Noor e Madinah

Summary: Capitalist Individuality

2006-12-17T04:36:00.000-08:00

• Is capitalism / democracy universal and necessary?

• This claim founded on the Enlightenment’s conception of rationality – ontological truth can be discovered through deductive / inductive logical processes.

• This reason is universal – common to all human beings as is the pursuit of this worldly happiness. Reason is therefore a slave of this passion for pleasure.

• Reason identifies the universal moral norms and social practises, which can maximize human happiness.

• Since every one is rational every one must rationally choose (a) maximization of happiness as the purpose of life (b) the norms and practises which makes this possible autonomously – no domination.

• In Romanticism intuitions / passion are seen as the source of ontological truths.

• The self – the source of intuitions – is necessarily good (for it can discover truth). It is good even when it wills evil (for this is just a means for achieving good). That is why the Roussiuan General Will is always good – willing the welfare of all. This is the basis of the faith in democracy and (autonomous) capitalist contracts.

• According to Kant the self “does not derive its laws from but prescribes them to nature”. It possesses an order which determines the structure of our experiences. The self gives the world its form and meaning. The self is transcendental in the sense that it is the necessary universal basis of all experiencing and conceptualizing. It has prior knowledge of the concept of an object and of the process of causation.

• As the self is the source of experiencing and knowledge it cannot be known. We have faith in it – in a self which is free to know and to will the world autonomously. This freedom is the presupposition of democratic / capitalist immorality.

• It is reason which tells us what our duty is. Reason produces universalizable moral principles. The practice of these universalizable principles produces a harmonious community (“a kingdom of ends”) in which everyone is treated as an end in himself.

• Reason permits a detachment of the noumenal self from the phenomenal self and the phenomenal world. The self is essentially good because it can autonomously discover the good. Faith in freedom is required for this discovery. Faith in freedom is intuitive.

• The self is the source of all feeling, knowledge and action and it is responsible for the world. In the German Romanticist tradition the self is seen as creating the world – willing truth not just knowing it.

• Hegel expands the self from the individual to a language community. Hegel also denies the existence of self validating universal truth. Every language community creates its own universal truth which is a shared interpretation of the collective experiences of a language community. The self realization of a language community takes place in history. The self realization of the West is the end of history.

• It is not the individual but the language community which is autonomous. Morality is the conventions / way of life of a community – it is not universal laws created / discovered by autonomous individuals – at the end of history the West’s conventions / constitutions are indispensable for freedom.

•Schaupenhauer showed that the world that the West has created is dominated by its Will not by its Reason. The Will is free – and reason is its slave. From the 19th Century the West insists upon the possibility of choice – but choice only among valueless ends. Keirkegard argues it is not important what you choose but how you chose it. Choices cannot be defended rationally. All choices are ultimately absurd and passionate commitment does not lead to moral progress. Life is full of crises of choosing between equally absurd commitments.

• Marx saw this as alienation and believed that it could be avoided by situating the whole harmonious person in a whole harmonious society. Class struggle was the means for creating a harmonious society and would lead to Communist Society where choice would be unlimited. Absurdity returns.

• Since the late 19th century the West asks, is Freedom possible. The positivits – Comte, Wittgenstein, Frege – reject the possibility of answering the main ontological questions rationally – necessary and universalizable propositions are only logical / mathematical other investigations of ontological questions were mere “psychologism”.

• Emotions and judgements are correct if they reflect the individual’s true “value feelings”. Thus Dilthey argued that these may reflect historical experience but hermeneutics – the systematic interpretation of human experience – may allow us to understand the meaning of every human experience. Nevertheless relativism could not be ruled out.

• Neitzsche – and Bergson – react to relativism by seeing the individual as the bearer of a vital force – the will to survive. Truth is an instrument for survival, not a source of knowledge. The morality of ubermansch is spending life as a work of art – a rejection of slave morality and an acceptance of fate.

• Phenomenology sought to return to universals by asserting that truth could be found in consciousness. Examining the structure of consciousness could reveal the universal / necessary truths of experience. The transcendental self “I” must find the truth in itself. Turing inwards leads the individual to objective truth (Husserl).

• Freud argued that objective truth is to be discovered essentially in the sub conscious. The urges of the unconscious (‘the libido’) dominate the individual’s life. But these urges are evil and civilization is possible only through their repression, this repression, “self denial”, leads to the “death wish”.

• Wittgenstein asserts the impossibility of discovering the ethical life through reason. Metaphysics is unsayable. There was therefore a need to transcend rational discourse. There is no necessity or value in the world. Knowledge is not to be found even in language – there are only “language games” which cannot represent universal truth. Wittgenstein gives us self doubt.

• Self doubt is re-enforced by Heidegger. The individual is merely Dasein – “being in the world” enquiring about Being. Asking the unanswerable question “who am I”. The boundaries of the self are unclear. The individual is concerned primarily with being not knowing. The self is partly constructed by “the they”. The self must choose his Existenz and avoid Falleness. Choosing Existenz seriously is coming to terms with death. Facing death is the hallmark of authenticity. But how this is to be done and what meaning is revealed by being remains unclear in Heidegger.

• Gadamer and Habermas argue that meaning is to be found in life not in death – the self knows itself as part of a humanity that shares the problem of life on earth. Intersubjective communication – if not distorted politically – can lead to a harmonious consensual universal fusion of interpretations that asserts Enlightenment values. Since the mid 1990s Habermas has significantly qualified these claims about the universality of human rights.

• Sartre endorses the absolute freedom of the individual – there are no necessary choices. The self is to be created. It is itself nothing. Consciousness can make the world what it is not. It can put whatever meaning it likes into the world attempting to do this is wanting to be God. Abandoning this wish is bad faith but in Camus’ view death frustrates this wish and shows the ultimate meaninglessness of life.

• Structuralism argues that objective laws of human behavior – though not meaning – can be discovered in the structure of culture and language. Foucault seeks to study the structure of Western civilization and identifies the historical sources (the genealogy) of these structures. He denies the possibility of deriving universal laws of human behavior from this examination. He speaks of the death of man in the precise sense that universal meanings cannot be derived. Knowledge is socially manufactured and discursive practices reveal power relations in a specific social setting. In Foucault meaning is not truth. Progress is impossible. The individual is filled with revulsion of post-modern society but continues the meaningless struggle for freedom despite recognizing the inevitability of capitalist subjectivity.

• Deridda ridicules these struggles. There is no meaning, no subject, no reality. All practical consensus is historically constructed. We can merely deconstruct.

Transcending Social Science

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•General loss of faith in Western ideals, freedom, rights, progress, reason. Foucault etc. have shown that it is impossible to justify the universalist claims of capitalist norms and practices. Post modernists justify these claims on esthetic grounds.

•Islamizing social sciences makes no sense in these circumstances. It only produces apologies for capitalist practices and liberal policies. This subjects Islamic thought and practise to human rights imperialism at a time when it is collapsing.

•Legitimating capitalist/liberal practices makes the construction of Islamic individuality, society, state more difficult. Such legitimation by Christianity has led to avarice dominated individuality, sexually and economically corrupt society and human rights imperialism. Rejecting social science is necessary for avoiding moral decadence and imperialist domination.

•Capitalist individuality and rationality is not natural but contingent. The dedication of thought and policy to the maximization of freedom/pleasure is not natural.

•Imam Ghazali provides the framework for deconstructing unIsalmic metaphysics and epistemology. He neither subordinates Islam to alien systems of knowledge nor does he incorporate them in Islamic epistemology. He seeks their total destruction.

•The Ghazalian approach refutes the claim of the West to be universal or a civilization. It rejects dialogue. It seeks the deconstruction of modernity and Western hegemony.

•The internalist Ghazalian critique of the social sciences demonstrates the incoherence of their presumptions and methodologies, identifies their hidden meanings and their lack of correspondence to their claims and to reality. The externalist Ghazalian critique involves critiquing social sciences presumption, methodologies, practises on the basis of Islamic epistemology and morality. Only the orthodox ulema and soofia can undertake this externalist critique.

•The development of a comprehensive internalist and externalist critique of Enlightenment epistemology is required for the overthrow of Western savagery and the demonstration of Islam’s claims as the only universal civilization.

•Islamic epistemology cannot accommodate social science presumptions and methodologies Islamic social enquiry presumes the ultimacy of God and rejects human autonomy and self determination. The moral oughts are established by the will of the Creator as interpereted in Shariah and the Tariqas by ijmah. Human practices are evaluated in terms of their submission to Allah’s will. In this perception knowledge is essentially awareness of Allah’s will with regard to human being and human conduct.

•Enlightenment epistemology is an outright rejection of these truths. Similarly there is no room for freedom, equality, progress, human rights, tolerance in classical Islamic learning. Imperialism seeks to incorporate these concepts into Islamic discourse in order to subordinate Islam to Enlightenment epistemology.

•We reject social science because its methodologies are not value neutral but provide justification and technologies for capitalist governance. Capitalism sees man as master of his body and of the world. Man imposes order on the world through self reflection which makes experimentation possible in order to subject it to his will. The commands of the human will cannot be evaluated (except thru universalisability, i.e. formally). Reason is a means for obeying the arbitrary commands of the will. The social sciences provide tools for the practise of mechanism and utilitarianism. They promote passion specially avarice and covetousness.

•The purpose of social enquiry in Islam is to create an individuality and society which voluntarily submits to God’s will. We recognize freedom as an evil because freedom is al bagh – the choice to choose any thing. This is to desire to subject the world to man’s arbitrary preferences. In practise this is the preference for capital for capital is universalisable and limitless. That is why social science legitimates and provides governmental technology for capitalist order.

•Islamic economics and Islamic constitutional theory legitimate capitalist rationality within the constraints of the Shariah. They are attempts at incorporating Islam within capitalist order. Fundamentalism – Christian and Islamic – may be seen as attempts at re-enchanting capitalism in this sense. They do not reject the goals of progress and freedom within Shariah constraints.

•The practise of shariah constrained capitalist rationalization and technologies in Iran and Saudi Arabia subjugates these societies to global capital and human rights imperialism. The authority of the ulema is delegitimised and Islamic individuality and social organization is weakened.

•Islam is committed to the overthrow of capitalism as a way of life. Islamic social enquiry is concerned with creating rationalities for the flourishing of Islamic individualities, social organization and virtues for effectively dealing with the contemporary challenges that Islamic revolutionary movements are facing.

•Islamic revolutionaries need to create space for anti capitalist economic and political practise. One way is the organization of non capitalist production and exchange structures. These structures should be instruments for the flourishing of Zuhd and infaq and for augmenting the material power of the Islamic revolutionaries. Islamic social enquiry should develop appropriate theoretical constructs for the mobilization of community based political struggle against the administrative and legislative authority of the constitutional state.

•Classical Islamic branches of learning have been concerned with developing mechanisms for the flourishing of Islamic virtues and Islamic social organization. They therefore provide an appropriate paradigm for addressing these issues in the contemporary context. Our social theorizing must be within the classical Islamic episteme.

•Such social analysis must not be concerned with legitimating isolated capitalist practices – stock trading and elections for example. It must develop the capacity to see capitalism as a complete system. It must ask: how can society as a whole be organized for the promotion of the Islamic virtues and the transcendence of capitalism (takkathur).

•Classical Islamic methodologies and rationalities have been preserved by the Ulema of Deoband and Barrailly in a pure and uncontaminated form. A basis exists for continuing Hazrat Qutb-ul-Alam Mohajir Makki’s project of integrating the movements of spiritual uplift, revival of Islamic leanring and jihad.

•The deconstruction of Enlightenment epistemology and addressing contemporary issues related to the overthrow of capitalism requires an expansion of the scope of ilm-I-Kalm, Fiqh and usul-al-deen. This broadening of scope must entail a construction on the basis of our inherited wisdom and an elaboration of the teachings on which there is ijma. Our social theories must conform to the maqasid-i-sharia and be sanctioned by the principles enunciated by usul-i-fiqh for the formulation of ahkam.

•This is taqleedi ijtihad – an ijtihad which confirms, elaborates and vindicantes ijma and preserves grounds for establishing Islam’s claims as the only universal civilization. Such ijtihad provides an indispensable basis for transcending social science and for waging permanent jihad against Western savagery.

•The West has adopted capitalism as a way of life and re-articulated the claim ana rabba kum al ala. The rule of capital leads to a total rejection of Allah’s authority and universalization of the vices of avarice and jealousy. It fills the world with sexual vice and mass slaughter. Economic life is thoroughly corrupted by riba and gharrar. All this represents a never to be satisfied lust for freedom and plentitude.

•Social science justifies man’s rebellion against God (freedom) sexual vice, economic exploitation and human rights imperialism. Transcending social science is necessary. It can be achieved by the ulema who must revive classical Islamic learning to reassert the universalist claims of Islamic civilization.

Islamic Banks as the West's natural Allies: Review of The politics of Islamic finance

2006-01-27T02:22:00.000-08:00

The September 11 counter attacks on America have created something of a crisis for Islamic finance. The Bush administration had expressed misgivings about the involvement of Islamic banks in financing resistance operations in America and several unsuccessful lawsuits have been brought against leading Islamic financiers. Islamic banks have been insisting that they have played no part in financing the Islamic resistance to American dominance of the Muslim world. Islamic banks seek to present themselves as institutions, which can facilitate the subordinate integration of Muslim economies to American capitalism.

The principle aim of Henry and Wilson’s book (Henry C.M and Wilson R (ed) The Politics of Islamic Finances, Karachi, Oxford University Press 2005) is to justify this claim of the Islamic banks. It seeks to show that the growth of “a new type of Islamic capitalism” has largely been a response to liberalization by governments in Muslim majority countries. These initiatives were usually articulated --through the Structural Adjustment Programs (redesigned as Poverty Reduction and Growth Facility Programs) of the IMF and the Sectoral Programs of the World Bank. The growth of the Islamic banks can legitimately be seen as a (perhaps unintentional) consequence of these programs. It is therefore not surprising that leading IMF and World Bank officials Sami’ al-Darvsih, Abbas Mirakhor and Mohsin Khan have played pioneering roles in the Islamic finance movement.

The book under review recognizes the superficial nature of the Islamic banks rejection of interest “they appear to share a financial world view in which riba is abolished while the time value of money as understood in contemporary financial theory is respected” (p. 2). Rodinson made much the same point about the legitimating of interest by the client Ulema of the Abbasi and Saljuk courts in medieval Iraq (Rodinson 1969 Chap 7).

Islamic banks exist in Muslim countries whose governments support them as “a part of a strategy to legitimate themselves” (p.2). At the beginning of 2002 Islamic banks esisted in 18 Muslim and six non Muslim countries (Switzerland, France, Netherlands, India, UK and the USA). Their share of commercial banks deposits in the Muslim countries averaged about 5 percent ranging from over 10 percent in the UAE to less than 0.1 percent in Tunisia. These figures exclude Iran where unislamic financial practices are forbidden. These figures also do not include deposits in the Islamic branches of non-Islamic banks. These are quite substantial in Egypt, Malaysia and Saudi Arabia. The share of Islamic financial institutions in bank deposits in non-Muslim countries was usually less than 0.001 percent in 2002.

On average about 60 percent of Islamic bank financing is on mark up basis Islamic banks have rechristened markup as “ murabaha”. Above 90 percent of credit extended by Islamic banks requires borrowers to pay fixed periodic charges. This is implied interest by whatever Arabic, Turkish, Swahili or Urdu name you call it (Warde 2000 p. 6)

But apparently changing names is sufficient for satisfying members of the Religious Advisory Boards who guarantee the Islamicity of the products of Citibank, Abn Amro, HBSC and the 200 odd other members of the Geneva based International Association of Islamic Banks. Henry and Wilson are confident that “the (Islamic) financeries and their religious boards will (continue) to make compromises with the financial markets” (p.5) and the range of interest duplicate financial contracts offered by Islamic banks had been increasing rapidly over the last decade. Moreover “the most significant guarantee of Islamic banks’ future (is) the large Western multinational (banking sector which) has opened Islamic windows” (p.5).

Henry and Wilson describe in detail the patronage networks sustaining the Islamic bank. Monzer Kahf a senior executive of the Jeddah based Islamic Development Bank attributes the rise of the Islamic banks to “an alliance between private financiers and religious scholars” (P. 17). This “alliance between the rich and the wealthy and the shari’a scholars…served to de-politicize the Islamic movement and opened up new avenues of co-operation between the government and (the) Islamic opposition” (p.17).

The founder of the Islamic banking movement in Egypt Dr. Ahmed al Najjar was a German educationist and financial economist “at considerable distance from the Muslim Brotherhood” (p.19). The first Islamic bank of Egypt was known as the Nasser Social Bank. It was owned by the government and a major purpose of its establishment was to delegitimise the social efforts of the Ikhwan.

Prince Muhammad al Faisal played a pioneering role in the development of Islamic banks in the Gulf and North Africa. The Saudi sponsored international religious network recruited many ulama to the Islamic banking movements, all of them dissidents of the Ikhwan (such as Yusuf al Qardavi, Abd as Sattar Abu Ghaddah, and Hussain Ahmed Hassan). A leading Deobandi critic of the Jama’at’i’Islami, Taqi Usmani was recruited some years later.

According to Kahf “(t) his alliance between the ulama and the Muslim bourgeoisie creates a new power structure” (P 25). The ulama “created a buffer that can be used in support of the main shareholders and professional managers of Islamic banks who are usually drawn from commercial banks” (p.25).

The shari'a scholars need the support of the banks and the government “for the rising Islamic movement sidelined most of them” (p. 25). There are innumerable material benefits the ulama enjoy because of the support of the bankers. One only has to visit Dar ul Ulum Korangi to ascertain this. As Monzer Kahf notes, “The alliance gives the ulama a new source of income that by far exceeds what they were used to earning. It gives them opening to a new life-style that includes air travel, some times in private jets and stay in five star hotel suits. In addition they are frequently commissioned to undertake paid research.” (p.26).

“Bestowing a new income and new associations it opens the ulama and exposes them to experiences that were even hard to imagine in the past. The ulama that in the 1950s, and 1960s had weather beaten dead skin hands, humble clothing, sitting in the cold teaching on the ground of mosques are now replaced with soft living ulama who are used to luxurious garments, services of five star hotels and expensive restaurants, (this) has resulted in changes in (their) viewpoints”(p.27)

Kahf further notes, “The bankers have always been very sensitive in selecting the type of ulama who are acceptable to both the government and the general public. The ulama allied with the Islamic movements are avoid(ed)” (p.28) The Islamic banks seek to promote “reconciliatory reformers who abandoned the banner of Syed Qutb, “Take Islam all together or leave it” (p. 29).

The pro imperialist stance of the Islamic banks is emphasized by Ibrahim Warde (chp2).

Warde notes that with the exception of the Sudan “Islamic finance (is) firmly embedded in the US centered political and economic order oriented towards preserving the status quo. In every new market they penetrate Islamic banks establish links with the local legal power structure and work within established oligopolies. (They) are keen on working with the major international financial institutions. The capitals of Islamic finance are London, Geneva and the Bahamas not Jeddah, Cairo or Karachi. (They) have a stake in the stability of international markets where they are heavily invested. They hold a large percentage of their deposits abroad. The large international banks were instruments in the very creation of the Islamic banks” (p. 41).

In countries such as Bahrain, Qatar and Malaysia governments have used Islamic banks as a tool for policy liberalization and deregulation (p.47). The Islamic finance movement has during the 1990s moved further and further away from traditional Islamic practices and in the name of urf and masliha sanctioned virtually all interest replicating contracts (pp. 47-49).

As Warde stresses “Islamic bank(ing) has become more pragmatic and is increasingly converging with conventional banks” (p.49). It is laughable that much of the “ijtihad” justifying Islamic bank practices now takes place at the Harvard Islamic Finance Information Forum (HIFIP).

For these reasons the Islamic banks were deeply shocked by the post 9/11 suspicions against them voiced by America. Prince Muhammad al Faisal was the first and most vocal denouncer of the counter attack on America. He wrote “We all condemn in the strongest possible terms the terrorist September 11 attacks as a serious crime (Gulf News 12th September 2001). Saleh Kamal boss of Al Barakah was equally distressed. The West has recognized the genuineness of the Islamic finance movements’ commitment to American hegemony and no case brought against the Islamic banks in the wake of the September 11 counter attack has succeeded.

The similarity between Islamic and mainstream banking practices is illustrated by Tarik Yousef’s paper (chap 3). The domination of murabaha in the Islamic banks’ financing packages shows that they are not an alternative but rather a compliment to the standard products of commercial banks. Yusufi shows (pp. 65-66) that murabaha contracts are “virtual replicas” of interest based debt contracts.

He shows that the same systemic factors account for the dominance of interest replica and straightforward interest financing and that there is convergence between them. There is nothing peculiarly Islamic about Islamic finance or about the behavior of Islamic capitalists.

Empirical studies have shown that the financial performance of Islamic banks has generally been inferior to conventional banks and Islamic banks have over the years became particularly dependent on state subsidies and a host of other forms of government support and patronage (chap 5).

In chapter 6 Rodney Wilson documents

the role Islamic mutual funds have played in accelerating capital flight from the Muslim world to the West. Far from contributing to national development Islamic banks and financial institutions are facilitating the rich and wealthy to transfer their funds to safe havens in Europe and America.

Foreign direct investment from one Muslim country to another is miniscule in relative terms in Islamic mutual funds invest almost exclusively in America and Europe. As Wilson notes “Islamic capital flourish (es) in the liberalized environment of the West” (p. 130). He sees contemporary Islamic capitalists as

“cultural brokers acting as institutions facilitating the westernization of the Muslim countries Islamic funds and banks serve as conduits for money that was previously held outside the banking system and the Muslim world to be transferred to Western financial markets. Shari'ah advisors of Islamic banks are legitimating this transfer of funds.

Wilson estimates that Gulf “filthy rich” nationals totaling about 200,000 held over $ 2 trillion in Europe and America in 2002 ( p.135). The predominant proportion of this investment is in America

The total number of Islamic funds had increased from 9 in 1993 to 105 in 2002. Most of these are owned and managed by American and European financial institutions, such as Permal Asset Management, Keppel Insurance, Pictet & Cie, UBS, CITI, First Investment Company etc (p. 141). The four largest Islamic funds management companies are from America, Britain, Germany and Switzerland.

Henry and Wilson conclude, “(P)olitical Islam should not be conflated with Islam’s other economic and social dimensions. Even governments in the Muslim world that wage war against political Islam recognize the difference between Islam’s political and economic practitioners” (p. 287).

Islamic finance is an imperialist initiative and as Henry and Wilson note

“Islamic banks remain highly vulnerable to external forces emanating from New York and Washington DC. Political Islam in the modern world is suspended between radical and moderate poles and the emergence of a distinctly Islamic form of capitalism (an) alliance between the Ulema, bankers and entrepreneurs could tip the balance and effect a deep structural transformation in the Muslim world. United States policy makers might well ponder over the implications of Kahf’s arguments, instead of supporting a bunch of middle class NGOs they might assist Islamic institutions that promote the spirit of capitalism and free enterprise” (pp. 296-297)

The natural affinity between the imperialists and the Islamic finance agenda is illustrated by the organic link between Islamic and mainstream financial institutions. Islamic banks can either be instruments for financial policy liberalization within the Muslim world or else a conduit for transferring money from Muslim countries to capitalist metropolises specially London, New York and Geneva. The Jordan case study (Chap 9) shows that Islamic banks make extensive use of trade financing and commodity speculation to transfer funds abroad.

The Kuwait study shows that policy liberalization has contributed to a softening up of the Islamic movement through the work of Kuwait Finance House. This has not been the case however in Egypt (Chap 12) or in Turkey (chap 10) where there is widespread criticism of the Islamic banks by the Islamic parties and the Islamic banks are now seen to be the pawns of the secular governments. Sadat’s and Mubarak’s attempt to transform the Ikhwan into an Islamic equivalent of the Christian Democratic Party has manifestly failed.

Typically “Islamic banks offer cover to the governments for the further engagement with international financial institutions and the Washington consensus” (p. 261) As Samir Soliman observes “Islamic financial banners wave freely in the air unfolding a harmless variety of meanings” (p. 264).This is especially true in the Gulf which is the only region in the world where Islamic banks have a significant share of bank deposits and which are for all intents and purposes American colonies.

The Kuwait case study shows how Islamic banking is being used to tip the scales in favor of American reformers within the government. There is widespread recognition that “it is in the Western world’s interest to encourage the integra (tion) of Islamic financial instruments into international finance.

Islamic capitalism is not a threat to Western capitalism. The IMF and the World Bank encouraged the establishment of the Islamic Financial Service Board that advises the central banks on the regulation of Islamic banks and facilitates standardization” (p.293). Integration between Islamic and western capitalism is being promoted by Islamic bonds “which have exactly the same features as their conventional equivalents and yield fixed rate of return comparable to market rates of interest” (p.294). Today Islamic capitalism is being sponsored by “ a much better qualified and financially aware generation of Sharia scholars in the Gulf approving radically innovative Islamic financial products” (p. 295).

This is a well-researched anthology written by insiders. It illustrates the imperialist sponsorship of the Islamic finance movement and the dangers it poses to the Islamic movements in the Muslim world. Separate chapters on Pakistan, Bangladesh, Malaysia, Indonesia and Thailand are badly missed and one hopes that OUP will add these to a future edition of this book.

Toward religious reorganization of civilizations: an Islamic perspective

2005-12-17T04:27:00.000-08:00

Professor Samuel P Huntington’s widely noticed contribution to US journal Foreign Affairs presents an essentially Jewish vision of world history and of the nature of global conflict in the immediate future.* The main features of this ‘vision’ are:

•“Culture” or “Civilization” are seen as identical terms. Both are loosely defined and both are seen as being ultimately reflective of the racial characteristic of a particular group. Huntington writes “Arab, Chinese and Westerners are not part of any broader cultural entity. They constitute civilisations (which are the highest cultural grouping people).

•People belonging to different races and civilisations are seen as having “different views on the relation between God and man, the individual and the group, the citizen and the state, parents and children, husband and wife as well as differing views of the relative importance of rights and responsibilities, liberty and authority, equality and hierarchy”. These different views cannot be assessed on the basis of some objective criteria – one holds them because one belongs to a particular race or civilization. Huntington presents no basis for evaluating the value claims of different civilizations and races.

•Religions are means for the assertion of racial identities: “In much of the world religion has moved in to fulfil the gap (created) by the weakening of the nation state.” Religious fundamentalism is thus merely an extreme form of nationalism a revived fascism which seeds the assertion of a particular racial superiority.

•Racial and civilisational groups cannot change their identities. The question is no longer “which side are you on” but “what are you”? “Russians cannot become Estonians,” writes Huntington. “Even more than ethnicity religion discriminates sharply and exclusively among people.”

•Economic success “reinforces civilisational and racial consciousness.” “Economic regionalism can only succeed when it is rooted in a common civilisation.”

•Since “people define their identity in ethnic and religious terms they are likely to see us versus them distinction between themselves and people of different ethnicity and religion.” It is no longer a question of which values are superior, whose views are right. Civilisaitonal conflict is not about the ordering of values. It is merely a naked struggle for power between different racial groups.

•The analysis presented by Huntington is anti-Islamic. “Islamic terrorists” and Islam are described as a threat not just to the West but also to “Russia, the bulk of Africa, Orthodox Serbs in the Balkans, Jews in Israel Hindus in India, Buddhists in Burma and Catholics in Philippines.” “Islam has bloody borders.” The suppression of Islam and the victimisation of the Muslim people is therefore justified. It is justified to apply double standards – condemn human rights violations in Iran but condone mass genocide in occupied Kashmir and Bosnia – for according to Huntington “ a world of clashing civilisations is inevitably a world of double standards: people apply one standard to (themselves) and a different standard to others.”

