Israr Ahmad on Revival of Islam

Islamic Renaissance seeks to rejuvenate Islamic ideals, practices, and societal structures. Dr. Israr Ahmad’s monograph, “Islamic Renaissance: The Real Task Ahead,” delves into why many Islamic revival movements have fallen short and how to correct these missteps for a true renaissance. In particular, Dr Israr Ahmad argues that the real task facing the Islamic Civilization is to meet the intellectual challenge created by Western academic achievements over the past few centuries. For a copy of the original book in Urdu, together with its English translation, see: Islamic Renaissance: The Real Task Ahead“

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1. Global Domination of Western Thought

The Western philosophical dominance has shaped global views, promoting concrete facts and physical phenomena while sidelining spiritual and transcendental concepts. This shift has impacted political, social, and cultural realms worldwide, influencing not just Western societies but also Islamic ones.

2. Western Onslaught on the Islamic World

The Western invasion of the Islamic world was not merely political but also ideological and cultural. The influence of Western ideologies led to the adoption of secularization and materialism within the Islamic world. Early attempts to resist this onslaught ranged from defensive postures to outright compromise.

3. Western Thought’s Influence on Islamic Revival

One of the key issues with contemporary Islamic revival movements is their assimilation of Western ideologies. These movements tend to focus on external aspects of Islam, such as political and social systems, adopting a Western-influenced framework while neglecting the spiritual essence at the heart of Islam. This misunderstanding leads to a superficial interpretation of Islamic principles, often reducing Islam to a set of social and political systems without the necessary spiritual foundation.

4. The Error in Interpretation of Islam

Dr. Ahmad asserts that many revivalist movements have fallen into the trap of secularization and materialism, emphasizing political and societal structures at the expense of spiritual depth. These movements often fail to stress the inner spiritual life that is central to Islamic belief. As a result, the essence of Islam is compromised, with revivalist efforts becoming more about social and political activism than about cultivating a deep, inward connection with God.

5. Revitalization of Faith: The Necessary Precondition

For an Islamic renaissance to be genuine, there must be a revitalization of faith (Iman). This requires moving beyond superficial affirmations of belief to a profound, existential faith. The focus must shift from a materialistic interpretation of Islam to a spiritual one, emphasizing the inner journey and communion with God.

6. A Blueprint for Action

Dr. Ahmad proposes a blueprint for achieving an authentic Islamic renaissance. The first step is establishing an organization dedicated to reviving faith and spreading the Qur’anic message. This step aims to correct the materialistic focus of previous revival movements. The second step involves creating a Qur’anic research academy to foster rigorous academic study while encouraging a deeper spiritual understanding of Islam.

7. Conclusion

Dr. Ahmad’s vision for an Islamic renaissance acknowledges that many revival movements have been compromised by Western thought. To correct this, he advocates for a return to the spiritual core of Islam, emphasizing faith, devotion, and a closer relationship with God. By addressing the shortcomings of previous movements and focusing on spiritual revitalization, a true Islamic renaissance can be realized.

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This summary explains how Western thought has influenced Islamic revival movements, leading to a misunderstanding of what is required for a genuine Islamic renaissance. It emphasizes the need for a deeper spiritual connection to correct this misunderstanding and achieve a true revival. For a deeper and detailed discussion, please see the original monograph in urdu (with English translations) at: Islamic Renaissance: The Real Task Ahead.

Decolonization of Education: An Islamic Perspective

{tinyurl.com/AZdeco} A talk on above topic was delivered at Institute of Policy Studies, Islamabad, on 23rd Feb 2024. The ZOOM video of original talk, in urdu, is given here: Decolonization of Education. The slides were re-recorded in English, and this video is linked below. It is followed by a writeup which is loosely based on the talk, but goes beyond it, and also provides links and references to additional materials relevant to the themes pursued in the talk. This writeup was done by researchers from IPS with feedback from me, and is available on the IPS website also.

Diverse Approaches To Islamic Revival

There is a broad consensus that Muslims have been going through a phase of decline, disintegration, and loss of direction. However, there are sharp disagreements and a wide variety of alternative opinions on the causes of this decline. The rise of the West created by global colonization has led to the domination of Eurocentric worldviews, which glorify the West as the most advanced civilization. Muslims influenced by this worldview argue that democracy, secularism, and capitalism constitute the only recipe for a better life. Another faction sees the conflicts between Islamic ideals and Western social institutions, and attributes Western success to their spectacular progress in science and technology. This group argues that Muslims must acquire Western science and technology while retaining Islamic identities and culture to progress.

In contrast to those who see development as following the leadership of the West, a sizeable group of Muslims considers the final revelation of God to mankind to be of central importance for guiding us out of our current darkness into light. Among this group, there are sharp differences when it comes to details. Some people stress that the failure and decline of Muslims can only be overcome by the renewal of faith and showing a stronger commitment to the obligations of Islam. The adherents of this group confine themselves to preaching faith and emphasizing fundamental religious rituals.

Another group of Muslims focuses on the eradication of heretical practices (bid’aat) and associating partners with Allah (shirk) by resorting to and upholding the concept of jihad. Yet another group thinks that the re-establishment of khilafah (caliphate) would entail the unity and revival of the Muslim ummah. Among these aspiring for khilafah, some advocate achieving it through jihad, others prefer non-violent means to revolutionize the system, and still others prefer using the existing political system.

One group that has always remained part of Muslim societies comprises those who remain concerned with their personal spiritual development and emphasize the purification of heart and soul through mystic philosophies and practices (tasawwuf). There are also groups associated with the idea that service to mankind is the highest form of worship. These humanitarian organizations exert significant influence in modern Muslim society.

In this essay, our contention is that the Muslims have not identified the real battlefield. While each group is dealing with genuine problems facing the ummah, none of them is tackling the root of the problem. Because of our collective failure to identify the challenge, we do not have the tools required to fight this battle. The cause of this failure is the colonization of minds, which leads us to frame the idea of progress in terms defined by the colonizers rather than in terms defined by Islam.

