A Brief History of Islamic Economics

Posted by johnhouk on Nov 18, 2009
 Gary H. Johnson, Jr. has taken a theme of economics in Islam and has spun a remarkably easy to understand history of Islam that has led to what many today would call radical Islam. Johnson roughly begins before the birth of Mohammed and finishes in the present with a brief description of Shariah Compliant Finance.

Johnson brings clarity to the influence of Imam Taqi al Din Ahmad ibn Taymiya. Taymiya is the Muslim scholar most referenced by anti-jihadists who correctly expose the ultimate nature of Islam’s theo-political agenda. That nature is to spread an imperial cultural discipline globally securing compliance with the enforcement of Islam as superior to all ideology or religions that exist. To institute that superiority violence is the primary vehicle hence the aversion to Western civil rights.

Taymiya of the most conservative Islamic school of thought known as Hanbali is the major influence on an 18th century Muslim Arab Muhammad ibn ‘Abd al Wahhab. It is from al Wahhab that the term Wahhabi Islam has come into existence. Wahhabism is the Islam of Osama bin Laden and Saudi Arabia.

Johnson also provides the best explanation of the term Salafist as opposed Wahhabist I have ever read. Johnson’s essay is entitled, “A Brief History of Islamic Economics.” If you wish to understand about why Islam is inimical to the American Way, this essay is a fantastic first step.

JRH 11/18/09
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A Brief History of Islamic Economics

By Gary H. Johnson, Jr.
11/18/09 01:50 AM EDT
Red County

In the early 1980s, Muhammad Akram Khan of The Islamic Foundation wrote an essay entitled “Al Hisba and the Islamic Economy” in which he states, “The economic history of the Muslim people has not yet been chronicled in detail.” Instead of an accurate portrayal of the actual reality of Islam’s economy through the centuries, what Western readers find when studying commerce and trade in the hey-day of Islam is a romanticized and sanitized version of events with little substance on the nature of slavery, piracy, human rights abuses, wholesale genocides, or dhimmitude in the wake of multiple imperialistic jihadist conquests. Instead of these pesky details, historians and orientalists have focused on the cultural advances of Islam in the areas of of art, architecture, mathematics, engineering, logic and medicine.

Before Muhammad was born, the Great Marib Dam (of present day Yemen), whose irrigation system made the southern Arabian peninsula into an agricultural envy of the world, irreparably broke. The economic system of trade in the age before Muhammad was centered on this land of frankincense and myrrh, whose biblical notables included the Queen of Sheeba. The Arabs, without a central kingdom to stabilize their fortunes by providing a hub for settlement and commerce, were thrown into anarchy. Warring tribes, food shortages and water shortages led the Arabs to either band together in war parties or to separate into a nomadic herding existence. One such war party rode north to Mecca with a herd of armored elephants to claim the water rights of the area as well as control over the Kaaba. These warriors; however, were struck with a plague and forced to withdraw. Muslims call it the year of the Elephant, 570A.D. It was on that year Muhammad was born.

In virtually every history of Islam or biography of the prophet Muhammad, the economic world of Arabia in the sixth and seventh centuries is described in exactly the same way: Muhammad lived in a mercantile age. Inevitably, the scene-scape shifts to the caravan trade, the silk road, and the tribal sport of the bedoui – caravan raiding. However, no critical lens is placed on Mercantilism in these historic accounts.

Mercantilism holds that wealth is static – there is a finite amount of grain, gold, silver, salt, iron ore, land, people, etc. Whoever holds the most of a commodity, then, is in a position of power over the market. By extension, geopolitically, whichever power can extend its control over the most natural resources will be able to afford the biggest and most well equipped army and be in a position to tax the most trade routes. Imperialism, then, and colonialism by default, is born of a Mercantile understanding of finite wealth – as opposed to capitalism’s dynamic estimation of wealth via risk, invention and entrepreneurship.

Mecca, the home of the Kaaba, found itself in a powerful position after the fall of the Kingdom of Sa’aba to its south. The Kaaba housed 365 idols. 365 different religions were represented in its house in Muhammad’s day. The Quresh tribe was in control of the Kaaba. Muhammad’s clan members were the honorable caretakers of the Kaaba.