•Despite an acknowledgment of the supposedly over-whelming military, political and economic power of the West there is a warning that “Western ideas of individualism, liberalism, human rights, equality, liberty, the rule of law, democracy, the free market (and) the separation of church and state have little resonance in other cultures.” There can be no “universal civilisation.” Only a very few “torn countries” – notably Turkey, Russia and Mexico – can “redefine their civilisation identities” (as in some exceptional circumstances Judaism accepts converts). But such conversion will necessarily be very limited and the main option before the West is to subvert and fight the “Islamic and Confucian states” which constitute “a renegade mutual support pact run by the nuclear proliferators and their backers.”

•Huntington recommends that the West “must limit the expansion of the military strength of Confucian and Islamic states, moderate the reduction of Western military capabilities and maintain military superiority in East and Southwest Asia, exploit differences and conflict among Confucian and Islamic states (and) support groups (in these states) sympathetic to Western values and interests”.

In sum the West is advised to become a greater Israel – it must abandon all claim about the universality of its values and content itself with ruling the world through force and fraud. This is the strategy the Jews have been pursuing in Europe and America for over a thousand years. They have made no attempts to universalise Jewish values but by force and fraud they have carved out for themselves a dominant position in the West; its finance, its science, its culture. Why not a Jewish future for Western civilisation? Has not Iqbal said:

Ha naza kay alam may ye tehzib jawa’n marg
Sha’id hoh kalisa kay Yahudi mutawali
(The existing Western civilisation is in the throes of death
In all probability Jews are going to be its custodians)

The future of the West

The Judaisation of the West has been an uneven process. The reformation provided an opening for the Judaisation of Christianity leading to the birth of an exclusivist national state and an exclusivist national church. Christianity, both Orthodox and Catholic, compromised with this Judaisation, but it never abandoned its universalist claims – liberalism in both its political and economic manifestations is a grotesque and monstrous mutilation of Christianity, reflecting above all the latter’s anthropomorphism. That is why the soldiers of Christ followed in the footsteps of the imperialist regimes throughout Africa and Asia and the conversion of the natives to liberalism and Christianity were hand in hand.

The modern dilemma of the West is that its people are losing faith in liberalism and the certainties of the Enlightenment. This loss of faith is reflected at many levels. Most fundamentally liberalism has failed to provide any workable alternative for Christian morality – the inner life of the individual has become impoverished for as even the pagan Greeks knew aesthetics can never take the place of morality. Spirituality can not be a consequence of beautifying the external world. Spiritual impoverishment has made love impossible, family life has collapsed and the West is in the grip of the worst sexual anarchy ever experienced by mankind.

Democratic structures too are disintegrating as people realise that freedom is nothing but an empty void – pure form. Participation in democratic processes is declining, political choice is narrowing as differences in the agenda of mainstream parties disappear. The universalisation of bureaucratic procedures make participatory and representative decision making a farcical charade. The traditional issues of high politics have become meaningless for the common people.
Freedom remains meaningless when it takes the form of capital – pure quantity, an infinite abstraction. The revolution in information technology is merely making the money (the symbol of freedom) go round faster and faster. On the other hand the rate of growth of physical production has been halved in the past decade, compared to the Bretton Woods era. The circuits of finance and physical capital are further apart than ever. Accumulation for its own sake focuses on the creation of unreal need. Men live to want and the purpose of life is merely to want more.

The West cannot survive if it closes its eyes to the tragedy of its own existence – to the failure of liberalism, capitalism and democracy. The people of Europe and America are among the bravest, most perceptive and resourceful people on earth. Abandoning universal principles and retreating into a nationalist cocoon is contrary to their nature. From the days of the ancient Greeks, it is this perpetual quest for universal truth which is the main current in Western history. The Judaisation of the West would among to an abandonment of this quest for truth. The successes of the Western states in extending the spheres of Western power would be phantom victories for the people are fast losing faith in the purposes for which this power is being amassed. Western states would become instruments of oppression for their own people in order to keep up the pretence that the international struggle for Western dominance reflects the needs and wishes of the Western peoples. The World Jewish community has since 1948 been Israel’s most pathetic victim.

The decay of liberalism, capitalism and democracy must not lead to an abandonment of the search for truth. In this quest Islam and Christianity are natural partners; for they, unlike Judaism, Confucianism, Hinduism (and all other civilisations enumerated by Huntington) are by their very nature non-exclusivist, anti-particularistic, anti-nationalist. They belong to no race, no nation. They are the common heritage of all mankind. Indeed it is by partially abandoning its universalist claims (St. Augustine’s sanctioning of the inevitable coexistence of the city of Man and the city of God) and by legitimating secularism in the form of empire and feudal order that Christianity lost the soul of the West.

The West must return to a non-secular, non Roman Christianity; the Christianity of the holy father of the church of Jerusalem of the first century, the Christianity of Peter and John and Baranabas. This Christianity is nothing but Islam. The rapid growth of so many sufi orders throughout Europe and America testify to the continuing strength and vigour of this pure Christianity. Those of us who have had the privilege of sitting at the feet of the European saints like Sheikh Abdul Qadir al Dargavi in Britain, Sheikh Abu Bakr Garudy in France, Sheikh Fadl Allah in Germany – know that they are the true inheritors of the now almost extinct monkish traditions, specially of those of holy saint Francis of Assisi.

They are the new opening (Fatiha) by which Islam is flowing into the heart of Europe and America and re-awakening the followers of the true Christianity. This re-awakening in the beginning must necessarily be spiritual miracle but if the spiritual miracle in the lives of the followers of the pious saints is to be universalised – if a new civilisation is to take place – political and economic reorganisation must inevitably follow. Religious political economy consolidated so that liberalism in the form of both capitalism and democracy may be superseded. Without this spiritual impoverishment, sexual anarchy, political disintegration and economic exploitation nurtured by liberalism cannot be overcome and religious society and a religious state cannot be created.

The British saint Hasan Abdul Hakim (Charles Gai Eaton) teaches “for those who are sickened by the errors of modernism, of rationalism, of nationalism and who wish to break from these illusions there is a home, a shelter always available, Islam.” Despite Jewish hopes, we are entering and ear when civilisations are coming together. The possibility of a religious alternative to liberal universalism is becoming manifest and a retreat into nationalist and racialist exclusiveness is by no means inevitable. There is every hope that a true religious consciousness spreads throughout the West the oppressive acts (both domestic and foreign) of predatory democratic and capitalist states will lead to the organisation of popular resistance to nationalism, secularism and democracy.

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* Huntington's article can be read here

Overthrowing Capitalism: A Ghazalian Perspective

2005-12-03T19:19:00.000-08:00

The foundations for the rejection of the Western way of life was laid by Hazrat Shaikh al Mashaikh Imdadullah Muhajir Makki(may Allah bless him) the Amir of the 1857 jihad. Hazrat Qutub-ul Alam (may Allah bless him) insisted that the project for constructing an Islamic state was inextricably interlinked with the project of totally rejecting the Western way of life.

There are two essential elements in the Islamic revolutionary response to the West: First we must articulate a principled and practical rejection of capitalism as a way of life – its norms, regulation procedures and transaction forms. This involves the construction and consolidation of a religious society encompassing the cultural, economic and political life of the Muslims. Authority at all levels must be concentrated in the hands of the Ulema and the mosque and the madrassah must be developed as central institutional modes for organizing the Islamic systemic resistance to capitalism.

In a country such as Pakistan there are ample opportunities for doing this. A very large proportion of businesses are outside the capitalist order – they do not transact with financial markets and their owners do not seek profit maximization. It is entirely possible to develop a mosque / madrassah based system of tamweel for establishing a counter capitalist economy and for mobilizing the power of the bazzar for the over throw of capitalist order. This has been done in Iran and the Islamic movements of Indonesia and Malaysia have developed several institutional initiatives to achieve this end.

Similarly Islamic movements can utilize the power of the trade unions for delegitimating capitalist property. Unions under the leadership of the ulema should abandon the struggle for workers rights and higher wages within the capitalist system. They must seek the transcendence of capitalist order through an abolition of capitalist money and finance and the utilization of state resources for deconstructing capitalist property and delinking from globalized capitalist markets.

The Islamic movements aim at creating a universal state. We explicitly reject the possibility of carving and a niche for a Muslim state within capitalist order through struggles for national liberalization. We seek not liberation but humanity’s total submission to the will of God. An Islamic state is necessarily a Jihadi state. The democratic process may be a mean for the construction of such a state. But the Islamic state is committed to the total destruction of democracy and republicanism in all forms. This is because we reject the possibility of validating norms and practices with reference to ‘general will’ or ‘the will of all’. We regard the quest for autonomy as a quest for evil. Islam is the submission of the will of man to the will of God – all truth claims are validated with reference to God’s will, and to it alone. Islam is a reassertion of the pre Augustinian commitment.

“Thy kingdom come, Thy will be done on earth as it is in heaven.”

Such a comprehensive social and political struggle against capitalist order has to be firmly rooted in Islamic epistemology.

The fifteenth century of the Islamic era is one of accelerated disintegration of the capitalist way of life throughout the world. Western savagery can no longer sustain the pretense that it is a civilization. Today the Enlightenment project has all but collapsed. As Wendy Brown argues “the West is still grieving the loss of belief in progress, rights, freedom, reason. Yet it still holds these ideals to be irreplaceable” (p. 103). Foucault and Gadamar and Gray and Rorty and Taylor have shown that it is quite impossible to theoretically justify capitalist norms and practices. The Islamic assault on capitalism and on Western savagery is gaining momentum because of the inherent incoherences of modernist and post modernist discourses.

Reinterpreting Enlightenment epistemology and the projects built upon this epistemology makes no sense in these circumstances. Islamising social sciences produces only apologies for capitalist practices and liberal policies. This subordinates Islamic scholarship and the political strategy of Islamic movements to human rights imperialism at a time when the imperialist system is beginning to implode.

Moreover legitimating capitalist norms and institutions makes the construction and sustenance of Islamic individuality, society and state more and more difficult. Legitimation of capitalist norms and practices by Christianity led to the development of an individuality incapable of surrender to God’s will and dominated by the passions of avarice and jealousy. Marketisation of society has led to a shocking decline of sexual morality and a disintegration of family and community. Finally the liberal state has imposed capitalist oppression throughout the world slaughtering hundreds of millions of people in America, Australia, sub Saharan Africa, Vietnam, Iraq, Afghanistan, Palestine and Latin America for the subordination of these countries to global capital. Rejecting Enlightenment epistemology is necessary to avoid and to overcome moral decadence and physical destruction throughout the world.

Rejecting social sciences in particular must involve a recognition of the contingent character of capitalist individuality and rationality. It is not necessary that avarice and covetousness dominate human consciousness. Similarly the dedication of thought and practice to the pursuit of freedom and the maximization of power/pleasure is neither inevitable nor desirable.

Imam Ghazali (may Allah shower His choicest blessings on our master) provides a framework for demonstrating the incoherence of all unIslamic metaphysical and epistemological discourses. Unlike the Mutazila our Imam did not try to incorporate alien discourses into the Islamic system of knowledge. He developed a critique of Greek thought on the basis of Islamic principles – and demonstrated its incoherence in order to refute it and overcome and destroy it. This ensured that Islam was not submerged within an alien system of thought and practices but sought and achieved its total destruction in the Muslim world. The Ghazalian approach explicitly refutes the claim that the West is a superior or universal epistemological and moral civilization. It rejects the possibility of a dialogue with the West [1] . The Ghazalian approach does not see any of the streams of Western thought and practice as a continuation of Islam. The Ghazalian approach seeks the destruction of modernity and post modernity and of Western hegemony. It tries to pave the way for the deconstruction of all Western knowledge and practise by highlighting its incoherences. This can be done both by developing an internalist and an externalist critique of Western knowledge and practice.

The internalist critique of Western philosophy and of the social sciences is an attempt at demonstrating the incoherences of the presumptions underlying this analysis, their methodological incoherences their concealed meanings and implications and their lack of correspondence to reality. Such an internal critique can be developed by Islamic revolutionary workers familiar with Western thought.

Such internalist critique must be accompanied by the development of an externalist Ghazalian critique of Western philosophy and the social sciences. Presumptions, methodologies and practices and policies produced by social sciences must be critiqued from an Islamic epistemological perspective. This externalist Ghazalian critique can be developed only by the orthodox (i.e. rasikh-ul-aqeeda) Ulema and Soofia. It cannot be undertaken by Muslims who have not been methodically educated in the classical Islamic branches of knowledge.

Following in the footsteps of our master Imam Ghazali we will insha Allah develop this internalist and externalist critique to show the inherent incoherence of Western thought and practise and to destroy the intellectual and political hegemony of the West. This is essential for the triumph of Islam as the only universal civilization through transcending capitalism.

The incorporation of social sciences methodologies and associated rationalities and practices within the classical Islamic branches of learning is impossible because of a fundamental dichotomy in the presumptions underlying Islamic and Enlightenment epistemologies[2]. Islamic learning is grounded in belief in tauheed manifested in a recognition of the metaphysical and axiological ultimacy of Allah (subhanahu wa ta’ala).

This is the perception and assertion of the following truths:

•There exists a transcendent Creator and historical creatures separated by an unbridgeable ontological gap.

•The Creator’s will constitutes the creatures’ “ought to be” expressed in terms of both Shariati and Tariqa (s) as articulated in the continuing history of the ummah authenticated by silsilah and ijma.

•Human beings are necessarily required to submit to the will of the Creator. Human beings are capable of moral actions but actions are moral only to the extent to which they articulate man’s surrender to God’s will.

•The ‘normativeness of the oughts’ and the moral capability of human beings entail the necessity of judgment of intentions and action in the hereafter. Attainment of God’s pleasure and of rewards in the hereafter are the objectives of all human thought and action.

•Knowledge is essentially awareness of God’s will with respect to human being and human conduct.

Enlightenment epistemology is an outright rejection of these primary truths [3]. Similarly thee is no room for freedom, equality, self determination, human rights, tolerance, welfare and progress in Islamic epistemology and our classical branches of learning. Apologetic attempts at providing space for these concepts within Islamic epistemology are elements of the imperialist strategy to subordinate Islam to Western savagery. We reject Western philosophy and the social sciences because;

•methodologies underlying them are not value neutral. Their purpose is to justify and provide technologies of governance for capitalist order

•their conception of being and of the world sees man as creator, sustainer and sovereign

•Enlightenment philosophy and social science holds that man imposes order upon on the natural world through a process of self reflection. This makes empirical enquiry possible and the purpose of both self reflection and experimental enquiry is the actualization of human freedom and autonomy. The commands of the self cannot be evaluated except formally (on the basis of universalisability). Reason here is a means for obeying the universalisable commands of the un-knowable self

•The self judges and cannot itself be the subject of judgment. There is no room in Western philosophy and the social sciences for the recognition of God as sovereign law giver

•the social sciences are the practical methodologies articulating the philosophy of mechanism and utilitarianism

•the social sciences are committed to the flourishing and the satisfaction of the passions and not to the elimination of vice

•the social sciences legitimate and facilitate the functioning of capitalist order which seeks the universalisation of the passion to make money.

The purpose of social enquiry in Islam is the formation and sustenance of an individuality and of a society which voluntarily submits to God’s will. Such an individuality and society recognizes freedom as evil. Freedom is essentially al Bagh, (rebellion). Freedom is the choice of choice itself – the assertion of man’s (fictitious) authority and capability to subject the world to his arbitrarily willed (universalisable) preferences. The theoretical preference for preference is in practise the preference for capital – for in secular orders capital alone is universalisable and in principle limitless. That is why the social sciences legitimate and provide technologies for the creation and sustenance of capitalist individuality civil, society and capitalist states.

Attempts at practicing social science methodology within the constraints of the Shariah – as reflected in the writings of Maulana Maududi on Islamic government – legitimate capitalist practices at both the individual and the institutional level . They do not contest capitalist rationality but instead accommodate. Islam within capitalist order. Nineteenth century clergymen and modern Christian apologists within the Christian Democratic parties of Europe have presented similar arguments for reconciling capitalist practices with the ‘spirit of Christianity.’

Euben argues that modern Christian and Islamic fundamentalism may be seen as attempts at “re-enchanting” the Enlightenment rather than as anti Enlightenment movements because they limit and do not in principle reject Enlightenment rationality and the associated goals of freedom and progress [4]. The practise of Shariah constrained ideologies and technologies in Iran and Saudi Arabia illustrates how this opens up these societies to capitalist penetration. Religious individualities and Shariah constraints on market and state institutions become delegitimised and political authority is transferred from the ulema to the agents and representatives of national and global capital.

Social science is a product of Enlightenment philosophy and a technology for the legitimation and practise of capitalist governmentality. Islam is committed to the overthrow of capitalism as a way of life and rejecting social science rationalities is therefore necessary. Islamic social enquiry must focus attention on creating rationalities and methodologies which can foster the growth of Islamic individuality and the flourishing of the Islamic virtues within the context of the contemporary challenge with which the Islamic revolutionary movements [5] are confronted.

Islamic social enquiry seeks the transcendence of capitalist order through the universalisation of the practise of Islamic virtues in the life of the individual, the society and the state. The flourishing of these virtues and the contractual and institutional structures which sustain them has been the concern of the classical Islamic branches of learning. These branches of learning provide an appropriate paradigm for addressing contemporary issues with reference to the sustenance of Islamic individuality and society. Our social theorizing must be contextualized by and located within the traditional Islamic episteme. The ulema and soofia have zealously preserved the epistemological heritage of Islam. In the subcontinent the ulema of Barailly and Deoband have in extremely difficult circumstances comprehensively defeated the modernists and revisionists who sought to corrupt traditional Islamic learning by its incorporation within Western epistemes [6].

This magnificent achievement of the ulema and soofia makes it possible to continue Hazrat Qutab-al-Alam Imadullah Muhajir Makki’s project of integrating the quest for spiritual revival and the revitalization of Islamic learning with the organization of a movement of jihad against the West [7].

The development of an Islamic critique of the presuppositions and methodologies of the social sciences (the development that is of an externalist Ghazalian critique of Western philosophy and the social sciences) is an indispensable step in the deconstruction of Enlightenment and post Enlightenment epistemes and in conceptualizing contemporary issues on the basis of the assumptions and methodologies rooted in Islamic epistemology and in our classical branches of learning.

The development of an externalist Ghazalian critique of Enlightenment philosophy of the social sciences provides a basis for the expansion of the scope of the classical Islamic branches of learning. In particular the scope of Fiqh, Ilm-i-Kalam and Usul-u-deen need to be broadened to enable us to analyze contemporary problems and issues on the basis of Islamic ontological assumptions and within the context of Islamic epistemological methodologies. This broadening of scope must entail a construction on the basis of our inherited wisdom and an elaboration of the teachings on which there is general consensus. Theories articulated within this context must confirm to the maqasid-e-Sharia and be derived on the basis of methods and mechanisms sanctioned by the usul-I-fiqh for theorizing and for articulation of policy based on legitimately constructed theories. The ijtihad this entails is taqleedi-ijtihad – an ijtihad which confirms, elaborates and vindicates the ijmah of the Ummah [8] . Such ijtihad provides grounds for asserting Islam’s claims as universal history and as the world’s only civilization (Qutb 1974 p51-60). It provides an indispensable epistemological basis for transcending Western philosophy and social sciences and waging permanent jihad against Western savagery [9].

Our commitment to undertake permanent jihad against Western savagery reflects our principled rejection of the rule of capital. The West has rejected Christianity and embraced capitalism as a deen. It has rearticulated. Pharaoh’s age old claim – ana rub kum al ala. (I am your great Lord). The rule of capital rejects the sovereignty of God and proclaims the false doctrine of freedom (human autonomy and self determination). The theoretical preference for preference is in practise the universal dominance of the vices of avarice and covetousness. Western man is possessed by the devils of covetousness and lust. He has filled the world with sexual vice – pornography, nudity, fornication, homosexuality, lesbianism, AIDS. He has corrupted economic life by infusing riba and gharrar in all production and exchange transactions. He continues to slaughter hundreds of million of innocent victims – Red Indian, Vietnameses, Cambodians, Palestinian, Kashmiri, Iraqis and Afghans – in a never to be satisfied blood lust for freedom and plentitude. Western philosophy and social science justifies man’s rebellion against God, the explosion of sexual vice, institutionalized economic exploitation and human rights imperialism.

A carefully crafted revolutionary strategy to build an anti-imperialist, anti capitalist universal state in the Muslim world has reasonable chances of success in these circumstances. Our chances of achieving the overthrow of capitalist order are improved in countries such as Pakistan due to the incoherence of modernist discourse as articulated by the local supporters of American imperialism. Perhaps we are in the Narodnik stage of our revolution or in its 1883 (when Plekhanov set up the party) or in its 1902 (when ‘What Is To Be Done” appeared) or in its 1905. But its 1917 seems a distinct possibility because of liberalism’s inherent incoherences and vulnerability, its inability to justify the rule of capital, the moral degeneration that is its inevitable consequence and the continuing weakening of the client states.

The socialist revolution was defeated because socialism did not reject enlightenment ontology – the worship of man remained as central to socialism as to liberalism and capital cannot be transcended without rejecting man worship. The Islamic revolution is essentially a revival of the pre Augustinian commitment. “Thy Kingdom come, Thy will be done on earth as it is in heaven”. Islam represents an internal – not an external – threat to capitalism. It is capitalism’s definitive critique and not simply another attempt to re-enchant the capitalist world as the Jewish political theorist Roxana Euben fantasizes. Today Islam threatens. Washington as Christianity threatened Rome in the 4th century.

The priority concern at present must be to mobilize the masses to resist American hegemony and to raise the costs of American occupation of Iraq and Afghanistan and American support of the Zionist enemy. This must be accompanied by the struggle to de-legitimate capitalist and liberal norms and institutions and to struggle for the establishment of a non-national Khalifat. The coming together of all Islamic forces on the basis of Islam’s orthodox doctrines and practices with the mosque as the organizational focus and in resolute opposition to the rule of law of capital is possible and should be our goal.

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Notes:

1. This is not a rejection of the possibility of Islamic dawah to individual Europeans or Americans. As Islamic da’ee we invite them to reject the ontological and epistimological presumptions and participate in the task of destroying Western savagery. We reject the possibility of dialogue in the sense that we do not recognize the West as a civilization and reject the possibility of peaceful coexistence with it.

2. The incorporation of Islamic themes within the social science paradigm is also impossible for the same reason.

3. The ‘Islamisation of social sciences’ project glosses over this basic dichotomy.

4. See specially the last chapter of her book where this argument is fully developed

5. both movements of jihad and movements of khurooj: These movements and not the ummah, or Muslim states or other formations are the agents of change in the struggle against capitalist order.

6. On the other hand Hindu intellectual and spiritual leadership failed to preserve such incorporation. Modern Hindu fundamentalism thus poses no challenge to capitalism and Western savagery and the Hindu religion has been overwhelmed by nationalism in the same way that classical Judaism has been destroyed by Zionism.

7. Hazrat Muhajir Makki was not only a scholar and a renowned sufi saint he was also the Amir of the 1857 jihad.

8. The ijtihad undertaken by Barelvi and Dewbandi ulema in the 19th and 20th century is taqleedi ijtihad.

9. It is to be stressed that the tasks of developing an externalist Ghazalian critique and of expanding the scope of the classical Islamic branches of learning to address contemporary issues can only be undertaken by the ulema and soofia. I have not attempted this since it cannot be undertaken by Western educated Muslims.

Islamic Constitutionalism and Maulana Maududi

2005-11-15T22:49:00.000-08:00

The greatest impact of modern political science on Islamic scholarship has been in the area of constitution making. I shall in this section briefly outline Maulana Maududi’s legitimization of liberal theories and practices on Islamic grounds.

Maulana Maududi is a seminal figure in contemporary Islamic thought. His critically important contributions are:

 His development of Shah Waliullah’s conception of Islam as a complete, closed system and as the only universal civilization. It is on this basis that Maulana Maududi makes a distinction between Islam and Jahiliya [1].

 His conceptualization of Jihad as a permanent revolutionary strategy and rejection of the view that Jihad is a defensive war for national liberation.

 His total rejection of Western epistemology and insistence on the position that no new interpretation of Islam is needed to deal with contemporary problems and challenges.

Despite this insistence on Islam’s completion and uniqueness Maulana Maududi endorses the use of liberal discourses and institutions as a political technology. His conception of “Islamic democracy” is of a political order in which “every individual is an equal participant in Khilafat and (in which) all individuals enjoy equal status as citizens” (Maududi 1990 p14)[2] . In Islamic order “every individual is Khalifa. All (individual) Khilafa delegate their powers of Khilafat to the formal ruler for administrative purposes” (1990 p140).

Maulana Maududi also finds room for personal autonomy within Islamic political order “within legal constraints every individual has full freedom to choose his way of life” (1990 p141). Endorsement of liberal values – autonomy and equality – leads to an endorsement of liberal institutions. “The President of the state must be elected by the Muslims… the election must reflect the free uncoerced will of the Muslims” (1990 p337,340). Maulana Maududi argues that a well defined and permanent shoora representative of the Muhajareen, the Ansar and allied tribes existed in the time of the Prophet (Salal Allah –o-Alehe-wa salam) “(Members of the Shura of the Prophet, sallah Allah-o-alahe wa salam) were choosen by a natural electoral process. They were true representatives of the Muslim tribes. Had elections of the modern type based on universal franchise been held the same people would have been elected….Had voting taken place there was no one else in the society who would have enjoyed the confidence of the Muslims. They thus joined the majlis-e-Shura through a process of natural elections. Thus in the era of the Prophet (Salla Allah-o-alahe-wa salam) the institution of the majlis-I-Shura had been established and the constitutional provisions for its continuous existence had also been formulated” (Maududi 1990 p346).

Maulana Maududi stresses the importance of representational democracy in the Islamic state. “The President must not consult any one be likes but only those who are the representatives of and enjoying the confidence of the ordinary citizens…. It is evident that the method for determining the representativeness of the members of the Shura that was applied in the time of the Prophet Salal Allah o alahe wa salam is no longer practical…. In the modern age (adult franchise based) electrons are a permissible way for determining the representative character (of the members of the Majli-I-Shura)” (1990 p344).

According to Maulana Maududi ordinary citizens of the Islamic state “have the right to elect the President and to be members of its parliament” (1990 p352). He endorses the whole array of liberal and social democratic rights – life, property, consciousness, association, welfare (1990 p355-358)[3] . Maulana Maududi does not recognize human rights as a negation of huquq-ul-ibad – i.e. as duties of a capitalist state to foster capitalist individuality and civil society and universalize avarice and covetousness.

In Maulana Maududi’s view Islamic democracy is based upon “popular viceregency” (1990 p371) and “this necessarily implies that government be established by the will of the people and remains in power only while it enjoys popular support” (1990 p371). Thus kingship (mulukyat) cannot be legitimate in any circumstances (1990 p374) and a constitution sanctioning human rights provides the legal framework for the practice of ‘popular vicereging (190 p375). Popular viceregents’ – i.e. the elected representatives of the citizens have the right “to legislate within the constraints of the Shariah” (1990 p441). “The legislator should have specific characteristics [4] but “he does not need to prove that he possesses them” (1990 p445). Such legislation and the existence of a legislature (Parliament) is seen as necessary for establishing the Islamic legitimacy of the state (Maududi 1990 p346).

The Islamic state is thus not a rejection of modern liberal democracy “but an intermediate stage and system of law and culture between theocracy and Western secular democracy” (Maududi 1990 p479). Like liberal democracy Islam accepts the principle that “establishment and change of government should be based on the will of the citizens… the state belongs to the ordinary citizen. It is run by a legislature elected on the basis of popular representation and enjoying the right to enact laws through consensus or majority decisions” (1990 p481). The Islamic revolution culminates in the establishment of the authority of such a legislature governing the state.

