Rising Islamism and (Bad) Islamic Economics

Any keen observer of the Islamic world must see this. Islamism is on the rise, first and foremost in terms of identity politics of the Muslim masses. Other forms of identity have failed, and have been abandoned by the masses: Arab nationalism and socialism of Nasser and the Ba`th; ancient nationalism such as Pharonic Egypt, Babylonian Iraq, Phoenecian Lebanon, and Cyrus's Persia, etc.; and globalized westernism. Elements of all three tendencies continue, of course, but they are constantly being pushed to the margins, as a new brand of Islamism is on the rise.

When they think of rising Islamism, people (and governments) in the west tend to think mainly of violent "jihadists", as they like to call them, but that is far from accurate. My own casual observation identifies mainly two groups. The first is a group who adopt the appearance of religiosity, in dress, language, etc., but retain a true identity that is some mixture of the three aforementioned (non-Islamist) tendencies. This includes people who use religion to advance their economic objectives, or simply to fit into an increasingly religious society.

The second group is much more interesting, but it appears to be suffering an identity crisis. They seek to live according to an Islamic ideal, but quickly discover that the Islamic ideal is largely fictional. This group includes well-meaning Muslims who turn to religious studies, only to discover the irrelevance and corruption of what they had considered scholarly circles. It includes MBA-holders who decide to get into "Islamic finance", only to discover that it is a racket for enriching cynical English bankers and lawyers, along with some corrupt, gullible, or greedy Muslims.

Most importantly, the second group includes most of the masses in Egypt, Pakistan, Indonesia, Malaysia, Turkey, and elsewhere, who would like to embrace the slogan "Islam is the solution", but fail to see how that solution would work in reality. This is the greatest failure of the school of thought generally known as "Islamic Economics", which sought to develop an understanding of Political Economy from "an Islamic perspective".

Timur Kuran has written a lot about this school of thought and its failures (most of those writings were reproduced in his recent book Islam and Mammon). Timur's conclusion is that the historical and intellectual record of "Islamic economics" illustrates that Islamism has also failed. It is definitely true that the brand of mid-Twentieth Century Islamism, which is still unfortunately marketed by most formal Islamic organizations, including the Islamic Development Bank and others, have indeed failed, and failed miserably, especially in the countries where it was taken most seriously -- Pakistan, Iran and Sudan.

However, if we are interested in real economic development in the Islamic world (beyond just pumping oil and gas, erecting buildings, and selling cell phones), we cannot dismiss the rising wave of Islamism. Indeed, religious inclinations can serve as a greater social bond for a new social contract than any nationalism or western materialism.

The difficulty is this: to find or develop and workable "Islamic solution", one must abandon historical and pietist utopianism. Islamic history, from its earliest days, has never painted a rosy picture. Islamic societies prospered when they were open to learning from others: Sassanid, Byzantine, etc. The famous Prophetic tradition said: "seek knowledge (`ilm), even [if you have to go to] China", and yet our young still seek knowledge (`ilm) only by going to Saudi Arabia, Pakistan, or Egypt, centuries after the Islamic world ceased to be a main depositary of knowledge.

The result is "Islamic finance", "Islamic jeans", and "Islamic Cola", along with satellite channels that broadcast feel good televangelist speeches about Islam, and broadcasting songs about Hijab and the Prophet in between MTV-style videoclips. This pattern cannot satisfy the increasing Islamist sentiment for long. Suspicions about the Muslim Brotherhood, Hamas, and other political Islamist groups notwithstanding, it seems almost inevitable that the growing wave of Islamism will bring a wave of political Islamists to power throughout the region.

The choice is most likely restricted to one of three scenarios:

(1) If they use the current pietist/historical brands of Islamism, those Islamist groups will fail, just like their predecessors did in Pakistan, Iran, and Sudan. Advocates of western capitalism will point to that failure to advocate abanadoning the Islamist identity. The Islamists will increase in their opposition to western capitalism, arguing that the fault was not with the ideal, but with its implementation. The rift between the two groups grows until every country in the region looks like Turkey.

(2) Some may follow the Erdogan route, but that is really just western capitalism dressed in Islamist garb, and thus unlikely to serve any long-term socioeconomic goals. In the meantime, as we learned from the recent Turkish presidency campaign fallout, the secularists will not allow even some token symbolic victories to Islamists. To survive, the Islamists must make more compromises to prove that they are "moderates", but they will only be tolerated if they become effectively more secularist than the secularists.

(3) A new definition of Islamic-democratic political economy emerges. It is not clear that Muslims have the requisite political and intellectual human capital to develop such a paradigm over the course of few decades. Daunting as the task may be, this seems to be the least painful of the available options, and the one most conducive to bona fide economic and social development in the short to medium term.