Were all Joc Thomson’s Burdens
Were all Joc Thomson’s Burdens… an old Scotish saying. It means we are all God’s children.
I just had a very interesting conversation with a man who makes over $1200 per day. Yes, per day. And he asked me if I was aware of the salaries based on nationality here in Qatar. He proceeded to explain how the nationalities were tiered, and how these rankings determined the rate of compensation. At the top of the list were the nationals (Qatari’s), at a close second US/UK/Western Europe; third, Eastern Europe; fourth, India, Nepal, Pakistan; then Philippines; and the list goes on.
How this works can be demonstrated with this mans salary. He is a highly trained Scot of the UK whose expertise and experience earns him the previously mentioned $1200. Now he told me of a peer who was similarly trained and experienced, but happened to be of Indian citizenry. This individual earned significantly less than the Scot, despite doing the exact same job.
Why is this? The country of Qatar and its respective national companies QatarGas, RasGas, etc. structure the pay scale to keep labor costs low. The country of Qatar is only 15% nationals (citizens of Qatar), which leaves 85% to be people here to work the plethora of jobs created from oil and gas and construction. These people are primarily Indians, Nepalese, Philippines, Lebanese and various other countries of the lower pay tiers. The country of Qatar believes that if the Indian contractor is paid as much as the Scottish contractor, then word would spread to other Indian specialists that they should be getting paid as much as their US or UK counterparts. Then it would spread throughout the site managers, and eventually to the workers that they should be receiving similar wages to other nationalities. This train of thought would pervade the factory, and Qatar’s structure for low labor costs would evaporate.
I work in project management as a cost estimator, and as such, I see the data that estimates the cost of workers. I can comfortably say that the labor force of roughly 50,000 people at work in Ras Laffan City (the main industrial area of Qatar) makes around $10 a day for their work. They typically work 10 hours a day, stay in a compound free of rent, eat free food, and then return to work the next day. This is obviously mutually beneficial for employer and employee because it continues. The worker receives more money and stable employment compared to their situations at home, and the company has its cheap labor. The question is not whether it works, but whether it is right.
I work with a similarly educated Filipino woman who makes significantly less than I do, but does similar work. Similar to the contractor comparison, I too feel personally involved in the disparity, but as usual need to think things out before picking a side (I still will probably not pick a side).
So let’s explore the two sides of this coin. Right now the coin rests on the ‘screw the little people side, yay big business.’ The other side is ‘we are all equal under God’s eyes, pay everyone the same.’ The best practice will undoubtedly lie somewhere in between, but lets explore the two poles.
The Theory of Economics:
The current way of doing things is in line with the principles of economics. Do things as cheaply as possible and it will promote healthy competition, and the eventual distribution of wealth. This theory has been accelerated with the arrival of large-scale industrialization. The world will continue to shrink until you will have the option of going just about anywhere to get your work done, whatever your work happens to be.
So how does this relate to Qatar’s pay scale. It relates in the same way that our manufacturing goods come from China. China is cheap labor, you can pay a Chinese worker a tenth of what you would pay a European of American worker. You work that fact into your books and it becomes obvious that it is economical to manufacture American Flags in a Chinese embroidery shop. Case closed. Now no one argues when these economies are separate, but when things are brought within close proximity, the pricklies come out. People get upset when they here that my Chinese co-worker gets paid a fraction of my rate. They say “What an injustice!”, but do not react as boldly to their t-shirt maker. But the issues are the same. Global economies are not equal. The cost of living and similarly, the rates of compensation, vary greatly throughout the world. I make in a day what some people in the world in a year. Some people make in a day what I will make in my entire lifetime. Things are not balanced. So when QatarGas says that it is going to pay its Indian citizens X dollars, it does so with the knowledge of an acceptable rate for Indian salaries. It then pays accordingly. Qatar is a country made up of expatriates, people working in Qatar but calling home elsewhere. Their money will be spent elsewhere, their families are often elsewhere, Qatar is the place where they work.
It is obvious how this works for QatarGas, they hire the cheapest people they can and that is done by paying them a salary comparable to the salary they could earn in their home towns. So how does it work for the Cambodian, the Indian, the Pilipino? Surprisingly it works fairly favorably for them as well. Overwhelmingly, the people that work in Qatar earn a salary that is “good” for their country. They have free housing and food, and the job security is excellent. Safety, hygiene and benefits are high because of the legal fears of companies like QatarGas, and they are not aware of what they are missing. Entire work crews are made up of similarly paid nationalities, so there is no mass knowledge that the people across camp could be making much less or much more than their crew. The most important evidence that this is mutually beneficial is the fact that work continues. People choose to keep the job, and that is because it is their most promising option for employment.