In sum Maulana Maududi provides legitimation for the establishment of a constitutional democracy in which Khilafat resides in a citizenry of individuals enjoying equal human and representational rights and governed by a parliament which legislates through consensual and majority decisions. This is certainly a new interpretation of Islamic political thought and it is not legitimated by references to the work of classical Islamic political thinkers such as Imam Mawardi, Imam Muhammad, Imam Ibne Khuldun, Imam Ghazali and Shah Waliullah (may Allah reward them and exalt their heavenly status). Quite the contrary Maulana Maududi’s political thought seems to draw upon the work of al Farabi a neo Aristotelian who saw democracy as providing opportunities for the development of the sciences and arts necessary for the establishment of the ‘virtuous regime’ (Mahdi 2001 p144-146). A more direct inspiration of course is the work of Locke and Rousseau.

It is Locke who provides the key statement justifying representational liberal governance in opposition to the religious state established by the saintly Lord Oliver Cromwell. Rousseau’s” conception of the general will is strongly influenced by Locke’s treatise on representative government. Rousseau’s conception of the general will as necessarily good in that it can not will evil draws upon Locke’s view that divine law sanctions representational governance [5]. In the Lockean conception there can be no contradiction in the articulation of the commands of God and the directives of the will of the citizens. This is based on Locke’s assertion that God does not mandate a particular political order and divine will in this respect had no particular content. The general will can be seen as an instrument for articulating divine will in a particular context [6] . Divine will can thus be interpreted as sanctioning the practical sovereignty of the citizen [7] - though as Locke recognizes this cannot be proved by direct reference to the Bible.

In Maulana Maududi’s view the general will of the people of Pakistan sanctions the supremacy of the divine will in the country’s political order. In the Pakistani state divine will legitimately circumscribes the general will and makes it subservient to and constrained by the Shariah. In this conception divine will is not empty (as it is in Locke’s thought). It legitimates the structuring of legitimate obediences and defines moral and social values. This concurrence between the dictates of divine will and those of the general will of the people of Pakistan is not theorized by Maulana Maududi in the sense that he does not show its necessity but takes it as an empirically observable fact. It is this fortuitous coincidence between the general will of the people of Pakistan and divine will which makes democracy an appropriate instrument for the Islamisation of Pakistan’s political system.

Sustaining concurrence between the general will of the people of Pakistan and divine will is a crucial problem for Maulana Maududi, for divine will as articulated in Shariah has a specific content[8] . Maulana Maududi does not justify his own scheme for the particular articulation of the general will within Pakistan in the form of a political system with reference to the historical experiences of the Muslims of the Indian subcontinent. Instead Maulana Maududi presents an abstract model based on his interpretation of some sources of the Shariah – he does not even justify his abstract model with reference to classical Islamic political thought.

The institutions Maulana Maududi sanctions – citizenship, human rights, the constitution, parliament – are not rooted in Islamic or Indian Muslim history. This implies that the political paractice of the Muslims of India has failed to articulate authentic Islamic norms and institutions and we are now able to do so only because of Maulana Maududi’s theorizing [9].

Electoral defeats since the Punjab elections of 1951 have shown that the people of Pakistan do not endorse the conceptualization of Islamic order as conceived by Maulana Maududi. The victory of the Awami League nationalists and the PPP secularists in 1970 showed clearly that there was no coincidence between the general will of the people of Pakistan and the divine will (at least as articulated in Maulana Maududi’s thought) hence democracy could not be conceived as an instrument for the articulation of the pre existing concurrence between the two. Therefore the democratic process has since 1971 been seen as the process by which people can be convinced of the need to formulate a general will which is in concurrence with (Maulana Maududi’s interpretation of) the divine will. To achieve this reformulation of the general will the Jama’at has sanctioned the politics of rights – the implementation of Islamic political order would lead to the provision of human and welfare rights and increased prosperity and progress. Islamic political struggle was thus reconceptualized as a quest for this worldly progress and welfare (not a quest for sacrifise and shahdat). In pre imperialist India struggling for rights was entirely alien to Muslim political culture. The Pakistan movement and the post 1970 political practise of the Jama’at-I-Islami has provided legitimation for the politics of rights and effectively closed the gap between politics of Muslim nationalism and the politics of Islamic revival.

Legitimation of the politics of rights has meant an endorsement of the values of competition (covetousness) and accumulation (avarice) and a downgrading of the need to foster the religious virtues through political struggle. The movement for establishing an Islamic state has effectively become a movement for reforming the liberal capitalist state. This illustrates that the strategy for using the democratic process as a means for creating a concurrence between the general will and divine will is practically a strategy for redefining the substantive content of the divine will in a manner which is acceptable to the people. The emphasis on human and welfare rights necessitates that the commands of the Shariah be implemented in a manner and to the extent acceptable to the people and an endorsement of capitalist values – competition (covetousness) and accumulation (avarice) – makes a reorientation of the general will impossible. The practise of democratic politics thus does not lead to a transformation of the general will but to a reinterpretation of the divine will for legitimating the politics of rights. Capitalist development inexorably secularizes society and fundamentalist movements (Hindu, Christian, Islamic) can provide legitimation for this secularization as both Binder (1983) and Euben (1999) have argued. Fundamentalist movements sanctioning the politics of rights are self destructive for they accept autonomous (i.e. capitalist) individuality as natural and not a product of the triumph of Enlightenment philosophy. Such religious movements thus do not seek a transcendence of capitalist individuality, civil society or of the capitalist state. They seek instead a reconciliation between the substantive content of religious teachings on the one hand and the arbitrarily willed preferences of the capitalist individual and the norms and structures of the capitalist system on the other.

Such religious movements reinterpret capitalism and seek to show that religious practices are effective means for the realization of capitalist norms and for the redressing of capitalist structural imbalances [10] . While Maulana Maududi seeks to constrain capitalist and democratic practices by Shariah injunctions the political discourse of the Jama’at presents Shariah injunctions as effective means for the achievement of progress and the flourishing of human rights [11] .

The essential significance of Maulana Maududi’s work in contemporary Muslim thought emerges from his insistence on Islam as a complete system, his recognition of the West as jahiliya and his rejection of the need for a new interpretation of Islam to deal with contemporary issues and challenges. Maulana Maududi’s, political writings however provide grounds for legitimating capitalist and liberal political values and structures and this frustrates the quest for systemic transformation and the transcendence of capitalist order. Thus Maulana Maududi’s reinterpretation of capitalist political order must be rejected and the analyses of classical Muslim political thinkers – Imam Mawardi, Iman Ibn-e-Khuldun and Shah Waliullah in particular – must be revived for achieving Islamic political hegemony and the comprehensive and final annihilation of capitalist order.

===
Notes:

1. Syed Qutb uses these concepts in Ma’alin fit Tariq and both Maulana Maududi and Syed Qutb described Western civilization as Jahiliyat-I-Khalisa Syed Qutb develops the argument that civilization is necessarily Islamic and Islamic civilization confronts not other civilizations but savagery (1973 p. 78-81). Maulana Muhammad Marmadukh Pickthall makes a similar point (1960 p. 184).

2. This separates Maulana Maududi’s thought not only from jadidis and innovators such as Amir Ali, Khalifa Abdul Hakim and Ghulam Ahmad Pervaiz but also from that of Islamic modernists such as Allama Iqbal, who argue that some Enlightenment schools of thought – in Iqbal’s case, empiricism – are inspired by Islam and therefore provide a basis for inter-civilization dialogue (It should be noted that Iqbal the poet is different from Iqbal the prose writer and thinker. As a poet most of his poetry is inspirational and contains revolutionary Islamic perspective of eternal value).

3. Universal franchise is unreservedly endorsed by Maulana Maududi. He writes “the electoral system must be so devised that the whole nation and every individual can participate in it” (1990 p. 370).

4. Maulana Maududi recognizes that “legislation within the constraints of the Shariah” requires legislatures” who have the following characteristics.
a) Belief in the Shariah, sincere wish to obey the commands of Allah and reject all other sources of legislation.
b) Knowledge of Arabic grammar and literature.
c) Comprehensive knowledge of the Quran and Sunnah and of Islam as a complete, closed system of beliefs and practices.
Knowledge of the work of the established fuqaha and schools of fiqh and intention to “legislate” in a manner which ensures continuity of the legal tradition of Islam (1990 p445).

5. As we have argued elsewhere Locke could not substantiate this view by reference to the Bible.

6. This view also required the assumption that there was no authentic interpretation of the divine will. The Protestant revolt against Catholicism was premised on the argument that the Church had no right to insist on the authenticity of its interpretation of the Bible and every Christian had the right to independently interpret scripture. As a devout Protestant Locke was thus on sound grounds when he rejected the traditional interpretation of Biblical teachings.

7. Divine will can also be interpreted as having no content whatsoever.

8. This is not a problem for Locke for in his conception divine will is empty and its substantive content is necessarily provided by the general will.

9. It also implies that classical Muslim political philosophy misconceived political order.

10. Rawls (1985) recognizes this and believes that such movements can be part of his overlapping consensus.

11. Thus Euben (1999) argues that Isalmic fundamentalist movements seek a ‘re-enchantment’ of liberal order and therefore the work of Syed Qutb and Maulana Maududi should be viewed in the same perspective as the works of mainstream communitarians (MacIntyre, Taylor, Rorty etc.)

===
References:

Binder L. (1983) Islamic Liberalism New York, Cambridge University Press

Euben R. (1999) The Enemy in the Mirror New York Oxford University Press.

Locke J. (1967) Second Treatise of Government London Cambridge University Press.

Mahdi M. S. (2001) Al Farabi and the Foundations of Islamic Political Philosophy New York Oxford University Press

Maududi A. A. (1999) Islami Riyasat Lahore Islamic Publication

Maududi A.A. (1961) Insan ka Maashi Masala Aur Uska Islami Hal Lahore Islamic Publication

Maududi A.A. (1963) Sood Lahore Islamic Publications

Qutb S. (1973) Jada-oManzil (Urdu translation of Ma’alim fit Tariq) Lahore, Islamic Publications

Corporate crime and accountancy fraud

2005-09-27T05:06:00.000-07:00

Corporate crime is booming once again in America. America has always been the natural home and global capital for corporate crime. In 2005 a long line of American ‘whiz kid’ CEOs have gone to jail with life or near life sentences. Examples include Dennis Kowzloski and Mark Swartz of Tyco, John and Timothy Ragas of Adelphia, Andrew Festow of Enron, Martin Glass of Rite Aid, Jamie Olis of Dynergy Sam Wicksal of I m Clone and of course Bernie Ebbers of World Com. By persecuting individuals and sparing companies - Enron, World Com, Arthur Anderson, Tyco and Rice Aid continue to survive and often, thrive - American judges have shown their awareness of the link between burgeoning corporate crime and impending capitalist crises.

The American justice system’s commitment to capitalism has been graphically demonstrated by its treatment of Arthur Anderson and KPMG - two of the global accounting industry’s ‘final four’. Both Andersen and KPMG have admitted to serious fraud and both have been spared by the American Supreme Court and the American Justice Department. Arthur Andersen settled out of court with World Com investors in April this year, and in May the American Supreme Court overturned its 2002 conviction. The judgement amounted to exonerating Arthur Andersen.

The American Department of Justice has been extremely reluctant to bring legal action against KPMG European Union regulators have warned it that bringing KPMG to the courts would destabilise the global accountancy industry. KPMG’s corruption is well known.

An American Senate committee report issued in May this year exposed the fraudulent and highly lucrative tax avoidance business run by KPMG for years, and in July KPMG admitted "full responsibility for unlawful conduct" with respect to what the Senate described as "abusive tax practices". Abusive tax practices are of course not confined to KPMG. Deloitle Touche has moved swiftly to avoid action with regard to misconduct of its associated firms in a case filed by investors. The Senate Report hinted at similar business deals involving Price Waterhouse Coopers and Ernst and Young. The American Justice Department, however, is bending all the rules unscrupulously to avoid the collapse of another ‘final four’ accountancy firm and to prevent it from following in Arthur Andersen’s footsteps. A decision not to punish KPMG severely will be interpreted as a license for continuing frauds. Other accountancy firms through out the world will feel that it is lucrative and beneficial to take the sort of risks that KPMG took when it advised clients on how to undertake tax frauds.

The ‘easy’ alternative of punishing CEOs while exonerating corporations is also becoming unpalatable. CEOs have expressed reservations about the ‘chilling effects’ of enhanced conceptions of individual legal responsibility for corporate transactions. As long as corporate America’s godfather Dick Cheney continues to call the shots at the White House, it will be impossible to dismantle the protective barriers, which shield most American corrupt CEOs. Accounting fraud will continue to flourish in America.

Accounting fraud is increasingly common throughout America. Major accounting frauds have been discovered at General Electric and the AIG in 2005. The Standard and Poor downgrade of GM and Ford shares was also partly fuelled by accounts related suspicions: with the explosive growth of ‘fair value’ accounting - and its official endorsement by American regulators in 2005, the scope for accounting fraud has expanded enormously. A 2005 study by Glass Lewis found that investors lost almost $1 trillion during 1999-2004 due to accountancy related frauds.

Fair Value accounting allows firms, in connivance with their auditors, to declare what profits suit them - fair value is thus unfair value in this precise sense. Fair Value accounting allows accountants to assign imagined estimated value to items such as bank loans and buildings. A 2004 study by Bergstesser and Rauh has shown that such estimates are usually widely off the mark and very easy to manipulate. They found robust evidence of deliberate tampering of statistics to influence M and A, new issue and stock option deals. Further evidence of fraud is presented by Lev, Li and Sougiamis’ 2005 study which shows that fair value accounts estimates are worthless as indicators of a company’s future performance, because they are in the main fraudulently estimated. Federal Reserve based records show that bond and loan fair value estimates are so volatile that they are practically worthless.

Mathematical model based calculations of ‘fair values’ of financial assets are nothing but fraud. This is because market values of all assets are speculatively determined in capitalist order, without reference to any objectively determined foundation, and as chaos theory shows there are no rational grounds underlying speculation. ‘Rational’ expectations are a myth. A 2005 much awaited Ernst and Young report admits this when it recognises that" estimated ‘fair value’ for intangible assets, unquoted securities, derivatives, pension costs and share based payments appear in company accounts at a hypothetical market price based on management’s assumption about the future and using a valuation model. We consider that it is inappropriate to refer to such estimated value as fair value. Fair Value accounting has deliberately been made increasingly incomprehensible to conceal fraud.

What are American regulators doing to deal with all this? Paradoxically, they are watering down the implementation of the Sarberne-Oxley Act (SOX) to facilitate accountancy fraud. SOX was a panic reaction to the enormous accountancy frauds of 2002. Today the imperialist press - the Financial Times, the Economist, the Wall Street Journal - is full of demands to roll back SOX. It requires management boards to waste a "huge proportion of time on reporting procedures". SOX is accused of "addressing symptoms not causes" and "costs significantly exceed benefits". In May 2005, the American Public Company Accounting Board (PCAOB) -a body established under SOX- chided management for being "overly cautious and mechanical" in interpreting SOX. The American Securities and Exchange Commission has also called for greater management discretion. Section 204 of SOX, requiring management to maintain "an adequate internal control structure and procedures for financial reporting", has come in for heavy criticism. This is said to cost America about $1.4 trillion and according to Deloitle, 700,000 additional man-hours. It is also said to be leading to a further concentration of the accountancy industry. The ‘final four’ - Deloitle, Ernst and Young, KPMG and PWC-are said to hog 98 per cent of the SOX related business. SOX, it is said, discourages risk taking. There is little evidence to show that SOX has reduced fraud..

It is predicted that William Donaldson’s replacement by Christopher Cox as American Security and Exchange Commission Chairman in June 2005 will lead to a "lighter application of SOX", according to the Financial Times.

The American business press is urging on Mr. Cox "to screw SOX" and scrap Article 204. No doubt he will do so, but you eat an apple bite by bite, not all in one go.

That accountancy fraud thrives in America is hardly surprising. Corruption is the American way of life. A 2001 Dept of Justice study found that 43 per cent of all income in America is in some form connected to the booming national crimes industry. Moreover, corruption has deep historical and cultural roots. Fifteen million Red Indians were methodically slaughtered and an entire continent looted and plundered over two and a half centuries through political and financial fraud and corruption. Today, the American government is inextricably involved in similar action in Iraq, Afghanistan and much of Latin America. America is the natural home of fraud and its global capital.

But America is also the sole surviving capitalist hegemony and capitalism is a system, not a Habermasian life world. Objectively (from an Islamic perspective) finance is fraud, capitalist property is theft, but a capitalist order structures finance and capitalist property so that they flourish as normal social practices. Historically, this has required a reconciliation of the practices legitimised by welfare (consumption) maximisation with those required by the need for profit (surplus) maximisation. Capitalist fraud is action, which (a) either prevents a corporation from maximising profit or (b) enables it to maximise profit in a manner considered illegal because it inhibits welfare (consumption) maximisation by the political representatives of free citizens. Neo-liberal capitalism shies away from recognising that the capitalist state must be empowered to prevent both types of capitalist fraud. It subscribes to the mistaken (but time-honoured) belief that markets can be self regulating - i.e. that shareholders can discipline (in a Foucaultian sense) managers and that profit maximising behaviour of individuated (corporate) persons will automatically unintentionally lead to the maximisation of social consumption (welfare).

Global capitalism has shown both assumptions to be untenable. Managers cannot be disciplined by shareholders in ways that do not inhibit accumulation. Efficient markets do not maximise social consumption. Moreover, dominant political forces, especially in America, are systematically obstructing the search for viable institutional restructuring to address the agency problem and the growing problem of governing the market. Social democracy is dead in America and America is killing it in Europe, Japan, China and India. Those working for the overthrow of capitalist order may therefore live in hope.

from here

THE MULTIPLE FAILURES OF PAKISTAN’S MONETARY POLICY

2005-05-27T06:09:00.000-07:00

STATE BANK ANNUAL REPORT 2000-2001
THE MULTIPLE FAILURES OF PAKISTAN’S MONETARY POLICY

Pakistan’s economic decline since the enforcement of the 1988 Structural Adjustment Facility Agreement with the IMF is largely attributable to the continuing and increasingly serious failure of the country’s monetary policy. Since 1988 the IMF and the World Bank have deliberately sought to create a financial crisis in Pakistan through a series of SAF/ESAF/EFF/SBA/PGRF agreements and Financial Sector Structural loans. The IMF and the World Bank have succeeded in engineering a financial crisis in Pakistan – along the now familiar East European model – by destroying our monetary policy.

The systemic dominance of the IMF over Pakistan’s financial system is now complete. This becomes tragically clear from the chapters on money and credit and the banking system in the State Bank’s Annual Report 2000 – 2001.

Throughout these chapters the State Bank evaluates the success of its monetary policy initiatives exclusively in terms of the targets set in the IMF’s Standby Agreement of Nov. 2000 and the structural and institutional changes that the IMF has mandated. Neither in these chapters nor in the chapters on growth and price trends is there any evaluation of the impact of monetary policy on the real economy – real GDP and sectoral growth, saving, investment, income and asset distribution, poverty alleviation, attainment of national self reliance, Islamization of the financial transaction networks, increased defense capability etc.

The message is clear. Pakistan is a colony of the IMF (i.e. of America). The State Bank is concerned with securing the IMF’s continuing approval. The State Bank has no concern with the impact of its policies on the welfare or sovereignty of Pakistan. It is the IMF (America) which is the true sovereign power in Pakistan, for has it not since 1993 been appointing the Governor of the State Bank and his entrounage of advisors?

This paper will (a) document our monetary policy failures (b) seek to identify the causes underlying these failures and (c) suggest an alternative strategy for dealing with the existing financial sector crisis.

I.Monetary Policy Disasters.

It is significant that the monetary orthodoxy underlying IMF perspectives is nowhere evaluated in the State Bank’s Report 2000 –2001. This orthodoxy is disintegrating as recession grips America, Europe and East Asia, controls are imposed on capital transfers in international market, currency board arrangements collapse in Argentina and the need for fiscal stimulation is relegitimized. Continued adherence to monetarist orthodoxy in the post globalization era can be suicidal. Unfortunately our monetary policy leadership is not aware of these damagers. It is clear that this leadership has little exposure to monetary theory controversies.

The Death of Credit Planning

Preserving the national financial system in an era of world recession requires the central bank’s firm control over it. As the State Bank becomes increasingly subservient to the IMF (America) it’s systemic control over the national financial system is inevitably weakened. This becomes clear from the ineffectiveness of credit planning. Every year the State Bank goes through the ritual of establishing targets for the components of monetary and credit expansion. Every year the State Bank Report shows that the actual outcomes are usually widely different from these targets. Thus the outcome for the 2000-2001 credit plan shows that:

•Net government sector retirement of credit (negative borrowing) was over 200 percent greater than the target set by the IMF (America) imposed credit plan and over 20 times greater than the target of the original SBP formulated credit plan.

•Gross budgetary borrowing was only 3.4 percent of the amount allowed by the IMF (America) imposed credit plan.

•Net budgetary retirement of credit to SBP was over 15 times greater than the target set by the original credit plan and more than 200 percent higher than the IMF(America) plan target.

•Net budgetary credit retirement to scheduled banks was only Rs. 1.4 billion as against the IMF (America) imposed target of Rs. 12.7 billion.

•Governmental sector borrowing was 23 percent lower than that targeted in the SBP original credit plan and 35 percent lower than that allowed by the IMF (America)

•Net private sector credit was 35 percent lower than that allowed by the IMF (America) credit plan.

•Other items net increased by Rs. 30 billion whereas the IMF (America) plan had expected a reduction of Rs. 2 billion and the State Bank plan expected zero growth in this item.

•Net domestic assets rose by less than 60 percent of the level allowed by the IMF / America and (useless) net foreign assets growth exceeded the IMF/America target by 31 percent.

•Total monetary assets (M2) growth was 13 percent lower than that permitted by the IMF/America and about 15 percent lower than that expected by the original State Bank credit plan.

In view of these grotesque differences it is surely farcical to speak of “credit planning”. The State Bank does not even have modest forecasting capability. What are the three research departments and the seven specialist advisors doing?

Neither the IMF (America) nor the State Bank has as yet developed an accurate understanding of the relationship between the financial sector and the real economy. The original credit plan was based on the assumption that real GDP would grow by 5 percent during 2000-2001. It had expected that a 10.5 percent rate of growth of monetary assets was sufficient to sustain this GDP growth rate. The actual GDP growth rate attained during 2000-2001 was only half the level anticipated in the original credit plan and 9 percent growth in monetary assets was required to permit GDP to grow at 2.6 percent. Should not monetary asset growth be much higher – at least 20 percent per annum – to sustain a substantial and significant increase in per capita income in Pakistan?

Impact of Contractionary Monetary Policy

The miserable growth performance of 2000-2001 is partly attributable to the vicious contractionary monetary policy pursued by the State Bank to please the IMF(America). The elements of this contractionary policy were as follows:

•Strict controls on government borrowing from the State Bank and the scheduled banks. Net government borrowing from the banking system was minus Rs.33 billion. This meant that public sector investment remained stagnant in real terms during 2000-2001 and has now fallen to 5.5 percent of GNP. The SBP acting as the IMF’s (America’s) local watchdog continuously monitors government borrowing from the banking system. This ensures that public investment growth is effectively throttled on a week by week basis.

•The SBP refused to entertain financing accommodation requests form the government forcing the government to borrow at expensive rates from the scheduled banks. In December 2000 when the State Bank had to meet NDA targets the government’s net borrowing from the State Bank fell by over Rs. 50 billion but its net borrowing form the commercial banks rose by over Rs. 40 billion. This high cost public debt was effectively substituted for low cost public debt.

•Usury rates were continuously jacked up to shore up the sagging Rupee: Cash reserve requirement rate and the discount rate were raised not only throughout the first half of 2000-2001 but also in June 2001.

•Tight monetary policy led to an increase in scheduled banks’ lending usury rates during 2000-2001 despite a fall in the average deposit usury rate. Private sector net borrowing during 2000-2001 was only Rs. 52 billion – even the IMF dictated “credit plan” had expected net private sector borrowing to equal Rs. 93.5 billion. There was virtually no net credit expansion to the policy favoured IT and small and medium scale industries. It was the petering out of the ‘ accountability’ drive and the widespread growth of rescheduling arrangements which encouraged the textile and sagar seths to return to the money market.

•Gross disbursements under the export refinance scheme also fell during 2000-2001. This was a direct consequence of the jacking up of usury rates under the EFS by linking them to T-bill rates. This is a component of the IMF’s receipts for killing off development financing in Pakistan.

Other disastrous consequences of monetary policy are:

•Non working capital loans accounted for only 7.7 percent of total private sector borrowing from the banks in 2000-2001. In 1999-2000 this share had been 8.9 percent. There is virtually no project financing in Pakistan. Since the IMF grip has tightened there are literally no new projects being undertaken by the public sector or the private sector. To pursue tight monetary policy in these circumstances tantamounts to committing national economic suicide.

•Virtually no credit was extended to the capital goods industries. Pakistan is facing a de-industrialization related technological melt down. The throttling of defense expenditure means that the capital goods sector and the technological intensive industries are being killed. Today they account for less than 5 percent of manufactured value added. The share of technology intensive exports in total export revenue is about 0.1 percent.

•The agricultural sector is also facing severe credit starvation. During 2000-2001 recoveries by ADBP exceeded gross disbursements by Rs. 23 billion. The State Bank has under IMF (America) pressure abandoned all development financing to the agricultural sector.

•Recoveries exceeded gross disbursements for the 14 DFIs by Rs. 43 billion in 2000/2001. Over the period 1999-2001 total recoveries by DFIs have exceeded disbursement by about Rs. 150 billion. This is disinvestment from the industrial and agricultural sector with a vengeance. The IMF (America) and the State Bank are deliberately killing off all long-term investment activity in Pakistan.

•The continuous compulsive pressure to build up net foreign assets in the form of liquid reserves locks up these resources in very low interest earning accounts. The rise in foreign currency holdings by the scheduled banks and the enforced foreign exchange and swap transactions of the State Bank necessitated by IMF (America) imposed NFA commitments entail a massive development loss for Pakistan.

Banking Sickness

•The underdeveloped character of the Pakistani money market is reflected in the fact that currency in circulation and demand deposits (M1) at end FY01 still accounted for 49 percent of total domestic liquidity. The increase in time deposits in the last two months of FY01 was due mainly to SBP’s injection of Rs. 20.8 billion in the market through the retirement of dollar swaps and the undertaking of fresh swaps to the amount of $126 million in the month of June. Moreover the significant increase in FCA deposits was also not investible in Rupee form since most of it was under the FE-25 scheme. Rupee deposits grew by only 6 percent in FY01: In FY00 they had grown by 8 percent. Taking account of inflation it can be shown that Rupee deposits as a proportion of real GDP have fallen in FY2001.

•Extremely tight conditions prevailed in the money market throughout FY2001. OMO absorptions exceeded injections by Rs. 26 billion in FY2001 Total amount of discounting by commercial banks doubled in FY01 compared to the previous year. The number of visits to the discount window and average amount discounted per visit also increased. There was continuous upward pressure on T-bill rates. Despite these measures the Rupee depreciated by about 19 percent during 2000-2001. Total internal debt rose by 9.6 percent during FY01. The total debt to GNP ratio now exceeds Rs. 115 percent of GNP.

•The banking sector continues to be in deep trouble. The capital adequacy ratio (extremely generously defined) despite a major injection of capital into the NCBs has declined for every group of scheduled banks during the calendar year 2000 – for the banking sector as a whole the capital adequacy ratio fell by 9 percent during 2000. The Non Performing Loan (NPL) portfolio is continuously massaged through a never ending process of payment rescheduling to conceal default. Despite this, for the banking sector as a whole the non performing loan to gross advances ratio exceeded 23 percent at end December 2000. Gross NPL advances rose from Rs. 230.8 billion at end 1999 to Rs. 236.7 billion at end 2000. The cash recovery to loan default ratio has fallen for all banks from 8.6 percent in 1997 to 8.3 percent in 2000. Thus over 90 percent of the non performing loan settlement takes the form of loan rescheduling and are essentially fictitious.

