Gold, Diamonds and Cloth: Economic Decisions at the Masjid
By Dr. Jerry Hionis, Jr.
I believe that “Islamic” economics should start to focus on the day-to-day decisions we as Muslims make. For example, one can go to a Jum’ah (Friday) service at any masjid and see decisions Muslims make with little thought.
It is very common to see both men and women wearing some type of gold jewelry. Outside of making the correct zakat payments, most people do not put in long hours of deliberation over whether or not they should buy gold. In modern times, the production of gold has become very harmful both to the people who mine the gold and the environment that is all too often polluted by it.
Gold has had a controversial history from the conquistador raiding on early Latin America to the exploitive practices in the Western U.S. during the 19th century. The modern industry has grown into another monster completely. Outside of the social costs that it inflicts on West African nations like Ghana, the purifying process destroys both the environment and those who live near the destruction. Once gold ore is found in a mine1 , chemicals such as cyanide and mercury are used to purify the gold from the rock, creating “slag”. In most developing countries with weak laws and even weaker government enforcement, this slag is improperly dumped on land and in rivers2 . It should not be a huge stretch for one to conclude that years of dumping slag in these areas decimates the environment and causes health issues for the local population3 .
Beyond gold, it is very common to see many Muslim women (and some men) wearing diamond jewelry. Hopefully, the effects of the diamond market on many African nations, such as Sierra Leone, Nigeria, Ghana, and Liberia, are well known to all. In summary, the consumption and selling of diamonds, whether labelled “conflict” or “non-conflict”, finances exploitive labor practices, war, rape, murder, drug trade/use and increased instability in governments – especially those with large Muslim populations. In fact, calling it the diamond market is a bit of a sham. It holds very little in common with most markets that the average consumer and producer partake in.
From both the consumption and production aspect, the industry is controlled (over 90% of all diamonds mine and sold throughout the world) by the De Beers corporation, a monopoly deemed criminal by the U.S. government. The cultural demand and preference for diamonds was manufactured by De Beers in an aggressive advertising campaign in the 1940’s. You know, “Diamonds are forever” and “Diamonds are a girl’s best friend”. Says who? De Beers, that’s who. The supply is manufactured as well. Against the conventional wisdom, diamonds are not rare. Actually, they are more abundant than one would think. The market price for diamonds is so inflated because the demand is kept high and the supply is controlled, by De Beers, to be artificially low. In other words, De Beers intentionally hordes resources and wealth to keep prices high4 . I am not an Islamic scholar, but I find it hard to believe that these practices would be deemed mubah (allowable if necessary), makruh (avoid if possible) or even halal (permissible) by the Prophet ﷺ (peace be upon him).
Finally, even without gold and diamond jewelry being donned, there is one item that all Muslims will have with them at Jum’ah: clothing. Out of the three preverbal needs of any person – food, clothes and shelter – the consumption of clothing is rarely thought about entailing an ethical or religious component. The recent tragedy of the Rana Plaza collapse in Dhaka, Bangladesh in April has made many start to ask where and how their clothing is made. Unfortunately, the problems of “sweatshop” labor and inhumane working conditions is an industry-wide issue that has been associated with the textile industry since its industrial conception.
The garment industry has had a historical “race to the bottom” structure, where production shifts locations in order to find lower labor costs. The modern industrial textile industry has raced from England, to the rural south and industrial north of America, to Central America, to West African nations and is now located in Southeast Asia. With low standards of living, labor costs in these countries are extremely minute compared to those found in Japan and the U.S.5 In economics, a good such as clothing is known as a labor-intensive good; that is, the major input in production is hands-on labor. Therefore, production will always move to where the labor is cheapest. These garments are then sold in America, Europe, and parts of the Middle-East, all with high standards of living, at higher prices. Even with transportation cost and retail overhead, the profit margins are substantial.
All this makes perfect sense theoretically. Globalization and free-trade supporters claim this to be the natural mechanism of the market and all are winners in the long-run. Opponents of globalization counter by saying that there are always winners and losers in the market, especially in the short-run, and the long-term effects lead to an increasing divergence in economic growth. Leaving this argument aside, the question for the Muslim should be: is it ethical and in line with the Sunnah of the Prophet ﷺ?
In her book The Travels of a T-Shirt in the Global Economy, Pietra Rivoli intensely examines the textile industry. As the production of clothing moves across the globe over time, one constant is that the majority of laborers in the market are women – usually, widowed or divorced – who have children to support. Rivoli shows that these women were and are6 preferred workers because, having dependents to support, they tend to accept lower wages, endure worse working conditions, work longer hours, take more abuse, complain less and, in general, are unaware of the country’s labor laws. In China for example, the huji, or hukou, system, where one is assigned an area that they are allowed to reside, has a direct effect on the exploitation of labor in the industry. Many leave their government assigned areas to go work in the urban textile factories. Because these workers are not designated residents where the factories are located, they must work longer hours for lower wages and no benefits and many even sleep in the factories to avoid travel costs. Of course, with a rising middle class in China, Chinese labor costs have been slowly rising and textile production has raced to other countries such as Bangladesh, Cambodia, and Indonesia.
