1/2/2014 Capitalism: of the rich, by the rich and only for the rich

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Capitalism:oftherich,bytherichandonlyfortherich

The release of Oxfam's report on global inequality: 'working for the few,' reveals a number of damming

indictments upon capitalism and the developed world. Some of its findings are startling:

• The richest 85 people across the globe share a combined wealth of £1trillion, as much as the poorest 3.5

billion of the world's population.

• In the US, years of financial deregulation directly correlates with the increase in the income share of the top one

per cent, which is now at its highest level since the eve of the Great Depression;

• In Europe, austerity has been imposed on the poor and middle classes under huge pressure from financial

markets whose wealthy investors have benefited from state bailouts of financial institutions.

Despite the global economy reaching $72 trillion, the largest in world history and global trade worth $36 trillion,

(again, the largest in world history) never have so few been so rich and never have so many been so poor. The

Oxfam report is a chilling reminder of the depths of wealth inequality across the globe; widening inequality has

created a vicious circle where wealth and power is concentrated in the hands of a few, leaving the rest to fight

over crumbs.

Capitalism has failed in distributing wealth in any equitable manner. Even in the birth place of Capitalism and

today's epicentre, Europe and the US, wealth distribution remains a massive failure.

The dogmatic views of the free market and economic growth relegated wealth distribution to the invisible hand

that only liberals can see, the rest of the world, since such ideas were presented in 1778 by the god father of

capitalism, Adam Smith, still await the fruits of this obscure process. The trickle-down effect which was meant to

make wealth flow from the top to the bottom remains as elusive as ever and is in fact worse today then Victorian

Britain.

Richard Robbins in his award winning book 'Global Problems and the Culture of Capitalism' confirmed this

when he said "The emergence of Capitalism represents a culture that is in many ways the most successful that

has ever been deployed in terms of accommodating large numbers of individuals in relative and absolute

comfort and luxury. It has not been as successful, however, in integrating all in equal measure, and its failure

here remains one of its major problems."

One of the main reasons for this economic inequality is because the rich have huge influence upon political

leadership and political institutions. These have become undermined as governments overwhelmingly serve the

interests of economic elites to the detriment of ordinary people.

The Oxfam report recognizes the curse of capitalism – money and politics, "Since the late 1970s, weak regulation

of the role of money in politics has permitted wealthy individuals and corporations to exert undue influence over

government policy making."

It is money that should have been separated from politics rather than religion.

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1/2/2014 Capitalism: of the rich, by the rich and only for the rich

http://www.khilafah.com/index.php/the-khilafah/economy/17992-capitalism-of-the-rich-by-the-rich-and-only-for-the-rich 2/3

The rich have been able to preserve such a status quo as the lowest tax rates, the best health and education and

the opportunity to influence are handed down to their children. Without a concerted effort to tackle inequality, the

cascade of privilege and of disadvantage will continue down the generations. Economic growth today amounts to

little more than a 'winner takes all' windfall for the richest."

Capitalism has no solutions to wealth distribution, more economic growth, changing tax regimes and tackling tax

avoidance are merely skirting around the real issue. This is a systemic issue and merely reforming capitalism

will just perpetuate the problem. Despite describing the inequalities of capitalism, even Oxfam accepts the sad

realities of capitalism, "Some economic inequality is essential to drive growth and progress, rewarding those

with talent, hard earned skills, and the ambition to innovate and take entrepreneurial risks."

Capitalism only has one view towards wealth distribution, namely leaving it to the free market. A number of

countries seeing the failure of the invisible hand have turned to the visible hand of the state and have achieved

mixed results. It has been over two decades since the collapse of the Soviet Union, when liberals celebrated

capitalism's unilateral position. This was however a false dawn as the inefficiencies of communism merely gave

way to the very efficient capitalism – for the rich only. Capitalism has no doubt created immense wealth, but it

should also be certified with enriching so few whilst condemning so many to a life of misery.

In order to maintain the status quo governments on behalf capitalist elites have offered scraps to the wider

public. The minimum wage is an example of this with the debate on raising the minimum wage in the UK

paradoxically being led by the right who would be expected to be against such interventionist polices.

Intellectual discourse is also dominated by free market liberals and this has ensured alternatives have little air

time and presence. Despite the worst recession since the great depression liberals have continued to argue that

capitalism is the best system on offer. Similarly, with the collapse of communism nearing its 25 anniversary, the

failure of communism is still present in the minds of many people. The victory in the Cold War for many is proof of

capitalism's superiority be it political, social or economic.

Capitalism's Achilles heel is its inability to distribute wealth equitably which has only got worse since the demise

of communism. Thus hope only lies Muslims and Islam. We as an Ummah need to realise this and take up that

challenge.

من فضلھ ھو خیرا لھم بل ھو شر لھم سیطوقون ما بخلوا بھ یوم وال یحسبن الذین یبخلون بما آتاھم ا�

بما تعملون خبیر القیامة و� میراث السماوات واألرض وا�

"Those who are tight-fisted with the bounty Allah has given them should not suppose that that is better for

them. No indeed, it is worse for them! What they were tight-fisted with will be hung around their necks on the

Day of Rising. Allah is the inheritor of the heavens and the earth and Allah is aware of what you do."

(Aal-Imran, 3:180)

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