•The inefficiency of the banking sector is also reflected in expenditure ratios. For the banking sector as a whole expenditure accounts for 96 percent of income in both 2000 and 2001. Even for private and foreign banks this ratio is a high as 89 percent in both years. Salaries allowances and perks account for 23 percent of total expenditure by NCBs and for 28 percent of total expenditure by privatized banks in 2000. In 2000 the salaries to total expenditure ratio rose by 14 percent for NCBs, by 6 percent for privatized bank and by 14 percent by foreign banks.

•The NCBs continue to be the worst performers and the much trumpeted improvement in their profits during 2000 is clearly a statistical illusion. The increase in NCB profits is almostly entirely accounted for by the fact that provisioning by them against bad loans fell from 10.09 percent in 1999 to 3.6 percent, in 2000 despite the fact that the gross non performing loans to gross advances ratio for NCBs remained at 26.5 percent in 2000. Foreign banks with a non performing loan to advances ratio of 5.1 percent had a provisioning ratio of 3.4 percent (only 0.2 percent lower than NCBs) in 2000. Private Pakistani banks had a provisioning ratio of 7 percent while their NPL to advance ratio was 11 percent (less than half that of the NCBs) in 2000.

•The liquidity position of all groups of banks has deteriorated during 2000. This decline is most pronounced in the case of foreign banks where the liquid to total assets ratio has fallen by over 17 percent over 1997-2000. Banks’ risk exposure has also increased. The gap between risk sensitive liabilities and assets has widened from Rs. 199 billion in 1997 to Rs. 255 billion in 2000.

•The overall weak position of the banks is reflected in the continuing decline of the deposits to GDP ratio which has fallen by ‘almost 10 percent during 1997-2000. Foreign banks account for only 14 percent of total bank deposits and their share of bank advances is even lower. Advances growth during 1997-2000 has been significantly in excess of deposit growth thus increasing the riskness of the foreign banks.

•Banking sector inefficiency has also increased. This is reflected in the continuing increase in the difference between deposit and lending rates which increased by 5.3 percent during 1997-2000. In calendar year 2000 average deposit usury rates fell from 5.5 percent to 5.3 percent but lending usury rates rose from 13.5 percent to 13.6 percent. Bank inefficiency is also reflected in the falling total banking assets to GDP ratio which has fallen by 5.8 percent during 1997-2000.

•It is clear that the prudential regulations and restructured bank supervision and inspection system has not succeeded in reducing bank inefficiency, increased riskness and mismanagement. During 2000 Prudential Commercial Bank and Indus Bank went bankrupt. In 2001 they were followed by the country’s leading DFI, NDFC. More bank closures and bankruptcies are on the way almost certainly for the State Bank has no detailed knowledge of the Pakistani financial system. It relies exclusively on IMF (American) and World Bank outsiders and is concerned only to please them.

Balance of Payments Illusions

•The apparent improvement of the country’s balance of payments position during 2000-2001 is largely a consequence of changes in accounting practices and short-term measures related to SBA arrangements. Thus the much trumpeted current account surplus is entirely due to the change in the accounting treatment of the Saudi Oil Facility (previously defined as a loan but now as an outright grant) and the massive increases in the outright purchases by the State Bank from the kerb markets – during FY 2001 these rose by 32 percent. The total amount under these two items exceeds Rs. 2.8 billion and if they are excluded the current account surplus (which is only $331 million) would of course vanish. The improvement in the capital account was mainly due to expanded short-term borrowing and the absence of roll over of Euro bonds, FE45 deposits and PTMA credit. The 63 percent increase in reserves recorded for 2000-2001 is also mainly due to new accounting practices which include reserves with authorized dealers as a component of total reserves. According to the old definition reserves at end FY2001 amounted to only $1.6 billion.

$4 – the Price of a Pakistani

•Pakistan received only a net inflow of $85 million from the IMF during FY 2001. Inflows of $324 million under the SBA were offset by outflow of repayments (repurchases) worth $239 million – thus IMF (America) has bought our national economic sovereignty for just $85 million. In addition we received net official assistance of $432 million mainly in the form of non project aid. Pakistan cost to imperialist? $500 million per year. A little over $3.5 per Pakistani.

•Net total foreign investment during 2000-2001 amounted to only $137 million and there was a net outflow of portfolio investment to the extent of $149 million. Exceptional financing (debt relief, postponement of roll over etc) netted us $692 million. The lesson is that selling national sovereignty earns us exceptional favours but it does not increase the long run commitment of long-term imperialist finance (public or private) to Pakistan.

Increasing Debt

•Maintaining imperialist dominance over the Pakistani economy requires maintenance of a high level of indebtedness. That is why despite all talk of public debt management (remember the Pervez Hasan Committee?) FY2001 saw the largest ever increase in Rupee denominated debt largely due to the 19 percent devaluation which accured in that year. Foreign debt now accounts for 55 percent of total public debt. The increase in the public debt to GDP ratio (up from 107 percent in 1999/2000 to 115 percent in 2000/2001) has come exclusively from the increase in external debt. As far as domestic debt is concerned we are bracing ourselves for an explosion of permanent debt with the launch of PIB which must grow experientially if it is to play its expected role of a market benchmark. Usury rates on public debt are subject to contradictory trends – rising in the case of funded debt (TB rates) and falling with respect to NSS schemes (unfunded debt.) Nevertheless total usury payments on domestic debt in 2000/2001 were still at the 1999 level.

•Usury payment on external debt rose by 12.5 percent during 2000/2001 and total external debt servicing in dollar terms rose by 11.7 percent in FY2001. Of the $3.33 billion external servicing undertaken as much as $1.71 billion (51.3 percent) is related to the servicing of short and medium term debt. It is clear that debt rescheduling leads to an increase in both the volume of debt outstanding and to the cost of servicing this debt. Moreover the debt burden continues to grow explosively due to the highly injurious free float exchange rate policy which has contributed both to accelerated depreciation and to a vicious jacking of usury (specially TB) rates during most of FY2001. There is a built in bais towards the undervaluation of the Rupee in this foreign exchange regime since as the State Bank Report 2000/2001 itself shows, while kerb rates are revaluation resistant, they respond swiftly to a depreciation (p158-159). There will be continuous pressure on external debt servicing and on interest rates in general as long as we follow the IMF (America) diktat and operate the disastrous freely floating exchange rate regime.

Credit – only for the Rich

•Perhaps the single most important cost of financial liberalization is the enormous concentration of credit it generates. Thus at end June 2001 accounts in excess of Rs. 10 million equaled only 0.9 percent of the total number of accounts in the country yet their share in the total advances of the scheduled bank was 75.8 percent. In 1999-2000 this share had been 72.8 percent. It can thus be seen that the wealthiest account holders received the highest share of credit growth from the banking sector. Almost all of these large investment account holders are defaulters and owners of non performing loans. Non performing loans will continue to grow as credit concentration increases. Abandoning market based monetary policy is necessary both for reducing credit concentration and for dealing with the problem of bad debt in the banking sector.

Who Weeps for the State Bank?

•Finally it must be stressed that the State Bank is an increasingly inefficient organization. As the Exhibit below shows the State Bank produced perhaps
==
State Bank Inefficiencies: Changes In Income and Expenditure
1999-2000, 2000-2001
Percent Change
Gross Earnings -1.8
Establishment Expenditure 197.1
Salaries etc. 10.0
Net earnings -88.2
Net Loss on foreign ex. trans. 355.8
Total income -36.4
Net profit -43.7
Source State Bank of Pakistan Annual Report 200-2001 p171
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the worst financial performance in its history in FY2001. Establishment cost went up by a shocking 197 percent. Due to this massive increase in establishment cost there was an operating loss of Rs. 6.8 billion in 2000 – 2001 against an operating profit of Rs. 34.2 billion in 2000-2001. Retirement benefits rose by 733 percent form Rs. 480 million in 1999-2000 to Rs. 3.5 billion in 2000-2001 (SBP Report p 204). The increase in other income shown in the ‘notes to the accounts’ (note 37) is mainly a consequence of changes in accounting procedure. Provisions made for retirement benefits and bad loans of Banker’s Equity lead to a draw down of reserves by Rs. 5.6 billion.

Net loss on foreign exchange transactions went up by 355 percent and SDR charges rose by 25 percent. Both were a consequence of adopting the disastrous free float exchange rate system which led to a massive devaluation of the Rupee.

Total income declined by 36 percent, net earnings by 88 percent, net profit by 44 percent. All talk of increased efficiency through reliance on outside imperialist trained experts and professionals become a laughing matter when one is confronted with such figures.

The poor analytical quality of the State Bank’s Annual Report also illustrates a lack of professional expertise. This analytical poverty becomes glaringly evident when one compares the State Bank’s flagship publication with similar publications of Bank Milli, Iran or the Reserve Bank of India. The State Bank is yet to publish a comprehensive flow of funds matrix for the macroeconomy – the most elementary of macro management tools. The State Bank’s Annual Report is a dreary reading of statistical tables displaying little analytical insight and providing no coherent justification for its preferred policy options. Readers of the Report are expected to be true believers in the voodoo economics of Lucas and Sargant. The State Bank has no less than three separate research departments but it’s research output is presumably meant only for the IMF (America) and World Bank consultants who dominate the State Bank and the foreign bankers who dominate the commercial banking sector. Ordinary Pakistanis can of course have no access to this research for the organizational mandate of the State Bank is to consolidate the financial foundations on the basis of which Pakistan can be turned into a subservient neo colony. One must have faith in the eventual success of the IMF (American) strategy – despite the overwhelming empirical evidence to the contrary. All that the State Bank takes prude in is meeting the IMF (America) targets.

II.Explanation Monetary Policy Catastrophes

The failure of monetary policy is reflected in:

The decline in the trend GDP growth rate of almost 6.5 percent during the credit planning period to a shade over 4 percent during the financial liberalization era and to 2 percent today.

Fall of national saving to about 12 percent of GDP and investment to about 15 percent of GDP.

Continued massive devaluation of the Rupee and the consequent compulsory rise in usury rates.

There are three major reasons for this failure.

First, the new classical economic theory on which IMF type macroeconomic stabilization programs are based is not focused on the issue of economic growth. The full implications of incorporating rational expectation assumptions means of course that monetary policy initiatives are entirely irrelevant in both the short and the long run. Even in the “monetarist” version of the new classical approach where short run effectivity of monetary policy is admitted, the impact is “assigned” entirely to changes in aggregate demand. Monetary policy can only adjust to changes in aggregate supply and these changes are attributed to theoretically unfathomable “exogenous” shocks. Monetarists recommend that such adjustment should be achieved by targeting money supply but the crucial assumption on which this preference for money supply targeting is based are (a) demand for real money balances is interest inelastic (b) the demand for real balances is stable and (c) investment demand is interest elastic and overall real expenditure varies significantly over time. If these assumptions do not hold, there is no reason to expect “monetarist” money supply targeting to stabilize the macroeconomy – let alone contributing to growth. The McKinnon-Shaw-Fry revision of crude monetarism predicts that adjusting money supply to eliminate market “distortions” will jack up usury rates but since saving is interest elastic and since higher usury charges necessitate an improvement in investment efficiency higher usury rates are good for growth. On the other hand, post Keynesian monetary theorists hold that in a modern sophisticated financial system control of the money supply is impossible since there are multiple sources of money creation and a plethora of liquid assets – inability to control US money supply has often been admitted by Alam Greenspan; the chairman of the Fed.

As Kaldor pointed out in the 1980s, the Central Bank in a capitalist economy does not control the processes of money creation, it merely accommodates or adjusts the macroeconomy to the credit creation decisions of private oligopolistic banks. There is nothing in new classical or monetarist economics to lead us to expect that an increase in money supply or credit will lead to an increase in production. It has during the last twenty years led mainly to an increase in financial claims on existing output. The new classical economists argue that the actual equilibrium in the money and the real sector is necessarily the potential output equilibrium and thus monetary policy is irrelevant. This is an economic version of the Hegelian “the real is the rational” absurdity.

Post Keynesians regard this “vision” of the macroeconomy as patent nonsense. Factor (specially credit) and commodity prices are rigid because production takes place over time. The investor needs to bridge the gap between capital lay out and return from sales. Debt contracts cannot be spot but must be temporally structured. This is also true of labour contracts and hence the rigidity of wages and usury rates is a structural / institutional requirement of a capitalist economy. Factor and commodity price flexibility is pure fiction a norm to which capitalist markets cannot tend.

Post Keynesians such as Rogers (see his Money Interest and Capital CUP 1989) also stress that interest is an exogenously determined price. Interest is the price of credit. Rogers shows that credit is a commodity to which the laws of production do not apply and it can therefore have no natural price (except zero). Usury represents the credit owner’s share of profits and from the time of Sraffa’s seminal contribution we know that the struggle among capitalists determines profit (i.e. surplus) appropriation. The legitimate/natural share of finance capital in surplus cannot be theoretically determined since it does not exist.

Changes in money supply do not automatically lead to changes in usury rates. As Kaldor showed in his classic critique of monetarism usury rates fall only if the central bank so desires. There is no built in automaticity because there is no reason for the existence of a positive interest rate specially in an economy where the central bank can create credit almost costlessly and at will. A central bank such as the State Bank of Pakistan which is inexorably pushing up usury rates, must necessarily stifle growth.

Market based monetary policy focused on money supply targeting must be growth stifling in Pakistan. Recent econometric research at CBM has shown that (a) investment demand is interest inelastic (b) there is no association between output growth and usury rate changes (c) monetary assets (M2) is an endogenously determined variable. It is caused by and does not itself cause output growth.

The second reason for the failure of monetary policy is that the IMF (America) and the World Bank have made it impossible for us to deviate from monetarism. The abandonment of the credit planning system and the full-blown financial crises that has followed the introduction of market based monetary management has been engineered by the IMF (America) and World Bank. The Fund and the Bank forced us to abandon credit planning. They forced us to adopt financial liberalization. Why did they do so?

The Fund and the Bank are the agents of international capital. Their primary organizational task is to facilitate world-wide sourcing and global profit maximization by international banks and multinational corporations. They perform this role as public agents effectively representing the strategic interests of imperialism’s sole hegemonic state, America.

During the 1990s most of the OECD countries – specially Germany and Japan have been in a state of recession. The United States is now in recession and prospects for all major regions are bleak. The present recession is characterized by negative output growth, high and rising unemployment, intense oligopolistic competition, declining population growth in the West and in East Asia and a rapidly worsening pattern of income distribution (specially in the United States) which severely constrains consumption growth. Sufficient profitable investment opportunities do not exist in the West to absorb the tremendous amount of corporate and business saving that the system is generating. International capital needs therefore to move into non-metropolitan countries but it can profitably do so only if it subordinates the only source of resistance which can seriously challenge globalization – i.e. the peripheral state. International capital’s primary need is to subjugate peripheral states to America. Without this, it can never feel secure in a peripheral country such as Pakistan.

International capital has two subsidiary needs. Since it’s dominant form is finance (not industrial) capital it requires a tight monetary policy and a jacking up of usury rates. Restrictionist polices are preferred and in as much as they foster deflationary conditions they fulfill international capital’s second subsidiary need. This is the cheapening of assets in the peripheral countries. Devaluation is the preferred tool for achieving this objective.

The IMF (America) and the World Bank have been only partially successful in achieving these ends. Our military budget has fallen in real terms in the last few years but we retain our nuclear programme and the imperialist dominance over our political system is still precariously balanced and it’s termination is a probability. Most importantly, there is a thriving manufacturing and commercial informal sector outside the reach of policy liberalism from which effective resistance can be launched. It is this delicate balance of political, economic and social factors, which ensure that foreign capital remains reluctant to commit itself to Pakistan.

But there is an important success that the imperialists have achieved in the period since the first Benazir government of 1988. During 1988-2001, they have succeeded in transferring economic management in Pakistan to a group of professionals who have no commitment to Pakistan. They are permanently based in America and work for American multinationals and banks. They have been seconded to Pakistani organizations on a short term basis to implement the imperialist agenda. These quisling professionals are imperialism’s fifth columnists in Pakistani banks, government organization, research institutes and autonomous bodies. During their prolonged stay in western countries, they have adapted the shameless life style of the West and have had no contact with the thriving Islamic movements of Europe and America. They have a strong hatred and contempt for Islam and are unashamed lackeys of their imperialist masters. It is their domination of the economic policy making process, which is the third reason explaining our implementation of policy liberalization. Being narrow-minded professionals, these quislings have no understanding of the theoretical inconsistencies and methodological premises on which liberalization policies are based. They undertake policy conception, and implementation in a ham handed fashion, which ensures that it has the maximum harmful impact on Pakistan. If Pakistan is to avoid an economic crisis the power of these quislings over monetary policy making must be broken.

In brief, we have not embraced financial liberalization voluntarily. It has been imposed upon us by the imperialists who use it as a means for weakening the state, destroying the production base (specially large scale manufacturing) and cheapening Pakistani assets. We continue to adhere to these policies because the imperialists have succeeded in infiltrating their servants into our decision-making institutions in both the public and the private sector. But continued subservience to imperialism is not necessary. An alternative is available. It is specially necessary to seize this alternative in the changed circumstances following the September counter attack on America and the protracted global economic downturn which it has precipitated.

III.The Alternative

The alternative to imperialist subjugation is Islam. There is no other alternative. We reject imperialist subjugation, globalization and policy liberalization because.

Globalization and policy liberalization is a failed experiment. Policy liberalization has led to a sharp fall in world output growth – this averaged only 1.8 percent per annum during 1990-99. During 1990-99, the OECD countries grew at an annual average rate of just about 2 percent. Income distribution patterns worsened specially in America. Financial liberalization has been a disaster, while commodity production has stagnated, through out the West financial claims on existing assets have soared laying the foundation of an unavoidable crisis. Moreover, there is no international financial regulatory authority – the IMF and the BIS have no power over the international banking conglomerates. Systemic arrangements to defuse major financial crisis do not exist. Liberalizing international trade does not lead to significant efficiency gains. In Dani Rodrik’s words, this is “the dirty little secret” which trade theory seeks to conceal. Integrating into the world market has few benefits overwhelmingly outweighed by the astronomical costs of increased financial vulnerability and loss of national sovereignty.

Since the September 2001 counterattack on America the world economic outlook has worsened. All major forecasters – Merrill Lynch, Goldman Sachs, the IMF the OECD – now believe that growth will probably be negative in 2001 and negligible in 2002. Despite the symbolic launch of a new WTO round, trade volumes will fall and process protectionist barriers will rise. Restrictions are being imposed throughout the world on the movement of capital. Budget deficits are back and the days of big government are returning. We are in a post global era in which integrating with the international economy makes no economic sense for countries like Pakistan. Pakistan has received only symbolic concessions for betraying Islam. There will be no major debt write off or significant debt reprofiling. Exports will plummet. Foreign investment flows will dry up. In these circumstances we must focus on domestic demand and abandon the quest for favours from America and the IMF.

Financial liberalization exposes Pakistan to Jewish penetration. As David Ben Gurian (then Prime Minister of Israel) said in 1967 “Pakistan is our deadliest enemy. It is a fundamental aim of Zionist policy to destroy Pakistan.” Financial liberalization has allowed Jewish financial empires – including Rothschild’s family bank – to dominate Pakistan’s money and capital markets. It is not surprising that these institutions and the IMF place great emphasis on the rapid demilitarization of Pakistan despite the growing American threat in the Gulf and the rising tide of Indian brutalities in occupied Kashmir.

Most importantly policy liberalization – and financial sector liberalization in particular – is a means for destroying the Pakistani state. This is evident from the continued insistence of the Fund and the Bank on reductions in military expenditure. During fiscal 2000-2001 federal defence, expenditure fell in real term and a further fall is envisaged for 2001-2002 – in dollar terms we spend less on defence today then we did ten year ago. Debt servicing on the other hand is expected to grow continuously despite hypocritical gestures of management strategies and associated rescheduling and reprofiling exercises. Moreover policy liberalization has led to a transfer of economic sovereignty from the Government of Pakistan to foreign agencies and their agents in the financial sector who are subordinating national policy to imperialist money and capital markets.

The alternative approach to monetary policy must involve the ouster of the present financial sector leadership. IMF (America) nominees should never again be the governors of the State Bank. The person selected to fill this post must be a true patriot and a sincere Muslim. The amendments to the State Bank of Pakistan Act 1962 and the Banking Companies Ordinance 1967 introduced in 1997 should be repealed and the State Bank should be subjected to the full authority and control of the Ministry of Finance and parliament. Without this, it cannot be prevented from functioning as an agent of international capital for destroying Pakistan’s sovereignty. Fifth columnists must also forthwith be removed from top management in NCBs. This is a matter of urgency for without it Pakistan can not avoid a financial crises.

It is also necessary to accelerate the pace of introduction of the Islamic financial system and the elimination of interest from the economy. Those who regard the implementation of the 1980 recommendations of the Islamic Ideology Council as impractical should note that when these recommendations were made our total debt servicing amounted to just Rs. 109.5 billion (in 1979-80). External debt servicing amounted to only 12 percent of foreign exchange earnings in 1979-80. Servicing of domestic debt amounted to just 1.1 percent of GDP. Had the debt retirement and restructuring proposals of the Islamic Ideology Council been implemented in 1980 imperialist domination and the growth of the debt burden would have been impossible.

Other measures required for a successful monetary policy are:

The cancellation of all existing agreements with the IMF and the World Bank and Pakistan’s immediate withdrawal from GATT/WTO commitments.

Immediate discontinuation of market based monetary management and rigorous implementations of credit planning. Market based monetary policy makes the Islamization of the financial system impossible.

Immediate nationalization of all banks, DFIs and financial institutions both domestic and foreign.

Abolition of the money market and immediate institution of a system for meeting financial sector liquidity needs on the basis of the 1980 recommendations of the Islamic Ideology Council.

Imposition of strict capital controls and foreign exchange rationing

Repudiation of all external debt claims incurred since December 1988. These debts have been imposed upon us by the IMF and are its responsibility.

Repudiation of domestic debt in accordance with the 1980 recommendations of the Islamic Ideology Council.

A doubling of expenditure on defence to at least 10 percent of GDP and a strengthening of the relationship between defence spending and capital goods sector investment.

Delinking from the international system will be painful. But it is clearly not impossible. Our trade – GNP ratio is about 30 percent and shrinking. Net external resources inflow is only 10 percent of gross capital formation. Foreign direct investment is minuscule – usually less than $400 million gross on an annual basis. Portfolio investment is negative and focused on trading of existing securities and not on new issues. Project aid has also been falling. At present domestic savings finance about 90 percent of our total investment. We are not a foreign capital dependent economy. Moreover, by repudiating foreign debt the government will save about $5 billion annually almost twice, what will be lost in DFI and project aid flows. Debt restructuring and reprofiling cannot conceivably save such sums.

Countries with a much higher level of dependence have successfully de-linked from the imperialist system – Russia in 1917, Germany in 1922 and Iran in 1979. Iran has grown at an annual average rate of growth of over 6 percent during the Islamic period despite US sanctions. If the political will of the people is resolutely organized on the basis of a platform of Islamic unity Pakistan’s subordination to imperialism can be ended and her Islamic identity preserved. The Islamic movement is immensely powerful and as Khomaini said in 1979, “America can not do a damn thing”.

Pakistan Ka Matlab Kiya?

2005-05-22T02:56:00.000-07:00

Pakistan is the first Islamic State established after the fall of the Usmani Khilafat. It is an Islamic state in name only, but nothing sustains its national integrity except Islam.

Pakistani nationalism is a contradiction in terms – a manifestation of Sir Syed’s failed project to Westernize the Indian Muslim community. The people of the regions that became Pakistan had no commitment to Muslim nationalism for unlike the Muslims of the minority provinces they had no fear of Hindu dominance. Their ethnic commitment is to their language communities. There is not now and has never been an equivalent of a Zionist movement in Pakistan.

The Pakistan movement sought to supercede ethnic consciousness by appealing to Islam.

Weakening the state’s commitment to Islam is weakening the state itself for legitimating the state’s existence requires invoking Islamic consciousness. The state elite has since 1947 been confronted with the dilemma that while the national interest cannot be legitimately defined in a non Islamic context, there is no room within Islamic discourse for conceptualizing a specific national interest. The Prophet’s (may Allah shower His choicest blessing on our lord) Medina, the Rightly Guided Caliphate, the Mughal and Usmani empires – none of these were nation states. The Ummah is a universal ethical community and it legitimizes universal political order.

Thus while an Islamic state has geographical boundaries it is a universal state in that it is committed to the advocacy of a universal truth – “the Bosnian tragedy occurred” writes Ali Sabry Gosovic “because Pakistan was not our neighbor. The Pakistanis would never have tolerated our persecution”.

The Pakistanis cannot tolerate the persecution of the Afghanis, the Kashmiris, the Chechens, the Palestinians, the Moros because the raison d`etre of their state is its commitment to universal truth. Pakistan is merely an instrument for the service of this truth. It is nothing else. Attempts to convert Pakistan into a nation state – into Napakistan – are an attempt at undermining the popular legitimacy of the state.

Africa is a good example of what happens when attempts are made to create an artificial nationalism – a nationalism not rooted in the historical experiences of a populace. Promoting civic nationalism, on the basis of the argument that it is in the material interest of the people of Pakistan to ensure Pakistan’s survival – cannot succeed for the ideology which sustains such civic nationalism is liberalism.Today, liberalism is a spent force even in Europe and America, where electoral turnouts have been declining for half a century, political agendas have become uniform, human rights discourse is subservient to hedonist commitment and there is a wiedespread “withdrawal from citizenship “ specially among the youth. How can liberalism acquire popular support in societies lacking historical commitment to liberal values, when it is dying in its homelands?

That does not mean that Islam cannot be defeated in Pakistan. But the defeat of Islam must involve a loss of state sovereignty – the conversion of Pakistan into Napakistan. Islam’s defeat can take two forms.

Pakistan can disintegrate, and popular support can be mobilized on the basis of racial hatred of the Punjabis. An often cited CIA report foresees this outcome, with Pakistan collapsing into two regions Sindh and Punjab subservient to India, and Balochistan and NWFP subservient to Iran and Afghanistan. This must involve a loss of sovereignty.

The other form that Napakistan can take is its transformation into a new South Vietnam. South Vietnamization will involve purchasing material benefits at the cost of state sovereignty and in particular redefining national foreign policy to serve imperialist objectives. The current Islamic resistance has shown that South Vietnamization will entail political costs.

But the Islamic resistance movement does not as yet have the sort of popular support the Viet Cong enjoyed nor does Afghanistan enjoy the support of super power allies. The major political parties – the Muslim League, the PPP, the ANP, Mutahida – are imperialist sponsored. The South Vietnamization of Napakistan is therefore not inconceivable but Napakistan cannot avoid a loss of state sovereignty. South Vietnam can only survive on ever increasing imperialist support and this must involves state subservience to imperialist policy objectives.

The government has clearly rejected the disintegration option and even the imperialists are not betting on the racialist parties. The government is dithering between choosing South Vietnamization or Islam. I will now present an argument against South Vietnamization of Pakistan.

This argument is grounded on religious principles. Choosing South Vietnamization is withdrawing from the jihad against a civilization which seeks the deification of man and universalizes the social duty to accumulate capital and practise its concomitant human rights. It is our religious duty to struggle against capitalist and democratic ideology and practise.

South Vietnamization will create an unbridgeable gap between the government and the people of Pakistan. The people will resent the de-Islamization of politics and society. No popular argument has been – or indeed can be – presented in favour of South Vietnamization.

Crushing the Islamic resistance movement will become inevitable and liberalism will have to be imposed upon an apathetic and disillusioned people and no argument will be available to prioritize collective to individual interests in such a scenario.