Idolatry, after the fall of Sa’aba was big business. Pilgrims from all over Arabia and beyond would travel along the caravan routes to pray at the Kaaba and relax in the multicultural crossroad. The idolatry of the region, then, supplied the elite tribes of Mecca with a healthy income and a steady diet of new technology and learning…and taxable revenues. Muhammad’s first encounter with his wife to be, Khadija (a wealthy widow) was as a commissioned caravan leader. Abu Bakr, Muhammad’s right hand man and second in command, was a wealthy central financier in the tribal caravan markets throughout the Arab world.

Muhammad’s claim to communication with god was nothing new in the region; however, the message of the early Meccan suras of the Koran called on its adherents to reject idolatry. Muhammad’s call to worship Allah, as the one and only true god, was met with serious resistance by the powerful elites, living fat off of the caravan trade – mainly out of a sense of economic self-defense. Idolatry, after all, was the chief draw of Mecca. In response to the perceived threat to the mercantile system of Mecca, then, Muslim converts were harassed, beaten, and eventually banished into a ghetto on the outskirts of Mecca, forbidden from accessing the main squares of trade. In this era of Islam’s infancy, the victim narrative is born.

After a decade of preaching and gathering converts from mostly the slave and outcast classes of Mecca, Muhammad was offered a Kingdom. The tribes of Medina (3 Jewish and 9Arab tribes) offered him a Kingship if he could come and mediate an end to the tribal disputes of the city-state. The message was betrayed, and the Quresh were alarmed at the prospect of a Muslim King in a neighboring city-state, so they tried to kill him. Muhammad’s escape is known as the Hegira (the flight). It marks the birth of the Islamic Empire and the beginning of the Muslim calendar.

In anger, the Quresh tribes tortured and imprisoned the Muslims who remained in Mecca. In addition, they looted the houses of the Muslims who fled to Medina. The Islamic injunctions which call for militant jihad were born in the Medinan suras of the Koran – and the first jihads were caravan raids inspired by Allah and designed by Muhammad to recoup losses of Muslim property. Soon, the Jewish tribes realized the supremacist vein in Muhammad, and attempted to work with outside tribes to overthrow Muhammad – and they were savagely butchered for their hypocrisy. Within a decade, all of Arabia submitted to Islam’s jihad. Muhammad’s military might swelled to over ten thousand men.

Upon Muhammad’s death, Abu Bakr took the helm as the caliph, and he embarked upon the Ridda wars, utilizing his unique tribal knowledge to forge and solidify alliances, killing all apostates in Arabia who reverted to idolatry. The age of Umar followed, Jerusalem fell in short order, and within a hundred years, Islam controlled all of North Africa, present day Syria, Iraq, and Iran. In the process, the religion had split over the succession rights of Ali and his sons to the rank of caliph – Shiism was born at Karbala.

By the 8th century, seafaring Muslim Pirates were raiding the lands of the Mediterranean with abandon, taking entire islands by force, pillaging the North African Coast, and finding stiff resistance on Europe’s Southern edge, finally breaking through in Spain. Muslim dominance in the Mediterranean would not be broken, ironically, until the Crusades brought European Pirates from Northern Europe to the Mediterranean with a writ from the Catholic Church to wipe away the Moorish, Turk, and Saracen presence by force of arms.

By 900 A.D., the Islamic scholars solidified the dogma of Islam, closing the gates of ijtihad (reasoned interpretation of the meanings of Allah’s commandments and Muhammad’s deeds). The Koran was not chronological, so the Hadith (the traditional sayings and actions of the prophet) were collected around the empire and placed into a canon of literature with varying degrees of accepted legitimacy. The Sira, or biography of Muhammad was also placed into a set mold. The Koran, Hadith, and Sira are considered the Islamic Trilogy – without all three, the context of Islam’s teachings is considered incomplete. Along with the Islamic Trilogy, the ijma (or consensus of fiqh scholars) was put into place and the schools of Islam broke into five or six main schools of thought. Shariah Law is born from these 4 institutional legs of Islam, and is found in local, cultural, national, regional, school-wide, and sect-wide applications, today.

