Getting a Real Education

English Summary of an Urdu Lecture to PIDE Students on Thursday 3rd Nov, on how we blindly accept everything taught by the West, even though there are fundamental mistakes in the foundations of the impressive looking mathematical textbooks. The lecture explains how we can create a revolution in economics and social sciences simply by understanding that social science must be situated within a historical context. An English summary of points covered in the urdu video lecture, also provides links to detailed explanations of each point.

  1. Current education system is a fraud (0:00 mins) – it deceives us into selling ourselves cheap, as commodities on the labor market – see: Learn Who You are!.
  2. Capitalism teaches us to make money the purpose of our life – see: The First Lesson
  3. Money is a means and not an end — see: The Pursuit of Wealth.
  4. Despite my extensive and global exposure to education, I never found out what was the purpose of my entire education — see “Recovering from a Western Education
  5. Capitalism requires workers, not humans. This is why capitalist education is designed to turn us into human resources, not human beings — See my Talk at Iqra University, on this topic.
  6. Turning human beings into human resources requires implanting many different poisons in our mind. See: The Third Poison: Worship of Wealth
  7. For this reason, in modern education of economics, extra effort is put into giving very nice costumes to this ugly set of theories. See: The Illusion of Scarcity
  8. Real education teaches us how to live — for example, see: The Secrets of Happiness
  9. Every human is unique, even twins. Each one requires and deserves unique and specialized training to develop their own unique potentials. A Western education is a form of Brainwashing, which teaches everyone the same thing, to turn them into standardized parts for use in a capitalist machine for production of wealth. See Teaching Fish to Fly to learn about personalized, REAL, education.
  10. Every person carries a potential – just like a seed. If the right environment is given, it can turn into an amazing thing. (9:00 min). See “Reaching Beyond the Stars
  11. Capitalism tries very hard to prevent this potential from being realized to ensure its own goal of mechanization of humans for profit maximization. See ET1%: The Blindfolds Created by Economic Theory.
  12. Indoctrination is done such a way that we all internalize the idea that our earning capacity is our only value. (11:00 mins) See The Quest for Prosperity.
  13. After my own experience in Western education, I realized that a lot of necessary stuff is not taught and a lot of stuff which is not needed are taught at insane lengths (13:00 mins) See The Higher Goals of Education.
  14. As a metaphor, I was taught the entire science of building a car from scratch – carburetor, radiator, spark plugs etc but was never taught how to drive. (14:00 mins). See The Education of an Economist.
  15. My advisor of research in econometrics told me that there are two kinds of researchers – those who work on real scenarios – they are the low league and are treated as workers and laborers while the other kind works on theory and they are treated as the executives and prestigious rank in the world of economics. (15:00 mins). See “Islam and Econometrics?
  16. When I came back to Pakistan, I thought about teaching students the ‘science of building the car’ but that was not possible here. Also, at the same time, I was realizing how important it is to ‘drive’ the car. (16:00 mins). See “A Realist Approach to Econometrics“.
  17. The data used during teaching is mostly exhibit data, not real data. We are trying to teach “Theory” by illustrating use of techniques on toy data — real applications will be done later. This is the fundamental flaw in the current approach to teaching statistics — the idea that theory and practice can be separated. See: Teaching Statistics./
  18. The contradiction between real world experiences and economics theory teachings exists because their is a deliberate effort made to create a theory which protects the interests of the upper class elites. See “Ideological Macroeconomics and Increasing Inequality.
  19. There is now some realization of the harms of theory/practice split. In other fields, there is an effort to develop an Integrated Curriculum where theory and practice are done together. This also needs to happen in economics and econometrics.
  20. Engine knowhow and driving skills are not necessarily correlated. It is possible to teach how to drive without necessary teaching how the car is made. (19:00 mins)
  21. I have developed several courses based on the principle that the knowledge we teach should be directly applicable to real world problems. Furthermore, the theory should be taught by showing how it works in practice. See Replacing Western Courses with Islamic Ones.
  22. At the heart of the problems we face in the Islamic world today is that we are so impressed by West, that we cannot accept the idea that they have made major blunders in their academic disciplines. This is because we suffer from a Deep-Seated Inferiority Complex, created by the process of colonization and the conquest of knowledge.
  23. In fact, their errors are so huge that it is flabbergasting. It requires some explanation to understand how anyone can make such major mistakes — See The Emergence of Logical Positivism for an explanation.
  24. The major flaws in the foundations of economics became obvious to all after the Global Financial Crisis. For quotes showing how leading economists have acknowledged these flaws, see Quotes Critical of Economics.
  25. Macro-economics is currently in its own dark ages. (25:00 mins) In Dark Ages, people often died from remedies as much as they did from the original ailment. The prescriptions used to solve economic problems today often cause more damage than doing nothing. See Romer’s Trouble With Macro.
  26. Because economics is in a dark age, what they teach as knowledge is really ignorance. Even if we start from zero and make a small contribution, we can make advances in the field. This creates a golden opportunity to build a new economics based on Islamic principles. See An Islamic Revolution in the Social Sciences.
  27. Given the apparent success of the West, it is hard to believe that they have made such major mistakes, and this requires some explanation. An important point at which they went astray was when they started to look for universal scientific laws of human behavior, rather than working with historical and cultural context, which must change from time to time. See Method or Madness for an explanation of how this happened.  (29:00 mins)
  28. Actual information and study is based in history and economics is based on mathematical and scientific laws. The actual facts are never taught in the economics studies and are looked at with disdain. (30:00 mins) See Methodological Mistakes at the Heart of Economics and Econometrics
  29. Economic theory teaches us about how rational humans behave — by maximizing utility. Psychologists who also study human behavior analyzed these economic theories and showed that they are wrong. This has created the field of Behavioral Economics, which studies actual behavior of human beings.  (31:00 mins). The dramatic differences between actual behavior and economic theory are discussed and explained in Behavioral Versus Neoclassical Economics
