I was looking at this article.
http://www.ideasinactiontv.com/tcs_daily/2006/06/islamocapitalism.html
I think some muslims (I, for one) would disagree with a few contentions.
1. The article claims that zakat (a central tenet of islamic faith) is a voluntary act of charity. But there is strong and widespread opinion prevalent in muslim world to the contrary. They claim that the phrase in the quran "should be taken" implies organized collection by the state, rather then it be left on individual philanthropic disposition.
The crucial difference from modern taxation, however, is that it is a "static wealth" tax, rather than an income tax. The idea is to promote business and trading activity, by taxing that portion of your wealth which is just "lying there" doing nothing. On money invested in business, as well as on ur income, there is no zakat.
2. The article also claims that While Islamic banking allows capitalism without interest, some Muslims go further and ask whether riba really includes reasonable interest. This statement, though technically true, is quite misleading. The view that "reasonable interest" is permitted is really a very minority view, and the over all thrust of islamic banking is not towards accomodating such "reasonable" interest, but only developing alternate mechanisms which completely eliminate interest.
Infact, there is also a large number of people (commoners as well as scholars) who are skeptical of the whole islamic banking thing, consider it an oxymoron, like a circular square. Islamic banking, in their view (as well as mine) is merely a facade completely forgoing the fundamental objective of zakat prohibition: Prevent capital from financing itself and increasing its own self, but to actually go back to what it was supposed to do: Generate business and "hard" profits through real economic activity. When capital is no longer able to increase itself by paper transactions (interest), then it will flow to financing real world projects that make a difference and produce goods and services.
3. Based on this different view of blanket prohibition of interest, (also a primary motivation behind the gold dinar movement), lots of western financial institutions and their activities come in clash with islamic principles, in this limited respect, it can be safely said that islamic is anti-capitalism (the kind of capitalism prevalent in the west).
4. However I fully agree with the conclusion that islam is pro-free market, and pro-trade, and considers and it is actually its obsession with production and commerical activity that it seeks to prohibit interest so it can make capital flow to the former channel for seeking its appreciation.
Asif Shiraz
www.goldmoneyshop.com