By the turn of the first millennium, Islam’s empire had expanded to Morocco and up into Spain in the West, India and China in the East, and upwards into the Turkic peninsula. Moreover, the Mediterranean was crawling with pirates, the slave trade was booming; yet, for some reason no Western history texts enlighten as to the nature of the economic realities of this imperialistic expansion by the sword. The Crusades were launched principally in response to the barbarous activities of the Mediterranean by Muslim pirates, who were now praying on merchant ships instead of camel caravans. The Catholic Church in Rome was being squeezed from the West by the Spanish Moors and from the East by an ever advancing horde of Muslim warriors, seeking to breach the defenses of Constantinople. Jerusalem was a rallying cry, and for 400 years, knights and templar pirates and mercenaries and warrior monks and peasants would rise against and break against the Muslim soldiers along the King’s Highway, sometimes taking the ground, and at other times retreating in disarray and defeat.

Signs of Muslim advance were everywhere through the 13th century – virtually all of central Asia region had been conquered; however, decline set in as Muslim armies locked into the process of fighting countless inner turmoil wars. It was in this setting that Imam Taqi al Din Ahmad ibn Taymiya was born. Known as the Sheikh of Sheikhs in Islam, all schools of Muslim thought revere ibn Taymiya as an authentic spokesman of the faith. When considering the decline of Islam, ibn Taymiya, a Hanbali scholar who traveled (as a Sufi Pir) throughout most of the Muslim empire in search of new learning, decided that the Muslim world had fallen away from Muhammad’s deen, the straight path, and had, after 500 years, failed to meet the first principles of the golden age of the first 4 caliphs…and set about the process of instilling a fundamentalist revivalism throughout the Islamic empire of his day with his ijtihad, breaking the old accepted norms of dogmatic Islam.

Known chiefly in the West for his treatises on political Islam and defense of militant jihad as a defensive mechanism, ibn Taymiya’s most powerful treatise is actually “The Institution of the Hisba” which is based on Islamic Economics and Islamic Ethics. Today, roughly 8 of ibn Taymiya’s treatises have yet to be translated into English. The treatise focuses on the Public Duties of Islam as relating to trade, prayer, knowledge, and capacity – it is perhaps the fullest exposition of the Muslim ethos and the Islamic Supremacist mentality ever written.

So powerful were ibn Taymiya’s ideas that in the early 1700s, a religious scholar in Arabia named Muhammad ibn ‘Abd al Wahhab spent hours upon hours transcribing his work. Wahhab travelled to the main holy lands of Islam and studied with various scholars, and settled in the Najd region of Arabia and found influence with a local chieftain who allowed him to implement his revivalist reforms on the area; however, the local chieftain was forced to expel Wahhab because his teachings were so radical. Soon, Wahhab struck an alliance with the wily Muhammad ibn Saud. The modern face of Saudi Arabia would be built on the blood of the Wahhab/Saud axis.

Today, followers of Wahhab prefer to call themselves Salafists (the Salaf are the first four rightly guided caliphs). Most modern Islamic fundamentalism springs from Wahhabism’s fundamentalist interpretation of Islam via ibn Taymiya. The roots of Al Qaeda and the Taliban in Central Asia actually find their ancestors affected by Wahhabism by the late 1700s…when the Deoband-Wahhab nexus was spawned, leading to an anti-British uprising throughout the Khyber Pass and on into India. The Muslim Brotherhood, Jamaat al Islami, and a score of other modern jihadist organizations owe their interpretations of jihad and ethics to Wahhabism. Since the 1970s oil embargo, Saudi Arabia has been exporting Salafist doctrine, heavily tainted with Wahhabist inspired teachings. According to some experts, over 20 of these schools officially exist in the United States of America, the most visible of which is located in the Washington D.C. area, under the scrutiny of Act! for America’s Northern Virginia/DC chapter headed by Catherine Martin.

