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Archive for the ‘Economy’ Category

The Cost of Living and Wages

Posted by Henric C. Jensen on June 30, 2007

It is often reported in the news that someone living in this or that country earns this or that much in US$ or UK£ – and it often turns out that the sum is pitiful small – but is it really? Doesn’t the value of money in this sense depend on what you have to pay for the daily necessities? Is it then fair to make the comparison to US$ and UK$£?

Isn’t that a kind of discrimination? I think so.

Think about it: 1 USD = 2.00811 GBP = 40.5000 INR – why not compare to actual living costs in the country instead? By comparing Cost of Living Indexes, instead of the numbers on money.

Let’s look at the examples above from the point of Cost of Living – in the US, UK and India – US was at 77.6, the UK at 85.3 and India at 64. Now this puts things into perspective, doesn’t it? The science here is sound – the numbers represent an average of the cities in each of the example countries that made it to the World Cost of Living Rankings 2006 – a list of 144 cities.

It can certainly be argued that wages in India are lower than those in the US and UK – but that should be compared to the cost of living, no to the value of money in the US and UK for an idea of what the real relation is.

“Food is extremely cheap unless you need certain foods which must be imported which will cost you triple of what it cost in America. Generally speaking if you owly buy India products then what cost $10.00 in America will cost approx. $1.00 here. Over the last 6 months the cost of living in Indian has increased about 15% because the $ on the exchange market is decreasing daily. One year ago the exchange rate was 46rps = $1.00 US but today it is 40rps per $1.00.Gasoline is around $4.50US per gallon. Local transportation (bus, train, air travel is cheap compared to America). Electricity is extremely cheap compared to American prices.” (From Yahoo Answers.)

What I am trying say here is that while the wages in India are low, so is the cost of living. It is not as low as it could be in comparison with the wages, but those are not comparable to those in the US or the UK. And to claim that is not right, because it gives the wrong image of India and any other country that is compared in this manner.

Posted in Economy | Tagged: | Leave a Comment »

Erradicating Poverty

Posted by Henric C. Jensen on June 29, 2007

Capitalism needs poverty. It is the poor who run the machinery. So there must be an end to capitalism. The best way to do this is to stop supporting corporations. We have to think more small business and more local production, especially of clothing and food.

Empowerment is making people know what is going on. An informed population is a dangerous one for the bourgeoisie. It is the ultimate cog breaker in the enormous capitalist chain.

Bartering and other money-alternate activities are also very essential, as is living a simple and sane lifestyle.

After people are able to alleviate poverty in their own communities, they will be so much more useful in global poverty eradication. Ted Kouretas in a discussion on Erradicating Poverty

My Reply to him:

When I read your post, Ted, I am reminded of the concept of Tzedakah – just distribution of societal resources to all. The simple and functioning base for Marxism.

Look at Grameen bank – it works. Indian women are slowly erdicating not just their own poverty, but others’ too – and why?

Because someone came up with the brilliant idea to accept the risk of loosing money by lending money without security. And for what? To start businesses that will make them both self-supporting and the producers of goods that is needed in their local community, as well as the inspiration for other to make similar ventures.

According to the Concept of Tzedakah, the highest level of Tzedakah is making someone self-supporting.

It strikes me that most large corporations today started out in someone’s garage with money from someone wealthy, that believed in the principle of Tzedakah.

What Grameen Bank does is believing in their customers’ ability to make something of the money they lend them, not their ability to pay those money back.

Same thing with Microsoft and the UN and the green computers for Africa – Knowledge is power, by educating teachers, so they can educate in Schools and providing functioning cheap computers they are empowering people.

This wouldn’t work if it hadn’t been for capitalism. It wouldn’t have worked if some had had their money seized in an attempt to erradicate capitalism.

It is far better to make people self-supportive and let them decide for themselves that passing that gift on to others will in the end create a society where we have not only financial, but also social justice – for all, also the capitalists.

To me this is all about ethics, about building a chain of “passing it forward”. Don’t thank me – pass it forward.

And this goes not only for monitary matters – it goes for everything. Each individual has something that is valuable to someone else, that is needed in the greater scheme of things. Even those that seemingly “take” are contributing something to the greater picture. Seeing that is all about ethics and the idea that we are all equals.

Some people don’t like my ideas about Tzedakah, because they believe that they are based in Judaic tradition – well they are, but they could just as well have been taken from Secular Humanism or Ethical Atheism.

Economic Justice, Tzedakah, Marx and where Marxism fails.

The Concept of Tzedakah

“Capitalism needs the poverty”.

No. Capitalism in it’s purest and most unbridled form needs consumers – consumers come from both the rich and poor sections of Society. Without a continuum in the chain of supply and demand Capitalism would be pointless. If there is no demand, Capitalism must either create such a demand or lower the price on the supply of whatever product it is wishes to capitalize on in order to survive.

It is therefore up to us, the consumers, regardless of our economic status, to inform Capitalism what direction we want it to take in it’s production. We make the choices.

Refusing to buy products that have been produced in countries and areas where work and wages do not meet the needs of the workers or violate their human rights is the ethical choice.

Franklin D. Roosevelt said it this way: “No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.” this should go for any nation and any corporation/business, not just the US and large corporations.

If a corporation cannot safe-guard the quality of the environment for it’s workers and pay them wages they can live and prosper from, because to do so would mean bankruptcy, that corporation has forfeited it’s right to stay in business.

“The best way to do this is to stop supporting corporations.”

No. The best way to do this is to make sure that corporations that do not follow ethical guidelines along the lines of what is Human Rights, Living Wages and Workers Rights are forced out of business and to reward those corporations that do produce their goods from an ethical stand-point.

An example of this is ecological farming vs non ecological farming. If ecological farming is rewarded through subsidies, so it can produce at a lower cost, and non ecological farming is penalized through taxation and limitations, non ecological farmers will switch to ecological farming.

“Empowerment is making people know what is going on.”

No. You empower people by giving them choices and information so they can make informed choices – knowledge is worthless if you cannot put it to use in your own life. Forcing people to see things your way is only going to make them resentful.

“After people are able to alleviate poverty in their own communities, they will be so much more useful in global poverty eradication.”

True, but only if they are allowed to choose for themselves how and what. People without choices – also to own their land and get an income from that land – are no more powerful or happy than a slave.

Posted in Economy | Tagged: , | 2 Comments »

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