elon Musk-aided surge toward $50,000 will be sourced using cheap coal power in China’s Xinjiang....The region that’s become notorious in recent years for complaints about abuse of Uyghur Muslim minorities is also a hub for the production of Bitcoin. Nearly two-thirds of global output took place in China as of April 2020, according to University of Cambridge researchers, and about one-third of that occurred in Xinjiang."

Bitcoin was launched right after the 2008 financial meltdown. Activists hoped that this time it would be different. They hoped that bitcoin would offer an alternative to the Capitalist banking system, which enables the rich to get richer and leaves the 99% behind.

But here we are.

Today, generating bitcoins is no different than any other economic oppression delivered by the Capitalist system. It's the same system that came up with su***de nets. Don't raise wages. But install nets to catch the workers who jump off the building to avoid the mess they make on the way out.

And then there is the support to the brutal Muslim dictators. Whether it's Sisi, MBS, or Assad, the powers want to ensure these regimes stay in power to ensure that the Muslims don't break out to establish an alternative to the Capitalist system. That way the oil in the Muslims, like the cheap coal in East Turkestan, remains in the hands of the 'vile Masters of Mankind'.

can't be reformed by half-measures. The labour activists in the 1900s thought they could achieve peace with the Capitalists, only to be crushed by globalization a few decades later.

Capitalism can't be reformed. It must be replaced.

One of the keys to a just economic system is a just ruler. The key to a just ruler is taqwa God-consciousness. Capitalism has proven that fear of the people is no substitute for this.

Prophet Muhammad (saw)

"No one who is placed in leadership over 10 or more, then does not act justly between them, except that on the Day of Judgement he is brought in shackles and chains" (Hakim; see below for the commentary on this hadith)

But did this type of thinking affect the Islamic leadership?

We can look to ‘Umar Ibn ‘Abdul Aziz, the fifth rightly guided Khaleefah (Caliph) to see the impact of this hadith.

‘Umar was shaken by his appointment and although he had acted justly in his life, before this he was accustomed to an extremely lavish lifestyle as lived by the Ummayah household. However, his appointment had a radical effect upon him and the weight that he now felt upon his shoulders made him change into something that would be spoken about for over a thousand years.

Upon his appointment, the Khaleefah’s carriage was brought for him and he refused saying that his mule was sufficient for him. Al-Laith narrated: “When he became Khaleefah he started with himself and family and then the people of his household and he took from them their possessions and counted their wealth as Mazhaalim (acts of injustices that needed to be restored). He moved out of the palace and built a small house with two rooms. He freed his slaves and returned any wealth and property that he had attained due to privileges to the Bait Al-Maal. He approached his wife Faatimah who had jewellery that was given to her by her father which no one had seen the like of and he said to her: ‘Either you return this to the Bait ul Maal or you permit me to separate from you because I cannot stand for you and me to be in the same house (whilst you have it).’

So, it should be clear that can only be built on Taqwa (God-consciousness) and not the Capitalist idea that makes material value the core objective in life.



COMMENTARY ON THE HADITH

a. The hadith is general for anyone in a position of leadership, whether someone appointed as a leader with limited responsibility, or a governor, or the Imam of all the Muslims.

b. To be brought forward on the Day of Judgement in chains and shackles is to be brought forward in the same position as the disbelievers and hypocrites who are likewise chained and shackled on the Day that each will be accounted for their actions.

c. The meaning to act justly is to act according to the Quran and Sunnah, and correlates to the various verses in the Quran in Surah al-Maida where those who do not rule by what Allah سبحانه وتعالى has revealed are described as sinful, oppressors or disbelievers, and the explanation of those verses is famous and can be found in the books of tafseer.

(See: http://www.khilafah.com/daily-hadith-244/)

Did you know that malls were inspired by Disneyland?

In 1963, real estate developer James Rouse, who coined the terms "mall" and "food court", "described Disneyland as “the greatest piece of urban design in the United States today” (even while acknowledging that it was an amusement park".