By the 1700s, European Colonialism had, with the aid of technological advances in seafaring, circumnavigated the globe in an effort to bypass the dangers and Muslim taxation along the Silk Road to India. British, French, Dutch, and Portuguese sailors, with the aid of armed mariners loyal to the crowns and flags of Europe set out on multiple voyages to establish outposts all around the world, where trade by sea could be developed. In so doing, Europe, in the throes of countless inner turmoil wars of territory and religion, developed a new method of commerce based on pure risk. The sea was an unforgiving highway, filled with storms and marauding bandits and disease. The new method was based on stock shares. Investors would pool resources to fund a voyage and to provide capital to purchase raw materials, which local merchants would then purchase at the tail end of a voyage. The profits were then distributed based on a share in stock purchased by investors. This methodology gave rise to a mercantile stock market based on speculation and a need for protection for the investors. Stock certificates could be traded and exchanged. Fortunes were lost and made on the stock market, and investment firms rose based on the level of protection their vessels were guaranteed.

Since the primary trade routes were to the Mediterranean Sea and heavy interaction with Muslim controlled waters, the nation states of Europe devised a new system – the pass port. Passing safely from port to port in the Mediterranean was based, by the 1700s, on a system of bribery. Muslim leaders called pashas and beys, whose territory abutted the Mediterranean, from Morocco to Turkey, raised pirate fleets to protect their shores. These pirate fleets then trolled the Mediterranean Sea in search of unprotected merchant vessels. Protection was purchased by the nation-states of Europe, whose diplomats would travel to meet with the Pashas and pay them a protection duty to allow merchant ships with documentation showing they were protected citizens to pass freely from port to port in the Mediterranean. This was the diplomatic method of the 1700s, and each nation-state submitted to the methodology of the pass port system, establishing diplomatic ties with all of the pashas and beys of the region to guarantee their citizenry would be able to travel safely, without pirate attack. When merchant ships not traveling under the protection tax were confronted by the pirate patrols, their cargo was forfeit and their citizens imprisoned. The imprisoned passengers were then held for ransom. If a ransom was not paid, the prisoners were sold into slavery. The slave market was running strong in the Muslim World, and the prospect of enslavement caused European diplomats to work over-time to affect the release of prisoners by loading pashas with extravagant bribes. This system had many problems, including renegade pirates, who attacked unsuspecting merchant ships without protection, and diplomatic envoys failing to recognize the need to establish passport protection with small pirate fleet patrols, not to mention the greed of pashas and beys who would direct their fleets to waylay marooned or distressed vessels.

By the birth of the United States of America, the pass port system was a culturally accepted reality in the trade circles of the Mediterranean. Thinkers like Benjamin Franklin, who had traveled extensively to Europe throughout the Revolution, declared the need to abolish slavery or fight over it later, after seeing how the system of slavery and piracy spawned out of the Barbary coasts of Islam had shaped Europe’s statecraft.

Following the American Revolution, the colonial ships of America were no longer under the protection of the British Crown’s diplomatic agreements. With a 3,000 mile Atlantic voyage, the newly independent American vessels, dripping with raw goods for trade and heavy with wealthy passengers, were too juicy for the Pirates of the Barbary to resist. American vessels were systematically attacked, their cargos seized, their crews imprisoned, and ransoms demanded.

The United States of America, founded on a capitalist ethic, rejected the passport system. American diplomats were sent to the region to affect the release of prisoners; however, the exorbitant system of bribery was appalling to the newly independent nation’s leaders.

As a result of America’s rejection of Islamic dominance over the ports of the Mediterranean, between 1800 and 1830, the United States fought a war with the Barbary Pirates, determined to break the system of forced taxation at the hands of bandits and thieves. America, under the guidance of Thomas Jefferson, was the first nation-state to refuse to submit to Shariah Law’s pirate jihads and the guiding ethics which allowed the practice.

The system of slavery was then attacked by abolitionists in the academic and political circles of America, due to the pirate origins of its barbarous past. And by 1863, in the middle of our own civil war, Abraham Lincoln abolished slavery. It took Saudi Arabia 99 years to come to the same conclusion and officially abolish the practice, though unofficially the practice remains.

The United States of America was born as a complete rejection of Colonialist Mercantilism and Shariah Law’s Piracy. The United States of America rejected slavery. And throughout its history, individual rights and industrial capitalism have squared off with the practice of imperial expansion, earning it complete dominance of the seas by the turn of the 20th century.