Colonization of Thought in the Subcontinent

In many dimensions, the Indian subcontinent was more advanced than the British at the time of colonization.[1]  Relative peace in the Islamic world and continuous warfare in Europe had led to a military revolution, which gave Europeans an advantage on the battlefield.[2] However, sustaining colonial rule required controlling the minds of the masses.[3] The recipe of the colonizers for achieving this goal was the total abolition of the native frameworks of education and the introduction of a system of instructions that only created literate slaves.[4] This system of education started producing a class of persons who were Indian in blood and color but English in taste, opinions, morals, and intellect.[5] By opening the doors of opportunities for this colonized class of locals, the British introduced a culture of elitism and divided the society for good.[6] The elite classes in Pakistan continue to respect, admire, and love the colonizers and have contempt and hatred for their own culture, heritage, and religion.[7] This cognitive colonization is a direct consequence of Western education, given that control of colonies acquired by conquest requires creating admiration and awe in the minds of the colonized.[8]

Muslim Legacy of Knowledge and World Development

Western education is designed to project the glories of Western civilization and suppress or minimize all others. Muslims under the influence of these ideas think that the only way to development and progress lies in following the footsteps of the West in every realm of life. They consider the Qur’an and the teachings of the Holy Prophet Muhammad (SAW) relevant in establishing their private connection with God but do not find them helpful in responding to the complex challenges of modern public life. Modern education glorifies Western intellectual achievements to the exclusion of all others. This created a conflicted worldview among Muslims since our religion gives primacy to the knowledge revealed to mankind by God.[9]

It does not require any emphasis that knowledge lies at the core of Islam; rather, Islam is rooted in knowledge. Islam initiated a transformative revolution in the world by catapulting once-ignorant and backward Bedouins to positions of world leadership. The book ‘Islam and the World: The Rise and Decline of Muslims and its Effect on Mankind’ by Sayyid Abul Hasan Ali Nadwi is the counter-narrative to the Western stance that the world was in darkness when Western knowledge enlightened it.[10] The book reminds us that Muslim civilization was the beacon of light and knowledge for almost one thousand years.

The reconquest of Al-Andulas provided European barbarians access to millions of books from Islamic libraries. Al-Andulas was so advanced in knowledge and development that signs of its progress continue to amaze. The Toledo translation project translated Arabic books into European languages and marked the start of the European Enlightenment and the end of its Dark Ages.[11] Unfortunately, the Europeans could not absorb the essence of knowledge and did not get to the core of its ideals, but the flood of knowledge instigated rational debates. Since the clergy could not respond to these debates, a clear split took place in Christianity.

The conduct of the church in Europe and its relations with the crown caused several violent battles, instability, and destruction to several generations of the West. The people were already distressed and wary of the arm-twisting by the clergy in the name of religion. The rationality that Muslim books brought and the efforts of the church to crush reason led to a rebellion against religion and the development of secularism. Politics and economics detached themselves from morality.

Because faith in God had led to continuous warfare, Enlightenment scholars rejected their intellectual tradition founded on Christianity and sought to rebuild knowledge from scratch based on solid foundations of facts and logic. The famous aphorism “I think, therefore I am” by Descartes, also known as the father of Western philosophy, illustrates this attitude. Starting from a position of complete ignorance to the extent of doubting one’s own existence, one seeks to rebuild knowledge using reasoning alone. The direct evidence of our senses, our beating heart, and a welter of bodily sensations is rejected as a source of knowledge. This shift in theories of knowledge eventually led to logical  positivism, which continues to form the philosophical foundation of modern Western education.[12] Emphasis on objective observations of external reality led to a deep understanding of the world, but rejecting the validity of our subjective life-experiences led to a loss of knowledge about the internal world of human beings – our lived reality.

The Challenge is not Unique

It is not the first time the Muslim mind has been awed by a foreign body of knowledge.[13] Muslims faced a similar challenge in the 8th century when translations of Greek knowledge came to Muslim lands, and some notable Muslim scholars were influenced by Greek philosophy. Greek philosophy dealt with concepts and methodological frameworks that had no connection to Islamic source materials. To make room for these ideas, a sect known as Mu’tazilites or rationalists emerged in Baghdad. They equated Greek philosophy with “reason” and argued that reason must take precedence over revelation since we use reason to understand the revelation. The orthodox Muslim approach vigorously and aggressively condemned this movement and advocated avoiding anything to do with Greek philosophy. However, when the movement became so impactful that it even influenced the Muslim khalifa, and the disturbing interpretation of texts gradually started becoming official verdicts, it became necessary for Muslim scholars to engage with this ideology.

To respond to the challenge, Muslim scholars delved into Greek knowledge and developed a specific discipline for validating Islamic stances and rebutting objections to them. This discipline is called Ilm ul Kalam. Among the leading Muslim scholars of that era, Ghazali stood out as the most effective in countering Greek knowledge through his scholarly critique.[14]

Contemporary Muslim scholars have to enter into a similar battle against Western philosophy. There is a need for a new Ilm ul Kalam.[15] It has to be based on the realization that Western education is not serving the purpose of our societies (or humanity at large). This education convinces a person that wealth maximization is the purpose of life. For a young Muslim, acquiring a lucrative job remains the only objective of education. Islamic knowledge is meant to develop the potential for excellence within human beings and transform our lives. The greatest challenge facing the ummah today is to develop an alternative to Western education that is deeply entrenched in Islamic tradition and meets contemporary needs.[16] In the particular context of the subcontinent, Muslim scholars need to rectify the mistake of deliberately abandoning Western knowledge post-1857 and engage with it just like Ghazali and other Muslim scholars engaged with Greek philosophy and Mu’tazilites.

Decolonization of Education

Rejection of God and reliance on observables alone led to the belief that man emerged accidentally by way of evolution, human lives have no higher objectives for which they should aspire, and society is just a cutthroat competition where survival of the fittest is the only moral principle. A Eurocentric education glorifies Western intellectual achievements as being the pinnacle of human civilization. However, Julie Reuben in ‘The Making of the Modern University’ documents how logical positivism eventually led to the exclusion of character building from the curricula of universities.[17] This has led to a situation where the “brightest and the best” educated graduates engage in mass killings without any compunction, as demonstrated to the world in the ongoing genocide in Gaza.[18] A decolonized education would lead students to the recognition that wealth acquired by plunder and genocide of other world civilizations cannot be considered a market of progress.[19] Islamic education would teach students to understand progress as being about human development, not the acquisition of wealth by any means, fair or foul. Within this paradigm, Islamic teachings provide the means to create excellence in conduct and spiritual progress, ideas that are completely missing from modern Western education.[20]

Many Muslim intellectuals who recognized the bankrupt moral foundations of Western epistemology and the damage this does to the Muslim youth sought to rectify the problem in various ways. The dominant paradigm for achieving this goal has been the “Islamization of knowledge” paradigm, which seeks to cleanse Western knowledge of harmful elements while retaining the useful ones.[21] This project, embodied in the International Islamic University in Islamabad and Kuala Lumpur, has not been very successful because they have failed to recognize the hidden moral foundations upon which apparently objective structures of Western knowledge have been built. The alternative is the Ghazali Project, which will be discussed in the next section.

