Understanding Islam as Economic policy

[Deus]

first, yes I was talking about the Jizyeh,

second when I was talking about women, wouldn't they eb unable to leave the house without a mahram, that would create a serious dostortion in the labour market.

furthermore, thank you for the link regarding the hub al tahreer publication. I've started looking through it, once again there are some rather unfounded assumptions upon which the analysis is made.

sepcifically regarding poverty and GDP, it is not unlike the link that was provided before. The Islamic solution from my understanding appears to be similar to the welfare state with regards to poverty. A flat tax financing welfare, there are no precise accounts of what that welfare system would look like other than it is simply transfer payments made from a treasury.

This is similar to other practices in welfare states, However, there is a major problem with this sort of set up especially since its so arbitrary. Transfer payments reduce incentives to work and contribute ro rising unemployment as seen most notably in places like france,

The gold standard discourse is interesting but also has some serious flaws,

The author also seems unaware of the hotelling theory with regards to natural resources. The idea is we revert money to gold and we wouldn't need interest rates anymore, well thats not really a change from a normal interest rate sysem because the price if gold should continue to increase and thus causing inflation. Also, the price of gold will never and can never be standard and thus appreciation on the value of gold is exactly the same as interest rate.

There are arguments for introducing or reintroducing the gold standard but no fully rational explanation is given

I will continue to read it but so far its extremely dissapointing due to its lack of well thought out analysis

 

[Knut Hamsun]

I have read the prophet's biography

Deus:
Which is considered the "authoritative" bio? I would like to read it. Thanks

 

[Deus]

I guess there is no real authoratitive bio, I was force fed ministry of education religion for 10 years and a such I feel like I've been through his biography, there are a lot of biographies out there by both western and Islamic scholars. I like Richard Eaton's anlaysis of early Islam. HE's written a number of books on the subject some of which argue that the prophet was not in himselt a cataclysmic event that propelled the Arabs into emprie buildin as is seen by islamic scholars but rather that the prophet was the embodiment of certain geopolitical movements occurring in the Arabian peninsula that set the tone for expansion.

Essentially the idea is secularist,
It could also be Abu-Loghod who wrote this , I can't remember its either richard eaton or abu lughod, both are very rewarding to read

 

[Ansar Al-'Adl]

first, yes I was talking about the Jizyeh

In which case the links I have provided should be sufficient. If you have any further questions, let me know and I can provide you with more information.

second when I was talking about women, wouldn't they eb unable to leave the house without a mahram

No, this is a misunderstanding of Islamic law.
http://islamtoday.com/show_detail_section.cfm?q_id=635&main_cat_id=35
http://www.islamtoday.net/english/showme.cfm?cat_id=2&sub_cat_id=548

As for your finding the HT publication lacking in depth, you need to first learn the basics of the Islamic economic system before moving on to a more in-depth analysis. How can one pass judgement on an economic system which they have not studied at an advanced level? Once you finish studying basic books, you can then proceed to more advanced material.

As for unemployment and zakat, the zakat money can be used to finance social institutions which would increase employment opportunities for the poor. The system was implemented quite effectively during the time of Umar bin Al-Khattab, such that it was reported that there were no people who came forth to recieve the welfare money.

The opportunities in an Islamic economic system has been studied and endorsed by a number of western economists. Several articles have been written by western researchers who have concluded that an Islamic system could function quite efficiently. I'll see if I can find some online links for you.

Deus:
Which is considered the "authoritative" bio? I would like to read it. Thanks

How absurd - asking an atheist for an authoritative biography on the Prophet Muhammad pbuh. Anyone who had a sincere interest to learn about the life of Muhammad would go to the primary sources, the Muslims, to know which is the best biography. As it turns out, I have already compiled a list of Islamic resources here:
http://www.islamicboard.com/education-issues/13373-studying-islam-list-resources.html

Regards

 

[Deus]

Ansar,,,

That is just the thing with an Islamic system, there is no advanced level. I specialize in Economics as it is my field of study. The sections I have read saw far int he publication you provided for lack for one thing any form of empirical evidence.Economics has transformed itself into a near pure science due to its reliance on the scientific method and econometric (advanced statistics and mathematical tools). The Hizb al tahreer publication does not provide any econometric regression or mathematical formulae by which they reach their conclusions as such the research is essentially flawed. Furthermore, the analysis also lack any intuitive logical reasoning. The only argument I have seen so far worth some merit is the gold standard argument but even that is not so convincing, a convincing argument would be Alan greenspan's proposition for the adoption of a gold standard because he believes that governments should not be able to to impose inflationary tax.

