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And disincentivize people from working? That's not a sustainable economic system. For a properly sustainable system, consider how Islam solved this problem ove

And disincentivize people from working? That's not a sustainable economic system. For a properly sustainable system, consider how Islam solved this problem over 1400 years ago. Zakat is the only form of "tax" if you will that is mandated. Interest and other predatory practices are prohibited (e.g. shorting). Once the fundamentals are correct, everything else naturally falls into place. It has been reported that during the rule of Umar II, there were no poor people left in Iraq to accept Zakat (charity) since everyone paid their share. It would be nice to see that happen again, but the modern financial system won't let it happen.

PaulDavisThe1st 6y ago
One might argue that having $1B of assets (certainly liquid assets) is a fairly major disincentive to working. High marginal tax rates on super-high levels of income and/or wealth doesn't discourage working. It just makes doing something to add another chunk to your income/wealth require something other than financial renumeration. There's plenty of evidence that humans do their best work when they have intrinsic and not extrinsic motivation. Bezos is a case in point. I believe him to have an almost absurdly high level of intrinsic motivation (I worked with him for 15 months). He might like the wealth he has, but the things he will continue to do with his life, just like Amazon itself, get done for reasons beyond money.
- gher-shyu3i 6y ago
  First, I really appreciate your response :) > High marginal tax rates on super-high levels of income and/or wealth doesn't discourage working. Do we have precedence for this? From what I'm aware, even when the US had high marginal tax rates which some dems seem to be calling to bring back, no one ever paid those rates because there are always ways for the very rich to reduce their income on paper, while still increasing their wealth. I do agree with you that it takes a very special kind of person to have the wealth of Elon or Bezos and still continue to want to work, it's obviously more than money at that point. But those people are outliers. I know I wouldn't be motivated to spend more effort if it meant a proportional decrease in the total amount of money I would end up pocketing due to increased taxes.
fossuser 6y ago
Worse than disincentivizing people from working, it disincentivizes people from risking money on growth (building companies, doing startups, angel investing). Interest isn’t predatory, it encourages growth and investment in building businesses. Look at the enormous wealth created by capitalism. Economic growth helps the most people the fastest, this model works. That doesn’t mean there shouldn’t be protections on the lower bound and human rights, there should be. It also doesn’t mean there shouldn’t be environmental protections or regulations to effectively coordinate and prevent tragedy of the commons style failures. We should also prevent wealth being able to leverage political power (which isn’t easy).
- gher-shyu3i 6y ago
  > Interest isn’t predatory It is by the very fact that the lender is owed money in the contract by doing basically nothing. Proper investment balances the risk between parties, so that one party does not have an inherent advantage over the other. This is part of running a moral and just society. > Look at the enormous wealth created by capitalism Red herring. The system is fundamentally unstable, by the very fact that people are on the lookout for the next economic crash because it's built into the system. When that happens, people with money are able to acquire even more assets, increasing the divide. I'm all for people making money, as long as they do it the moral way. Interest is immoral and predatory.
  - fossuser 6y ago
    The lender is paid for the service of lending money out (which incurs risk). You want to incentivize this behavior. Without interest, it would be harder for people to get loans. Lots of financial services wouldn’t exist (or would demand some other form of payment). This would keep people who aren’t already rich unable to access capital. People react to incentives, good incentives lead to beneficial behavior. Interest is extremely net positive, both for lenders and for borrowers (and society). Everyone wins. Crashes aren’t really built into the system or a fault of capitalism, they happen because problems are hard to predict and the environment changes. The wealth created isn’t only for the rich: https://press.stripe.com/#stubborn-attachments https://press.stripe.com/#stubborn-attachments everyone benefits from economic growth. I think Islamic law (or really any religious framework) has very little of value to say on the topic of morality or running a productive society.
ibn_khaldun 6y ago
As salaamu alaykum, I enjoy reading your discourses in support of Islaamic economics. Do you have a blog, email or social media account? Wa salaam.
- gher-shyu3i 6y ago
  Wa alaikom assalam, Thank you brother. Please feel free to reach out to me at zmadaniia@gmail.com
selimthegrim 6y ago
Umar II is the one Umayyad caliph whose tomb wasn't sacked by the Abbasids when they took power. Would you care to enlighten us as to how this system went so wrong (Hint: it was Arab Muslims accumulating property and wealth over non-Arab Muslims, let alone non-Muslims)