Rooted Revival: A Three-step Way Forward

The successful decolonization of minds requires understanding that the final message of God to mankind is complete and perfect and far superior to any knowledge produced by mankind.[22] Decolonization of education is a mandatory but challenging task. Without this, all efforts at reform and revival are doomed since the toxic Eurocentric worldviews are being planted in the hearts and minds of the vast majority of the Muslim youth by Western educational institutions around the globe. The foremost task towards this end is to rewrite the history of the last 300 years by decolonizing it. The intrinsic Eurocentric biases in the narration of history have convinced generations of Muslims of the superiority of Western thought, tradition, and culture and of the impotence and incompetence of Muslim rulers, scholars, and masses. Unless this defeatist approach is repaired, even the efforts of decolonization will remain colonized. The first step in this direction has already been taken by Sayyid Abul Hasan Ali Nadwi’s book ‘What the World Lost Due to Decline of Islamic Civilization’.[23] This needs follow-up by Muslim historians to document the degeneration in humanity that has accompanied the technological progress of the West.

Muslim academia needs to extensively and consistently discuss the purpose of life, differentiate between useful and useless knowledge, and focus their attention and energies on developing the knowledge that is relevant to and commensurate with their purpose of life. For this purpose, the Al-Ghazali approach looks more pragmatic, which emphasizes that in the process of developing knowledge, one should benefit from the already established knowledge and learn from human experiences. In the words of Recep Santurk, there is no need to build knowledge from zero, but we have to make a “rooted revival” as we already have a knowledge heritage of 1,000 years, and Muslim scholars have already laid the foundations of knowledge in different realms.[24]

So, knowledge has to be constructed on the already available foundations but with the realization of the contemporary context. Muslims cannot solely rely on fiqh rulings from previous books as the circumstances have changed, but they can make use of usool ul fiqh (principles of jurisprudence) to approach contemporary issues. The logical arguments of Ilm ul Kalam remain very powerful, but they need a new articulation. Ontological, cosmological, teleological, Big Bang, fine-tuning, and design are some of the major arguments of today’s world that can effectively be responded to through Islamic interpretations.

Imam Ghazali provided an effective counter to the challenge of Greek philosophy in earlier times. We can break up the task into three steps. The first was rebuilding faith in the fundamentals of Islam, using our minds and hearts, as in his book ‘Al Munqidh min al-Dalalah’. The second step was to analyze and debunk Greek philosophy in ‘Tahafat ul Falasafa’. The final step was ‘Ihya Uloom-id-Deen’, or the revival of religious sciences. The Ghazali Project for today requires rebuilding the structure of human knowledge on Islamic epistemological foundations.[25] This is because knowledge was built on toxic moral foundations by the Enlightenment philosophers for the past few centuries. We have to rebuild this knowledge on sound foundations, and rebuild university education around the core of character development, central to Islam. This is the most important challenge currently facing the ummah.[26]

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[*] This manuscript is based on a talk by Professor Dr Asad Zaman, professor at Akhuwat University and former vice chancellor of Pakistan Institute of Development Economics (PIDE), Islamabad. The talk was delivered at the Institute of Policy Studies on February 23, 2024. Dr. Zaman reviewed the paper and graciously added references to other resources where he explained the key themes in his talk.

Prepared by: Moaz Bashir and Muneeba Rasikh

[1] See Ahmad and Zaman (1998): https://ssrn.com/abstract=4580809

[2] The dominant Eurocentric myth is that global conquest by Europeans demonstrates their superiority in strength and intelligence. See http://bit.ly/AZcmeh, ‘Central Myths of Eurocentric History’, which explains that global conquest is a testimonial to the barbarism and cunning of the West, rather than their advanced civilization.

[3] See: The Conquest of Knowledge: http://bit.ly/AZcok

[4] See: Atiyab Sultan, The Mirror and the Lamp: Colonial Educational Reform in 19th Century Punjab – how British educational reforms destroyed an excellent functioning educational system in Punjab: https://bit.ly/4c9S34z

[5] See: https://azprojects.wordpress.com/2018/06/08/the-british-educated-and-civilized-us/

[6] See: Impact of Colonial Heritage on Economic Policy in Pakistan: http://bit.ly/AZimpact

[7] See: A Deep Seated Inferiority Complex: http://bit.ly/AZinfr – in this connection, see also The Illusion of Western Educational Superiority – the firmest frontier of colonization of minds.

[8] See: The Dazzle of Western Knowledge: bit.ly/AZdazzle

[9] See: Islamic Worldview: Central to Islamic Education: bit.ly/iwv4az

[10] See: What the World Lost Due to the Decline of Islamic Civilization: bit.ly/azrdm

[11] See: Theft of History: Western Plagiarists & Islamic Revolutionaries: bit.ly/AZplag

[12] See: The Emergence of Logical Positivism: bit.ly/AZelp

[13] See: The Modern Mu’tazila: bit.ly/AZtmm

[14] See: Kalam & the Hanbalis: Is it Really Relevant Today?: https://bit.ly/4a2BLIM

[15] See: Countering Arguments for Atheism (Urdu): https://bit.ly/49MQlVi

[16] See: The Deep and Difficult Dilemma of Islamic Education: bit.ly/AZddd

[17] See: The Marginalization of Morality in Modern Education: bit.ly/AZmme

[18] See: The Marginalization of Morality: https://bit.ly/3IROLFX

[19] See: Progress Under Western Leadership?: bit.ly/AZcol4

[20] See:  Build Character to Build Nations: https://bit.ly/3VbBVcI

[21] See: The Islamization of Knowledge: bit.ly/cie1iok

[22] See: Understanding Colonization and Decolonization: bit.ly/AZcol1

[23] See: What the World Lost Due to Decline of Islamic Civilization: bit.ly/azrdm

[24] Recep Senturk’s Lectures on Decolonizing the Social Sciences: bit.ly/3v9FV32

[25] See: Central Ideas of the Ghazali Project: bit.ly/Ghazali1

[26] See: How to Launch an Islamic Revival?: Bit.ly/azlir

Transformative Teaching: Changing the Lives of Our Students

Our Prophet Mohammed ﷺ was a model for excellence in every dimension. His teachings transformed ignorant and backward Bedouin into world leaders.(see: The Greatest Teacher of All Time). As teachers, can we follow in his footsteps? Can we teach in way that transforms the lives of our students, and gives them the vision to change the world?

