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M. Bakri Musa

Seeing Malaysia My Way

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Location: Morgan Hill, California, United States

Malaysian-born Bakri Musa writes frequently on issues affecting his native land. His essays have appeared in the Far Eastern Economic Review, Asiaweek, International Herald Tribune, Education Quarterly, SIngapore's Straits Times, and The New Straits Times. His commentary has aired on National Public Radio's Marketplace. His regular column Seeing It My Way appears in Malaysiakini. Bakri is also a regular contributor to th eSun (Malaysia). He has previously written "The Malay Dilemma Revisited: Race Dynamics in Modern Malaysia" as well as "Malaysia in the Era of Globalization," "An Education System Worthy of Malaysia," "Seeing Malaysia My Way," and "With Love, From Malaysia." Bakri's day job (and frequently night time too!) is as a surgeon in private practice in Silicon Valley, California. He and his wife Karen live on a ranch in Morgan Hill. This website is updated twice a week on Sundays and Wednesdays at 5 PM California time.

Sunday, October 07, 2018

Religious Barriers To malay Participation In Commerce

Religious Barriers To Malay Participation In Commerce
M. Bakri Musa

Third of Four Parts

It is the supreme irony that Islam, a faith started by a trader, would today consider capitalism and trading “un-Islamic.” Islam and trading have always gone hand in hand. That was how the faith entered the Malay world.

This hostile turn began during colonization, not surprisingly, with our equating capitalism with colonialism and the West. It accelerated when Edward Said’s Orientalism led Muslim scholars to the fad of “Islamization of Knowledge” in the mistaken belief that there is a uniquely Islamic version of it. Again no surprise there as the vast new knowledge that emerged then (or now) came from the West.

Those scholars ignored this centrality of Islam. That is, all knowledge comes from Allah. As to why He chose to impart the insight on the concept of zero onto a Hindu, the secret of gun powder to a Chinese, and the causative agent of polio to a Jew is not for us to question but to learn and benefit. Early Muslims learned from and later added the body of knowledge of the ancient Greeks. And those Greeks were atheists and polytheists, the kafirof kafirsas it were!
A pernicious product of this Islamization fad is Islamic economics, with Islamic banking its most malignant manifestation. In his voluminous critique of socialism and capitalism, Iktisaduna(Our Economics), the Shiite Iraqi scholar Baqir al-Sadr tried vainly to pave a third choice, or what he thought to be one.

The consequence to Sadr’s thinking is that today millions of Muslims are paying unnecessarily more, in many cases considerably more, for their banking and other financing needs. The other is that the vast majority of Muslims, including those in his native oil-rich Iraq, are still trapped in abject poverty.

Meanwhile across the continent, Deng Xiaoping, no intellectual, was consumed not with finding a “third way” but with emancipating his people out of poverty. He adopted Western capitalism, tweaked its evident weaknesses, and labelled it “capitalism with Chinese characteristics.” Never mind that his version of capitalism had non-existent personal property rights or had massive state intervention in the marketplace. Nonetheless with that he lifted hundreds of millions of Chinese out of poverty in just one generation. That is unprecedented in human history. That remarkable success story is not over yet.

The essence of Deng’s strategy? Engaging his people in trade, including and especially with China’s hitherto archenemy, America, reminiscent of what Prophet Mohammad, s.a.w., did in early Medina. Deng’s other genius, no less monumental, was that he succeeded in persuading his people to adopt capitalism, a full 180-degree turn in belief! By contrast, for Muslims to adopt capitalism would be less daunting.

Deng’s acceptance of capitalism was remarkable for yet another reason. Like Muslims, the Chinese too had been humiliated by the West. Thus they could be excused had they rejected anything Western.

The biggest single stumbling block to Muslims’ acceptance of capitalism is ribaa. No other word, Arabic or in any other language, has caused so much misery to so many and for so long. Ribaais haram; the Koran and hadith said so in no uncertain terms. However, just because some semiliterate-in-English medieval scholars translated ribaaas interest is no reason for Muslims today to be trapped by that interpretation. Words change meaning with time, usage, and culture.