People are starting to now check the tags on their clothing and ask questions. Unfortunately, checking to see if the tag says “Made in ________” does not give one the full story of their garment. Like the fallacy of diamonds labeled “non-conflict”, the production of a t-shirt, a pair of socks, a pair of pants, a thobe, has many steps in many countries in many factories with varying conditions. Just because your kameez (shirt) says “Made in Pakistan” does not mean exploitive labor practices were avoided in all stages of production.
For the most part, all this is legal and theoretically efficient, but are these practices in accord with the Prophetic tradition? Again, I unabashedly admit that I am not an Islamic scholar. Yet the seerah (biography) of the Prophet ﷺ consistently mentions his reputation as an honest and fair dealing trader. There is no shortage of hadith (narrations) that refer to trading and the importance the Prophet ﷺ put on clear, honest and transparent transactions, especially on labor.
If the Pope himself condemns the labor practices in Bangladesh and labels them “slave labor”7 , why has the Muslim community not been at the forefront of this issue – especially given that the majority of Bengalis are Muslims? Muslims should not be supporting the various movements and organizations that fight to change these practices. Muslims should BE those fighting for change, whether those being exploited are Muslim or not.
Posted: 19 Sep 2013 05:00 AM PDT
By Dr. Jerry Hionis, Jr.I believe that “Islamic” economics should start to focus on the day-to-day decisions we as Muslims make. For example, one can go to a Jum’ah (Friday) service at any masjid and see decisions Muslims make with little thought.
It is very common to see both men and women wearing some type of gold jewelry. Outside of making the correct zakat payments, most people do not put in long hours of deliberation over whether or not they should buy gold. In modern times, the production of gold has become very harmful both to the people who mine the gold and the environment that is all too often polluted by it.
Gold has had a controversial history from the conquistador raiding on early Latin America to the exploitive practices in the Western U.S. during the 19th century. The modern industry has grown into another monster completely. Outside of the social costs that it inflicts on West African nations like Ghana, the purifying process destroys both the environment and those who live near the destruction. Once gold ore is found in a mine1 , chemicals such as cyanide and mercury are used to purify the gold from the rock, creating “slag”. In most developing countries with weak laws and even weaker government enforcement, this slag is improperly dumped on land and in rivers2 . It should not be a huge stretch for one to conclude that years of dumping slag in these areas decimates the environment and causes health issues for the local population3 .
Beyond gold, it is very common to see many Muslim women (and some men) wearing diamond jewelry. Hopefully, the effects of the diamond market on many African nations, such as Sierra Leone, Nigeria, Ghana, and Liberia, are well known to all. In summary, the consumption and selling of diamonds, whether labelled “conflict” or “non-conflict”, finances exploitive labor practices, war, rape, murder, drug trade/use and increased instability in governments – especially those with large Muslim populations. In fact, calling it the diamond market is a bit of a sham. It holds very little in common with most markets that the average consumer and producer partake in.
From both the consumption and production aspect, the industry is controlled (over 90% of all diamonds mine and sold throughout the world) by the De Beers corporation, a monopoly deemed criminal by the U.S. government. The cultural demand and preference for diamonds was manufactured by De Beers in an aggressive advertising campaign in the 1940’s. You know, “Diamonds are forever” and “Diamonds are a girl’s best friend”. Says who? De Beers, that’s who. The supply is manufactured as well. Against the conventional wisdom, diamonds are not rare. Actually, they are more abundant than one would think. The market price for diamonds is so inflated because the demand is kept high and the supply is controlled, by De Beers, to be artificially low. In other words, De Beers intentionally hordes resources and wealth to keep prices high4 . I am not an Islamic scholar, but I find it hard to believe that these practices would be deemed mubah (allowable if necessary), makruh (avoid if possible) or even halal (permissible) by the Prophet ﷺ (peace be upon him).
Finally, even without gold and diamond jewelry being donned, there is one item that all Muslims will have with them at Jum’ah: clothing. Out of the three preverbal needs of any person – food, clothes and shelter – the consumption of clothing is rarely thought about entailing an ethical or religious component. The recent tragedy of the Rana Plaza collapse in Dhaka, Bangladesh in April has made many start to ask where and how their clothing is made. Unfortunately, the problems of “sweatshop” labor and inhumane working conditions is an industry-wide issue that has been associated with the textile industry since its industrial conception.