The models of education which we have borrowed from the West are not capable of doing so. In fact, these educational methods cause damage to the personality of our students. Today, because of shock and awe of the West, we follow Western models blindly. To understand why these models lead to harm, we need to study the historical roots of Western theories of knowledge. Modern education provides technical skills but teaches us nothing about ideals, visions, or the purpose of life. At the root of this crisis is a transformation in our theories of knowledge, which occurred as a result of the Enlightenment of Europe. As the conception of knowledge changed, so did the methodology and substance of education, which is designed to provide valuable knowledge to the young. In this post we will discuss this transformation in epistemology, and its harmful effects, as well as what can be done to counteract them. This is a continuation of a previous post on Islamic Pedagogy. The video below is in English; for Urdu Version of the talk, see: Transformational Teaching (URDU).

Centuries of battles between Catholics and Protestants on an unprecedented scale of brutality and destruction led to the Great Transformation in European Thought. Enlightenment thinkers rejected the heart and soul as sources of knowledge, as their historical experiences showed that this led to perpetual bloody warfare. They were optimistic that rational thought, combined with objective observations, could arrive at all knowledge worth having. Over the centuries that followed, this epistemological shift had consequences that went far beyond what they could have foreseen. The rejection of God, Life after death, and Judgement Day led to increased focus on this world, making the pursuit of pleasure, power, and profits the goal of life. This provided the intellectual foundations for a shift to a capitalist society, where market relationships came to dominate social relationships. In the realm of education, this was reflected in the transformation of the role of the teacher as a mentor, guide, confidante, and life coach, to an anonymous specialist hired for the provision of subject-specific skills. In modern education, students and teachers have no social relationships outside the classroom. In a previous post on Islamic Pedagogy, I suggested that we need to revive and renew our teaching methods, to achieve better outcomes. In this post, I provide some specific suggestions on initial steps we can take in this direction.

The mindset of most teachers is that we are paid to “deliver” a specified subject matter to students. We are also responsible for evaluating the students on their grasp of the subject matter. After having delivered the subject matter in the best possible way, the teacher is not responsible for ensuring that the student puts in the work required to master the subject. This is starkly different from the parental guidance mindset of Islamic pedagogy, where we take pride in the achievements of our students, and take their failure as being due to our own failure to inspire and motivate the learning process. A subtle distinction is involved here. Students cannot learn unless they make their own efforts, and struggle to master the subject. In this sense, students’ failure results from their own failure to make the required efforts, and teachers are right to put the blame on the students. However, in a deeper sense, the failure of the teacher lies in failing to motivate the students to put in the required effort.

I would like to discuss some specific steps we can take to change our teaching styles, in the context of two questions raised by teachers at Akhuwat University, where I was explaining these new pedagogical methodologies. One of the teachers asked about what to do if, despite our best efforts, the majority of students fail the midterm. Another teacher was concerned that there was some security breach allowing students to get access to his midterm, and suggested tighter security procedures to prevent this from happening.  Both questions reflect the influence of the market methodology for teaching, instead of the parental guidance methodology. Parents take pride in achievements of their children, and feel responsible for their failures, even though they do not teach them at school. A teacher who takes a parental interest in his students would never be taken by surprise by failures in the midterm. This is because he would monitor the progress of his students on a daily basis, and know exactly what they can and cannot do. Similarly, learning that students are getting access to the midterms would not lead to questions about how to improve security. Instead, we would be concerned about how to improve honesty and integrity of the students, and also, how we can provide them with the skills required so that they feel confident in their abilities, instead of feeling the need to cheat.

But can we really monitor the students on a daily basis? And how can we motivate them to study outside of class, to get the skills they need to pass exams?  Doing this requires efficient time management techniques, as well as changes in teaching methodology.  The conventional teaching methodology creates a hostile and adversarial relationship between students and teachers. The teachers are trying to keep quizzes secret, and make them difficult, to deny students points. The students are trying to overcome obstacles created by teachers’ stinginess, and get points. Instead, we must start by telling the students that we are partners and have the same goal: to create the maximum learning for the students. If they take partnership seriously, the students will immediately demand that we give them 100% marks on all quizzes and assignments. Thus, we must clarify that our goal is to create good learning outcomes. It is the knowledge that will lead to marks. It defeats our purpose to give marks without knowledge, because students will never learn, if they can get scores without learning. From experience, I know that this is a difficult message to convey, and has to be repeated many many times. Throughout their career, students have been concerned with marks, not with knowledge. They make an effort to learn only “if it will be on the exam”. It is hard for them, and for us as teachers, to focus on knowledge instead of marks. Doing so requires more than just talking about it. We must show students that knowledge is valuable.

In fact, love of knowledge is built into the hearts of human beings. However, bad teaching and wrong kinds of subject matter have destroyed this faculty within our students. Our Prophet ﷺ made dua for useful knowledge and also asked for protection from useless knowledge.  Useful knowledge enters the heart. Most of what we teach is useless knowledge. The subject matter was developed to analyze and understand Western societies, and is not directly relevant to ours. It cannot enter the hearts of our students because it does not relate to our life experiences, nor to our own history. Thus, as teachers, we have to make special efforts to connect what we teach to relevant real-world issues that would engage our students. These connections do not exist within the textbooks we use, so making them requires creative efforts on part of the teacher.  The effect of years of struggling with and attempting to understand fundamentally incomprehensible theories, completely irrelevant to students’ experiences, has led to a defeated mindset. The students have abandoned efforts at learning, and seek only to memorize answers to questions which they expect to be asked. Repairing the damage requires a lot of effort on part of the teacher. If we start to relate the subject matter to the life-experiences of our students, they will start to take an interest in learning. Furthermore, if we ask them to make intentions to use their knowledge for the service of the Ummah, this will provide them with a higher vision for the purpose of education. Of course, we will also have to change our teaching methods to provide them with knowledge that can be used for the service of the Ummah.