PaulDavisThe1st 6y ago

One might argue that having $1B of assets (certainly liquid assets) is a fairly major disincentive to working. High marginal tax rates on super-high levels of income and/or wealth doesn't discourage working. It just makes doing something to add another chunk to your income/wealth require something other than financial renumeration. There's plenty of evidence that humans do their best work when they have intrinsic and not extrinsic motivation. Bezos is a case in point. I believe him to have an almost absurdly high level of intrinsic motivation (I worked with him for 15 months). He might like the wealth he has, but the things he will continue to do with his life, just like Amazon itself, get done for reasons beyond money.

gher-shyu3i 6y ago
First, I really appreciate your response :) > High marginal tax rates on super-high levels of income and/or wealth doesn't discourage working. Do we have precedence for this? From what I'm aware, even when the US had high marginal tax rates which some dems seem to be calling to bring back, no one ever paid those rates because there are always ways for the very rich to reduce their income on paper, while still increasing their wealth. I do agree with you that it takes a very special kind of person to have the wealth of Elon or Bezos and still continue to want to work, it's obviously more than money at that point. But those people are outliers. I know I wouldn't be motivated to spend more effort if it meant a proportional decrease in the total amount of money I would end up pocketing due to increased taxes.

fossuser 6y ago

Worse than disincentivizing people from working, it disincentivizes people from risking money on growth (building companies, doing startups, angel investing). Interest isn’t predatory, it encourages growth and investment in building businesses. Look at the enormous wealth created by capitalism. Economic growth helps the most people the fastest, this model works. That doesn’t mean there shouldn’t be protections on the lower bound and human rights, there should be. It also doesn’t mean there shouldn’t be environmental protections or regulations to effectively coordinate and prevent tragedy of the commons style failures. We should also prevent wealth being able to leverage political power (which isn’t easy).

gher-shyu3i 6y ago
> Interest isn’t predatory It is by the very fact that the lender is owed money in the contract by doing basically nothing. Proper investment balances the risk between parties, so that one party does not have an inherent advantage over the other. This is part of running a moral and just society. > Look at the enormous wealth created by capitalism Red herring. The system is fundamentally unstable, by the very fact that people are on the lookout for the next economic crash because it's built into the system. When that happens, people with money are able to acquire even more assets, increasing the divide. I'm all for people making money, as long as they do it the moral way. Interest is immoral and predatory.
- fossuser 6y ago
  The lender is paid for the service of lending money out (which incurs risk). You want to incentivize this behavior. Without interest, it would be harder for people to get loans. Lots of financial services wouldn’t exist (or would demand some other form of payment). This would keep people who aren’t already rich unable to access capital. People react to incentives, good incentives lead to beneficial behavior. Interest is extremely net positive, both for lenders and for borrowers (and society). Everyone wins. Crashes aren’t really built into the system or a fault of capitalism, they happen because problems are hard to predict and the environment changes. The wealth created isn’t only for the rich: https://press.stripe.com/#stubborn-attachments https://press.stripe.com/#stubborn-attachments everyone benefits from economic growth. I think Islamic law (or really any religious framework) has very little of value to say on the topic of morality or running a productive society.

ibn_khaldun 6y ago

As salaamu alaykum, I enjoy reading your discourses in support of Islaamic economics. Do you have a blog, email or social media account? Wa salaam.

gher-shyu3i 6y ago
Wa alaikom assalam, Thank you brother. Please feel free to reach out to me at zmadaniia@gmail.com

selimthegrim 6y ago

Umar II is the one Umayyad caliph whose tomb wasn't sacked by the Abbasids when they took power. Would you care to enlighten us as to how this system went so wrong (Hint: it was Arab Muslims accumulating property and wealth over non-Arab Muslims, let alone non-Muslims)