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Below is the text of an editorial by Common
Sense editor Sahib Mustaqim Bleher
for issue 23 on the topic of alternative
economics.
Money grows on
trees, but the banks take the harvest
We talk a lot about money
in Common Sense, not because, like most, we haven't got enough of
it, as we have got used to making do with little, but because in
solving the money problem lies the key to resolving the greater part
of the ills of modern society. This is not to say that all man-made
problems are due to a lack of money. Often a lack of faith is the
source of much evil in our lives, but for those who still believe
the Qur'an to be true in its entirety, the forcefully expressed
prohibition of usury and interest by a declaration of war from Allah
and His messenger against those who persist in illicit usurious gain
indicate that the attempt to establish a just economy is essential
to the preservation of faith. Today's global society has become
increasingly godless, and the unchecked exploitation of man by man
is a clear symptom of this disease. As it has always been the task
of believers throughout history to call to both faith and justice,
the Islamic Party of Britain has made the attack against an unjust,
interest-based monetary system a key element of its programme.
Readers of Common Sense
are, therefore, familiar with many of the arguments in favour of a
humane and equitable economic model. Issue nr. 2 of Common Sense had
been entirely devoted to this subject, but has been out of print
since long. This present issue is intended to be another compilation
of valuable reference material for all those active in trying to
convince others not only of the futility of the present finance
system, but also of the viability of an Islamic alternative. Some of
the earlier materials will be repeated, but a lot has been learnt
over the years in the struggle present the Islamic view to Muslims
and non-Muslims alike. Too many Muslims are still totally oblivious
of the larger picture, too concerned with the own back gardens of
cultural isolation, and too brainwashed by modern media-propaganda
to sincerely believe that the alternative presented in the Qur'an
can actually be applied to the workings of a modern economy.
It is for this latter
reason that it is necessary to include the wisdom of many a
non-Muslim, from Abraham Lincoln to Napoleon and John F. Kennedy, to
show that an interest-free economy is not only Islamic, but also
makes sense, whereas the present-day arrangements, besides all their
sophistication, can only be described as madness, from the dumping
of edible food in the sea to maintain price levels, whilst millions
of people in the world are starving, to the instability of money
markets which can plummet whole regions into deprivation over night.
Events like the devaluation of currencies in south-east Asia have
provided sufficient a shock to make many Muslims re-think their
hitherto blind following of the inherited wisdom of Western economic
theory. Malaysian prime minister Dr. Muhammad Mahathir had the
commendable courage to challenge the International Monetary Fund and
its Guru George Soros. Even the chairman of the Dallah Al-Baraka
Group, Sheikh Abdullah Saleh Kamil has had to admit that so-called
Islamic Banking "carries many of the features of the conventiional
loans entailing interest and many of the disadvantages of the
Western capitalist system". Quoted in the December issue of Impact
International he goes on to say that we did not "cleanse our
dealings of interest" and "were not able to overcome the effects of
the conventional banking system". According to the article, Islamic
Banks had become zero-interest windows for collecting Halal money
which was then channelled into the international banking system. To
lure the sceptic Muslim customer, ordinary high street banks had
also begun to open "halal windows in their haram palaces".
This admission is
gratifying in that we had warned for years of the unacceptable
nature of these Islamic banks and Islamic investment schemes, trying
to sell the halal pork chop to unsuspecting customers. Many more of
these pretended alternatives are being produced all the time,
including off-shore trusts with exclusively non-Muslim directors but
an attachment of Sharia-advisers to placate the fears of the Muslim
clientele targeted by them for the benefit of large banking
corporations. An article in The Times of 17th January entitled
"No-interest loan has poor take-up" seems to suggest, however, that
Muslims are no longer stupid enough to pay the extra percent for
having their interest-based mortgage declared halal by an Arab bank
posing as Islamic. Increasingly the crude instrument of Murabaha is
seen for what it is, an attempt to extract interest by use of a
contract which simply circumvents the restrictions placed on such
usurious dealings by Islam by fulfilling the letter of the law in a
roundabout way, but violating its spirit.