It takes time to build connections between the subject matter and real world applications familiar to and relevant to our students. As a first step, we should focus on developing skills within our students, rather than teaching them a body of materials contained in textbooks. If we are charged with teaching students to drive, we can assess our progress by seeing if they have learned to drive or not. In preparing every lecture, we must ask what the students will learn to do as a result of this lecture. Initially, when we have not learned how to make deeper connections, the skills may just be the ability to answer the questions at the end of the textbook chapter. At the end of the lecture, we must learn whether or not the students have acquired the ability to answer the questions. Generally speaking, because we were also taught this way, we use a one-way teaching process. We lecture at the students, and never find out what they understood from our lecture. When we first attempt to get feedback, we will be very surprised at the huge gap between what we thought we clarified, and student understanding.

There is a big technical problem in getting such feedback. At the start of the lecture, the teacher should write down three questions, and say that in this lecture we will learn the answers to these questions. But if we ask students to write down the answers and submit them for corrections, we will drown in the grading task. The solution is to have the students grade themselves. Leave ten to fifteen minutes at the end of class for this feedback. Take only one or two questions and have students write down the answers to them. Tell them that this will not be graded, it is meant to help them understand the materials, so that they are not tempted to cheat. Randomly switch papers so that each student has the paper of someone else. Then ask the student to read the answer, and ask him to comment on whether or not it is a good answer. Get several students to read answers, and discuss them among the students to arrive at an understanding of the correct answer. Then have every student grade the paper in front of them, based on the common understanding of the correct answer which develops during the discussion,

This method would create a good understanding of students’ level of comprehension. If teachers have daily feedback on what kinds of questions the students can answer and what they cannot, they would never be surprised by a mass failure on the midterm. Aligned with the cooperative teaching style is the idea of formative exams. Instead of giving students exams to evaluate where they stand, exams should provide a learning experience. One method is to use open-book exams which ask students to answer questions requiring a level of understanding which goes beyond simple replication of textbook material. Another method is take-home exams. There are many ways to prevent cheating in such cases. One of them is to go over the exam together to test for understanding, and to give a second in-class short exam which is easy for those who understand the answers, but difficult for those who copied them. The essence of all such methods is to engage students in active learning within the class, and to help and encourage them in their struggle to understand the materials. If before the midterm, we have worked through all the expected questions with the students in class, the students will feel confident and capable of being able to answer all the questions. This is exactly the outcome we desire – if we undertake to teach driving skills, we would like all of our students to learn driving, as the outcome of the class.

All this in-class work creates a new problem. Where will we get the time for the lecture? The solution is to use the inverted classroom, where the lecture materials are covered outside of the classroom, and the homework questions are worked out cooperatively within the class. The students should be assigned to cover the lecture materials outside of the classroom. These days, there are an enormous amount of resources available which students can be assigned, which would enable them to cover the substance of the lecture outside of class. But, we all know that it is difficult to get students to read assigned materials outside of class. One method which I have found useful is to give a small quiz at the beginning of class which asks very basic and elementary questions about assigned reading materials. This ensures both on-time arrival of students, and motivates them to do the required study outside of class. Then, class time can be devoted to developing student skills cooperatively, at least in terms of learning how to solve problems and answer questions. Using this method, teachers can easily identify the strong and weak students. The stronger students can be assigned to teach the weaker students outside of class time.

To learn how to change the lives of our students, to motivate and inspire them to change the world for the better, we must transform ourselves, and change both the style and the substance of our teachings, This is a hard task, but has the most rewarding outcomes, because it is aligned with the mission of our Prophet ﷺ, May Allah T’aala fill our hearts with the Noor of His Knowledge, and allow us to transmit this spirit to our students,

Epistemological Roots of the Climate Crisis

{tinyurl.com/AZerocc} This post is based on a talk prepared for a National Conference on SDGs: Catalysts for Economic Transformation in Pakistan on Feb 29-Mar 1, organized by the Economics Department of University of Lahore. The original talk, in the video below, has been revised and updated in the blog post which follows it:

At first glance, industrialization seems the primary culprit of our climate crisis, driving rampant overproduction and overconsumption. However, these are merely the visible outcomes of a deeper, more profound shift in thought ushered in by the European Enlightenment. This pivotal era fundamentally redefined our relationship with the planet, transitioning from a view of Earth as a nurturing entity to a resource for exploitation. This blog post aims to unpack this transformation in thought, and how it paved the way for the environmental challenges we face today. To solve the crisis requires another revolution in thought, and foundations for such a revolution are provided by Islamic epistemology.

The European Enlightenment was deeply influenced by centuries of religious conflicts between Protestants and Catholics. It became clear to all that a peaceful society could not be built on theological foundations. Political Science was the first of secular social sciences to emerge. Theology had been universally considered as the foundation for all knowledge. Creating a secular social sience required a revolutionary change in epistemology. Tradition, intuition, emotion, and lived experience had been considered as reliable sources of knowledge. The European Enlightenment discarded everything known until then, and sought to rebuild the entire stock of human knowledge from scratch, trusting only in objective facts and logic.

The Enlightenment brought a significant metaphorical shift in how we perceive Earth, from ‘Mother Earth’ to a ‘dead machine.’ This shift, rooted in the widespread acceptance of Newtonian physics, marked a transition from a symbiotic and nurturing relationship with the planet to one focused on exploitation for power and profits. This change in metaphor is intrinsically linked to the epistemological shift of the Enlightenment, symbolizing a broader transformation in our understanding and interaction with the natural world, from mutual respect and coexistence to control and utilization.

The climate crisis we are grappling with is fundamentally a crisis of knowledge, an epistemological error at its core. To address the environmental challenges we face, it’s imperative to redefine our concept of knowledge. We need to alter our ways of knowing the world and reshape our relationships with all creations. This requires a monumental shift, a reversal of the ‘Great Transformation’ in European thought that has long influenced our understanding of nature and our place within it. For a more detailed summary of ‘The Great Transformation’, see The Great Transformation.

How can we reverse the Great Transformation? This task requires us to undo the epistemological shift brought about by the European Enlightenment. Merely rejecting Enlightenment thought is not sufficient. We must also reconstruct the accumulated human knowledge of recent centuries upon sound epistemological foundations. Islam offers such foundations. The final revelation of God to humanity imparts us with knowledge of unassailable truth. While Enlightenment philosophers rightly discarded Christianity, recognizing its corruption and role in perpetuating conflict, they overlooked the potential for other sources of pure, revealed knowledge.