Liberalism dissolves communities and liberal policies – specially liberal economic policies – provide no scope for nation building. Building Napakistan through South Vietnamization will lead to the growth of the rampant corruption, selfishness and cruelty which characterized the Saigon regime under Thieu.

As corruption and selfishness spread the imperialist stranglehold will strengthen. The concept of a national interest which restricts immediate access to material well being will become meaningless. If today we are willing to sacrifice our commitments to Afghanisatan for our national material well being, why not betray Kashmir tomorrow and the nuclear programme the day after? All these betrayals will become increasingly palatable to a hedonist people for each will be accompanied by greater and greater imperialist largesse.

There is simply no argument which simultaneously justifies the betrayal of Afghanistan and the defense of the neucler initiatives if the national interest is conceived of in material benefit terms. Both Afghanistan and neucler capability are sacrificable on the grounds of a higher standard of living.

Imperialist support can raise standards of living. In South Vietnam GDP growth was high during most of the 1960s. Similarly imperialism can provide substantial benefits – debt write of, access to American markets, multilateral assistance, etc. But as in the case of South Vietnam the growth made possible by imperialist support will prove unsustainable. There are three reasons for this.

First America will loose the war in Afghanistan and eventually in the Middle East. America is not in a position to fight a long drawn out guerilla campaign and the Islamic regime will not disintegrate even if there is a temporary loss of some major cities. There is a growing realization that the security threat to America is internal in nature and creation and preservation of pro American regimes, specially in regions peripheral to the interests of global capital, is somewhat irrelevant. As the impossibility of a clear cut victory in Afghanistan becomes clearer the temptation to quit Afghanistan – and reduce commitments in Pakistan – will become strong. This is what happened in Vietnam and it is improbable that the Americans will stay long in Afghanistan. The commitment to the Middle Eastern regimes is of course much more durable but Pakistan does not stand to gain much from this, since the major policy imperative of this commitment is the deneuclarization of Pakistan.

Secondly the cost of obtaining imperialist support is continuing adherence to the liberal policy agenda imposed upon us by the IMF and the World Bank.

We are forced to reduce military expenditure (already less than one fifth that of India) cut deficits, devalue, restrict the growth of high powered money and privatize in a de-globalizing world, a world in which these policies make no economic sense.

As growth rates plummet public deficits will return to America and private capital flows to all developing countries, including “emergent markets” will be reduced. Trade volumes will also fall as insurance and freight rates rise.

Moreover imperialist governments will be forced to impose capital controls – “we are all Keynesians now” says the Financial Times – for without this taxing capital and sustaining growth in public spending will rapidly become unsustainable. The defeat in Vietnam brought about a twenty year downturn, for America and Europe. The defeat in Iraq Afghanistan may impose a greater cost on capitalism for populations are falling and ageing, the debt mountains have assumed unprecedented heights, faith in the basic liberal values has been eroded and everything depends on stimulating consumer and investor “confidence”. But what is there to be confident about?

Delinking from such a system which is poised on the brink of disaster is both necessary and possible. Like India and China our international dependence is limited. Our trade / GNP ratio is below thirty percent and the net capital inflow to gross capital formation ratio is between 10 to 12 percent. We are a self reliant economy producing 80 percent of what we consume and financing 90 percent of our total investment. Rejecting the IMF imposed economic policy agenda is the only viable policy choice for us in the present circumstances.

This must involve

 Removing pro-imperialist ex-employees of the IMF, the World Bank and private international banks from positions of leadership in major policy making institutions.

 Abandoning the quest for a new IMF stabilization programme and freeing our economy from its associated conditionalities.

 Repudiating foreign debt and imposing strict capital controls on inflows and outflows. In present circumstances it is most unlikely that debt repudiation will lead to major retaliatory action.

 Nationalizing the financial system by abolishing the creation of money in the form of debt and abolishing the money market. This is the essence of Islamization of finance for the profit sharing system does not recognize debt or debt money.

 Building a war economy centered on the public financing of investment in defense related industries, specially capital goods, energy and food. The investment strategy must focus on stimulating domestic demand.

 Restructuring informal sector and bazzar transactions with the mosque as a financing node which facilitates the pooling and deployment of small savings and the development of input – output linkages between micro, small and large scale producers. Mosques can serve as bazzar based branches of national non debt financial institutions.

The introduction of these reforms will be resisted by the imperialists and their supporters. But in the present circumstances an appeal to make sacrifices for Islam can prove highly effective. An anti imperialist policy stance will bridge the gap between the government and the people and the organizational structure for popular mobilization and for institutionalizing popular support already exists in the form of thousands of mosques and madrassahs spread throughout the country.

The chances for the success of such a strategy are good but failure is also possible. We are committed to this strategy on religious not on pragmatic grounds. Pakistan is a universal not a nation state. Redefining Pakistan’s national interest in non universal terms is the conversion of Pakistan into Napakistan. This is not acceptable to the people of Pakistan.

A note on conceptual confusions

2005-05-15T04:55:00.000-07:00

It is almost a truism to say that Islam is a balancing act, a balanced way and a system of life based on moderation. Of course Islam is the religion of justice and moderation. But what does this mean? What is the conceptual and logical status of terms such as ‘moderation,’ ‘balancing acts,’ and ‘justice?’

When Allah (Almighty and Glorious is He) calls His religion and deen a balanced act and a path of moderation, He does this on the basis of His all-encompassing knowledge and on the basis that He is the creator of the criterion (Al-furqan) according to which we distinguish between what is a balancing act and what is not, what is moderation and what is extreme.

Allah (Almighty and Glorious is He) revealed the criterion through His messengers and through His books to us so that we can guide our life according to the revealed criterion. The criterion is preserved in its purest and final form in the teachings of Islam, in the Quran and in the life and sayings of the Prophet (peace and blessings of Allah Most High be upon him) and the Ijma of the Ulema of this Ummah.

Allah (Almighty and Glorious is He) revealed the criterion to differentiate between good and evil, moderation and extreme, because it is impossible to discover the criterion through human efforts, through senses, reason and intuition. The senses, reason and intuition has no bearing on the question. This is the basis of the need for the prophethood and divine guidance because if one denies the inability of senses, reason and intuition to discover the ultimate truths one in fact denies the need for prophethood and guidance.

Greek philosophers like Plato and Aristotle believed (for example) that the ultimate criterion to distinguish between justice and injustice can be discovered through reason. Aristotle famously held that a right act was ‘mean’ between two extremes and that ‘mean’ can be discovered through a combination of theoretical and practical intellect.

The Christian and Muslim disciples of Plato and Aristotle had great difficulty in reconciling between the Platonic and Aristotelian views about the self sufficiency of human intellect with their religious views about the need for prophethood and guidance. In the end they were compelled to propose an arbitrary compromise according to which both philosophers and prophets teach the same criterion to distinguish between right and wrong. The difference however is that the way of messengers is “easy” and open/accessible to the masses while the way of philosophers is difficult and hard to understand for most people. That is how St. Augustine, Aquinas, Al-Farabi, and Ibn Sina claim to reconcile the teachings of the Greek philosophers with Christianity and Islam respectively.

Now our master the Hujjah of Islam Imam Ghazali totally rejected this so called reconciliation. He showed the incoherence (Tahafa) of any such claims. He established beyond doubt that reason was incapable of discovering the criterion (Al-furqan) of what is right and wrong, just and unjust, moderate and extreme. To accept the absurd claims of philosophers is in fact to deny the essence of prophethood and the most basic human need i.e. the need for guidance.

In the light of above it should be clear that Islam is the sole criterion through which we can distinguish between what is good and evil, what is right and wrong, what is just and unjust. This is implied by a universally agreed upon belief among the Ahlussunna wal jamaah that Islam is the truth (Al-Haq). There can be no value neutral criterion to judge whether Islam is just or not, moderate or extreme, because Islam itself defines what is just and unjust, what is moderate and extreme, what is balanced or not, in the first place.

There is no difference of opinion among Ahlussunna wal jamaah on the above in that, unlike Mutazilah (and Shia), they unanimously reject that justice can be defined in any value neutral terms. It is for this reason that Ahlussuna wal jamaah (unlike Mutazilah and Shia) has never included justice among the basic pillars of Islam.

If the above is correct then something like the following can be interpreted in two different ways of which only one can be correct:

A)Islam is the religion of moderation and a balancing act
B)Justice and balance are from the greatest goals of the Shariah.
C)Our scholars have stated that the Shariah came with justice and balance in every way.

The statements above and countless other statements like this are correct if understood within the limit of what we have said above as meaning that the Shariah came to establish balance, justice and moderation in the life of people and that the Shariah itself defines what is just, unjust, balance, etc.

However the above statements are wrong when they are presented as independent principles (Usul) to derive Ahkam, simply because Shariah itself defines what is moderate and what is not and so moderation cannot possibly be a principle of deriving Ahkam (simple logic would suffice to understand it).

If the Shariah itself defines what is moderation and what is not then it is simply nonsense to use the concepts of balance, moderation or justice as independent principles to establish the permissibility or impermissibility of a certain act. If justice means acting according to the will of Allah (Almighty and Glorious is He), if balance means choosing the way Allah (Almighty and Glorious is He)has prescribed for us and His beloved (peace and blessings of Allah Most High be upon him) has lived for us then how on earth can the concept of justice and balance be treated as principles to establish Ahkam?? Imbalance means deviating from the way of the beloved of Allah (peace and blessings of Allah Most High be upon him), injustice means not obeying the Will of Allah (Almighty and Glorious is He). That is why Islam is the justice and the balance and Kufr is injustice and imbalance par excellence.

However it is not just simple nonsense, it is rather a dangerous ploy as well (intentional or unintentional) to distort the very meaning of Shariah and the deen of Allah (Almighty and Glorious is He). The very fact that a third term is employed in discussing issues rather than establishing the religious edict in a direct way itself points towards the fact that something is fundamentally wrong with this strategy.

Invoking third terms is a dangerous ploy because it imperceptibly and gradually tries to establish the value neutral meaning of justice, balance and moderation and hence changing the very meaning of these terms as they are understood in the religion of Allah (Almighty and Glorious is He). It gradually reinterprets the Shariah of Allah (Almighty and Glorious is He) in the light of these supposedly value neutral concepts.

It should be remembered that the concepts which I have referred to as value neutral are in fact never value neutral. The content of these concepts if not derived from the consensually established meaning of Shariah is filled by the meaning of the term which is prevalent. Considering which civilisation is dominant today, epistemologically and politically, the whole process can only be described as modernization and Westernisation of Islam. The process is part of the campaign to create a moderate Islam (thus intended or not).

The above mentioned danger is not an abstract or empty danger. This is precisely what happened with Christianity and this is God forbid what could happen to Islam if the trend spreads.

It is ironic that in the forefront of the movement leading this are those who claim to hold the banner of traditionalism. But in fact there is no deeper irony here since traditionalism is the flipside of Modernity and Modernity has always used traditionalists to their advantage.

Modernity can only be resisted and eventually overcome on the basis of the principles of Ahlussunna wal jamaah who combine emphasis on tradition and continuity with equal or more emphasis on the transcendent character of Quran, Sunnah, and the Ijma of the best period in the history of Islam (i.e. the Ijma of the first century of Islamic era).

MAHBUB UL HAQ CENTRE CRISES OF GOVERNANCE: HUMAN DEVELOPMENT REPORT 1999 OUP KARACHI

2005-04-14T17:44:00.000-07:00

As liberal, socialist and social democratic discourse looses credibility and popular participation in democratic processes declines throughout the world, legitimizing imperialist dominance becomes increasingly problematic. New ideologies have to be crafted to justify imperialist dominance. Humane governance is one such ideology.

The Mahbub-ul-Haq Centre’s 1999 Annual Report on the crises of governance is essentially a somewhat simplistic defence of this ideology. The conceptual chapter in the Report written by Meghnad Desai explicitly identifies the Kantian and Rawlsian foundations of humane governance ideology.

It is “the people” (and not Allah) who are sovereign. The rulers should be subject to the will of “the people” not to the will of God. Liberalism’s authoritarian and totalizing orientation is fully reflected in the claim “Humane Governance is a norm appropriate to all countries”. Liberalism asserts the universal sovereignty of “the people” who have an absolute right to reject or reinterpret God’s will.

Both civil society and state are seen as instruments for building “the people’s” capabilities for exercising sovereignty. The capabilities that are to be built are those which prepare the masses to deal “with the emerging market economy and instill habits of contract fulfillment”. This makes it clear that within liberal order the only legitimate “aspiration of the people” is the will to accelerate the sustainable rate of capital accumulation – every thing else is subordinate to this uniquely genuine aspiration.

The fact that the formal sovereignty of “the people” is really the sovereignty of capital is made clear from the instrumental conception of democracy, which the Report endorses. It argues that “democracy has not brought about an advance towards a rule based society”. The masses do not have the right to reject the rules of liberal law that guarantee capitalist property rights – the rule of law is the rule of the law of capital. The liberal constitution should not be easily amendable and social atomization should be promoted through political decentralization and sexual and religious homogenization. The purpose of “humane governance” of “the state, the market, the society is ultimately to maximize the welfare of the people” – i.e. to maximize the present value of consumption flows by maximizing long run profit.

The achievement of this purpose requires the transformation of the subject of God into the subject of capital – the citizen who participates in state processes in his own interest (maximization of profit) and whose “sovereignty” is guaranteed by the securing of the fundamental human rights which are the obverse of the individual and social duty to accumulate capital. These rights “enrich” “the people” by expanding “their freedom of choice” – expanding, that is the realm of the circuit of capital.

The new political economy explicitly recognizes the threat posed by democracy to liberal order. Democracy permits what the new political economy calls “rent seekers” to prioritize the interests of particular capitals over the duty to maximize the long-term rate of return on capital in general. The prioritization of the interests of capital in general is rational (by definition) but the actual empirical behavior of particular individuals and collectivities always threatens to violate this rationality: hence the need to constrain democratic behavior by means of a liberal constitution framed by an enlightened priesthood.

Thus it is the framers of the American constitution standing on the corpses of seven million slaughtered Red Indians and holding aloft the flag of liberty who are “the people” It is their sovereignty that is sacrosanct. Liberalism claims that sovereignty belongs to the framers of the American constitution for all times and in all places for they are the true representatives of universal, permanent capital. John Rawls’ construction of the ‘original position’ is a formal statement of this fundamental tenet of liberalism.

Humane governance is thus a means for ensuring the social dominance of an elite liberal priesthood (“the people”) committed to the supremacy of capital in general and owing no allegiance to a particular country – except to the global state of permanent, universal capital, America. That is why there is not the faintest hint of patriotism through out the Mahbub-ul-Haq. Centre’s Report. It repeatedly describes the Kashmir Jihad as a border dispute and never mentions the rising tide of Indian brutalities in the occupied territories.

Delegitimating patriotism must involve a weakening of the commitment to national identity – hence the emphasis the Report places on decentralization.

Decentralization is a primary tool for the achievement of humane governance As the report notes “decentralization generates political pressure necessary to focus government attention on humane governance priorities”. It notes with satisfaction that “decentralization by default” is already underway due to the increased dominance of a huge corpus of NGOs in Pakistan. Decentralization serves to delegitimate issues of high politics such as concern with national security, international capitalist dominance over national finance, subjugation of national industries to multinationals etc. Decentralization is essential for achieving the imperialist objective of “limiting the volume of state activity to the protection of human rights and the guaranteeing of (capitalist) property and contracts”.

National identity should also be weakened by making “civil society independent of the centralized state”. Civil society institutions – specially the media – are seen as imperialist agents and sponsors of human rights discourse with full commitment to liberalized markets. “in which prices reflect (monopolistically) determined scarcity values” and government intervention is outlawed. Civil society is also to serve imperialism by agitating against increases in national defense expenditure.

Converting religious society into civil society involves above all defeminization – the social triviliaration of the role of the daughter, the wife, the mother and the child and the delegitimation of honour (ghairat) and chastity (iffat). This is achieved by co modification of female labour – therefore naturally this is a key element in the humane governance agenda. Promoting defeminization is a key element in the reconstitution of the economy as a full-blown capitalist entity emphasizing the social primary of capital accumulation and the safeguarding of capitalist property rights and contracts. Civil society is an adjunct to the capitalist economy. Civil society constituents legitimate interest orientation and structure communities to simulate individual utility (consumption) maximizing behavior. Such behavior legitimates self love and a society in which self love is universalized is necessarily incapable of worship. Such “self development” is also necessarily cannibalistic – it destroys the communities from which it emerges and serves only universal, permanent capital. This has been the historical experience throughout Western Europe and North America.

Humane governance cannot be limited to a particular sphere – economic, political, civic. As the Report says “the three dimensions of humane governance are inextricably linked and complimentary – they form a governing framework and require a holistic approach”. As the Report accepts, humane governance is an ideologically charged concept. It is a continuation of “the 1989 world humane revolution, which established the universal primacy of freedom”.

Capital is the concrete form of freedom and the integrated character of the humane governance project reflects the exclusive, totalizing character of capitalist order. Capital is not willing to share sovereignty with any other, hence the sovereignty of the citizen provides only the form for the substantive sovereignty of capital within liberal order. The Post Fordist system of accumulation seeks to universalize liberal order and it’s proponents seek nothing but Pakistan’s total subordination to universal, permanent capital through.

•Increasing social sector expenditure
•Liberalizing land and credit markets
•Liberalizing trade and privatization
•Expanding population control and opportunities for the comodification of female labour.
•Increasing the market access of the poor
•Eliminating government subsidies and increasing user charges
•Imposing legislative limits on government debt
•Guaranteeing political autonomy of local bodies and provincial governments
•Encouraging NGO participation in local and provincial government
•Reducing the legislative and fiscal power of the federal state
•Reducing the size of the civil service
•Drastically cutting defense expenditure
•Remodeling judicial systems to reflect liberal norms
•Establishment of special financing faculties to create partnerships between governments and NGOs
•Mobilizing popular forces advocating subservience to human rights imperialism
•Organizing groups within the government to support the agenda for imperialist subordination
•Weakening the formation of opposition forces resisting imperialist subordination

This agenda of humane governance is a programme for drastically weakening Pakistan. This wreaking is to be achieved by:

•Destroying the defense capacity of the state
•Destroying the capacity of the state to determine the pattern of resource allocation
•Fracturing the national polity into “autonomous” provinces and localities subservient to imperialism
•Delegitimizing Pakistan’s existence by creating a social order focused on self interest and self love- a civil instead of a religious society
•Politically mobilizing elites committed to liberal imperialist subservience and apposed to Pakistan’s existence as a non liberal anti imperialist Islamic state

Imperialism seeks to delegitimize popular concern with issues of high politics – Kashmir, the nuclear programme, defense of national economic sovereignty, the implementation of the Sharia, elimination of interest etc – and constitute a civil society focused on the competitive pursuit of self interest by utility maximizing local or single issue collectivities. This it is hoped will dissipate opposition to the political agenda of capital in general and legitimate Pakistan’s subordination within imperialism’s global order.

But civil society cannot take root in Pakistan, as long people’s holistic commitment to Islamic values is not fundamentally dented. Civil society can prosper only after Islam has suffered a major political defeat – Turkey in 1924, Egypt in 1953, Bangladesh in 1971. Civil society – the competitive pursuit of self interested collectivities – is an alien import. It has no roots in Pakistani local histories, cultures or politics. People regard civil society organization and leadership as an imperialist implant, because the universalistic claims of human rights discourse are false. There is nothing in the traditions, self interpretations, vocabularies and ethos of the Pakistani people which can induce them to “own” civil society. They instinctively rally for Islam for the Sufi masters have embroidered Islam into myriad local cultural practices.

Legitimizing civil society is much easier in a culture without a holistic religious tradition – as Xudong Zhang shows one can speak of a genuinely Chinese post modernism emerging in the 1990s.

Liberalizing state policy must lead to the dismemberment of Pakistan. In order to understand why this is so it is necessary to explicate the nature of the relationship between the market and the state in capitalist order.

A market economy cannot stand on its own. Noam Chomsky describes modern capitalism as “a system of administration of markets by collectivist legal enterprise – mergers, cartels, corporate alliances – in association with powerful states and international bureaucracies which regulate and support private power”. The function of “regulating, legitimating, supporting” capitalist power must be performed by the capitalist state – it cannot be performed by the market. When liberalism deprives a particular state of its power to regulate capital in general (the essence of high politics) this power is shifted not to the market (which cannot regulate itself) or to provinces / localities (which cannot regulate capital in general) but to a metropolitan state which makes the disempowered state it’s client. That is why it is legitimate to treat imperialism and globalization as inter changeable terms.

Global capital needs a global state. That global state is America and the purpose of human rights and good governance discourse is to legitimize American monopoly of high politics. Pakistani representatives of global capital recognize as natural and rational the need to subordinate national policy preferences to American hegemony. This is natural and rational because without this, capital cannot be effectively regulated or supported in Pakistan. American national preferences and interests are the concrete manifestation of the interests and preferences of capital in general.

It is irrational to support the Kashmir Jihad, safeguard national nuclear capability, defend national economic sovereignty, reject Indian hegemony, Islamise the financial system because this subverts American hegemony. But abandoning these concerns is abandoning any justification for the continued existence of Pakistan – for there is no such thing as Pakistani nationalism permitting Pakistan’s subordination within liberal imperialist order – Sindhi / mohajir / Pashtun nationalisms are essential instruments for achieving such a subordination. Imperialist humane governance ideologies must therefore continue to seek Pakistan’s disintegration through civil society development and state decentralization.

Economic Dimensions of the Struggle against Imperialism in Pakistan

2005-04-13T04:17:00.000-07:00

[Following was written just after American attack on Afghanistan, and was published in major English newspapers in Paksitan. We will be excerpting important parts of it in few installations here. The piece was written by Muhammad Riffat].

The 11th September counter attack in the United States has created a new situation in Pakistan and policy makers are confronted with a series of choices. This paper seeks to provide a framework for a dispassionate analysis of these choices. We begin with an assessment of the impact of the counter attack on the global economy. This is followed by a brief section on Pakistani nationalism to identify the objectives that can be regarded as politically legitimate bases for the choices that our country makes. The paper ends with a discussion of the strategy that should be adopted to preserve Pakistani sovereignty and prevent the transformation of this country into a new South Vietnam.

The Impact of the Counter Attack

In terms of America’s total wealth and global capitalism’s gross physical and financial resources the direct loss caused by the September counter attack is trivial – a few hundred billion dollars worth of assets and 6500 easily replaceable workers (most of those killed were secretaries, janitors, low grade officials etc.) Most firms which, suffered are already back in business.

But the indirect costs are enormous. The counter attack was a counter attack on capitalist rationality. In my judgement there is a reasonable likelihood that it will precipitate a depression – which was already on the cards since early 2001. Most forecasters (EIU, Merrill Lynch, Goldman Sachs) are now predicting zero growth for Europe, USA and Japan for 2001 but most also predict a modest “recovery” (1 to 2 percent) for 2002. This does not appear plausible since what has been hit is consumer and investor “confidence” (the essence of capitalist rationality) and there is no reason why this could be revived unless America demonstrates that it has won the war against the anti –capitalist forces and made at least the prosperous parts of the world once again safe for capitalism.

That this is becoming increasingly impossible is reflected in the synchronized nature of the present capitalist downturn. When the hard currencies fall commodity prices rise but this is not happening today – gold and oil and base metals remain depressed. In 1990 – 91 when the US was depressed Japan and Germany boomed. Today capital desperately wants to flee America but where shall it flee to? There are no safe havens anywhere, any more.

So the global synchronization of the downturn and the global decline in consumer / investor confidence. But what have the consumers / investors been confident about? Without answering this question we cannot understand the nature or limits of capitalist rationality.

Capital is takkathur – (our master Muhammad Marmaduke Pickthall translated this as “rivalry in worldly increase”).

A capitalist society is dominated by the universal duty to accumulate (human rights are merely the resources required for the fulfillment of this universal duty). But accumulation is primarily the accumulation of debt.

A capitalist society is compelled to accumulate debt for the creation of money is the creation of debt. In Britain for example 97 percent of the money created is debt – money created by banks in the form of credit to consumers and investors.

In America total household debt exceeds annual income and household savings are typically negative and on average zero.

The dependence on debt is graphically illustrated by the fact that soon after real wages started to rise in America (somewhere in the second quarter of 1998 depending on the figures you trust) the bottom fell out of the American boom.

It was the growth of debt which had sustained profitability and productivity growth in both finance and manufacturing in America during the 1990s.

In a mature capitalist system the central bank is a slave of the commercial banks. The creation of money is entirely dependent on creation of debt. If debt stops growing accumulation is impossible.

But debt can only continue to grow if:

(a)Consumers and investors are confident that they can continue to roll over an increasing volume of debt in order to prevent the repossession of their assets by their creditors (ultimately the banks which have created and which “own” the credit financing the acquisition of these assets).

(b)The banks which create this debt are reasonably confident that it can be profitability lent and will be repaid on time.

When consumers and investors loose confidence they stop borrowing and spending. When banks loose confidence they stop creating money / debt. There is an immediate fall in demand and the downturn phase of the business cycle sets in.

The consumer / investor / lender confidence in capitalism depends upon Riffat’s faith in:

(a) the efficiency of the market
(b) the ability of the state to correct market failures.

Riffat’s world can collapse instantaneously like a house of cards for under mature capitalism her debt obligations exceed her income and all her assets are mortgaged to the banks, building societies and credit companies.

The September counter attacks have undermined Riffat’s faith in the financial markets’ ability to match claims and obligations in a growth-enhancing manner. But has she also lost confidence in the State’s capability as a defender of capitalism?

I don’t think so although there is no doubt that globalization has weakened the state. But perhaps this weakening is only a temporary phenomenon and some may argue (Meszaros for example) more apparent then real.

Greenspan has after all been pursuing a sort of bastardized Keynesianism since the early 1990s by using declining interest rates – rather than rising public expenditure – to stimulate aggregate demand.

He pumped in $100 billion into the American economy in the wake of the September counter attack. But nominal interest rates are, as Keynes pointed out long ago, sticky downwards in capitalism. They cannot fall much below the 2 percent Fed Fund’s rate predicted for the end of this year.

Ultimately the American budget surplus must vanish and deficit financing religitimized. The corporate sector in America, Europe and Japan is urging “big government to get back into business” promptly.

Nevertheless there are three factors which make a return to Keynesianism difficult if not impossible.

First government intervention cannot grow with out imposing restrictions on the movement, specially cross border movements, of capital. There must be a tightening of state regulation of financial markets. This is already evident in the American attempt to impose restrictions on transactions suspected to finance the September 11 and future counterattacks. Ultimately this must involve a comprehensive overhaul of the bank regulatory regime as the Bank of International Settlements has already pointed out. But there are few signs – at least as yet – that the major players in the money markets are ready to countenance such systemic changes.

This reflects a fundamental weakness of post modern capitalist order – the impossibility of constructing a global state. A global state could legitimately regulate global capital for it could claim to represent the General Will – the interests of capital in general. But as John Gray, capitalism’s most enlightened apologist today, keeps reminding us, several capitalisms must learn to coexist and the quest for universality abandoned.

The economic authority of the Fed and the US Treasury is not likely to acquire global legitimacy and American pawn international organizations have become a laughing stock. The IMF is not even a minor player in world financial markets. The World Bank has been recently described as “a failed institution” by the Financial Times. The WTO is still born and the development of the UN security system is in tatters. Who will guarantee global debt contracts in such circumstances?

Moreover the West, capitalism’s heartland, is now in a post democratic phase. Ralph Dahrendorf spoke of a “withdrawal from citizenship” twenty years ago. Today less than 50 percent of Americans vote in Presidential elections and less than 20 percent Europeans vote in elections for the European parliament – the withdrawal of the young in both Europe and America is far greater.

Differences in party manifestos have disappeared and no new collectivities have emerged to take the place of the working class which sustained social democracy.