Furthermore, Umar Ibn al khattab, that was almost 1400 years ago, the structure of the economy was almost completely different. It was an agrarian based society, even if that were true that no one was seeking welfare there is another blaringly obvious reason for that which was the islamic expansion during that time into the Levant and Egypt, a prolonged war effort generates enough employment

unless your proposing a return to an agrarian society with no no industrial or service base then the wealth of empirical data compiled by economists in the last 60 years suggests that zakat or welfare handouts never generate employment. It's fairly simple idea, if you're getting money for nothing you won't go out and find a job. Even if that money only provides you with the bare minimum, this coupled with the fact that Moslems tend to have large families (lots of children) means that the labour supply will be growing at a high rate). But the lack of a banking sector (as advocated by the removal of interest rates) means that investment is going to be extremely low)

Even the interest rate argument is flawed because introducing the gold standard will provide for an unofficial interest rate in the form of appreciation int he value of gold, but since there is no banking sector then you will have no facilitaror for investment, no entities providing loans for investment. Plus another problem with the gold standard is that we must assume that the rest of the world wont become an islamic economy, therefore if say we had the gold standard and our money was tied to gold and we are trading with say the rest of the world in dollars we have a major problem for a number of
reasons, gold is not liquid currency, it is not hot money moving gold takes more than a few clicks on a computer,
the other problem is that we assume that gold appreciates relative to the islamic state's internal demand and supply dynamic and we can assume that gold will get rarer and rarer because there is a finite amount of it on earth (hotellign theory) therefore, the value of our gold currency will become higher relative to the dollar (inflation is low and historically has been with the dollar) Therefore our exports will be much more expensive and the islamic state will become uncompetitive in the export market. This is a major problem because the export sector creates jobs for thousands upon thousands of people.

There are serious shortcomings in this analysis so far ive gotten through a third of it and hoping to finish it soon, its interesting to see a new perspective on things but its lack of correct methodology or intuitive reasoning makes it dissapointing,

asking me for the biography is not necessarily wrong because I have lived in a moslem country, as I said before, there are secular perspectives and islamic ones, the secular ones need not be unflattering, in fact ive read a a few secular ones that are highly positive and laud the prophet's statesmanship and political prowess.

 

[Deus]

I looked at your link regaring women travelling without a mahram,

I see that some individual imams might interpret the law like that, however, it appears that most islamic societies with sharia law most notably Saudi Arabia and Afghanistan limited female mobility based on the original ruling that says that women may not travel without a mahram. Hence it would be reasonable to assume that given a "strict" interpretation of Islam within an "ideal" and perfectly islamic state women would not be allowed to move without a mohram.
The link you gave me appears to be some sort of liberal interpretation but the lattter of the law stands as women cannot move without a mohram. If indeed women were allowed to move around and enter the labour market without discrimination then that wouldn't be a problem, but all indications suggest that women would not enjoy that sort of freedom under an islamic system due to the abundance of historical evidence that suggests otherwise.

 

[Deus]

thought of something new on the Umar Ibn al Khattab, production if a function of tis inputs namely labour and capital according to the formula Y = ALαKβ where a= Technology or Technological innovation, L = Labour and K = capital.

the umar Ibn il Khattab agrarian economy had little or no Capital, as such Labour was the complete input of production, Since the movemet away from agrarian based economy plus larger populations have necessisitated the use of capital in production for efficiency and total output to increase as such total output has increased but with a trade off in labour. This has augmented the economic structure quite markedly since Umar Ibn al Khattab as such the comparison is not valid.

Also it was really the advent of war that led to full employment

Furthermore, if the Islamic caliphate under Omar was so perfect why was he assassinated, of course I learnt of the embelishd version of a "madman" assasinating him but doesnt it have more to do with the fact that the assassin was bound in slavery and Umar refused him to be freed? but more importantly it is the economics that conern me and should everyone because nations economy is what determines a nations ability to succeed and prosper

 

[Ansar Al-'Adl]

That is just the thing with an Islamic system, there is no advanced level.

You're entitled your opinion, however uninformed it may be. Studying secular economic systems does not render one an expert on Islamic law.

unless your proposing a return to an agrarian society with no no industrial or service base then the wealth of empirical data compiled by economists in the last 60 years suggests that zakat or welfare handouts never generate employment.

As I pointed out earlier, the zakat money can be used to finance social institutions to increase employment opportunities amongst the impoverished of society. We find a precedent in the time of the Prophet pbuh who prohibited a man to beg and instead gave him some basic tools allowing him to start a business selling lumber. Thus, he focused on self-sufficiency.