Fast forward to today, Rouse's dream has become a nightmare. Malls tried to take it up a notch by actually becoming amusement parks.

But behind large-scale projects are large-scale loans.

WSJ notes how mall owners: "Pyramid and Triple Five have gone much further than other mall owners in adding grand spectacles to their biggest U.S. properties, racking up debt they are now having trouble repaying. Last year, three of their four big U.S. malls defaulted on some CMBS debt, according to Trepp; the fourth mall is delinquent on some local-government bills."

(Note to reader, remember those weird debt instruments, mortgage back securities, that they used to crash the economy in 2007-2008? Well, these guys used loaded on the commercial equivalents, "commercial mortgage-backed security". )

Their delinquencies on debt have gone up about 5-fold: "about 14% of $50.6 billion were delinquent at the end of 2020, up from 2.7% at 2019’s end."

Behind the children's laughter and smiles, lies an ocean of financial trouble. Interest-based debt grows exponentially, outpacing the underlying business model and causes such endeavours to eventually collapse in ruin. The smiles disappear, the laughter ceases and Capitalism's reality of "capital first" rears its ugly head.

But is it really limited to super-debt-charged malls?

Behind the smartphone lies ***denets of China, behind the suede shoes lies the of Bangladesh, and beneath the malls lies the broken bodies of the indigenous people - who were sacrificed a long time ago at the altar of Capitalism.

It's the dual nature of Capitalism that I find so disturbing: there is this Disneyland-like atmosphere in the movies, malls and music, but underlying it all is a brutality that is frightening.

For more on this checkout,
https://www.freshonomics.org/blog/2019/3/10/the-99-billion-pound-gorilla-in-the-room-mindless-materialism

Why can billionaires bilk old people through their electric bills?

New York Times reported:
"Scott Willoughby, a 63-year-old Army veteran who lives on Social Security payments in a Dallas suburb. He said he had nearly emptied his savings account so that he would be able to pay the $16,752 electric bill charged to his credit card — 70 times what he usually pays for all of his utilities combined. “There’s nothing I can do about it, but it’s broken me."

The NYT goes on to explain:
"For customers whose electricity prices are not fixed and are instead tied to the fluctuating wholesale price, the spikes have been astronomical."

Meanwhile, the billionaires are licking their claws as they dine on the savings of old people like Scott Willoughby. Roland Burns, the CFO of Comstock Resources, (a natural gas company) said to reporters:

"This week is like hitting the jackpot with some of these incredible prices...Frankly, we were able to sell at super premium prices for a material amount of production."

So what's wrong with this?

RasulAllah (saw) explained that a person should not be prevented from access fuel, such as natural gas. Energy resources, like water, must be commonly owned:

"The Muslims are partners in three, water, pastures and fire" [Ahmed, ibn Majah]

"Three are not prevented – water, pastures and fire" [ibn Majah]

The ijthihad of "fire" means that the energy resources must be shared. So when it comes to the reality of energy resources they are in the ground, air or water - all things which are by their nature common to society.

More broadly, society has a duty of care to its citizens to ensure that their basic needs are met. For example, Umar bin al-Khattab (ra) worked to bring in food to famine-struck Madinah from Egypt and Sham.

This is in sharp contrast to Capitalism. One person tweeted about Willoughby's plight as follows:

"This guy GAMBLED with a variable rate plan - we don’t bail out people coming back from Vegas with only the clothes on their backs cause they doubled down against the dealer - we shouldn’t bail out this guy!!!"

What made this person to be so brutal that he doesn't care about his fellow human being?

Capitalism trained him to think this way.

It's the mythology of the individual. People who spout such thoughts usually don't have a problem with billions upon billions poured into the defence budget because a society must collectively provide for the basic need of security. Similarly, society must ensure all basic needs of the people because - like security - it's needed to live.

Why else do the rich pour millions into advertising campaigns? Because the thoughts about HOW a society should work are commonly held.

For more on this, see this post:
https://www.freshonomics.org/blog/2017/10/9/policy63

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