Islamic epistemology presents a stark contrast to Enlightenment views. All of God’s creation is a family, and those who serve His family are beloved by God. The Quran teaches us that the heart is not merely a physical organ but an instrument of cognition, capable of moral discernment when purified through ‘Tazkiya’, the cleansing of one’s inner self. This purification is key to moral cognition, fostering a profound connection with the universe and instilling a natural abhorrence for harming the environment or any of God’s creations. Environmental degradation arises from the Enlightenment epistemology which ignores the heart and soul as sources of knowledge. This leads to individualism, which creates isolation and loneliness, breaking our connections with the environment and other individuals. Many studies show that these connections are the central sources of human happiness.

To repair the damage done by Enlightenment epistemology, we must have a deeper understanding of the sources of their errors. The most fundamental mistake is the idea that we can arrive at certain knowledge starting from a position of complete ignorance. Logical reasoning requires a starting premise to reach any conclusion. This mistake is clearly illustrated by the most famous line of reasoning “I think, therefore I am” from Descartes, the father of Western Philosophy. Descartes claimed to derive his own existence as completely certain, starting from a position of complete ignorance.  But the existence of “I” is already assumed in the premise “I think”, so the conclusion that “I am” follows trivially.

The Enlightenment philosophers were trapped into making the same mistake. Since they claimed to start from zero, and build objective, value-free knowledge, they had to make HIDDEN assumptions. In particular, the hidden moral foundations upon which knowledge was built within the Enlightenment tradition, are toxic. It is this intellectual tradition which dominates university education today, and it makes false claims to objective and value-free knowledge. Post-modernists have been able to see past these claims, but they have made their own mistakes, and have not been influential in changing the Western educational paradigms. For instance, Michel Foucault argues that modern human sciences (biological, psychological, social) purport to offer universal scientific truths about human nature that are, in fact, often mere expressions of ethical and political commitments of a particular society. On deeper analysis, what passes for knowledge, and is stated as a universal scientific truth, is actually a defense of existing power configurations.

In attacking Enlightenment epistemology, our efforts must focus on revealing these concealed assumptions, and exposing their flaws. Since the Enlightenment was launched in response to religious wars in Europe, a critical foundational assumption is rejection of God. This is masked as “rational” by an epistemology which claims to believe only in what can be seen or derived from logic. However, this apparently reasonable stance leads to tortuous complexity when inferences to unobservables are admitted in physics, but rejected in religion. For example, it is permissible to believe in dark matter which is unobservable, because it accounts for the observable motions of the stars. But when we argue that the creation of a universe at a moment in time requires a creator, this inference is rejected as “unscientific”. The Philosophy of Science is the name of centuries of efforts to distinguish between religion and science. Early in the 20^th Century, the logical positivists claimed success in this project. They purported to demonstrate that science leads to truth about external reality, while religion is mere superstition and ignorance. See The Emergence of Logical Positivism for more details. However, later in the 20^th century, philosophers came to see the deep flaws in their arguments. A recent textbook entitled “What is this thing called Science?” documents how confusion reigns supreme. The Philosophy of Science has set itself the impossible task of rejecting inferences to the existence of God, while being certain about inferences which lead to the existence of electromagnetic forces.

One of the settled foundational premises of secular modernity is the rejection of God. This axiom cannot be disputed or discussed, but it has extremely harsh consequences. It is immediate that the universe was created by an accident. Life must have been created by an accident. Man is just another animal like others. Society is governed by the ferocious competition of the laws of the jungle. The only moral principle is the survival of the fittest. By definition, the scope of science is limited to the external universe which surrounds us. It cannot contemplate events prior to existence of the universe, since these are completely outside the possibility of observation. When we take science to be the only valid source of knowledge, questions regarding the existence of God cannot be discussed, ruling out the possibility of contemplating alternatives to this bleak view of meaninglessness of our human lives.

This axiomatic rejection of God has major consequences for how we build human societies. If there is no afterlife and no Judgement Day, then we should seek pleasure and power in this life. Individualism and Hedonism are natural consequences. Competition replaces Cooperation, and Greed is preferred over Generosity. These are ugly principles on which to build society. The consequences of these choices are visible in a world which fits the description of the war of all against all. These acids dissolve family and community, the fabric of society, and lead to loneliness, depression, and suicides, as well as war against nature. For the Islamic alternative, see Lecture 2 on Gratitude, Contentment, and Trust in my online course on A New Approach to Islamic Economics

With all this background, we can come back to original question. How does this epistemological shift to secular modernity create the climate crisis, and what is proposed line of attack to counter this problem?

In the wake of recognizing the limitations of secular modernity and its foundational assumption that discards the divine, we encounter the question: What fills the void left by the absence of God in our understanding of the world and our place in it? The secular narrative has led to a worldview centered on materialism and empirical validation, sidelining the profound questions about existence, purpose, and morality that have occupied human thought for millennia.

The repudiation of a higher purpose and the embrace of materialism have not only shaped our social structures but also our individual pursuits. In the absence of a transcendental goal, the pursuit of personal gain overshadows the collective welfare. The shift from communal to individualistic values fuels a society driven by consumption, where success is often measured by accumulation rather than contribution.

However, the consequences of such a worldview are not restricted to social dynamics alone. They extend to how we engage with our environment. If life’s purpose is bound to material success and personal gratification, then the natural world becomes a mere backdrop for human activity, valued only for what it can provide rather than what it inherently is. This utilitarian approach has facilitated an unprecedented exploitation of natural resources, leading to ecological imbalances and a climate in peril.

In the search for a more holistic understanding of our world, one that integrates the spiritual with the empirical, we turn towards alternative epistemologies. Islamic thought provides such an alternative, offering a framework where knowledge is not divorced from the divine, where the material is interconnected with the spiritual, and where the pursuit of knowledge is not just for worldly gain but for a greater, more profound understanding of our place in the cosmos.

The challenge before us is not merely to adapt to new environmental policies or technologies but to undertake a more ambitious journey—a reevaluation of the very foundations upon which our knowledge and society rest. It calls for a re-engagement with the spiritual, an acknowledgment of the divine, and a reconstitution of our moral compass, informed by the rich heritage of Islamic thought.