As you should know, the various problems current economic and trade systems have sparked wide-spread debate, causing economists to analyse and assess opportunities available in other systems.
http://www.perfecteconomy.com/
http://home.vicnet.net.au/~harmony/whneweco.htm
http://www.strohalm.net/en/islam.html
http://encarta.msn.com/text_761562677___14/Economics.html
http://www.islamicvoice.com/june.97/economy.htm
http://www.listener.co.nz/default,2561.sm
Have you read the report on Social Capital and Globalization by Dr. Matthews and Dr. Tlemsani? Or the alternative perspective of Tarek El Diwany?
http://www.theproblemwithinterest.com/index.html

Ultimately, debating over the benefits of an Islamic ecnomic system versus another economic system is futile in this context for two reasons:

1. Until a system has been implemented accurately and on a comprehensive scale, its effectivity cannot be guaged. This has not been achieved with the Islamic system in the modern era, and I would agree with you that a comparison with the early Islamic empire is not accurate in many respects. Because of this, any objections one may raise against the system boil down to what is purely a matter of personal opinion - and we all know how varied that is amongst world economists.

2. It is a fundamental flaw in methodology to examine the Islamic system from a secondary aspect as opposed to its primary focus. It is akin to debating over the benefits of the prohibition of pork in Islam. One should begin by discussing the coherence and validity of Islamic theology.

asking me for the biography is not necessarily wrong because I have lived in a moslem country

So someone who lives in a muslim country becomes an expert on the Prophet's sirah? Again, quite an absurd notion. The reality is that non-muslims are not the ones to decide which are the 'authoritative' sources on Islam. Asking a non-muslim to recommend a book in Islam (while in the presence of Muslims knowledgeable about their religion) is clearly a sign that the questioner does not have a sincere interest to learn about Islam.

I see that some individual imams might interpret the law like that, however, it appears that most islamic societies with sharia law most notably Saudi Arabia and Afghanistan limited female mobility based on the original ruling that says that women may not travel without a mahram.

Acutally the two scholars I quoted are Saudi scholars. Shaykh Sâmî al-Mâjid is a professor at Al-Imam University, Riyadh Saudi Arabia. And Shaykh Muhammad al-Duhayyim is a court judge in Al-Layth District. So this is clearly not a minority opinion, and the time of the Prophet Muhammad pbuh and later generations provides many examples of women in the workforce and part of the education system as well. In fact, there are many cases where it is compulsory for women to work. These include cases of female doctors, nurses, etc.

The website I gave you provides fatawa (religious rulings) from over 60 different religious scholars world-wide, including many professors of Saudi Islamic universities.

If indeed women were allowed to move around and enter the labour market without discrimination then that wouldn't be a problem

Exactly.

but all indications suggest that women would not enjoy that sort of freedom under an islamic system due to the abundance of historical evidence that suggests otherwise.

Perhaps you were unaware of the thousands (literally) of Muslim women who were scholars and held independent public study circles:
http://www.simplyislam.com/iteminfo.asp?Item=54138
http://www.islamtoday.net/english/show_detail_section.cfm?q_id=846&main_cat_id=2

Furthermore, if the Islamic caliphate under Omar was so perfect why was he assassinated

What kind of argument is this? How does the manner in which one dies have to do with their efficiency as a ruler? Abu Lu'lu'ah was a Zoroastrian slave who belonged to Al-Mughirah.

 

[Deus]

I've decided to give up on this thread because I've gone through the links you provided and see that the corpus of Islamic economicts as it is called is simply not rational. There are also a number of contradictions between different would be scholars.

Some of the links refer to investment and the stock market as gambling, other do not.


Some want to abolish banking completely! some others just interest.

The links on abolishing interest do not come from peer reviewed academic sources. Just people who are angry they had to pay interest on loans or believe it to be haram. That is not an argument

one of the links takes paul samuelson completely out of context. and dismisses the position of savings in growth.

Lots of problems with these links, unfortunately there isn't really anyone on this forum or anyone with a basic understanding of economics to engage in debate so I think we should just end this forum now

 

[HeiGou]

>deletions<
2. It is a fundamental flaw in methodology to examine the Islamic system from a secondary aspect as opposed to its primary focus. It is akin to debating over the benefits of the prohibition of pork in Islam. One should begin by discussing the coherence and validity of Islamic theology.
>deletions<
The reality is that non-muslims are not the ones to decide which are the 'authoritative' sources on Islam. Asking a non-muslim to recommend a book in Islam (while in the presence of Muslims knowledgeable about their religion) is clearly a sign that the questioner does not have a sincere interest to learn about Islam.

The first bit is the reason why from any perspective other than a religious one, non-Muslims are precisely the people to ask. Muslims ask questions that are of interest to Muslims. Non-Muslims ask questions. You have made up your mind on several important issues before even starting. Which is correct from a religious point of view, but as far as new or interesting insights go, well, why would you be interested in that?