  30. Instead of changing theories when they are contradicted by the data, economists stubbornly stick to their own theories, and refuse to accept the conflicting data. For some evidence about this, look at How the Methodology of Economics handles Conflicts Between Theories and Facts?
  31. Just as human beings do not maximize utilties, so firms do not maximize profits.
  32. A research of firms showed that 75% of firms said that if they produce more, for the next units, their DMC would be lower which contradicts the economic theory. [paper by Avi J. Cohen ??] (34:00 mins). See my lecture  AM06: Firm Behavior, based on Hill and Myatt Anti-Textbook.
  33. Modern economics is a theory designed to justify policies which exploit the poor to increase the wealth and power of the rich. We must learn economic theory in order to avoid being deceived by economists (as stated by famous economist Joan Robinson). See the Power of Economic Theory, Graphically Illustrated.
  34. Econometric Theory is a particularly powerful tool of deception. As explained in Confessions of an Economic Hitman, powerful and sophisticated math is used to deceive nations into pursuing false policies. In fact, econometric methodology is so bad that any data can be used to prove any result. This is why it is easy to use econometrics to deceive people. See Methodological Mistakes and Econometric Consequences.
  35. A Western education teaches us to value scientific theories, which have universal validity. History is not of value because it is particular — one event happens once, and will not repeat, so you cannot get universal laws out of it. This is a huge mistake. History is of central importance in understanding the world around us. For example the Battle of Dien Bien Phu  has a lot to do with contemporary economics. This was a turning point in history, when a colonized nation defeated a European power in combat for the first time. Since this goes against the Central Myths of European Superiority, Western textbooks do not often mention it, or point out its significance and importance
  36. Because a Western education destroys our abilities to think, and poisons our minds with false myths, we must self-educate ourselves. We must learn to re-write history from an Islamic point of view, in order to develop “An Islamic WorldView: An Essential Component of an Islamic Education.
  37. Between 41:00 mins and 51:00 mins, a documentary is shown about Battle of Dien Bien Phu. It was a battle which proved to be the death knell of colonialism in which the native population, while being poor and short of resources, did something the French thought was impossible and defeated the French. Note that French sources are heavily biased and we should look into the Vietnamese accounts. (51:00 mins)
  38. Even though Woodrow Wilson had promised to support the right of self-determination of all peoples, instead of letting the Vietnamese achieve freedom, he took steps to ensure their continuing enslavement and colonization, replacing the French masters by new US puppeteers. This eventually led to the Vietnam War by the USA, which led to overprinting of dollars to finance the war, and made it impossible to maintain the gold standard backing for dollars. This shows how we must learn history, in order to understand economics. The concept of “Entanglement” says that theories cannot be understood without their historical context, and history cannot be understood without learning theories used by human beings to understand that history. See 22m Video Lecture on “Entanglement” —
  39. In 1971, Nixon suspended convertibility of dollars for gold, leading to a new era of fiat currencies with floating exchange rates.  This has led to the current system where unbacked dollars are used, instead of gold, as backing for other currencies. This creates “A Lopsided Monetary System” where the USA can earn foreign exchange just by printing dollars, while all other countries must export real goods and services to earn dollars.
  40. Dollar was made necessary for petro trade by agreement between US and Middle East rulers. The power and value of US Dollar is based in politics and is not intrinsic to it. Mahathir Mohammad first realized this American technique. One of the major problems we face in understanding the complexities of modern finance is obsolete economic theories, created for the times of the gold standard, and not updated to keep us with current realities. See Modern Monetary Theory for further explanation.
  41. What is the practical importance of these revolutionary ideas for students writing theses in economics today? My advice is to run regressions but also to study reality. Even though regressions typically lead to useless results — see “Choosing the Right Regressors”, for an explanation of why -, we must run them because our thesis would not be acceptable without some data analysis. But at the same time, we should try to support this analysis with a study of real world factors, which is not part of typical econometric or economic analysis.
  42. Even though economic theories coming from the West are disastrously wrong, we are all so impressed with Western achievements in the physical sciences that we accept them without question. See “The Thousand Snakes: Image and Reality of Western Economics“, to see how what appears to be a powerful, sophisticated and complex theory is just an illusion – ignorance masquerading as knowledge.
  43. Because Western education, especially the social sciences, is built of fraudulent foundations, we must reinvent education. Instead of abstract theories which pretend to be universal laws, we must teach theories within their historical context. Today, discontent with conventional economic theory is widespread, but no one has come up with a good alternative. This creates a golden opportunity for us to launch a revolution in education, based on the teachings of Islam, which are “Still Revolutionary, after 1440 Years.”
  44. I invite readers to participate in launching this revolution on the basis of the twin pillars of the Ghazali Project, which involve rejecting Western wisdom, and applying Islamic teachings to the solution of modern problems.
This entry was posted in Critique of Conventional Economics, econometrics, Eurocentric History, ghazali, Historical Context of Economics, Islamic Knowledge by Asad Zaman. Bookmark the permalink.

About Asad Zaman

BS Math MIT (1974), Ph.D. Econ Stanford (1978)] has taught at leading universities like Columbia, U. Penn., Johns Hopkins and Cal. Tech. Currently he is Vice Chancellor of Pakistan Institute of Development Economics. His textbook Statistical Foundations of Econometric Techniques (Academic Press, NY, 1996) is widely used in advanced graduate courses. His research on Islamic economics is widely cited, and has been highly influential in shaping the field. His publications in top ranked journals like Annals of Statistics, Journal of Econometrics, Econometric Theory, Journal of Labor Economics, etc. have more than a thousand citations as per Google Scholar.

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