Alexander Hitchens has an article at Standpoint, in which he argues that ‘Islamic banking’ structures should be resisted, because they are essentially a device employed by Islamists to bolster their control over Muslims, who are made to feel guilty if they do not buy these financial products:
The first detailed and comprehensive argument for the creation of a sharia-based financial system was articulated by the Pakistani journalist and thinker Sayyid Abul-ala Mawdudi (1903-1979), one of the godfathers of modern jihad and the founder of the Jamaat e-Islami (JI). For Mawdudi, the answer to the perceived ills of Muslims around the world was to be found in a return to the days of Muhammad. He identified western concepts, particularly secular liberal democracy, as an existential threat to the umma (the worldwide Muslim population, conceptualised as a monolithic political bloc) and his answer was twofold. First, Muslims had to identify themselves first and foremost by their religion and therefore separate and isolate themselves from the “unbelievers”. Second, Muslims had to engage in jihad to reclaim formerly “Islamic lands” and eventually establish global supremacy. Mawdudi believed that Islamic finance was one of the essential cogs of a totalitarian Islamic state.
He goes on to show that some of the most obnoxious Islamists are also enthusiastic promoters of Sharia banking. I have to say, that surprises me little. However, I think I would need more that this in order to accept that any ‘Islamic banking’ practice was fatally tainted by this coincidence.
Some time ago, I saw it argued that Sharia banking was being used as a device through which to fund Islamist politics. There was little evidence for this assertion in the article itself, so I searched around to see if there was any real pattern of clerics attached to Islamist political parties ‘blessing’ particular Sharia products. I found a few: but I also found that the overwhelming majority of ‘consultant theologians’ to sukuks and the like, were ordinary vanilla clerics. Most were pretty conservative, but very few could really be described as radicals.
Certainly, there are many reasonable criticisms one might make of Islamic banking. It is an example of one of the many self-denying ordinances that many religions encourage their followers to adopt, to no particularly good end. It presents another opportunity for clerics to enrich themselves by peddling nonsense. The products themselves are not obviously ‘ethical’: or at least as conventionally ‘ethical’ as – say – the Co-Op’s range of goodies.
Yes, there is hocus pocus and hypocrisy to the reasoning that underpins them. How different from, say, credit default swaps which are eminently sensible things which all financial institutions ought to invest in, heavily…
Alexander is right to point out that, in the United Kingdom, there are many vocal supporters of Sharia banking who are also Islamists. But was Mawdudi’s vision of an Islamic banking system really such a radical innovation? Are he, and his followers, really the only Muslims who would rather not put their money into companies which gamble or what have you? There is a prohibition on usury in Islam, and I would imagine that some Muslims at least might like to use products that don’t involve haram practices. Their wish to do so doesn’t make them Islamists, even though Islamists and jihadists might also favour use of such practices.
Put it this way. No doubt, the pro-terrorist Rabbi Meir Kahane would have taken the view that Jews should keep kosher. That doesn’t mean that the Beth Din is a branch of Kach.
In Britain, of course, the issue of usury has been long bound up with antisemitism and – depressingly – the murder of Jews. It is well known that in the 12th century in this country, Jews were prohibited from most occupations, but permitted to lend at interest. Indeed, there are some who argue that the concept of the ‘mortgage’ – a notion at least as artificial as murabaha or ijara – was invented by Jews. If you want to get conspiracist about it, there’s a snippet from a book, here, by Christopher Tyerman which details a particular mortgage contract raised by a certain Humphrey of Earlham, to finance his trip to the Crusades. Tyerman goes on to note that the men who lead the massacre of Jews in York, then destroyed all the mortgage deeds they could find, and traipsed off on the Crusades where they killed as many Muslims, Jews, Cathars, and Christians-with-stuff-worth-stealing as they could find.
Nevertheless, despite this miserable history, and despite the sub-prime crisis, there is still something to be said for the good old fashioned, bog standard mortgage: Sharia compliant or not.