In the wake of the September counter attacks Americans and Europeans have widely welcomed the abandonment of liberal values and statecraft practises. This is a welcome retreat not just from citizenship but an abandonment of liberalism’s universalist claims.

If Asmat is a Muslim there is decreasing room for her in European / American society – even if she is a muslim Liberal. Liberalism is an exclusive project of Western civilization. It can become universally dominant (through imperialist conquest) it can never be universalized. Universality is realizable only in Islam – this is a point we will return to later.

The West seeks liberalism’s universal domination (globalization) – not its universalization. But the resources at its disposal for pursuing global hegemony are limited and declining.

Like the Rome of the second century (AD) onwards the native populations of the post modern West have embraced hedonism – women are refusing to have children. Hence native populations are declining throughout the West. They are also ageing rapidly and given the universal commitment to hedonist values no Western governing elite can call for sacrifice from its people.

If political legitimacy is to be retained every regime must guarantee a continued rise in (debt financed) consumption levels. Ageing must be accompanied by massive increases in social security spending. This must involve a fall in defense expenditures unless this too is debt financed. As noted earlier it is growth in debt which sustained the boom of the 1990s but the slow down of the year preceding the September 11 counter attack showed that consumer / investor confidence was being strained by the growth in debt. Perhaps government debt financed expenditure may rekindle this confidence. But this possibility is limited by the fact that an increase in deficit financing must limit capital’s freedom (as Keynes foresaw).

Since the early 1980s global capital has become a privileged dominant force in all metropolitan states – it has seized control of both conservative and social democratic parties. Surrendering its privileged dominance to a nation state will not become easily palatable.

For no nation state, not even America, can sacrifice its national interest – the commitment to procure continuously rising (debt financed) standards of living for its declining, ageing native population – for the interests of global capital. It is only as long as accelerating global capital accumulation is synchronized with the metropolitan national commitments (of rising consumption levels for natives) that a growth in public debt financed expenditure can enhance investor / consumer confidence.

The inability to construct a global state – through consensus or conquest – is thus a fundamental, non contingent limit on global capitalism.

When a capitalist nation state is threatened the specific capitals involved assess the consequence of its victory / defeat for themselves. The typical response of global capital is to flee the territory.

But America is of course special – it is a nation state illegitimately claiming to represent the interest of capital in general.

A threat to the global hegemony of the American state is a threat to global capital in the sense that though the American claim to the representation of capital’s general interest is illegitimate there are no legitimate claimants for the exercise of this representation.

This is a genuinely new situation in the history of capitalism. Prior to the abandonment of the Bretton Woods System global capital did not exist. Global capital has been brought into the existence by the collapse of the Bretton Woods System.

Habermas and Rorty see this as an “over determination” of liberal order and argue for a retreat to national capitalism. History is littered with such “over determinations” which typically characterize the early phases of a civilization’s downfall. The point today is that capital cannot flee America. Not only is there nowhere to flee to, America’s global political hegemony is essential for capital’s global dominance. This is so because the construction of a global state is impossible.

Since the end of the Second World War America has rarely won its guerilla wars. There have generally been negotiated settlements as a result of which the guerrillas have formed or been incorporated into governments committed to hedonism. America’s guerrilla wars have usually been fought by non Americans and the costs to the American economy and to global capital have been limited. The exception of course is the Vietnam war which America lost comprehensively but which also resulted in the formation of a government committed to hedonism.

America is fighting a suicidal war in Afghanistan and elsewhere. It cannot win this war because even within the West the core values of Western civilization have become hollow shells. The only commitment is to hedonism and hedonism makes sacrifice impossible. The West worship the world and as Wittgenstein reminds us. “There is neither truth nor value in this world”. The West has in practise retracted from its universalist claims in the post modern era. The pretence of promoting human rights universalism today is merely ridiculous.

America can choose to fight on in Afghanistan killing and maiming hundreds of thousands of people, propping up puppet administrations and extending the war to Pakistan, the Gulf and the Fertile Crescent in defense of Israel. Or it can choose to withdraw first from South Asia and then form the Middle East. Whichever course it adopts will tantamount to it’s defeat for neither provides a basis for relegitimizing capitalist and democratic values in these regions or indeed in America itself. America must loose for it cannot make the world safe for global capital either by fighting in Afghanistan or by withdrawing from the region. Globalization died on September the 11th, 2001. It cannot be resurrected.

but if you desire more than your sufficiency . . .

2005-04-07T21:35:00.000-07:00

If what you desire from this world is what should suffice you, a little should suffice you;

but if you desire more than your sufficiency, the entire world will not suffice you.

Control your egos by abandoning what the world contains, for you have entered it naked and naked you will leave it.

[Imam Ghazali]

contributed by R. Idris in Sydney
link courtesy of "Lesson of the day"

From the “Death of God” to the “Death of Man”

2005-02-17T03:43:00.000-08:00

In order to destroy God, and after having destroyed him, the European mind destroyed every thing that could oppose man; having accomplished its attempt, it finds only death. — André Malraux La Tentation de l’Occident, p. 158

. . . although human beings are finite, the desire for freedom is infinite and unlimited. Human beings as limited beings can not be free (can not have unlimited powers) but they can desire freedom (desire to become infinite). However this desire is incompatible with the real position (maq┐m) of human beings in this universe: the fact that they are not God but creatures of God with limited powers.

Historically speaking, in the West the “death of God” signifies the rejection of Christianity as the ultimate guarantor of truth and meaning. The positive repercussion of this belief was the replacement of God by “man” as the ultimate guarantor of truth and meaning. The divinity of man was claimed on the basis of his capacity to reason. With the disintegration of belief in reason the status of man built on this belief has naturally eclipsed. The “death of man” has followed the “death of God”.

The act of the killing of God was a double murder, of both “God” and “man”. The “death of man” has not given birth to a new “God”; it can not do this since “God is dead”. The West, after this double murder, finds itself rudderless, without any guarantee of truth and meaning. Truth, meaning, morality and value become mere conventions without any ultimate significance. The West has lost faith in the divinity of man but it has not shunned the desire to freedom. In fact freedom now becomes less an inspiration and more a compulsion.

Human beings are seen as condemned to freedom in the sense that in a universe, which has been deserted by “God” and His “murderer” alike, the “new humanity” is forced to face the world without any pre-defined rules, meanings, values and truth. Thus while on the negative side “übermensch” replaces belief in “man” in the positive sense it does not provide any basis for new certainties. Humanity is now being told to learn to live without certainties, to accept precariousness and volatility as the permanent condition of human existence: “Exposed to (übermensch), we begin to think of appearance without reality, openness without closure, falsehood without truth, form without content, and finally hope without hope. We take pains to affirm nothing but our disavowals, and keep disavowing this very affirmation”. (Henry S. Kariel, “Beginning at the End of Democratic Theory” in Democratic Theory and Practice, p. 255).

All utopias and apocalypses are being shunned as hindrance to the performance and practice of freedom: “We commit ourselves to a distant Kingdom of Ends and are led (temporarily, it is always said) to accept the exclusion of interest. We are led to esteem achievements rather than process. And we accordingly legitimate not only experts in violence trained to move us toward utopia but also licensing agencies, accreditation boards, and professionals skilled in telling us how far we can go." (Ibid., 258. Emphasis added.).

It is being hoped that the immense energy liberated in the wake of the shunning of these utopias will be utilised for the revival of action and practice for the sake of action and practice. What Foucault calls “perilous action”(The Order of Things, 238.), action without pre-defined rules, any immanent telos, in sum meaningless action, action without end: “In the end we may even wonder why we should ever settle for anything less than the world at large as self expressive spectacle, a universal play signifying nothing, an undirected performance open to forms of action which allow us to confront the knowledge of our insignificance . . . We would then treat all forms of behaviour as play and recognise what we now call theatre to be human life in a concentrated, stylised, self-conscious form — in a form easier to denounce than the compulsive routines of undramatised existence. We would then surrender our deadly emblems of authenticity and merely pretend to be authentic, truthful, sincere, honest, scholarly, and truly in touch with ourselves. We would then not mind knowing that nature defined no centre for society and no self for us” (Democratic Theory and Practice, p. 260, emphasis in the original).

It is hoped, however, that mere intensification of this action, what Foucault terms “hyperactivisim” (Michel Foucault, “On the genealogy of ethics: an overview of work in progress”, in Michel Foucault: Beyond Structuralism and Hermeneutics, 231), shall produce a semblance of meaningfulness (Democratic Theory and Practice, p. 257).

The failure to create utopias is supposed not to lead to despair, it is rather to converge into a new kind of hysterical fatalism which revels in the impossibility of utopias and in the energy liberated in the wake of emancipation from utopias. This energy will “keep” things going in the absence of all moorings and utopias “on this ‘Holzweg der Holzweg’, on this ‘path of the paths that leads nowhere’ that nevertheless we insist on following without a programme, ‘catching the train while it is moving’, always setting out on the territory of unknown being” (Antonio Negri “Notes on the Evolution of Thought of the Later Althusser” in Post Modern Materialism and the Future of the Marxist Theory, p. 58.).

Apocalypse itself is now being redefined from its original Greek sense of uncovering or disclosing (Jonathan Ree, “Apocalypse Unbound” in New Left Review, 4 (July-August 2000), 164.) to what Malcolm Bull terms as “coming into hiding” (Seeing Things Hidden: Apocalypse, Vision and Totality, p. 31.).

This is effectively abandoning the search for truth that has been the defining characteristic of Western philosophy and thinking since the Greeks: “ . . . ‘seeing things hidden’ . . . mean(s) a sceptical reconciliation with our own ignorance — an acknowledgement that some things are hidden from us, and perhaps will always be. When hiddenness is brought to light, what we see is not the whole world as it really is, but rather the fact that ultimate truth will always elude us” (Jonathan Ree, “Apocalypse Unbound”, 165).

Apocalypse according to this redefinition dawns “when hiddenness at last comes into its own; to use (Bull’s) teasing phrase, it is a time of coming into hiding”(ibid.). This is another way to say that the West has overcome its “futile” penchant for truth, for uncovering and disclosedness and has at last realised that it is condemned to darkness forever.

Moreover, the darkness should not be abhorred as something unwarranted but as a way out of the illusion of truth beyond what human beings have the capability to ascend to. More than that, truth and “objectivity” now become “a matter of intersubjective consensus among human beings, not of accurate representation of something nonhuman” (Achieving Our Country: leftist thought in the twentieth-century America , p. 35).

Foucault’s remarks in this context are naturally classic: “. . . the great question, according to Heidegger, was to know what was the ground of truth; according to Wittgenstein, it was to know what one was saying when one spoke the truth; but in my opinion . . . the question is: how is it that there is so little truth in truth” (Paul Veyne, “The Final Foucault and his Ethics”Foucault and His Interlocutors., p. 231, n. 1.).

One outcome of the abandonment of the search for truth, more precisely abandonment of the very idea of truth in its traditional sense, is the abandonment of the idea of justification. The West no longer deems it necessary to provide justification of its ideas and way of life on the basis of its claims of the uniqueness of its rationality. Justification now takes the form of fatalism, the “values” are not defended on the ground that they are based on a superior rationality but on the ground that “they are our flesh and blood, as long as they are our present” (Ibid., 226). One can refer to Richard Rorty to know what this means in practice, acceptance of naked ferocity and brutality of the only rogue* superpower of today’s world: “. . . we (Americans) are the first thoroughgoing experiment in national self-creation: the first nation state with no body but itself to please — not even God. We are the greatest poem because we put ourselves in the place of God; our essence is our existence, and our existence is in the future. Other nations thought of themselves as hymns to the glory of God. We redefine God as our future selves” (Achieving Our Country: leftist thought in the twentieth-century America , p. 22).

While talk of postmodern “openness”, plurality, fragility has multiplied, American barbarism, cruelty and ferociousness has not subsided. The image of new Western leaders such as Bill Clinton** , and “junior partner” Tony Blair has been portrayed as new “emphatic” leaders of the postmodern era although their cruelty can not be disguised by the rhetorical ploys of “ethical” foreign policy and dawn of the era of consensus and partnership, orchestrated by their postmodern advisors.

George Bush is not even bothered to wear the cloak of postmodernity and compassion. His recent State of the union address echoes Rorty’s brags about the power and might of America: “Even seven thousand miles away, across oceans and continents, on mountain tops and in caves, you will not escape the justice of this nation . . . Steadfast in our purpose, we now press on. We have known freedom’s price. We have shown freedom’s power. And in this great conflict, my fellow Americans, we will see freedom’s victory” (BBC News Wednesday, 30 January 2002).

The voyage from the “death of God” to the “death of man” has been seen as the dawn of a new “subjectivity” of a new humanity, a humanity that can live without any moorings, a humanity that realises that “they somehow bear up without secure foundations” (Henry S. Kariel, “Beginning at the End of Democratic Theory” in Democratic Theory and Practice, p. 260).

This has been seen as the dawn of an era when human beings become completely mature. However in our opinion the current state of Western discursive and non-discursive practices should be seen rather as the intensification in the gradual epistemological, moral and factual disintegration of Western civilisation.

More than two hundred years after the West’s announcement of the “death of God”, the “death of man” — the purported emergence of übermensch — demonstrates the futility and cruelty of the desire for freedom. Man is not God and cannot become God.

The desire for and belief in freedom both in its modern and postmodern forms is the desire for divinity. The quest for freedom, whether it is the quest of a “man” who is deluded by hallucinations of grandiose or of an “übermensch” who has realised his finitude, is mere futile vanity.

The desire for freedom is incompatible with man’s real status in this universe, his status as a creature of God. All great religions have emphasised the futility of and vanity of the desire for freedom. Even the pagan Greeks knew the futility of the fight against their gods.

The West is dying under the weight of the gravest of all sins it has committed, the sin of transgression. The West’s decay is evident in its inability to articulate any “good” for itself. Its moral and social decay, environmental depletion, menaces like AIDS that are threatening to wipe out the population of whole continents reflect this inability.

The West is committing suicide in the sense that the population espousing Western values is shrinking as an average of the world population quite alarmingly. The West’s share of world population is expected to fall as low as 9 percent in 2050 (Gray Dawn: The Global Aging Crisis, pp. 42-55).

The West is dying for one simple reason — sexual immorality and defeminisation have made love and motherhood impossible. There is no biological explanation of the decline in fertility rates. It is only the diabolical worship of freedom, which induces women to sacrifice children to the demon of pleasure.

Abandoning God is abandoning life — for the “dead heart is incapable of receiving life”(What is Sufism? p. 36). as Sheikh Abubakr Lings teaches . The West pretends that it has forgotten death — but as Heidegger saw, it is death alone, which you can choose when you choose to worship freedom. If the West desires to reverse this process it must abandon the desire for freedom. To be connected to the fountains of life again the West must surrender to its Lord, the Lord of heavens and earth:

Say O People of the Book! Come now to a word that is common between us and you: that we worship none but Allah, and that we associate naught with Him, and let not some of us take others as Lords, apart from Allah. And if they turn their backs, say: Bear witness that we are those who have submitted [to Allah]. (Qur’┐n 3: 64).

--
*“The US is the only country condemned by the World Court for international terrorism” (Noam Chomsky, “Chomsky compendium: Interviews from Greek, Spanish, and French Press”).

**Clinton’s Secretary of State Madeline Albright was asked about the death of ½ million Iraqi children on National TV. She replied that “it was hard choice” for the administration but ‘we think the price is worth it” (quoted in Noam Chomsky, “Chomsky compendium: Interviews From Greek, Spanish, and French Press).

Islamic objections to Islamic finance

2005-02-12T17:21:00.000-08:00

There are some fundamental objections to Islamic finance, which are very relevant in the present geo-political scenario. We are seeing a resurgence and renaissance of Islam ever since the Afghan Jihad of 1980. The imperialists fear the re-emergence of Islam as a world civilisation. Islam is seen as a threat, as something which has replaced communism as a rival to the West and which must be suppressed, contained and destroyed. The development of Islamic finance is a means to contain this threat. To understand why this is it so is essential to understand capitalism.

The capitalist way of life was established after the overthrow of religion. Capitalism has many ideologies such as liberalism, nationalism, socialism and social democracy. However, all these are only ideologies. The way of life as a whole is what we call the capitalist way of life. The capitalist way of life became established by overthrowing religion. It established itself by overthrowing Christianity. That is why the challenge to capitalism is posed by not by one of ideologies, not by nationalism, or socialism or social democracy or communism. The fundamental challenge to capitalism is posed by religion.

What is capitalism?

The central values of capitalism are two - accumulation and competition. Christianity was opposed to both these values. Islam calls accumulation, hirs. We call competition, hasad. Christianity called them avarice and covetousness. Capitalism exists by universalising both these values. This is accomplished by establishing the dominance of financial markets as value determinants in society. Such a market-dominated society is called a "civil society" as apposed to religious society where value is determined with reference to the will of God. In civil society value is determined in the money market and the capital market. Value is determined on the basis of the capacity of a product and an economic activity to produce surplus. For example, when the stock market evaluates a particular share, it never evaluates the purpose of the business that the share represents. It is only concerned with the profit produced by that business. So, accumulation becomes an end in itself. Based on this principle, the product markets have developed a relationship with the financial markets, which is in essence the relationship of the master and the slave. Finance is the master in capitalism and production and exchange serve this master.

This market-dominated system produces a society dominated by lust and greed. This is the social dominance of viciousness. The United States of America established itself by slaughtering fifteen million Red Indians over two centuries. America continues to slaughter people in Palestine, Vietnam, Iraq and Afghanistan. The fundamental expression of capitalist society is the universalisation of sexual vice. You cannot name a capitalist society, which has maintained the virtue of chastity. This master-slave relationship between the financial and product markets overthrows religion in the sense that God becomes irrelevant in the day-to-day lives of the people. Man seeks pleasure for its own sake and values are assigned to products and activities without reference to God’s will.

Islamic capitalism

Unfortunately, we have been subjects to Western governance for three centuries and because of the failure of the Jihad movements a trend has developed particularly among the ulema to seek reconciliation with capitalism and to carve out for themselves a niche where Islam can be protected, while the system as a whole becomes and remains capitalist; That attitude has become common among the contemporary scholars of Islam including many groups of ulema.

This reconciliation tendency has manifested itself in two ways, Islamic Democracy and Islamic Finance. Islamic Democracy is an effort to seek a niche within the capitalist liberal political framework. Islamic Finance is an effort to submerge Islam into the capitalist economic order. Capitalism has been accepted as a technical response to modern problems. For example, a very important book has been written by Maulana Taqi Usmani ‘Islam aur jadeed maishat aur tijarat’ in the early 1990s. It is widely used in India and Pakistan. It argues that the laws of demand and supply are natural laws although mathematical chaos theory has proved that that is not the case. There is no law of demand operating in non-capitalist societies. For example, Agleitta’s research on 17th century France shows that the law of demand depends on the prior existence of capitalist property. Laws of demand and supply are specific to capitalism and are not general technical rules that exist in all societies all times. The same book argues that corporate personhood and limited liability are natural and technical concepts. But of course corporate ownership has no existence outside capitalist property.

Capitalist property’s main characteristic is that it separates ownership from control. Control is vested in the hands of those people who know how to accumulate. In that particular sense, capitalism also abolishes private property like socialism. There is no private property in capitalism. Nobody can do anything with his money except entrust it to someone who has the ability to accumulate it for the sake of accumulation alone. That is what the bank and capital market institutions do.

Islamic finance

Corporate personality and limited liability are social and legal instruments to universalise capitalism. Islamic finance argues, like Islamic democracy, that we can carve out a niche where we can practice Islamic financial transactions within capitalism. This legitimises capitalism. Islamic finance considers a few things that capitalism allows as haram and the list is getting shorter, for example Malaysia and the UAE. The number of transactions that Islam forbids is getting shorter by the day in Islamic financial markets. In essence Islamic banks and Islamic economists are saying that there are some technical problems with the existing system but capitalist rationality is fully endorsed by them. That is the reason why existing Islamic finance practitioners never raise the question of the relationship between transactions and morality. It is this conception of the value-neutrality of transaction forms that has allowed ABN Amro and Citibank, the World Bank and the IMF to applaud Islamic finance. Why do they applaud Islamic finance? Why do Citibank, ABN Amro and the international banks practice Islamic banking with the help of Muslim ulema? It is because Islamic banking is seen as a niche within the capitalist market. It is seen as an activity, which can be, practiced whatever the religious and moral orientation of the practitioners. The acceptance of Islamic banking by the international banks shows the secular nature of Islamic banking.

A fundamental question must be asked. Is reconciliation necessary? Is it necessary that we accept Western conceptions and institutions as the only rational standard to govern our life? Or is an alternative possible? There have been attempts at creating Islamic financial frameworks outside capitalist financial markets. The most successful are three Islamic organisations — Dar-ul-Arqam Malaysia, Hezbollah of Lebanon and Hamas of Palestine. Definitely the West has no acceptance towards these attempts and they are called terrorist finance. Hamas is practicing terrorist finance. Hezboolah is practicing terrorist finance. The financial systems that they have created cannot be integrated into capitalist financial markets and they therefore represent a threat to the capitalist way of life.

Fundamentally, we reject the Islamic finance movement because it subordinates Islam to capitalism and legitimates the quest for pleasure maximisation within civil society.

The cost of SBP’s autonomy

2005-02-04T21:02:00.000-08:00

The cost of SBP’s autonomy

By Dr. Javed Akbar Ansari

Despite its much-flouted concern with banking sector efficiency, the State Bank remains an incompetently managed and highly inefficient organisation. This is evident from the single fact that during Ishrat Hussain’s governorship (1999-2004) the State Bank has suffered a cumulative loss of over Rs65 billion in foreign exchange transactions.

This note examines the financial performance of the State Bank (and not that of its subsidiaries) for the year 2003-2004. During this year the SBP made an operating loss of Rs568 million. Operating loss for 2002-2003 had been Rs1,376 million.

Net profit for 2002-2003 had been only Rs24.8 million. This rose to Rs6.1 in 2003-2004. However as note 40.1 to the accounts shows this was entirely due to the privatisation of the Habib Bank the sale of whose shares fetched no less than Rs6.08 billion. If this figure is deducted net profit for 2003-2004 fall to about Rs28 million as again Rs24.8 million for the previous year.

The SBP Annual Report for 2002-2003 Vol II (p 96) shows that net profit for the year ending June 30th 2003 stood at Rs39 million - why this has been reduced to Rs24.8 million in the 2004 Report Vol II (p 130) is not explained.

There are many other unexplained discrepancies between the profit and loss accounts for 2002-2003 as published in the two Annual Reports. This creates doubt about the authenticity of all SBP estimates.

Even the meagre net profit of Rs24.8 million for 2003-2004 was made possible by disposal of SBP filed assets during 2003-2004 worth Rs149 million. The notes to the accounts give no details of the assets that were disposed of and if this amount were also deducted and SBP would show a significant net loss for 2003-2004. The more than three fold increase in "other income" from about Rs2 billion to over Rs7 billion) in 2003-2004 is entirely due to these two measures. (HBL) share sale and sale of SBP fixed assets)

We also of course do not know what the government has done with the Rs6.08 billion it received from the SBP for the sale of 26 per cent of HBL shares in June 2004. This Rs6 billion does not seem to appear very clearly in Shaukat Aziz’s budget estimates for 2004-2005.

The SBP’s interest income declined from Rs18.5 billion in 2002-2003 to Rs6.5 billion in 2003-2004. There was a colossal decline in net earnings on MTB’s from Rs7.3 billion in 2003-2004 to Rs1.7 billion in 2003-2004 (note 31). This reflects not so much a decline in average yields as it does a decline in acceptances. The volume of outstanding six month T-Bs fell sharply during 2003-2004. The average six month T-B yield actually rose from 1.65 per cent in 2002-2003 to 2.07 per cent in 2003-2004. The SBP’s account of the reasons for decline in interest income in the domestic market is thus not entirely convincing. Interest rates have been rising during the last quarterly of FY-2003-2004 and the outstanding domestic public debt has risen by 6.5 per cent during that year.

Interest income from foreign currency deposits and securities increased very modestly from about Rs6.4 billion in 2002-2003 to about Rs6.9 billion in 2003-2004 despite a significant increase in global interest rates. The interest expenses of the SBP, in 2003-2004, rose by almost 100 per cent. The notes to the accounts do not provide any details about the distribution of thee expenses in terms of local and foreign transactions. However the major loss of Rs3.8 billion was with respect to profit and loss transactions.

During 2002-2003 the State Bank incurred a loss of Rs11.8 billion on foreign exchange transactions. The SBP Annual Report for 2002-2003 attributed this loss primarily to a 3.7 per cent appreciation of the Rupee during 2002-2003. during 2003-2004 the Pakistan appreciated by a further 1 per cent yet the SBP realised a gain of Rs755 million on exchange rate transactions. SBP is not justified in its view that Rupee depreciation necessarily leads to a net gain in foreign exchange transaction value and Rupee appreciation to a loss.

During 1999-2004 the only year when SBP’s expectation of a negative relationship between exchange rate value and exchange gains was realised was 2002-2003. In 1999-2000 and 2000-2001 the Rupee depreciated and SBP incurred large losses on foreign exchange transactions. In 2001-2002 and 2003-2004 the Rupee appreciated and yet there was a gain of foreign exchange transactions.

Similarly there is no necessary negative association between the size of foreign exchange reserves and gains on foreign transactions. Even a cursory glance at profits and loss accounts of the central banks of both India and China shows that during 1999-2000 to 2003-2004 they realised massive foreign exchange transaction gains despite holding much larger reserves than Pakistan. Nor are depressed market interest rates any excuse for losses or low gains on foreign exchange transactions because these affects earnings not value of foreign assets. In any case China and India face the same world market situation as Pakistan. Why are they able to make much larger gains on foreign exchange transactions in a typical year. Obviously because of the honesty and skill of their foreign exchange managers.

The State Bank under Ishrat Hussain’s governorship has on average lost Rs13 billion per year during 1999-2004 on foreign exchange transactions. This is a colossal loss and there is a need for a detailed long form audit of the work of the SBP, Exchange and Debt Management Department, the Exchange Policy Department, the Risk Management Department and the SBP Treasury. Such an audit will reveal the chronic inefficiency of the SBP exchange management team. Those responsible for these gigantic foreign exchange losses should be called to account under due process of law.

While the SBP’s interest rate earnings have decreased by about 45 per cent during 2003-2004 in comparison to the previous year, its interest expenditure has more than doubled from Rs2.57 billion in 2002-2003 to Rs5.20 billion in 2003-2004. Note 32 shows that this was due to a massive loss of Rs3.3 billion on profit and loss financial transactions. No explanation is provided for this gigantic loss.

Other income rose significantly but this was mainly due to a massive increase of almost 30 per cent in bank penalties, surely not a healthy sign showing that side stepping prudential regulation requirements has become easy and affordable in Pakistan (note 36)

Establishment costs have been held at almost Rs6.1 billion in both 2002-2003 and 2003-2004. However salary expenditure has gone up by 7 per cent (significantly higher than the 2003-2004 inflation rate) and retirement payments have risen by 15 per cent. Retirement expenses are by far the single largest establishment cost. Its share in establishment cost has gone u from 22.3 per cent in 2002-2003 to 26.1 per cent in 2003-2004.

This shows that the SBP continues to pursue a vicious policy of retrenchment and downsizing. Staff morale is low as the threat of forced retirement and retrenchment is ever present. Worker participation and collective bargaining in organisation management has been totally dismantled. Meanwhile exorbitantly paid consultants dominate policy making, so salary expenditure continues to rise and the total workforce does not fall as operating losses continue to accumulate.