An Indian friend told me how he has several servants in his home. His family is of middle class, and as is customary, they can afford several servants to attend to their needs/wants. Similarly, Qatari’s have a number of servants per household. Jon the man who makes $1200+ dollars a day replied that he is disgusted by this fact of servants. I might have agreed with him years ago, but my Indian friend explained something about the servant/master relationship in India. The jobs provided by these “rich” people are sometimes the only job that can be had by these people. And that in a sense, it is a perfect example of wealth distribution. The poor of India find the job of serving to be very profitable considering other professions offered to their class. I am not here to argue against the caste system, I am just pointing out how the servants of the rich are actually receiving money that otherwise would stay in the hands of the rich. If they did all these tasks themselves, shopping, nursing, cleaning, that would keep the money in the family instead of spreading it amongst a host of others. These relationships persist because they are mutually beneficial.
But lets flip the coin, because it is important to remember that it is not what works that interest us, but what is right.
The Golden Path:
Now enter the near communist state. The idea of everyone sharing everything and people lacking personal possession has been tried and proven incompatible with human nature. One day maybe, but not now. People have a sense of entitlement, and the truth of the matter is that not everyone contributes equally.
There is that magical quality of human beings called greed that promotes people to take advantage of any system. This is the main problem with communism. Some people will not want to work for what they get, and some people will always try and get more than what they are entitled. And eventually someone will come about that will hold enough power to carry that initiative out. A communist state could have no kings or queens, no nobles or governors, and for that matter no distinctions at all. So lets move past the idea of completely equal payment for all things and simply look at equal payments for similar jobs.
Should a Nepalese man get paid the same amount as I for the same work given that we come from two different places? If this were to happen, and happen on a large scale, the Nepalese economy would skyrocket. It might even be good for other nations, as Nepalese families purchased goods from other nations. But it would not benefit the person paying the Nepalese salary. Spreading this to workers across the sight, and soon economies are booming all over southeaster Asia, but now the project is over budget. Way over budget. The project is cancelled and everyone loses their jobs. Or maybe the project continues, and instead of taking a loss on the project, RasGas and all the other oil and gas companies charge a huge premium on their products. Now the wealth is still helping Nepal, but is starving to death poor Thailand who happens to have no workers in the industry. They still have to pay the rising price for energy but have no benefits coming in. The more I learn about the economy, the more I see how fragile it is. And like most fragile things, it is best to be left alone. But lets continue.
The main purpose of salaries is to trade services for capital. The companies need people and people need money to buy the things they want. It is a matter of give and take that existed in one form or another since we existed. It is the idea of compensation that is interesting. People must feel rewarded for their efforts. This promotes the person to keep on working and incites the person to put in a greater effort. This happens on the local and global scale. India and China are examples of countries that are getting compensated for a skill (IT and manufacturing, respectively) that promotes further development in that area. As their skills grow, their rewards grow, and the nation becomes more economically powerful.
As this natural balance of needs and skills develops throughout the world, wealth is created and distributed. It is a wonderfully simple idea, but it is not necessarily a moral one.
The reason why equating the wealth would not work is because it does not follow the rules of the game. The rules of the game says that whatever is cheapest will work best. Legislation would have to be drafted to change the rules, but that legislation would simply shift the imbalance to someone else’s plate. It’s like squeezing a balloon. Any constrictions in one place would result in expansions somewhere else. Equate the cost of salaries, and the costs of goods would skyrocket. The economy is setup to balance on its own by takings its good sweet time.
The last point I want to make is the idea of getting money for the sake of getting money. This happens a lot in the industry where I work: Oil. I do not refer to the companies but rather the nations that get the vast majority of oil revenues. All over West Africa, oil money has done more harm than good, but I believe it is because the money was mishandled. Money flowed into countries like Nigeria hand over fist and the money was pocketed instead of invested back into the nation. Wealth has to be distributed and that is most easily done by growing the economy. Starting infrastructure projects like roads, refineries, power plants, irrigation systems creates work forces that need to be paid. If the money given to the government was used in efforts like these, the people of many oil butchered countries would be better off. But it is that human tendency for greed that trumps all. A culture cannot be sped through economic growth, it is a slow process. I believe I have exhausted this topic, but I have learned something.
In the end, All things being equal, the status quo is usually a reasonable solution.
The world is not out to be bad, it is not inherently evil or fatally flawed, it is merely trying to do the best it can. Humanity and its tendencies are like a young child learning the rules of survival, and it makes mistakes and learns from them. Changing the world is possible but most of the time it just takes experience for it to happen. Once in a while, when the stars align, paradigm shifts occur that radically change the course of development, but they cannot be coerced to happen by good intentions. Like all things, the key to saving our poor lot is patience and persistence. We must strive to better ourselves as a whole and take the opportunities to change when they arrive. Good night and good luck :).