During a recent seminar,
a Western scholar of economics and writer for the Financial Times
and other papers, David Cowan presented a paper in which he spelt
out what most Muslims active in the field of Islamic finance
conveniently ignore, that "if Islamic bankers are merely acting
piously for the wealthy clients, then this strikes one as being
somewhat self-serving, not a serving of the community of a duty of
care to the community and God's earth. Looking around the Islamic
banking scene I do not see too much evidence of Islamic bankers
providing services to the blue collar or pooerer sections of the
community, except for the obligatory Zakat thrown in the right
direction. When broached on the subject, Islamic bankers respond
that it is not always economically viable, a critical mass is
required before services can be filtered down to the lowest levels
of society. I don't recall the prophet using the term 'critical
mass' anywhere, but that aside, there is still the question of
intent matching action. One supposes that this is a question for
personal reflection on why one is an Islamic bankeer, and what good
intention one has. .Islamic banking is often reduced to a series of
'do's and don'ts', and Shariah boards are hired to making up such
shopping lists, and each list is different, but who is examining the
intent?" He says, that Shariah is applied to modern banking
practices inadequately: "Islamic banking is not a pious veneer to
cover Capitalist values. 'Where's the margin?' and 'What's the
bottom line?' are not questions one hears being asked in the Qur'an
or the hadith, but scratch away a little of the veneer of Islamic
banking and I suggest that is what you will find."
It is a shame that it
takes a non-Muslim to hold up the mirror and expose the
self-righteous pretence of Muslims in stating that the scholar has
not clothes! Muslim economists have consistently missed the point
and served as Muslim Calvins in justifying the greed of their
paymasters by permitting them to circumvent the prohibitions. Whilst
the technicalities of Islamic banking are discussed at length in
scholarly volumes, little attention is being paid to the issue of
money creation. Again, it takes the effort of non-Muslims to point
the way, and recently the Green Party has begun to discuss, and
hopefully take on board, recommendations to change our
interest-based and fraudulent monetary system.
Money is man-made, and so
are the problems connected with it. Except for the small change, it
is made from paper and therefore produced at very little cost. As
far as the paper pulp is concerned, money does grow on trees, and
its supply is only limited by artificial reasons. Those who issue
our money want to be paid for the privilege, and so they create the
myth that if money was not kept artificially scarce, we would all
suffer, when really the only harm that would come from an increased
money supply is to their illegitimate harvest gained from people's
needs. One would think that in a democratic society, the issue of
the life-blood of our economy would be democratically controlled,
yet the new government has elected to irresponsibly delegate all
monetary decisions to the non-elected Bank of England, which really
is a bank of the banks of England, not the people. It is there to
bail banks out when they miscalculate, whereas ordinary folks
wanting some tighter regulation of the money markets will be told of
the free play of market forces. Banks have created the myths of
merely lending depositors' money, but in the system of fractional
reserve banking, these deposits only serve as a basis upon which
they create credit, fictitious money, which represents no wealth and
only exists because desperate borrowers are compelled to underwrite
it with their promise of repayment at exorbitant rates. If the man
in the street printed his own bank notes to pay for his purchases,
he would be jailed, whereas a bank can freely issue money out of
thin air to lend to him to pay for those very same purchases and
demand even a fee for this macabre game of hocus-pocus. What is
worse, governments, the representatives of the people, are forced to
borrow those previously non-existent funds from the banks and
forbidden to create their own.
Imagine the Bank of
England were permitted to do precisely that, issue the money supply
of the nation as and when needed at zero interest. It would not need
to profit from money creation, because the nation would profit from
the uses the funds were put to. No longer would we have to hear of
school and hospital closures, because the funds cannot be found. The
question: where is the money going to come from? would be answered
thus: the government will issue the funds necessary for any projects
deemed desirable and feasible, and any surplus can be returned via
taxation. Of course, money, in this case must not be hoarded nor
traded, but simply fulfil the function of representing real wealth
in goods and services, providing a means of exchange that is more
easily quantifiable than a direct exchange via barter transactions.