The over all picture that emerges is not a pretty one. The SBP is an increasingly inefficient organisation, which produces operating losses year after year. Accumulated losses on foreign exchange transactions for the period of Ishrat Hussain’s governorship approximate Rs65 billion, interest expenditure on domestic market operations has risen significantly while domestic interest income has fallen. The net profit in 2003-2004 is entirely due to the sale of HBL share sand the disposal of SBP’s own fixed assets. This net profit entirely disappears if these two items are subtracted from it. Salary expenditure continues to rise, as does the number of total SBP employees while a major retrenchment is underway. Workers are demoralised and slick professionals with little understanding of local market condition dominate policy making.

Granting autonomy to the State Bank has reduced its operational efficiency. Subordinating the State Bank to the authority of Parliament and of the Ministry of Finance is essential if the massive losses on foreign exchange transactions are to be eliminated, the cause, underlying these losses are to be identified and those responsible for these losses are to be called to account. It is equally important to abandon the market based monetary policy, which the SBP has been pursuing since 1993 and which is an important factor in increasing unemployment and misdistribution of income in Pakistan.

An autonomous central bank is not autonomous of the international money markets. It impose the discipline and the preferences of these markets on the people of Pakistan and deprives the Pakistani state of its economic sovereignty. Moreover as the continuing losses at the State Bank show this does not lead to a more efficient use of national resources especially as far the management of national foreign exchange reserves is concerned.

The question that must be answered is which foreign financial institutions and imperialist governments gain when Pakistan suffers foreign exchange transaction losses, who are the officials who enable these foreign institutions and governments to make such gains and why are these officials not being punished.

Ending the State Bank’s autonomy should be a major policy of a popular, anti imperialist Islamic government in Pakistan.

Good Government or Islamic Government?

2004-12-24T14:44:00.000-08:00

The concept of good government - central to the discourse of the late lamented 2010 programme of Mr. Ahsan Iqbal and Mr. Eric Jansen - has its origins in the new political economy approach of Bates, North and other neo institutionalist. The World Bank has been the official sponsor of this ideology since the mid 1980s. Some liberal Islamic scholars such as Prof. Khurshid Ahmad and Mr. Khalid Ishaque argue that there are important points of tangency between the good governance ideology and the Islamic conception of government. This paper (a) seeks to situate good governance ideology within liberal political discourse (b) contrasts orthodox Islamic political philosophy with good governance ideology and (c) sketches an Islamic strategy for over-whelming, the good governance related policy initiatives of the imperialists and their camp followers in Pakistan.

I.Good Governance Ideology

Good governance ideology is rooted in Kantian individualism a modern restatement of which is to be found in Rawls Riffat is seen as being anticedently individuated - she has the desires she has and orders them as she wills for no knowable reasons. Liberal epistemology is de-ontological precisely in the sense that it denies the possibility of self-knowledge and the knowledge of the will of Allah. As Taylor demonstrates while ethical principles can be derived from such as “original position”, the idea of a de-ontological morality/spirituality is inherently absurd.

Rawls’ de-ontological principles of justice seek to establish the prioritisation of equal liberty as a principle of social organisation and governance. For a maximisation of her (equal) freedom. Riffat needs to increase her access to Rawls’ primary goods - income, wealth, power and authority (over nature and at least in theory not over other rational individuals whose equal freedom is a precondition for the maximisation of Riffat’s liberty). Income, wealth and power are a function of capital accumulation so maximisation of equal liberty requires the maximisation of the rate of capital accumulation. Capital is the only possible universalsable concrete form of freedom.

Capital accumulation is the categorical imperative of liberal order. Riffat is forced to be free in the social specific sense that she must recognise the social prioritisation of capital accumulation - this is the essence of liberal rationality. Human rights are the resources she must possess to articulate liberal rationality. Human rights are merely the obverse of the supreme social duty to accumulate capital. They can have no separate justificatory grounds. Liberalism cannot tolerate the existence of a social order which does not prioritise the social duty of capital accumulation. There can be no coherent liberal objections to the slaughter of seven million Red Indians in the eighteenth and nineteenth centuries, the establishment of Israel, the promotion of famine in Iraq and American state terrorist attacks in Afghanistan and Sudan. This is why Rawls can write “These are doctrines that reject freedom. This gives us the practical task of containing them like war and disease” (Political Liberalism p. 64).

Human rights are means for the promotion of the cardinal sins of avarice and covetousness. In liberal society Riffat can not rationally seek self-annihilation - (fana) for she has no consciousness expect the consciousness of being in the world. She must seek to eternalise this consciousness through capital accumulation and this requires her to compete (be covetous) and to accumulate (to be avaricious). Imam Muhammad. Marmaduke Pickthall characterises this conjuncture of vices as “takathur”.

The non consequentionalist claims of de-ontological liberalism are invalid in practice. It is a distortion and a dishonouring of the teachings and the person of Christ. Liberalism creates a society in which Riffat worships herself. Her interests dominate her loves. She losses all consciousness of being with God.

II.The purpose of Islamic government

Islam’s rejection of the theory and practice of good governance is not pragmatic. It is grounded in Islamic ontology and epistemology. Islam recognises good governance as a means for establishing accelerated capital accumulation as the organising principle of Pakistani society. Good governance practise will enhance right oreintedness, eliminate God consciousness and promote lust, lewdness, avarice, covetousness and selfishness.

Islam straggles against these vices because it seeks Riffat’s salvation. Islam rejects the possibility of eternalisation of being in the world. It seeks to create in Riffat the consciousness of being with God. The purpose of Islamic political and social organisation is to enable Riffat to live a life which pleases her Beloved so that her journey to Him is joyous and blissful.

Islamic political practice rejects self determination and autonomy. It creates an order focused on fulfilling the will of God. It assigns value to acts in accordance with their contribution to the promotion of virtue. Islam’s cardinal virtues are sabr, ihsan and jihad - virtues which make self annihilation (fana) possible and transforms the heart of the believer into the House of the Lord - “My heaven and My earth have no room for Me but there is room for Me in the heart of My believing slave” (Hadith Qudsi). Islam’s organising principle - like that of Christianity - is not freedom but love. In liberal society Riffat is an end in herself. In Islamic society she is part of my being and we find our selves in the presence of Allah.

III. Islamic Response To The Agenda Of Good Governance

Good governance is an imperialist project. Its purpose is to subordinate Pakistani society and state to the process of global capital accumulation. This is to be achieved by forcing Riffat to be free. She is to be de-feminised by the commodifcation of her labour. Her soul is to be corrupted through indoctrination - the propagation of the belief in the eternity of being in the world. Riffat is to become a self worshiper over-whelmed by the discourse of rights and incapable of sacrifice and love.

Imperialism seeks Riffat’s subordination through the creation of a rights oriented contract based society and polity. A large net work of non governmental and community based organisations are being financed to enable Riffat to struggle for her rights. These NGOs struggle to legitimise the pursuit of lust, avarice and covetousness. They de-legitimise self-sacrifice, tradition, love and jihad. They strike at the roots of religious society, family life and Islamic culture.

They also seek to weaken the state through devolution and decentralisation. Imperialism regards a nuclear armed Pakistan as a serious threat to its global hegemony. The de-composition of the federal state structure in Pakistan is thus an important imperialist objective. This is to be achieved by:

(a)Reducing the share of the provinces in the national divisible revenue pool to increase the dependence of provincial and local government on imperialist finance

(b) Popularise human rights thorough propaganda and the building up of pro-imperialist cult figures such Aung Sun Suki, Anwar Ibrahim and Asma Jahangir,

(c) Demilitarising Pakistan through multilateral agency conditionalities and the sponsorship of racialist parties which preach race hatred and seek the disintegration of the State.

The Islamic government project on the other hand seeks the establishment of a strong militarised state - a jihadi state - sustained by a mass mobilisation of a populace committed to self-sacrifice and self-annihilation (fana). Such a state has been created in Iran, Sudan and Afghanistan through the mosque based mobilisation of the people under the revolutionary leadership of the Ulema. Establishment of Islamic government in Pakistan must involve an elimination of human rights and good government discourses and a dispersion and dispossession of the imperialist client elite which sponsors it.

** An earlier version was presented at a seminar on good governance sponsored by the Area Study Centre for Europe University of Karachi in October 1998.

A response to Sheikh Murad's "Bombing Without Moonlight"

2004-11-22T04:38:00.000-08:00

1)People like us who work for western institutions but are Islamically oriented have a guilty conscience. We need to rationalize our weaknesses in not making the sacrifice of life and wealth that our glorious heroes are daily making against most overwhelming odds. Acknowledging this sin is easy for a wretched sinner like myself but extremely difficult for spiritually sensitive persons who as an Imam says are enveloped in veils of light. The devil ignores me but goes after people who have potential of becoming aulia.

2)The enemy knows this and provides shelter, support and platform for such sincere scholars so that they oppose the Islamic movement on religious grounds and question its authenticity. Shaikh Murad reminds me of our dear brother Khurram Murad who gave in a different context very similar reasons for dialogue with the west and the Suadi royals. It is the sincere devotion of such scholars, which makes them of immense value to the enemy. Shiekh Murad reflects the great danger that the European convert community faces-the danger of becoming imperialism's front line agitators against the Islamic movements.

Summary of Sheik Murad’s paper:

1)Sheikh Murad describes, Islamic movement, as a heretic sect. Imam Qutb, according to him, is not a Muslim but a fascist, a concealed disciple of de Chardin and Alexis Carrel. Islamists are anti Semites and do not acknowledge that Palestine is the least inhospitable site for the Jewish diaspora because we are schooled on Mein Kampf. Islamists take their “spiritual armament from modernity” and are marked out for anachronism. “Islamists dismiss the juridical, theological and mystic intricacies of Islam as so much dead wood.” Imam Qutb rejects “Asharite de-ontology (sic)” and Sufi teachings and “jettisons” the political thought of Imam Mawardi and Imam Ghazali. Islamists are kharjis and are regarded as such by less radical puritans in Saudi Arabia. Everyone agrees that (Islamists) are far away from medieval sunnism.” Imam Ibn Taymiya was “angry with the past”. Imam Taymia believes that “God is alienated from His creation” Imam Taymiya‘s “ roots (are) in Harran (and) in neo Gnostic(s)” Imam Ghazali facilitated “ Seljuk accommodation”. Imam Ghazali apposes zealotry and like Nizam-ul-Mulk sanctions pluralism and his “ is a pragmatic achievement” “ Traditional Sunnies intuit that al Qaeda is a Western invention” “Islamism” is inauthentic and “rejects the classical cannons of Islamic law and theology.” Islamists are driven by nativist passion: The Palestinian jihad is nourished by the Tamil Tigers Hindu roots. Islamists combine xenophobia with a passion to acquire the Other’s technology. Islamists are seized by a rage which is undeniable. Hamas (advocates) "rage, revenge and the technological suspension of the ethical” Islamism represents a covert but deep surrender to enlightenment thought. Islamists reject the principles of tradition. Islamists bar intertextuality and the community of sages (and) are all engineers and doctors. Islamists have appropriate(ed) the machinery of centralized postcolonial states. Islamists have made “Muslim lands a prison rather than a landscape of options”. Islamists attack tradition and are inspired by Foucault and by Marxism.

2)All these are blatant lies and imperialism has put them in Sheikh Murad’s mouth. That is why he can only cite authors such as Garrett, Margalit, Habermas, Jewett, Roxanne L. Euben, Schleifer, Samuel Goitein, Zizek, John Kelsay, Abdelwahab Meddeb, Rosen, Waldman, Boyarin, Goldstien, Bernard Lewis, William Shephard and the Nasserites Salah Abd al-Fattah al-Khalidi and Youssef Choueiri in support of these slanderous taunts.

3)Shaikh Murad seeks to make Sunnis into allies of imperialism. He calls for a “Counter reformation.” The Islamic response to modernity should be that of self scrutiny as Sir Syed emphasized, Muslims should develop a toleration of many norms (and) be well aware of the ultimate indefinable quality of much of Holy writ. Sunnis (should) be conciliatory, cautious and disciplined seeking to identify the positive as well as the negative features of the new global culture and reject “totalitarian and exclusionary readings of the law and state". It is not enough to denounce the Islamists as the imperialist financed gathering at Putrajaya did. The sunni leadership needs to be more alert. The sunni leadership has not done enough (to defeat the Islamists) which remains the responsibility of the Muslim Ulema not of the west: “The war against this neo kharji ideology can only be won by the Sunnis”. “Liberalism (Sunnism’s ally) cannot be relied upon to supply ethics under condition of stress”. Sunnism advocates a “ theo politics invigorated by mutual tension (between) the Men of the Pen and the Men of the Sword”. The Sunnis need to overcome “capitalist shortsightedness”, not capitalism as such for with it they are in alliance. It is the responsibility of Sunnis to create a system grounded in the ethical brilliance of the monotheisms-presumably Islam and Judaism, for Christianity is compromised by its Enlightenment links. Thus order must be “cosmopolitan, non totalitarian”, remobilized to affirm the Other’s heart (and) reconnect the global system with religious reality. A successful war on terror cannot be detached from a humanly consensual war on environmental loss, on unfair trade on identity feminism and on genetic manipulation. If so detached it will be lost.

4)Shaikh Murad is a true humanist “Religion is indispensable to the nurturing of true humanism”. Despite his repeated criticism of the Enlightenment and of modernity be endorses Habermas’s project of reviving the Kantian morality which sanctions and provides a bases for the articulation of universal and individual autonomy, codes of human rights and legitimates the war against “Islamists”. The monotheism that can aid this imperialist adventure –the universalization of human rights and human autonomy- is a synthetic monotheism: Bearing “all the arms it has acquired and sharpened during its travels: its intellectual appropriation of Athens, its hospitality to the autochthonously non-Semitic, its insistence on diversity, all enabled and preserved by the centrality of spiritual purgation.” This many splendored modern/post modern monotheism will strengthen liberalism (which has proved to be too weak) and successfully terminate the suicidal civil war within the Enlightenment.

Our Response

1) First we should make a clear distinction between imperialist mercenaries ( Fazl-urRehman, Eqbal Ahmed ,Mohsin Mahdi) and sincere scholars such as Shaikh Murad, Prof Khurshid, Allama Shariati , Imam Qardhavi, who seek reconciliation and dialogue with imperialism. This is very difficult because the sincere Muslim scholars hate us passionately. Shaikh Murad’s criticism of Imam Qutb and Imam Ibn Taymiya is shockingly contemptuous, arrogant and insolent. This hate reflects the guilt they experience for being unable to make even a small fraction of the sacrifices our heroes are making against the most overwhelming odds in their glorious struggle for Islam. But many of these heroes who willingly die for Islam do not live by it and their lives too are contaminated by sins and errors of both judgment and intention. All Islamic groups commit theoretical and practical mistakes and we must learn to love each other in spite of our faults. Our attitude towards the sincere pro imperialist Muslim scholars must be that of humility and reverence .We are great sinners and beseech them to come within the folds of the Islamic movement to correct our mistakes.

2)Shiekh Murad accuses us of being part of modernity. This is superficially correct in that we represent an Islamic response to modernity. Our key thinkers Imam Qutb and Maulana Maududi have taken western discourse seriously as the traditionalist Ulema have not. We understand modernity/post modernity to be the order of global capital (we are indebted to Imam PICKTHAL for this insight) and are struggling for the overthrow of global capitalist order from within it. We are forced to rely upon its technologies in this struggle, but are conscious of the need to eliminate this dependence. By building upon the thoughts of Imam Qutb and Maulana Muadudi we are developing a Ghazalian Critique of freedom and progress, modernity’s central values. The traditionalist Ulema have sought to preserve true Islam within capitalism. The resources they provide are indispensable for our struggle. The work of the traditional Ulama and the work we have undertaken are complimentary .We are the slaves of the traditional Ulema and Sufia and seek to put ourselves entirely under their command.

3)Our leaders are orthodox- Muslims. Imam Qutb was a Shafee, Maulana Maududi a Hanafi, neither was a faqih both were Mutakulimun. We reject Kharjiyat because it was a revolt against an Islamic state. We are not struggling for the overthrow of any state that is Islamic but of states that are subservient to global capitalist order and in which the Shariah is not in practice and is not the supreme law. Khuruj against un-Islamic rule is integral to Islamic orthodoxy as integral as attempts to preserve Islam within un-Islamic order. Both movements are complimentary to each other. Imam Zain ul Abideen and Imam Ja’far complement Imam Hussain. The Sahibain complement Imam Abu Hanifa (who died in prison because of his support of the Khuruj of Imam Nafs Zakiyya). The greatest leaders of Jihad in India, North Africa and central Asia have always emerged from the ranks of the Sufia. One need only mention the glorious role of the Yassavia order in sustaining the Jihad in Chechenya and Daghistan. Other shining examples of Sufi mujahideen are Mujaddin Alf Thani, Imam Sanusi, Hazrat Quttub ul Alam Imdaullah Mohajir Makki.

4)The Islamic movement is the natural home of the traditional Ulema and Sofia who alone can provide its authentic leadership. The movement needs to practice taqleedi ijtihad. This requires that all conceptions be legitimated by authentic ahkam derived on the basis of traditionally sanctioned usual. A return to Imam Ghazali is particularly important at this stage because a revival of the Ulum al Deen is urgently necessary. Isolation from global capital is no longer possible and we are forced into a posture of offensive defence against states subservient to capitalist order. The conciliatory approach advocated by Sheikh Murad (by reference to a small number of Ayats and Ahadis but without validation on the basis of their consensual interpretation) is no longer possible because human rights imperialism is uncompromisingly totalising. The diversity Shaikh Murad yearns for is neither desirable nor possible today for the market is colonizing all aspects of human life and all societies are collapsing into the political order of global capital. There are no non-combatants or innocent by standers in struggle against capital.

5) Abandoning Struggle and resistence is accepting subservience to human rights imperialism, freedom and progress. Islamic tradition does not sanction this surrender and there are no grounds for equating its acceptance of Islamic monarchy with its acceptance of the secular rule of global capital. Islamic tradition on the other hand provides indispensable resources for undertaking struggle and for avoiding the type of excesses of which we have sometimes been guilty. We humbly beseech the Ulema to accept the responsibility of leading the Islamic movement at this crucial turning point in history.

by Riffat Muhammad

Poverty of Islamic Economics

2004-11-20T17:11:00.000-08:00

The initiative to provide an Islamic economic justification for capitalism dates back to the early 1970s. Its leading exponents in those days were Najatullah Siddiqui at the Centre for Islamic Economics Jeddah, Khurshid Ahmad visiting professor at the King Abdul Aziz University and Umar Chapra of the Saudi Arabian Monetary Agency. The sub discipline of Islamic Economics was invented to justify Saudi polices.

In the 1980s, Prince Muhammad al Faisal led the Islamic banking movement to justify Arab integration into the imperialist financial system. The IMF and the World Bank were closely associated with the Prince’s initiative. Sami at Darvish, a Director of the World Bank became the first President of Faisal’s, Daral Maal al Islami. IMF researchers – Mohsin Khan and Abbas Merakhor – started providing apologies for Islamic finance in the professional literature. Within Pakistan, Ziauddin Ahmad and Fahim Khan played a similar role.

Islamic economics represents an attempt at legitimizing the ethics and institutions of capitalism. This becomes abundantly clear when we examine the technical writings of the Islamic economists. Invariably these scholars work within the neo classical paradigm. The “Islamic” consumer/producer/public policy maker is a welfare maximiser (like his neo classical compatriot) and the definition of his utility function is a task usually left to the faqihs (the neoclassical economists also depend upon the philosophers of utilitarianism to define individual and community welfare functions). Although the constraints within which utility maximization is sought by the Islamic economists are claimed to be uniquely Islamic this is of very little significance. For, the Islamic economists claim also that in the long run the elimination of interest, the introductions of Zakat etc. are necessary for the maximization of efficient production. The Islamic constraints thus appear in the guise of procedures which constrain short term utility maximization so that long term utility may be maximized. The Islamic economists are rule utilitarian and short term constraints turn out to be no constraints at all in the long run.

This methodological similarity necessitates that the ethics of capitalism – acquisitiveness, competition, primacy of material well being, freedom, equality – are all endorsed by Islamic economics. Islam is seen not as a distinct civilization but as a means of reforming capitalism. Capitalism is criticized not for the ends it sets itself but for failing to achieve a “balance” in the attainment of legitimately conflicting ends (acquisitiveness vs cooperation, freedom vs equality etc) Islam can achieve such a balance if we formally eliminate interest and introduce Zakat.

Now the ruling elites of the Muslim world realize that the introduction of Zakat and the introduction of Shariah compliant financial contracts replicating interest based transactions within capitalist financial markets represent no more than marginal policy changes. Often this is a small price to pay for co-opting potentially trouble some Islamic parties and for diverting revolutionary energy into reformist politics. Nimeri, Ziaul Huq and Mahathir have used this tactic with advantage and all three have found Islamic economists to be good and faithful servants. General Musharraf is probably not unsympathetic to the Islamic economists.

In most Muslim countries – Afghanistan, Algeria, Indonesia, the Indo Pak subcontinent, Iran – the resistance to imperialism during the 19th and 20th centuries was led by Islamic groups and scholars. These groups kept aloof from the reformist and apologist movements because there was an instinctive realization on their part that the difference between Islam and Western savagery was qualitative in nature. Islam was not a means for reforming capitalism but for annihilating it. The Islamic groups thus developed into popular movements with a capacity to challenge the continued dominance of the West and the Western educated elites that inherited power after independence. The social project of the Islamic movements was to develop an alternative to capitalism and to highlight the injustices that could not be redressed within this system.

Islamic economics has proved to be an important means for changing this social orientation of the Islamic parties. In Pakistan, the Arab world, Turkey, Malaysia and Indonesia many Islamic groups are now firmly allied to various factions of the politically dominant Western oriented elite. The economic platform of many Islamic parties is dominated by Islamic economic themes. Introduction of Shariah compliant financial contracts and the effective introduction of Zakat are increasingly seen as the main measures to be advocated. The reformed capitalism of Islamic economics theory is increasingly accepted as the ideal Islamic economy.

Islamic parties in Pakistan, Turkey and the Arab world have never taken the task of defining their economic problematique very seriously. Islamic economics has become a major conceptual hurdle in the attempt to define both ideal types and the social processes through which over time these ideal types are to be approximated. The Islamic ghost of neo classical economic man conjured up by Islamic economics bears hardly any resemblance to the historical reality of individual economic motivation at the time of the Prophet (Sallallaho wasallam). Utility and profit maximization was the concern neither of the individual consumer/producer nor the purpose of social organization. Islam articulated a religious ethic which firmly subordinated economic endeavour to the individual and social quest for spiritual upliftment. Economic activity was a means for achieving spiritual excellence and was strictly limited to ensure that it aided spiritual progress – the Prophet (Sallallaho wasallam) did not save, invest or bequeath property. The values of Zuhd and Faqr were strongly emphasized by Islam.

Similarly, the Islamic conceptions of property and of justice are rooted in a metaphysics that is at odds with the metaphysical conceptions underlying capitalism. Thus Rawls (the leading liberal political philosopher of modern times) builds his theory of justice on the Kantian conception of the individual as a self-determining being. Justice, within the Rawlsian system entails the creation of a social order in which individuals can pursue their autonomously defined ends and constraints in this pursuit of individual ends are justified on only two grounds.
(a) That they are necessary to preserve the similar liberty of other individuals and
(b) That they are required to compensate the most socially disadvantaged group (the so called difference principle).

It follows that in the Rawlsian system all individually valued ends are of equal social legitimacy. To give an example from Rawls himself the system of justice as fairness must treat as of equal value the conception of the good put forward by an individual who finds fulfillment solely in the counting of blades of grass ands the conception of the good put forward by an individual who finds fulfillment in fighting drug abuse. Liberal conceptions of justice whether Kantian, or Rawlsian have no coherent argument for the ordering of values. All autonomously defined ends by self determining individuals are of equal value.

Now all the higher religions and most emphatically Islam reject the metaphysical conception of the individual as a self determining being (the conception of man as God) Islam insists that human fulfillment lies in a voluntary surrender (the word Islam means surrender) of the capacity of self determination. The capacity of self-determination is not denied but the authentication of ends with reference to this capacity leads one to Kufr and to frustration since such authentication cannot conceivably provide a basis for the ordering of values. The ordering of values and the authentication of ends cannot be achieved through an exercise of man’s rational faculty. Reason can identify means for achieving given ends but it cannot provide a basis for valuing ends.

The Islamic conception of justice can assign intrinsic value only to the religious norms Iman, Islam, Taqwa and Ihsan. Islamic theorists thus face the task of conceptualizing a social and economic order in which the practice of the religious virtues (not welfare, not utility) are enhanced. Economic institutions have to be examined and their potential for inducing individuals to accord priority to the attainment of spiritual progress must be identified. The factory, the system of land tenure, the family as consuming unit, the distributive and marketing channels, the bazzar, the policy making and executing offices, saving and investment institutions all must be redesigned to facilitate the growth of virtue. This is essential to develop an economic system the purpose of which is the promotion of the religious virtues.

Islamic economics of course cannot raise such questions. It is a branch of neo classical economics and assumes the value neutrality of capitalist institutions. Adding on Zakat and introducing Shariah compliant financial contracts and other marginal adjustments such as reducing the maximum size of land holdings and guaranteeing trade union rights etc. would suffice for the achievement of Islamically sanctioned welfare maximization. Islamic economics is methodologically incapable of exploring the relationship between institutional structure, individual motivation and value change. In the Islamic economics paradigm the individual consumer, producer, policy maker is assumed to be Islamically motivated and the problem of the impact of economic activity on individual motivation is thus assumed away. Instead of addressing this vital issue Islamic economists accept capitalist values, structures and organization forms as natural.

by Dr. Javed Ansari (circa 1996, I have reproduced here from my notes, with some recent additions).

For the summary of above article go here Summary: Islamic Economics and Capitalism

City of the Prophet - Ramadhan in Madinah

2004-11-20T17:03:00.000-08:00

Every time Ramadhan comes around I remember the year that Allah blessed us with a visit to His most blessed city.

We entered Madinah Munawwara (City of Light) in the afternoon and settled down in our hotel. Once we were ready we went to the sacred mosque to prepare for iftar (meal at the end of fast). As soon as we stepped through the gates of the sacred mosque, children came running to us from all directions. One after another after another they attempted to take us home to break the fast with them and their families. We were obliged to turn down invitation after invitation from total strangers.

Soup with the Sheikh

After the sunset prayer, we went to visit a great sheikh of hadith, Sheikh Zakharia Bukhari, who sets aside a room in his house for serving soup to strangers and the poor during the nights of Ramadhan. Sheikh Zakharia was now very old, and although he had stopped teaching, people liked to visit him to listen to Hadith and poetry about the Prophet (Allah bless him and give him peace), and to ask for his dua.

We left Sheikh Zakharia's house and returned to the mosque for night prayers and the beautiful taraweeh prayer alongside approximately one million people. We were led in prayer by some of the best reciters of Qur'an in the world.

The Sacred Mosque is kept in good condition despite the huge number of worshippers. The authorities hire many cleaners and although their job is humble it is a highly sought after position. We heard stories of how people with successful careers would drop everything for the honour of becoming a cleaner of the Sacred Mosque.

Garden of Paradise

The heart of the Mosque is the Rawda, a garden from the gardens of Paradise. We made a habit of getting there early in the morning to wait for the morning prayer, and we soon got to know the 'Rawda regulars'. Among them were some beautiful Sudanese brothers with impeccable manners and gentility, dressed in white robes and white turbans. There were Arabs from various countries who would make long and beautiful duas, and Turkish and Pakistani brothers who were intense in their love for the Prophet (Allah bless him and give him peace) and shed many tears.

Some of the columns of the Rawda are the sites of significant events like the repentance of Abu Lubaba, the place where the Messenger (Allah bless him and give him peace) would rest before 'itikaf, and the pillar of Aisha where no dua is rejected. These are marked with different colours and special markings to highlight the spot.