I just had a very interesting conversation with a man who makes over $1200 per day. Yes, per day. And he asked me if I was aware of the salaries based on nationality here in Qatar. He proceeded to explain how the nationalities were tiered, and how these rankings determined the rate of compensation. At the top of the list were the nationals (Qatari’s), at a close second US/UK/Western Europe; third, Eastern Europe; fourth, India, Nepal, Pakistan; then Philippines; and the list goes on.
How this works can be demonstrated with this mans salary. He is a highly trained Scot of the UK whose expertise and experience earns him the previously mentioned $1200. Now he told me of a peer who was similarly trained and experienced, but happened to be of Indian citizenry. This individual earned significantly less than the Scot, despite doing the exact same job.
Why is this? The country of Qatar and its respective national companies QatarGas, RasGas, etc. structure the pay scale to keep labor costs low. The country of Qatar is only 15% nationals (citizens of Qatar), which leaves 85% to be people here to work the plethora of jobs created from oil and gas and construction. These people are primarily Indians, Nepalese, Philippines, Lebanese and various other countries of the lower pay tiers. The country of Qatar believes that if the Indian contractor is paid as much as the Scottish contractor, then word would spread to other Indian specialists that they should be getting paid as much as their US or UK counterparts. Then it would spread throughout the site managers, and eventually to the workers that they should be receiving similar wages to other nationalities. This train of thought would pervade the factory, and Qatar’s structure for low labor costs would evaporate.
I work in project management as a cost estimator, and as such, I see the data that estimates the cost of workers. I can comfortably say that the labor force of roughly 50,000 people at work in Ras Laffan City (the main industrial area of Qatar) makes around $10 a day for their work. They typically work 10 hours a day, stay in a compound free of rent, eat free food, and then return to work the next day. This is obviously mutually beneficial for employer and employee because it continues. The worker receives more money and stable employment compared to their situations at home, and the company has its cheap labor. The question is not whether it works, but whether it is right.
I work with a similarly educated Filipino woman who makes significantly less than I do, but does similar work. Similar to the contractor comparison, I too feel personally involved in the disparity, but as usual need to think things out before picking a side (I still will probably not pick a side).
So let’s explore the two sides of this coin. Right now the coin rests on the ‘screw the little people side, yay big business.’ The other side is ‘we are all equal under God’s eyes, pay everyone the same.’ The best practice will undoubtedly lie somewhere in between, but lets explore the two poles.
The Theory of Economics:
The current way of doing things is in line with the principles of economics. Do things as cheaply as possible and it will promote healthy competition, and the eventual distribution of wealth. This theory has been accelerated with the arrival of large-scale industrialization. The world will continue to shrink until you will have the option of going just about anywhere to get your work done, whatever your work happens to be.
So how does this relate to Qatar’s pay scale. It relates in the same way that our manufacturing goods come from China. China is cheap labor, you can pay a Chinese worker a tenth of what you would pay a European of American worker. You work that fact into your books and it becomes obvious that it is economical to manufacture American Flags in a Chinese embroidery shop. Case closed. Now no one argues when these economies are separate, but when things are brought within close proximity, the pricklies come out. People get upset when they here that my Chinese co-worker gets paid a fraction of my rate. They say “What an injustice!”, but do not react as boldly to their t-shirt maker. But the issues are the same. Global economies are not equal. The cost of living and similarly, the rates of compensation, vary greatly throughout the world. I make in a day what some people in the world in a year. Some people make in a day what I will make in my entire lifetime. Things are not balanced. So when QatarGas says that it is going to pay its Indian citizens X dollars, it does so with the knowledge of an acceptable rate for Indian salaries. It then pays accordingly. Qatar is a country made up of expatriates, people working in Qatar but calling home elsewhere. Their money will be spent elsewhere, their families are often elsewhere, Qatar is the place where they work.
It is obvious how this works for QatarGas, they hire the cheapest people they can and that is done by paying them a salary comparable to the salary they could earn in their home towns. So how does it work for the Cambodian, the Indian, the Pilipino? Surprisingly it works fairly favorably for them as well. Overwhelmingly, the people that work in Qatar earn a salary that is “good” for their country. They have free housing and food, and the job security is excellent. Safety, hygiene and benefits are high because of the legal fears of companies like QatarGas, and they are not aware of what they are missing. Entire work crews are made up of similarly paid nationalities, so there is no mass knowledge that the people across camp could be making much less or much more than their crew. The most important evidence that this is mutually beneficial is the fact that work continues. People choose to keep the job, and that is because it is their most promising option for employment.