As we consider the path forward, we must ask ourselves how we can construct a future that respects the delicate balance of our world, that recognizes the intrinsic value of all life, and that seeks to align our earthly endeavors with a higher purpose. The path is complex and requires not just a change in action but a transformation in thought—a return to an epistemology that sees the world not as a machine to be mastered but as a creation to be cherished.

Educational Planning at Akhuwat University

It is a simple fact that the education we provide to our children shapes the future of the nation. From personal observation over twenty-five years, I can testify that our educational processes destroy the potential of our students, instead of building it. Furthermore, this problem can easily be remedied by adopting Islamic models of education, instead of mindless imitation of Western models which currently dominates the field. It is horrifying to contemplate the enormous amount of time we waste, teaching materials of zero value to the cream of our youth. But this disastrous educational methodology also means that there is enormous potential for improvement.

Meaningful discussion of educational policy must begin with recognition of the dramatic differences between the English-speaking elites and the vernacular classes. The foreign exchange spent by the elites on taking exams from England exceeds by far the government budget for primary schooling for the masses. This discussion is mainly about the non-English speaking masses, and not about the English-speaking elites. Our educational system fails the masses on all fronts. It does not prepare them for life, does not provide job skills, and does not create understanding of the forces which shape the world around us. One critical barrier is the medium of instruction, which is English. Whereas our elites speak English from early childhood, the masses never acquire proficiency in this language. This makes it impossible for them to master complex materials from an alien culture in a foreign language. Instead, rote learning of a narrowly circumscribed set of topics makes a mockery of the concept of education.

The single most important policy for the future of Pakistan would be the provision of equal educational opportunities for all the children of Pakistan. For the long-run, this would provide far greater returns than any of the standard set economic policies being touted as the solution to our current economic problems. If we could create the feeling of being united like one body, so that the whole feels the pain of any part. If we could treat all children of Pakistan as our own, this would be sufficient to change the future of the nation. I am not asking for the moon; all I would like is that, within the means available to us, we provide the best possible education to all our children, irrespective of their social class. Given the current setup, where what the elites spend on their children’s education exceeds by far the government budget for educating the masses, this seems like a pie-in-the-sky dream. But a journey of a thousand miles begins with a single step. I hope to describe the first few steps in this post, in the context of a very practical example of Akhuwat University.

It is the dreamers and the visionaries who change the destiny of nations. Pakistan is fortunate to have been blessed by many visionaries, including Dr. Amjad Saqib. He is famous globally for introducing interest-free Islamic microfinance, which was considered impossible by many. Over the past two decades, Akhuwat has made interest free loans of billions of Rupees to millions of people, and lifted countless out of poverty. As an extension of this vision, Akhuwat University was launched about four years ago, to provide completely free education to the poor. Currently, it has only BS IT, BS Econ and a Diploma in Tourism and Hospitality. It chooses students from all provinces of Pakistan, and strives to integrate them in the hostels.   

When Dr. Amjad Saqib asked me to head the Economics Department at Akhuwat, I accepted the challenge. I was confident that I could teach economics in a way that would be far superior to what is currently available in Pakistan. Having studied economics throughout my career, I have become deeply aware of the failings of the subject. For starters, modern economics was developed by Western authors for Western economies, and is blind to the economic problems facing Pakistan. So, it is easily possible to provide a far superior approach, which would give students insights into the Pakistani Economy, instead of the US Economy. I wrote up an initial plan for pedagogical changes in the BS Econ program here: Akhuwat University: A Paradigm Shift in Education.

After spending some time on campus, and meetings with students and faculty, I realized that my initial plans for revising the Economics curriculum had many defects. What I wanted to teach our students was not compatible with HEC requirements for the BS Econ degree. Furthermore, it required a lot of reading materials in English. The teachers were not available to teach this program. And the students did not have sufficient English skills as well as maturity to read the materials available. Furthermore, if by some miracle, all of these problems could be overcome, students with a highly unorthodox training in Economics would face great difficulty in a market where conventional teaching is prized. On the other hand, if we taught a conventional economics degree, it did not seem likely that our students could rise above second-rate copies of the best programs in Pakistan. Based on these considerations, I decided to drop the BS Economics program, and replace it with a BBA program, designed to make students self-sufficient after four years of Education.

To support and justify this change, I made a presentation to the Senior Management at Akhuwat University. The audio recording of the introduction by Dr. Amjad Saqib, followed by my discussion of the planned change, is given below. A brief summary of the highlights of the talk is given below. You can also access the complete audio file for the meeting.

started by noting that the faculty and staff must buy in to the vision of Dr. Amjad Saqib, to make it sustainable in the long-run. And what is the vision we need? We want to create a model for Islamic Education, which is very different from the Capitalist Educational paradigm which dominates the market and mindsets. The educational model we are all familiar with is a market transaction, where services of a teacher are purchased for teaching a specific subject to a group of students. In the Islamic paradigm, a teacher is in loco parentis, and acts as a guide, counsellor, confidante, and life-coach to the students. For more details, see Islamic Pedagogy.

We want to design education so that the students become self-sufficient after four years. They should acquire life-skills, character, awareness of their social, civic and religious responsibilities. They should be able to understand the forces which shape the world around us. They should also be able to provide for themselves, without being dependent on vagaries of the job market. This requires substantial changes in the substance and style of pedagogy.

We would like to put Character Building at the center of our curriculum. But this is now a lost art, and we need to rediscover effective methods of achieving this goal. We want to students to be service oriented, not to seek fame, status, and luxuries, for themselves. In a fascinating book, Julie Reuben (The Making of the Modern University) has documented how the mission of character building was central to education in the early 20th century, but was dropped completely by mid-century. A university education provided technical skills only, with no discussion of the higher purposes, ideals and dreams which shape our lives. As a consequence, David Halberstam has documented in his book The Brightest and Best, that the best educational institutes of USA turned out people who could engage in mass murders in Vietnam without any moral compunctions.

All over Pakistan, we see high losses in inefficiencies due to corruption. But this is because character development is simply not a part of education. If we could just one objective: create honesty and integrity in our students, that would be enough to create a revolution. But this is a big ask which required coordinated efforts on multiple fronts. At the same time, if we do not even try for it, we will never make any progress.