At present, however, local and national government will have to make
ever more devastating savings in all areas of government spending to
be able to continue to pay the crippling interest levied on the
monies borrowed from banks which did, what the economists paid by
them deny the government to do: issue it upon demand.
The insanity of private
credit creation has led to untold suffering of people at a time of
fascinating technical advance. Previously unthinkable achievements
have been made possible by technology, but are denied to us due to
insane monetary restrictions. And so the short-comings of our
civilisation are entirely man-made. God provides plenty, but man
holds back. Power-greedy financiers and politicians will easily find
the means to produce millions of pounds worth of destructive weapons
to drop free of charge on top of innocent populations around the
world, but refuse to find the means to alleviate totally unnecessary
poverty at home and abroad. In His wisdom, Allah has linked usury
with war when describing the harm which comes from it, as it creates
both the strife that leads people to confrontation as well as the
economic conditions which rely on the conquest of new markets and
the production of self-destroying goods to further a valve by which
to let off some steam from a system which is always near collapse.
The equation is easy: for someone to become rich without effort,
someone else will have to pay.
If a banker issues a
certain amount of credit, let's say a hundred pounds, but wants it
back with interest at the end of the loan period, then the extra
amount of interest which is paid on top of the original loan must be
found from somewhere else, for the banker did not create that money.
A manufacturer will have to raise prices, causing inflation, to be
able to keep up with the interest demands on the original loan taken
out to finance production. Consumers who have over-borrowed to pay
for the goods which were out of reach to them, will after some time
no longer be able to afford as much as they were used to, as the
burden of interest payments weighs them down. Consequently, some
businesses will collapse for lack of sales, and the merchandise
produced by them will find its way back in the economy as bankrupt
stock, bringing some relief to the stretched capabilities of
consumers and letting some pressure of this artificially troubled
economy. Through bankruptcies, banks call in real wealth in exchange
for the fake money they issued as loans. Thus the rich get richer,
and the poor poorer.
This works on the global
level, too, and soon the rich nations of the world,
disproportionately exploiting the world's resources will see the
need to protect themselves against the demands of the poorer nations
through tight immigration controls, and more importantly, heavy
defence budgets. Arms are a convenient way to get governments into
debt. They will borrow plenty of money but not spend it on an
increase of living standards which would appease their populations.
To create the need for arms provides the finance houses with real
power of control over governments. Therefore, the fear and threat of
war must be kept alive. If the same funds necessary for the
production of arms were spent on the needs of people, people would
prosper and not see the need to fight nor to borrow. That may sound
like paradise, but is bad news for bankers who are parasites, not
benefactors. The greed for wealth and the greed for power go hand in
hand, and it is not surprising that the big finance houses, like the
Rockefellers and the Rothschilds are the prime movers behind the
drive for global government. Multi-national companies, like oil
conglomerates, are already far more powerful than individual
governments, and in their partisan interest, governments are bullied
into doing what is good for business, not what is good for the
people who elected them. Democracy has become a farce.
If humanity is to
overcome the curse of poverty, crime and exploitation, the big war
will have one day to be waged: the war of people against the banks.
To rid the planet of war, to achieve peace and prosperity, the
usurer's control over the world economy will have to be curbed.
Islam has so far withstood attempts at secularisation and
commercialisation. Notwithstanding the attempts of so-called Islamic
banks, the rules forbidding interest have not been cancelled, and
never will. Is it surprising then, that Islam has become enemy
number one for those who dream of controlling the world? The day
Muslims wake up to reality - or those who are awake discover Islam!
- we might see the light of liberation from the shackles of modern
slavery. The Islamic Party of Britain and its publication Common
Sense intends to continue to encourage such an awakening.
Author: Sahib
Mustaqim
Bleher |
Date Published:
January
1998 |
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