What kind of argument is this? How does the manner in which one dies have to do with their efficiency as a ruler? Abu Lu'lu'ah was a Zoroastrian slave who belonged to Al-Mughirah.

You think the frequency of political violence in the early period of Islamic history is irrelevant and uninteresting?

 

[Deus]

What I meant to say about umar Ibn al Khattab, thanks you for reminding me Heigou was that the Islamic state, even in Agrarian society was far from perfect as people claim as there were individuals such as the assassin in question who were slaves

 

[Deus]

I never claimed to be an expert on Islamic law,
I said that from en economics perspective these reforms want lead to growth and development,
alot of these sources, you provide, are non -academic or represent the extreme fringe of academic community,

 

[Deus]

last thing,

it wouldn't be wrong to ask me for a bio on the prophet because as I had mentioned many times before, I was forced to take Islam for 12 years in school as a subject over the course of those 12 years I have come into contact with a lot of bios on the prophet as sanctioned by state curriculm

 

[Knut Hamsun]

last thing,

it wouldn't be wrong to ask me for a bio on the prophet because as I had mentioned many times before, I was forced to take Islam for 12 years in school as a subject over the course of those 12 years I have come into contact with a lot of bios on the prophet as sanctioned by state curriculm

I agree. I think Ansar's comments to the contrary were pretty hasty. If I wanted the party line, I'd ask the party.

 

[Thinker]

first, yes I was talking about the Jizyeh,

I have read through a question asking how jizyah on all non-Muslims could be jusrified. The justification was that as non-Muslims don’t pay Zakah they must pay jizyah.

The explanation goes on to suggest that as non-Muslims receive the same protection from the state and may refuse (on religious grounds not to serve in the army, they should pay jizyah. It cites examples some of which I reproduce below:

In his covenant with the people of certain cities near Al-Haira, Khalid ibn Al-Walid, may Allah be pleased with him, recorded: “If we are able to protect you, we deserve the collection of jizyah; otherwise, we shall not offer you protection.”

The jizyah was also imposed on Muslim men who could afford to buy their way out of military service. If a Christian group elected to serve in the state’s military forces, it was exempted from the jizyah. Historical examples of this abound: the Jarajima, a Christian tribe living near Antioch (now in Turkey), by undertaking to support Muslims and to fight on the battle front, did not have to pay the jizyah and were entitled to a share of the captured booty.

My questions are:

Is the jizyah tax levied against non-Muslims in Muslim countries?

How do you rationalise using a donation to the poor to pay for an army?

 

[aamirsaab]

...
Is the jizyah tax levied against non-Muslims in Muslim countries?

I take it you mean, present muslim countries. In which case, I don't really know. I've only ever lived in Pakistan (but then, that country is full of so much corruption I wouldn;t be able to tell you what it is doing right!) I guess it sill is being levied but not sure at all.

How do you rationalise using a donation to the poor to pay for an army?

It's not a tax on the poor. It's a tax on the non-muslims who are living in an islamic state and aren't serving in the army that protects them.

If it was a tax on the poor, that country's army would be weaker than a small band of chavs!

 

[Thinker]

I
It's not a tax on the poor. It's a tax on the non-muslims who are living in an islamic state and aren't serving in the army that protects them.

Hi again,

My understanding is that there is Zakah (which is a requirement that all Muslims donate 2 1/2% of their income to charity) how charity is defined is another question)) and that the suggestion was that the justification for making non-Muslims pay jizyah was because they are not obliged to pay Zakah.

The problem I have (in trying to understand this explanation) was that the examples given were that the jizyah money was used to pay for the armed forces (protecting them). How can a contribution to help the poor be used to pay for the armed forces? Is it for example, the case that, a payment to armies or armed groups is acceptable in meeting the requirment to fulfill Zakah?

.

 

[aamirsaab]

Hi again,

My understanding is that there is Zakah (which is a requirement that all Muslims donate 2 1/2% of their income to charity) how charity is defined is another question)) and that the suggestion was that the justification for making non-Muslims pay jizyah was because they are not obliged to pay Zakah.

The problem I have (in trying to understand this explanation) was that the examples given were that the jizyah money was used to pay for the armed forces (protecting them). How can a contribution to help the poor be used to pay for the armed forces? Is it for example, the case that, a payment to armies or armed groups is acceptable in meeting the requirment to fulfill Zakah?

.

Ah you've been mislead. Jizya is not the non-muslim equivalent of zakat. It's completely unrelated to zakat since it deals only with the army/protection, whereas zakat is solely for charity. In other words; the justification for Jizya is NOT because non-muslims are not obliged to pay Zakah.

The actual justification in laymans terms is: if you're living in this state and you aren't a part of the army, then you should atleast be supporting the army.