An Indian friend told me how he has several servants in his home. His family is of middle class, and as is customary, they can afford several servants to attend to their needs/wants. Similarly, Qatari’s have a number of servants per household. Jon the man who makes $1200+ dollars a day replied that he is disgusted by this fact of servants. I might have agreed with him years ago, but my Indian friend explained something about the servant/master relationship in India. The jobs provided by these “rich” people are sometimes the only job that can be had by these people. And that in a sense, it is a perfect example of wealth distribution. The poor of India find the job of serving to be very profitable considering other professions offered to their class. I am not here to argue against the caste system, I am just pointing out how the servants of the rich are actually receiving money that otherwise would stay in the hands of the rich. If they did all these tasks themselves, shopping, nursing, cleaning, that would keep the money in the family instead of spreading it amongst a host of others. These relationships persist because they are mutually beneficial.
But lets flip the coin, because it is important to remember that it is not what works that interest us, but what is right.
The Golden Path:
Now enter the near communist state. The idea of everyone sharing everything and people lacking personal possession has been tried and proven incompatible with human nature. One day maybe, but not now. People have a sense of entitlement, and the truth of the matter is that not everyone contributes equally.
There is that magical quality of human beings called greed that promotes people to take advantage of any system. This is the main problem with communism. Some people will not want to work for what they get, and some people will always try and get more than what they are entitled. And eventually someone will come about that will hold enough power to carry that initiative out. A communist state could have no kings or queens, no nobles or governors, and for that matter no distinctions at all. So lets move past the idea of completely equal payment for all things and simply look at equal payments for similar jobs.
Should a Nepalese man get paid the same amount as I for the same work given that we come from two different places? If this were to happen, and happen on a large scale, the Nepalese economy would skyrocket. It might even be good for other nations, as Nepalese families purchased goods from other nations. But it would not benefit the person paying the Nepalese salary. Spreading this to workers across the sight, and soon economies are booming all over southeaster Asia, but now the project is over budget. Way over budget. The project is cancelled and everyone loses their jobs. Or maybe the project continues, and instead of taking a loss on the project, RasGas and all the other oil and gas companies charge a huge premium on their products. Now the wealth is still helping Nepal, but is starving to death poor Thailand who happens to have no workers in the industry. They still have to pay the rising price for energy but have no benefits coming in. The more I learn about the economy, the more I see how fragile it is. And like most fragile things, it is best to be left alone. But lets continue.
The main purpose of salaries is to trade services for capital. The companies need people and people need money to buy the things they want. It is a matter of give and take that existed in one form or another since we existed. It is the idea of compensation that is interesting. People must feel rewarded for their efforts. This promotes the person to keep on working and incites the person to put in a greater effort. This happens on the local and global scale. India and China are examples of countries that are getting compensated for a skill (IT and manufacturing, respectively) that promotes further development in that area. As their skills grow, their rewards grow, and the nation becomes more economically powerful.
As this natural balance of needs and skills develops throughout the world, wealth is created and distributed. It is a wonderfully simple idea, but it is not necessarily a moral one.
The reason why equating the wealth would not work is because it does not follow the rules of the game. The rules of the game says that whatever is cheapest will work best. Legislation would have to be drafted to change the rules, but that legislation would simply shift the imbalance to someone else’s plate. It’s like squeezing a balloon. Any constrictions in one place would result in expansions somewhere else. Equate the cost of salaries, and the costs of goods would skyrocket. The economy is setup to balance on its own by takings its good sweet time.
The last point I want to make is the idea of getting money for the sake of getting money. This happens a lot in the industry where I work: Oil. I do not refer to the companies but rather the nations that get the vast majority of oil revenues. All over West Africa, oil money has done more harm than good, but I believe it is because the money was mishandled. Money flowed into countries like Nigeria hand over fist and the money was pocketed instead of invested back into the nation. Wealth has to be distributed and that is most easily done by growing the economy. Starting infrastructure projects like roads, refineries, power plants, irrigation systems creates work forces that need to be paid. If the money given to the government was used in efforts like these, the people of many oil butchered countries would be better off. But it is that human tendency for greed that trumps all. A culture cannot be sped through economic growth, it is a slow process. I believe I have exhausted this topic, but I have learned something.
In the end, All things being equal, the status quo is usually a reasonable solution.
The world is not out to be bad, it is not inherently evil or fatally flawed, it is merely trying to do the best it can. Humanity and its tendencies are like a young child learning the rules of survival, and it makes mistakes and learns from them. Changing the world is possible but most of the time it just takes experience for it to happen. Once in a while, when the stars align, paradigm shifts occur that radically change the course of development, but they cannot be coerced to happen by good intentions. Like all things, the key to saving our poor lot is patience and persistence. We must strive to better ourselves as a whole and take the opportunities to change when they arrive. Good night and good luck :).
posted by Anthony Jackson at 8:05 PM
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