The history of Islam’s jihad conquests and their territorial advances and application of Shariah Law are not well documented in English texts. History is generally taught in terms of Western Civ., leaving the oriental cultures of the East to a more involved and advanced form of study found in collegiate environments. This academic/collegiate history of the Orient has focused on an anthropological interpretation of greater and lesser powers formed around the archeological record rather than source documents from the halls of the Muslim record.

By the turn of the 20th Century, the leading Western thinkers on the orient, known as Orientalists, focused on linguistics and available documents and traveled to the regions they were focusing on to accompany archeological digs and to find available information. This research occurred as World War I and World War II changed the face of the region and the accepted borders of the MENA territories. Three events transformed the world – (1) the abolition of the Caliphate by Ataturk in Turkey in 1924, which devastated the Muslim World and caused multiple schisms due to power struggles unreported in the West and gave leave to the House of Saud to claim the seat of power as the keeper of the two holy cities; (2) the creation of the Jewish homeland of Israel by the UN in 1947, which the Muslim World perceived as an attempt to establish a Western beachhead in the heart of the Muslim World, causing the surrounding Muslim states to lay siege to Jerusalem in an all out war to reclaim the third most holy city in Islam from Western control; and (3) the creation of the Islamic State of Pakistan the same year, resulting in a war between Hindus and Muslims and ultimately witnessing America’s brash role in the creation of an International Jihad to defeat Communism.

It was not until the 1950s that the maps we currently know were established. Advances in archeology, anthropology, linguistics, and state run institutions in the new “oriental” nations of Islam worked to gather as much information as possible about the reigns of Shahs and Imams and Emirs and Khans and Caliphs, attempting to break through the information chasm in the West; however, the economic realities and human rights records of the lands were not a priority in the research. Little focus was paid to the norms of Shariah Law or the application of Shariah Law in the realms of slavery, dhimmitude, politics, sharecropping or trade. The focus instead was on the cultural triumphs of the region and the uncommon marvels of mathematics, engineering, medicine, architecture, art, prose, and poetry bestowed to the West by the tribes and empires of the East. A “what did Islam contribute?” attitude prevailed. The “what did Islam steal?” attitude never surfaces.

In the 1950s and 1960s, Western companies traveled to the Middle East and South Asia with the aim of increasing trade and providing famine relief, building dams and canals in Afghanistan, and entire cities in Saudi Arabia and Iran for the express purpose of building pipelines and railways for differing geopolitical aims. Companies like Aramco and Bechtel led the way. As the 1960s closed, the world began to shrink as technology advanced, and further Western interest in the cultures of the East ramped up with the help of the experimental drug culture in America. Marijuana and Opium were plentiful in the region, from Morocco to Indonesia, and with the focus of former students of the Free Speech generation now in professorial positions, and with the failures of Vietnam, driving interest in the orient, the Western world began to cross pollinate with the academic communities of North Africa, the Middle East and South Asia. It is little surprise then, that the late 1960s, all of the 1970s and early 1980s found a wave of marijuana and heroin washing on America’s shores from the Hindu Kush.

The Oil embargo of the 1970s and the creation of OPEC caused the price of oil to shoot up, all American owned companies in the region were nationalized, and the Sheikhs and Kings of the new found states were suddenly awash in Oil wealth. Saudi Arabia immediately embarked on a program of exporting Wahhabist literature throughout the world, paying scholars to travel to every corner of the world to establish madrassas and mosques with the largesse of Saudi Sovereign Wealth Funds. Universities sprang up throughout the Middle East with Wahhabist themes. In 1979, the world changed yet again…Iran was overcome with a Shia Revolution, Afghanistan, which had a Communist leadership in Kabul was invaded by Russia, and Pakistan became the frontline state of the Western world, attempting to hold back Russia’s advance in the throes of a Cold War. It was upon this stage that American diplomacy made a fateful choice to help launch an international jihad against the communist geopolitical pressures of the USSR.

The history of Shariah Compliant Finance, as it is practiced today, finds its roots in the center of this tumultuous time. Shariah Compliant Finance is not new. It is a force that has been gathering steam for 30 years, receiving infusions of cash and political backing slowly but surely through a variety of channels. The history of Shariah Compliant Finance and modern Islamic Supremacism and jihadist radicalism are inextricably linked.
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