The garment industry has had a historical “race to the bottom” structure, where production shifts locations in order to find lower labor costs. The modern industrial textile industry has raced from England, to the rural south and industrial north of America, to Central America, to West African nations and is now located in Southeast Asia. With low standards of living, labor costs in these countries are extremely minute compared to those found in Japan and the U.S.5 In economics, a good such as clothing is known as a labor-intensive good; that is, the major input in production is hands-on labor. Therefore, production will always move to where the labor is cheapest. These garments are then sold in America, Europe, and parts of the Middle-East, all with high standards of living, at higher prices. Even with transportation cost and retail overhead, the profit margins are substantial.
All this makes perfect sense theoretically. Globalization and free-trade supporters claim this to be the natural mechanism of the market and all are winners in the long-run. Opponents of globalization counter by saying that there are always winners and losers in the market, especially in the short-run, and the long-term effects lead to an increasing divergence in economic growth. Leaving this argument aside, the question for the Muslim should be: is it ethical and in line with the Sunnah of the Prophet ﷺ?
In her book The Travels of a T-Shirt in the Global Economy, Pietra Rivoli intensely examines the textile industry. As the production of clothing moves across the globe over time, one constant is that the majority of laborers in the market are women – usually, widowed or divorced – who have children to support. Rivoli shows that these women were and are6 preferred workers because, having dependents to support, they tend to accept lower wages, endure worse working conditions, work longer hours, take more abuse, complain less and, in general, are unaware of the country’s labor laws. In China for example, the huji, or hukou, system, where one is assigned an area that they are allowed to reside, has a direct effect on the exploitation of labor in the industry. Many leave their government assigned areas to go work in the urban textile factories. Because these workers are not designated residents where the factories are located, they must work longer hours for lower wages and no benefits and many even sleep in the factories to avoid travel costs. Of course, with a rising middle class in China, Chinese labor costs have been slowly rising and textile production has raced to other countries such as Bangladesh, Cambodia, and Indonesia.
People are starting to now check the tags on their clothing and ask questions. Unfortunately, checking to see if the tag says “Made in ________” does not give one the full story of their garment. Like the fallacy of diamonds labeled “non-conflict”, the production of a t-shirt, a pair of socks, a pair of pants, a thobe, has many steps in many countries in many factories with varying conditions. Just because your kameez (shirt) says “Made in Pakistan” does not mean exploitive labor practices were avoided in all stages of production.
For the most part, all this is legal and theoretically efficient, but are these practices in accord with the Prophetic tradition? Again, I unabashedly admit that I am not an Islamic scholar. Yet the seerah (biography) of the Prophet ﷺ consistently mentions his reputation as an honest and fair dealing trader. There is no shortage of hadith (narrations) that refer to trading and the importance the Prophet ﷺ put on clear, honest and transparent transactions, especially on labor.
If the Pope himself condemns the labor practices in Bangladesh and labels them “slave labor”7 , why has the Muslim community not been at the forefront of this issue – especially given that the majority of Bengalis are Muslims? Muslims should not be supporting the various movements and organizations that fight to change these practices. Muslims should BE those fighting for change, whether those being exploited are Muslim or not.
- Again, we will ignore here the horrific and inhumane conditions that many of the laborers must work in to produce menial wages. For those inclined, see Perlez and Bergman’s article “Tangled Strands in Fight over Peru Gold Mine” in The New York Times October 25, 2005
- See Perlez, Jane and Johnson, Kirk. “Behind Gold Glitter: Torn Lands and Pointed Questions”. The New York Times October 24, 2005
- See Perlez, Jane and Johnson, Kirk. “Behind Gold Glitter: Torn Lands and Pointed Questions”. The New York Times October 24, 2005
- There is no shortage of resources on the subject from movies, books, articles and documentaries. In fact, reading any historical, economic or political account of a West African nation is bound to dedicate a substantial amount of time to the diamond industry. That being said, the most iconic book on the subject is Greg Campbell’s Blood Diamonds: Tracing the Deadly Path of the World’s most Precious Stones.
- For a comparison: http://www.fibre2fashion.com/
industry-article/9/895/indias- textile-wet-processing5.asp - Al-Mahmood. “Bangladesh’s garment industry still offers women best work opportunity.” The Guardian, May 23, 2013. http://www.guardian.co.uk/
global-development/2013/may/ 23/bangladesh-garment- industry-women-opportunity - “Pope condemns Bangladesh ‘slave labour”’. Al Jazeera, May 2, 2013.http://www.aljazeera.com/
news/americas/2013/05/ 2013525185257206.html
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