After the morning prayer, we would stand before our Prophet (Allah bless him and give him peace) and give him our greetings, before we headed towards the Baqi cemetery where many sahaba (companions of the Prophet) and ahl al-bayt (family of the Prophet) are buried.

Beloved Mountain

One night we visited the mountain of Uhud where sayyiduna Hamza and the martyrs of Uhud are buried. According to a hadith, the mountain of Uhud is "A mountain which loves us, and which we love" (Bukhari, Muslim, Muwatta). We climbed halfway up the mountain and entered a cave which is said to have been used by the Prophet (Allah bless him and give him peace) as a shelter during the battle of Uhud. Inside the cave we all caught the scent of the most fragrant musk we had ever smelt, which seemed to emanate from the very stones of the mountain. We hoped that this had something to do with the hadith of the Prophet (Allah bless him and give him peace) "I find the scent of Paradise beside the mountain of Uhud".

Eid Sweets And Songs

Finally, it was the day of Eid. It began around 3.00 in the morning for us! To get a place inside the Mosque on Eid you have to get there early, and even then we had to be content with a place in the new extension, rather than the older Ottoman part were we had hoped to be.

After the Eid prayer we went about the streets giving sweets to the children of Madinah, and we visited Sheikh Zakharia again. Later that night we also visited an Egyptian sheikh who entertained us with songs and poetry about the Prophet (Allah bless him and give him peace).

Leaving this beautiful city after Eid was painful, but we were comforted by the words of a sheikh we met in the Rawda who told us, "We have come to visit the greatest blessing of Allah, the Holy Prophet (Allah bless him and give him peace), and we will not return home empty-handed". Madinah will always remain in my heart.

Owais Adam

Ramadhan Around The World

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"It seems to me that all the people who live in this city, or even sojourn in it temporarily, very soon fall into what one might call a community of mood and thus also of behaviour and, almost, even of facial expression: for all of them have fallen under the spell of the Prophet, whose city it once was and whose guests they are now . . .

Even after thirteen centuries his spiritual presence is almost as alive here as it was then. It was only because of him that the scattered group of villages once called Yathrib became a city and has been loved by all Muslims down to this day as no city anywhere else in the world has ever been loved. It has not even a name of its own: for more than thirteen hundred years it has been called Madinat an-Nabi, 'the City of the Prophet'. For more than thirteen hundred years, so much love has converged here that all shapes and movements have acquired a kind of family resemblance, and all differences of appearance find a tonal transition into a common harmony.

This is the happiness one always feels here - this unifying harmony. Although life in Medina today has only a formal, distant relationship with what the Prophet aimed at; although the spiritual awareness of Islam has been cheapened here, as in many other parts of the Muslim world: an indescribable emotional link with its great spiritual past has remained alive. Never has any city been so loved for the sake of one single personality; never has any man . . . been loved so personally, and by so many, as who lies . . beneath the great green dome.

. . . . . . . . . .

This love . . . lives on in the heart of his followers like the leitmotif of a melody built up of many tones. It speaks to you out of every stone of the ancient city. You can almost touch it with your hands: but you cannot capture it in words . . .

Muhammad Asad, The Road to Mecca, pp. 251-252.

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The love of the Messenger sallallahu alayhi wa sallam

------
Ich bin der Staub, Du die Sonne
die mir das Licht zuteilt

Ich bin vor Kummer Krank, Du
Das Mittel, das mich heilt

Ich fliege ohne Flügel
Und Fendern zu Dir hin,

Der Bernstein Du, Ich ein Stroh nur,
Von deinem Sog ereilt

Maulana Rum

A response to Sheikh Murad's "Bombing Without Moonlight"

2004-11-17T05:42:00.000-08:00

Introduction:

1)People like us who work for western institutions but are Islamically oriented have a guilty conscience. We need to rationalize our weaknesses in not making the sacrifice of life and wealth that our glorious heroes are daily making against most overwhelming odds. Acknowledging this sin is easy for a wretched sinner like myself but extremely difficult for spiritually sensitive persons who as an Imam says are enveloped in veils of light. The devil ignores me but goes after people who have potential of becoming aulia.

2)The enemy knows this and provides shelter, support and platform for such sincere scholars so that they oppose the Islamic movement on religious grounds and question its authenticity. Shaikh Murad reminds me of our dear brother Khurram Murad who gave in a different context very similar reasons for dialogue with the west and the Suadi royals. It is the sincere devotion of such scholars, which makes them of immense value to the enemy. Shiekh Murad reflects the great danger that the European convert community faces-the danger of becoming imperialism's front line agitators against the Islamic movements.

Summary of Sheik Murad’s paper:

1)Sheikh Murad describes, Islamic movement, as a heretic sect. Imam Qutb, according to him, is not a Muslim but a fascist, a concealed disciple of de Chardin and Alexis Carrel. Islamists are anti Semites and do not acknowledge that Palestine is the least inhospitable site for the Jewish diaspora because we are schooled on Mein Kampf. Islamists take their “spiritual armament from modernity” and are marked out for anachronism. “Islamists dismiss the juridical, theological and mystic intricacies of Islam as so much dead wood.” Imam Qutb rejects “Asharite de-ontology (sic)” and Sufi teachings and “jettisons” the political thought of Imam Mawardi and Imam Ghazali. Islamists are kharjis and are regarded as such by less radical puritans in Saudi Arabia. Everyone agrees that (Islamists) are far away from medieval sunnism.” Imam Ibn Taymiya was “angry with the past”. Imam Taymia believes that “God is alienated from His creation” Imam Taymiya‘s “ roots (are) in Harran (and) in neo Gnostic(s)” Imam Ghazali facilitated “ Seljuk accommodation”. Imam Ghazali apposes zealotry and like Nizam-ul-Mulk sanctions pluralism and his “ is a pragmatic achievement” “ Traditional Sunnies intuit that al Qaeda is a Western invention” “Islamism” is inauthentic and “rejects the classical cannons of Islamic law and theology.” Islamists are driven by nativist passion: The Palestinian jihad is nourished by the Tamil Tigers Hindu roots. Islamists combine xenophobia with a passion to acquire the Other’s technology. Islamists are seized by a rage which is undeniable. Hamas (advocates) "rage, revenge and the technological suspension of the ethical” Islamism represents a covert but deep surrender to enlightenment thought. Islamists reject the principles of tradition. Islamists bar intertextuality and the community of sages (and) are all engineers and doctors. Islamists have appropriate(ed) the machinery of centralized postcolonial states. Islamists have made “Muslim lands a prison rather than a landscape of options”. Islamists attack tradition and are inspired by Foucault and by Marxism.

2)All these are blatant lies and imperialism has put them in Sheikh Murad’s mouth. That is why he can only cite authors such as Garrett, Margalit, Habermas, Jewett, Roxanne L. Euben, Schleifer, Samuel Goitein, Zizek, John Kelsay, Abdelwahab Meddeb, Rosen, Waldman, Boyarin, Goldstien, Bernard Lewis, William Shephard and the Nasserites Salah Abd al-Fattah al-Khalidi and Youssef Choueiri in support of these slanderous taunts.

3)Shaikh Murad seeks to make Sunnis into allies of imperialism. He calls for a “Counter reformation.” The Islamic response to modernity should be that of self scrutiny as Sir Syed emphasized, Muslims should develop a toleration of many norms (and) be well aware of the ultimate indefinable quality of much of Holy writ. Sunnis (should) be conciliatory, cautious and disciplined seeking to identify the positive as well as the negative features of the new global culture and reject “totalitarian and exclusionary readings of the law and state". It is not enough to denounce the Islamists as the imperialist financed gathering at Putrajaya did. The sunni leadership needs to be more alert. The sunni leadership has not done enough (to defeat the Islamists) which remains the responsibility of the Muslim Ulema not of the west: “The war against this neo kharji ideology can only be won by the Sunnis”. “Liberalism (Sunnism’s ally) cannot be relied upon to supply ethics under condition of stress”. Sunnism advocates a “ theo politics invigorated by mutual tension (between) the Men of the Pen and the Men of the Sword”. The Sunnis need to overcome “capitalist shortsightedness”, not capitalism as such for with it they are in alliance. It is the responsibility of Sunnis to create a system grounded in the ethical brilliance of the monotheisms-presumably Islam and Judaism, for Christianity is compromised by its Enlightenment links. Thus order must be “cosmopolitan, non totalitarian”, remobilized to affirm the Other’s heart (and) reconnect the global system with religious reality. A successful war on terror cannot be detached from a humanly consensual war on environmental loss, on unfair trade on identity feminism and on genetic manipulation. If so detached it will be lost.

4)Shaikh Murad is a true humanist “Religion is indispensable to the nurturing of true humanism”. Despite his repeated criticism of the Enlightenment and of modernity be endorses Habermas’s project of reviving the Kantian morality which sanctions and provides a bases for the articulation of universal and individual autonomy, codes of human rights and legitimates the war against “Islamists”. The monotheism that can aid this imperialist adventure –the universalization of human rights and human autonomy- is a synthetic monotheism: Bearing “all the arms it has acquired and sharpened during its travels: its intellectual appropriation of Athens, its hospitality to the autochthonously non-Semitic, its insistence on diversity, all enabled and preserved by the centrality of spiritual purgation.” This many splendored modern/post modern monotheism will strengthen liberalism (which has proved to be too weak) and successfully terminate the suicidal civil war within the Enlightenment.

Our Response:

1) First we should make a clear distinction between imperialist mercenaries ( Fazl-urRehman, Eqbal Ahmed ,Mohsin Mahdi) and sincere scholars such as Shaikh Murad, Prof Khurshid, Allama Shariati , Imam Qardhavi, who seek reconciliation and dialogue with imperialism. This is very difficult because the sincere Muslim scholars hate us passionately. Shaikh Murad’s criticism of Imam Qutb and Imam Ibn Taymiya is shockingly contemptuous, arrogant and insolent. This hate reflects the guilt they experience for being unable to make even a small fraction of the sacrifices our heroes are making against the most overwhelming odds in their glorious struggle for Islam. But many of these heroes who willingly die for Islam do not live by it and their lives too are contaminated by sins and errors of both judgment and intention. All Islamic groups commit theoretical and practical mistakes and we must learn to love each other in spite of our faults. Our attitude towards the sincere pro imperialist Muslim scholars must be that of humility and reverence .We are great sinners and beseech them to come within the folds of the Islamic movement to correct our mistakes.

2)Shiekh Murad accuses us of being part of modernity. This is superficially correct in that we represent an Islamic response to modernity. Our key thinkers Imam Qutb and Maulana Maududi have taken western discourse seriously as the traditionalist Ulema have not. We understand modernity/post modernity to be the order of global capital (we are indebted to Imam PICKTHAL for this insight) and are struggling for the overthrow of global capitalist order from within it. We are forced to rely upon its technologies in this struggle, but are conscious of the need to eliminate this dependence. By building upon the thoughts of Imam Qutb and Maulana Muadudi we are developing a Ghazalian Critique of freedom and progress, modernity’s central values. The traditionalist Ulema have sought to preserve true Islam within capitalism. The resources they provide are indispensable for our struggle. The work of the traditional Ulama and the work we have undertaken are complimentary .We are the slaves of the traditional Ulema and Sufia and seek to put ourselves entirely under their command.

3)Our leaders are orthdox- Muslims. Imam Qutb was a Shafee, Maulana Maududi a Hanafi, neither was a faqih both were Mutakulimun. We reject Kharjiyat because it was a revolt against an Islamic state. We are not struggling for the overthrow of any state that is Islamic but of states that are subservient to global capitalist order and in which the Shariah is not in practice and is not the supreme law. Khuruj against un-Islamic rule is integral to Islamic orthodoxy as integral as attempts to preserve Islam within un-Islamic order. Both movements are complimentary to each other. Imam Zain ul Abideen and Imam Ja’far complement Imam Hussain. The Sahibain complement Imam Abu Hanifa (who died in prison because of his support of the Khuruj of Imam Nafs Zakiyya). The greatest leaders of Jihad in India, North Africa and central Asia have always emerged from the ranks of the Sufia. One need only mention the glorious role of the Yassavia order in sustaining the Jihad in Chechenya and Daghistan. Other shining examples of Sufi mujahideen are Mujaddin Alf Thani, Imam Sanusi, Hazrat Quttub ul Alam Imdaullah Mohajir Makki.

4)The Islamic movement is the natural home of the traditional Ulema and Sofia who alone can provide its authentic leadership. The movement needs to practice taqleedi ijtihad. This requires that all conceptions be legitimated by authentic ahkam derived on the basis of traditionally sanctioned usual. A return to Imam Ghazali is particularly important at this stage because a revival of the Ulum al Deen is urgently necessary. Isolation from global capital is no longer possible and we are forced into a posture of offensive defence against states subservient to capitalist order. The conciliatory approach advocated by Sheikh Murad (by reference to a small number of Ayats and Ahadis but without validation on the basis of their consensual interpretation) is no longer possible because human rights imperialism is uncompromisingly totalising. The diversity Shaikh Murad yearns for is neither desirable nor possible today for the market is colonizing all aspects of human life and all societies are collapsing into the political order of global capital. There are no non-combatants or innocent by standers in struggle against capital.

5) Abandoning Struggle and resistence is accepting subservience to human rights imperialism, freedom and progress. Islamic tradition does not sanction this surrender and there are no grounds for equating its acceptance of Islamic monarchy with its acceptance of the secular rule of global capital. Islamic tradition on the other hand provides indispensable resources for undertaking struggle and for avoiding the type of excesses of which we have sometimes been guilty. We humbly beseech the Ulema to accept the responsibility of leading the Islamic movement at this crucial turning point in history.

related posts:

A critique of Sheikh Murad

Eid Mubarak

2004-11-17T05:32:00.000-08:00

On the blessed day of Eid, our brothers and sisters in Fallujah are in our hearts and minds. May the help of Allah Most High be with them.

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أحكام العيد وآدابه

11/11/2004
**إعداد /محمود إسماعيل شل

شرع الله لعباده دينًا كاملاً، فلم يدع أمرًا إلا وبيَّن لهم حكمه فيه، وأرشدهم إلى المنهج الذي يضبط سلوكهم ويُعينهم على إعمار حياتهم.

وعيدا الفطر والأضحى عند المسلمين لم يخرجا عن هذه القاعدة، حيث جاء الشرع الحنيف بأحكام خاصة بهما؛ ليوجه سلوك المسلم في هذه المناسبة وفق شرع الله وسننه، ويطلب منه أن يلتزم بها، ويراعي الآداب التي شرعت لأجلهما.

ومن الأحكام الواردة بخصوص هذه المناسبة ما يلي:

1 - حرمة صوم يومي العيدين؛ لما رواه البخاري عن عمر رضي الله عنه أنه صلى قبل الخطبة ثم خطب الناس فقال: "يا أيها الناس إن رسول الله صلى الله عليه وسلم قد نهاكم عن صيام هذين العيدين، أما أحدهما فيوم فطركم من صيامكم، وأما الآخر فيوم تأكلون نُسُككم".

2 - يستحب الإكثار من التكبير في ليلة العيد؛ لقوله تعالى: {ولتكملوا العدة ولتكبروا الله على ما هداكم} (البقرة: 185)، وهذا في عيد الفطر، والتكبير فيه يكون من غروب شمس آخر يوم من رمضان، ويستمر حتى صلاة العيد، ويكون عامًّا في الأماكن كلها، ولا تكبير في عيد الفطر عقب الصلوات المفروضة.

أما التكبير في عيد الأضحى فيكون من أول أيام ذي الحجة على الصحيح؛ لقوله تعالى: {ويذكروا اسم الله في أيام معلومات} (الحج: 28) والأيام المعلومات هي العشر من ذي الحجة. ولما ثبت في "صحيح البخاري" معلقًا: "أن ابن عمر وأبا هريرة كانا يخرجان إلى السوق في أيام عشر ذي الحجة يُكبِّران ويُكبِّر الناس بتكبيرهما". ويستمر التكبير إلى عصر آخر يوم من أيام التشريق، وهو رابع أيام العيد؛ لقوله تعالى:

{واذكروا الله في أيام معدودات} (البقرة: 203)، ولقول النبي صلى الله عليه وسلم: "أيام التشريق أيام أكل وشرب وذكر لله" رواه مسلم.

هذا في التكبير العام في كل الأماكن، أما التكبير في عيد الأضحى عقب الصلوات المفروضة فيكون من فجر يوم عرفة، ويستمر حتى عصر آخر يوم من أيام التشريق.

3 - ويُستحب الاغتسال للعيد والتنظف له، وقد ثبت هذا عن ابن عمر رضي الله عنهما من فعله، وهو معروف باتباعه للسنة، ويُستحب كذلك لبس أفضل الثياب؛ لحديث عائشة رضي الله عنها أنها قالت: قال رسول الله صلى الله عليه وسلم: "ما على أحدكم إن وجدتم أن يتخذ ثوبين ليوم الجمعة سوى ثوبي مهنته" رواه أبو داود وصححه الألباني. ويوم العيد يشبه يوم الجمعة من حيث المعنى، فكان من السنة فعل ذلك.

4. عدم الخروج إلى العيد حتى يأكل تمرات لما رواه البخاري عَنْ أَنَسِ بْنِ مَالِكٍ قَالَ كَانَ رَسُولُ اللَّهِ صَلَّى اللَّهُ عَلَيْهِ وَسَلَّمَ لَا يَغْدُو يَوْمَ الْفِطْرِ حَتَّى يَأْكُلَ تَمَرَاتٍ.. وَيَأْكُلُهُنَّ وِتْرًا. البخاري 953.

وإنما استحب الأكل قبل الخروج مبالغة في النهي عن الصوم في ذلك اليوم وإيذانا بالإفطار وانتهاء الصيام، وإذا كان عيد الأضحى، فلا يأكل حتى يصلي، لما صح عنه صلى الله عليه وسلم أنه كان "لا يطعم يوم الأضحى حتى يصلي" رواه الترمذي وصححه الألباني.

5- ويُستحب أن يخرج إلى العيد ماشيًا، وعليه السكينة والوقار، لحديث أُبيٍّ رضي الله عنه قال: "كان رجل، لا أعلم رجلاً أبعد من المسجد منه، وكان لا تخطئه صلاة.

فقيل له: لو اشتريت حمارًا تركبه في الظلماء، قال: إني أريد أن يُكتب لي ممشاي إلى المسجد. ورجوعي إذا رجعت إلى أهلي. فقال رسول الله صلى الله عليه وسلم: (قد جمع الله لك ذلك كله) رواه مسلم. وعن علي رضي الله عنه قال: "من السنة أن تخرج إلى العيد ماشيًا، وأن تأكل شيئًا قبل أن تخرج" رواه الترمذي وحسَّنه، وحسنه الألباني.

6 - ومن السنة أن يخرج إلى العيد من طريق ويعود من غيره؛ لفعله صلى الله عليه وسلم فيما رواه جابر رضي الله عنه قال: "كان النبي صلى الله عليه وسلم إذا كان يوم عيد خالف الطريق" رواه البخاري.

وقد ذكر أهل العلم لذلك حكمًا كثيرة، منها: إظهار شعيرة الله بالذهاب والإياب لأداء هذه الفريضة، ومنها إغاظة المنافقين، ومنها السلام على أهل الطريقين، ومنها شهادة سكان الطريقين من الجن والإنس، ومنها التفاؤل بالخير بتغير الحال إلى المغفرة والرضا، ومنها قضاء حاجة من له حاجة في الطريقين، ولا مانع من صحة كل ما ذكروه من العلل، كما أنه لا مانع أن تكون هناك علل أخرى.

7 - ولا بأس بخروج النساء يوم العيد لحضور الصلاة وشهود الخطبة، واستحب ذلك بعض أهل العلم. وكل ذلك مشروط بأمن الفتنة، ودليل ذلك ما رواه مسلم عن أم عطية رضي الله عنها قالت: "أَمَرَنا رسول الله صلى الله عليه وسلم أن نخرجهن في الفطر والأضحى، العواتق، وذوات الخُدُور، فأما الحيض فيعتزلن الصلاة، ويشهدن الخير ودعوة المسلمين".

ويجب على المرأة في العيد وفي غيره أن تخرج غير متطيبة، ولا مرتدية ثيابًا لافتة للانتباه، أو لباسًا غير شرعي.

8 - ومن السنة أن يُصلَّى العيد في المصلَّى؛ لحديث أبي سعيد الخدري رضي الله عنه قال: "كان رسول الله صلى الله عليه وسلم يخرج يوم الفطر والأضحى إلى المصلى" متفق عليه. ولم يُنقل عن النبي صلى الله عليه وسلم أنه صلى العيد بمسجده إلا من عذر.

9 - ولا بأس بالتهنئة في العيد، كأن يقول لمن لقيه: تقبَّل الله منا ومنكم، وأعاده الله علي وعليك بالخير والبركة، وعيدكم مبارك، ونحو ذلك؛ لحديث أبي أُمامة الباهلي رضي الله عنه أنهم كانوا إذا رجعوا من العيد يقول بعضهم لبعض: تقبل الله منا ومنك.

قال أحمد: إسناد حديث أبي أُمامة إسناد جيد. قال ابن تيمية -رحمه الله- "وقد روي عن طائفة من الصحابة أنهم كانوا يفعلونه، ورخص فيه الأئمة من بعدهم، كأحمد وغيره".

10- ويُستحب إظهار الفرح والسرور والبشاشة في وجه إخوانه وكل من يلقاه من المسلمين. ولا بأس باللعب واللهو المباح وفعل كل ما يُدخل البهجة في النفوس، بشرط أن يكون ذلك في حدود ما أباحه الشرع، ومن غير إفراط ولا تفريط.

11- الحذر مما يفعله كثير من البعض في أيام العيد من الإسراف والتبذير، وتبديد الأموال والأوقات، وارتكاب المحرمات، فيما لا يفيد نفعًا لا في الدنيا ولا في الآخرة، بل يعود عليهم بالضرر والخسران {والله يدعو إلى دار السلام ويهدي من يشاء إلى صراط مستقيم} (يونس: 25).
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تحري رؤية هلال شوال
خاصة من أهل القرى والبوادي، إذ تحري الأهلة المرتبطة بها بعض العبادات قربى غفل عنها كثير من الناس.
يثبت هلال شوال بأحد طريقين:
1. رؤية مستفيضة، وتجزئ رؤية عدلين.
2. أوإكمال رمضان ثلاثين يوماً.
ولا تثبت الأهلة بالحساب، ولهذا لا يجوز الصوم ولا الفطر بالحساب، هذا مذهب سائر أهل السنة، ولم يشذ منهم إلا ابن سُرَيج من الشافعية، وعدّ ذلك من هفواته والله يغفر له، ولم يعمل بالحساب إلا أهل الأهواء الشيعة.
التكبير
إذا ثبت هلال رمضان يسن التكبير والجهر به في الأسواق، والطرقات، وعقب الصلوات، وعند دخول البيوت والخروج منها، وعند التلاقي، للمسافر والمقيم، وفي مصلى العيد، إلى أن يقوم الناس لصلاة العيد؛ وصيغته: الله أكبر، الله أكبر، لا إله إلا الله، الله أكبر، ولله الحمد؛ ويمكن أن يزاد عليه: الله أكبر كبيراً، والحمد لله كثيراً، وسبحان الله بكرة وأصيلاً.
زكاة الفطر
إخراج زكاة الفطر عنه وعن كل من يعول من المسلمين، وهي صاع1 عن كل واحد من عامة ما يقتاته الناس، ويجوز أن تخرج حباً، أوطعاماً: خبزاً، أولحماً، أوسمكاً، أولبناً، ونحوه؛ ولا يجزئ إخراجها نقداً، ومن أخرجها نقداً اعاد إخراجها طعاماً.
وحكمها أنها فرض، وتجب على كل من ملك ما زاد على قوته وقوت من يعول؛ وتخرج عن اليتيم من ماله؛ وتؤدى قبل الخروج إلى صلاة العيد، وأجاز بعض أهل العلم إخراجها قبل يوم أويومين من العيد، ومصارفها هي مصارف الزكاة الواجبة، ولا يشترط لها نصاب.
الفطر قبل الخروج إلى الصلاة
السنة أن يفطر المرء على تمرات قبل خروجه لصلاة العيد.
الغسل والتنظف ولبس أحسن الثياب
يستحب الغسل للعيد، فعل ذلك علي وابن عمر من الصحابة، وطائفة من أهل العلم، وكذلك التنظف وحلق الشعور المأذون في حلقها، سوى اللحية إذ حلقها حرام، ويلبس أحسن ثيابه، جديدة كانت أم مغسولة.
صلاة العيد
وقتها من ارتفاع الشمس مقدار رمح إلى الزوال، والسنة تعجيلها، تصلى في الصحارى، إلا في مكة أولضرورة كمطر أونحوه، تصلى في المسجد.
وهي ركعتان، يكبر في الأولى سبع تكبيرات يرفع يديه فيها، وقيل ست تكبيرات سوى تكبيرة الإحرام، وفي الثانية خمس تكبيرات سوى تكبيرة القيام، ويجهر بالقراءة فيهما، ويسن أن يقرأ فيهما بعد الفاتحة بقاف والقمر، أوبسبح والغاشية.
حكمها أنها فرض كفاية، وقيل سنة مؤكدة؛ ولها خطبتان كخطبتي الجمعة في الهيئة، فقط خطبتا العيد تفتتحان بالتكبير، يجلس بينهما؛ وخطبتا العيد بعد الصلاة، وإذا خطب قبل الصلاة أعاد، والاستماع لهما سنة.
السنة إخراج النساء حتى الحيَّض وذوات الخدور، إذا خرجن متحجبات غير متطيبات في صحبة محارمهن، وإذا اختل شرط من ذلك يحرم خروجهن، والسنة أن يخرج لصلاة العيد من طريق ويرجع من طريق آخر

تقبل الله، ويقول الراد كذلك: تقبل الله.
المعايدة
يجتهد المرء أن يصل والديه أولاً، ثم أقاربه، وأرحامه، وعامة المسلمين.
المحافظة على صلاة الجماعة، والذكر، وقراءة القرآن في أيام العيد.
الحرص على التصدق والإنفاق في أيام العيد.
التوسعة على العيال والأهل من غير إسراف.
ممارسة اللهو المباح للصغار والكبار.
أن يكثر من الدعاء لإخوانه المستضعفين من المسلمين.
رد الحقوق والمظالم إلى أهلها، أواستسماحهم.
العزم على التوبة.
الحرص على الطاعات التي تعودها في رمضان.
أيام العيد أيام أكل وشرب وذكر لله.
ما يجب على المسلم تجنبه في العيد
صيام يوم العيد، حيث يحرم صيامه.
مواصلة خصام ومقاطعة من كان مقاطعاً له من قبل.
الدخول على النساء الأجنبيات.
مصافحة النساء الأجنبيات، إذ المصاحفة حرام في العيد وغيره.
الاختلاط بالنساء.
تبرج النساء وسفورهن في الطرقات.
إحياء أيام العيد ولياليه بالحفلات الغنائية ونحوها.
ممارسة المحرمات كشرب الخمر، ولعب الميسر، والسماع، والموسيقى.
ضياع الوقت في اللعب بالورق ونحوه.
تجمع الرجال والنساء في بيوت حديثي الوفاة والبكاء والنحيب.
زيارة النساء للقبور.
إحياء ليلة العيد بالسماع الصوفي، والرقص والتواجد فيه.
تعييد بعض المريدين مع مشايخهم، وتركهم لأهلهم وذويهم.
الذهاب لزيارة مشايخ الطرق في العيد، والتوسل بالأحياء والأموات، ونحو ذلك.
ما يجب فعله بعد العيد
التعجيل بقضاء ما عليه من صيام أيام أفطرها في رمضان.
صيام ستة شوال.
يجتهد أن تكون حاله بعد رمضان كحاله في رمضان.
التعجيل بإخراج كفارة الإطعام طعاماً وليس نقداً.

تقبل الله منا ومنكم صالح الأعمال، والسلام