Borrowings during the prophet’s time were exclusively between individuals, and with rates that today would be considered extortionate. Failure to repay would consign you and your progenies to perpetual servitude. In contrast, with today’s capitalism loans are rarely between individuals but between them and banks or other institutions, and between corporations. Meanwhile debtors’ prisons went away in the 19thCentury. The worst penalty for a debtor today would be bankruptcy. It would be folly both conceptually and operationally to equate ribaa of the prophet’s time to today’s interest.

Muslim scholars make much ado about the equal sharing of risks between lender and borrower to be “Syariah-compliant.” To think that a borrower with a $100K mortgage from the billion-dollar-asset Maybank would be sharing the same or equal risk is laughable if not the height of stupidity. To the borrower, that loan is his entire savings; to Maybank, a minor ledger entry. Some equality!

A few years ago a Muslim couple had such a mortgage with an Islamic bank. Later when they wanted to pay it off, the Bank forced them to prepayallthe anticipated interests of the loan to maturity! Only with the wisdom of a non-Muslim judge in a civil court did the couple prevail. The deafening silence of Muslim jurists, scholars, bankers, and economists to this gross affront to simple justice, if not broad daylight robbery, was stunning. They still are silent.

To me, interest reflects and factors in the two universalities of life. One, a dollar (or dinar) today is worth more than one promisedtomorrow. The economist’s “time value of money” is part of that, quite apart from the fact that the money could depreciate in value through inflation and or devaluation.

Then consider this. When I borrow a dollar or a pot of rice, I deprive my lender of its use. So in lending, the lender is granting me his goodwill, in addition to and quite apart from the rice or dollar. Neither the Koran nor hadith considers lending to be a meritorious act; there is no command that we should lend to others. So when I return only what I have borrowed, I have not reciprocated the lender’s goodwill. To do that you have to add something extra. Interest can be construed as the lender returning the borrower’s kindheartedness in lending to him.

In the old village when we borrowed a pot of rice from the neighbor, on returning it, we would always include something extra, to reciprocate or express our appreciation of the neighbor’s goodwill. If nothing else, that would encourage the lender to continue lending in the future! Interest is thus goodwill monetized.

The other universality is that we are not all honorable, and that include borrowers. Some would renege on their debts. Interest could thus be viewed as the honest borrowers’ share to cover the cost of those irresponsible.

Credit is the vital air of the system of modern commerce. It has done more, a thousand times, to enrich nations, than all the mines of all the world, wrote Daniel Webster. Borrowing is the flip side of credit.

Islam is consistent with and supportive of the ideals and practices of capitalism. One certitude is this: Islam cannot be supportive of atheistic communism or its close cousin, socialism. The egalitarian ideals of socialism may appeal to Muslims and could be construed as Islamic. On closer reading, equality is not the ideal of Islam; indeed that would be against human nature. Allah in his wisdom has created us in all our diversities, with different skin colors, speaking different languages, and having diverse cultures. He has also endowed each of us with different talents and abilities.

Islam emphasizes justice, not equality. We cannot treat an orphan in the same or “equal” manner as the son of the privileged. That would be the height of injustice. There is no greater inequality, to paraphrase Justice Oliver Wendell Holmes, than the equal treatment of the unequal.
It is a perversity andtragedy that no Muslim nation is in the top ten based on the “Islamicity Index.” In capitalist America, the poor and elderly get free healthcare . . . in the most expensive system! Finland has guaranteed minimum income.

The path to raising Malaysia’s (and thus Malays’) standard of living as well as increasing our Islamicity Index is to emulate Finland and New Zealand, not Iran or Saudi Arabia. Embrace capitalism. Be like the Mainland Chinese! Don’t bother with Islamizing economics, the banking system, or capitalism. Adopt, adapt, and imbue it with Islamic attributes. Commerce has been part of Islam since its inception. Hajj, Islam’s holiest time, is associated with intense commerce. In Malaysia, during Ramadan many Muslim traders coming out of the woodwork. Why not nurture that to be year round?

Why waste your effort trying to invent a third “pure” path?

Next:  Last of Four Parts:  Soft Barriers to Malay Participation In Commere

Based on the author’s book, Liberating The Malay Mind. Its updated and American edition will be released next month.


Anonymous Anonymous said...

Your should cut and repair your own brain instead, msian gone to the dogs that take hundred year to repair. msia gone backward governs by retarded 'uturn' 'rounabout' ministers

9:32 PM  

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