Since it seems impossible to achieve the desired goals from a BA Econ, it seems advisable to shift to a BBA. But our planned BBA is different from LUMS/IBA style, which aims to equip students with skills to land jobs in the corporate sector. We want to produce job-creators and not job seekers. One of the books of Dr. Amjad Saqib entitled “Successful People” describes the life histories of our indigenous business communities and their methods for doing business. These models are radically different from the ones taught at Harvard Business School, and imitated at our local universities, without any understanding of the differences in our environment. Fortunately, Dr Shahid Qureshi and associates at IBA have created an entrepreneurship program which teaches the principles of doing business in an Islamic style. This program has enjoyed huge success, and turned out thousands of successful entrepreneurs. We hope to launch our BBA program with a tentative title “Chinioti – Memon School of Business” and differentiate ourselves strongly from the general trend of BBA programs currently available. Hopefully, our new BBA program will instill our students with the confidence and capabilities to launch their own business, and become job creators instead of job seekers.

Islamic Pedagogy

{bit.ly/4c13knZ} I’ve spent my whole life in academic institutions, first as a student then as a teacher. I taught for 15 years in the USA, 6 in turkey and 25 years in Pakistan. In this talk, I would like to draw some lessons from these life experiences. An Urdu version of the talk is: Islamic Styles of Pedagogy (urdu). The English video below is followed by a writeup:

Our religion teaches us that each life is infinitely precious. Each individual life is potentially as valuable as the entire humanity. Our students have enormous potential, and it is our job as teachers to bring out this potential. I found that this effort to bring out the hidden potential in the students to be of immense value, and extremely fruitful. Countless books have been written on the principles of etiquette (Adab) for Islamic education, extracted from the Quran and the Hadith. I will just mention a few. Our knowledge should not give us Pride. Instead, it should make us humble. We should value our students as having more potential than ourselves and we should take care to value their time and to give them useful knowledge. The Prophet ﷺ made Dua for useful knowledge and sought protection from useless knowledge. We have a tremendous opportunity because our students, if inspired and motivated, shape the future of the world – just like the students of our Prophet ﷺ did. Whereas our religion teaches how to become the best human being that we can be, modern education is designed to suppress and destroy this potential, and turn us into human resources, interchangeable parts in the capitalist machine for the production of wealth.

Since I myself was educated in the West, I experienced and absorbed the dominant Western pedagogical models. It was long personal journey to recover from the damage done to me by this educational process (see: Recovering from a Western Education) . It is worth providing a brief summary, so that the reader can understand where I am coming from. In the 1970s, I studied at MIT and Stanford and then for 15 years I taught at top universities in the USA. I left for two reasons:

1. my children were growing up and I didn’t want them in public schools in the USA where they would acquire American culture
2. I felt that I was being paid for the job of educating the children of foreigners when our own children in our own countries were not educated and this was my responsibility

When a chance offer materialized, I left and spent six years (from 93 to 99) at a leading Turkish University. After that I moved back to Pakistan, and have been teaching here since. I found my experience as a teacher much more satisfying because I felt that these students are my students and their successes were my success, and their failures were also my own failure. So, I tried very hard to make sure that they would succeed. My students responded to my efforts by giving me their best performances, and many graduates are now placed in good institutions in Pakistan, and around the world.

After my return, I noted many differences that forced me to change my approach to teaching from the one I had learnt in the West. While in USA, I saw that at the top universities, the best students were highly competitive and also very confident of their skills. In Pakistan, especially in the Public Sector, I found that the students had a defeated and colonized mindset. They could not imagine that they could be the world’s best. However, in terms of raw talent, our students are just as good as anywhere around the world. Unfortunately, the imitative educational system we have is designed to destroy their capabilities – they learn to aim low like the crows, instead of claiming their birthright to fly high (See: The Way of the Eagles bit.ly/42CCjTp ). Students can only achieve according their ambitions, and it is the job of the teacher to believe in the students, and to teach them to reach for the stars (See: Reaching Beyond the Stars: bit.ly/azRBS ).  

There is another, much bigger, difference between the role of the teacher in Market societies which now dominate the world and in a traditional Society traditional Islamic society.  In a market Society a teacher is paid for his work and he does educate the students in return for his salary.  As opposed to this, in an Islamic Society the teacher is a mentor, a life-guide, a counselor, an advisor, and he acts in a parental role. He worries about the personality development of the students. But the most important job of the teacher is to create desire and enthusiasm for the pursuit of knowledge in the students. In my experience, I have found that the greatest obstacle to high achievement is lack of self-confidence in our students. The students do not even try to learn because the experience that they have had with learning is very bad. They have been trained to not try to think instead just to memorize. Trying to master alien subjects in a foreign language has proven so difficult, that they consider themselves incompetent, and incapable of learning. They cannot identify the real causes for their failure: the educational system, the subject matter, and the teacher.

Building the confidence of our students is essential if we want stellar achievements from them. This requires work on multiple fronts. One the psychological front, we need to work on decolonization of minds. Defeats and failure on every front for the past two centuries has led to a defeated mindset in the Ummah as a whole. But, in addition to building psychological confidence we also need to provide the skills to match. Creating confidence in car-driving skills, without teaching the skills, will lead to crashes. It is the teacher’s job to build this confidence, and this starts by believing in the potential of our students. If we believe that our students have the potential to change the world, they will perform to fulfill our expectations. In addition to self-confidence, we also need to rebuild the shattered confidence in our heritage religion, heritage, and culture. I also have several lectures on this topic which are linked here: How to Launch an Islamic Revival.

In order to act as a guide, a mentor, and a life-coach, we need to create a very different relationship from the one that we are accustomed to. In a market society, the teacher’s only concern is to teach a subject he has no other relationship with the student. Instead we have to become helpers and partners of the students in their quest for knowledge. We have to switch the students from striving for scores to become knowledge seekers. This is a very difficult transition because the students have been burnt in the past. The thirst for knowledge comes naturally; it is part of human nature. But, students have been frustrated by past educational experiences. Both the subject matter and the teaching style has been designed to discourage students to search for knowledge. Students have tried many times and have failed. They have acquired the false belief that we are unable to learn. To switch their mindsets, we must change our own mindset and style of teaching as well as the subject matter. We vastly underestimate our students. Instead of discussing the big problems facing our society, facing the ummah, facing the world, or facing us in our personal lives, we teach them nitty-gritty details of trivial questions which make no sense and deprive them of the excitement of learning. If we engage with them on problems which actually matter in the real world, and teach the technical stuff as part of what is needed to solve them, they would be very eager and excited and keen to learn. I have found personally that when I started this approach, it was immensely valuable for the students. The students became engaged and interested, and acquired skills. Instead of the textbook approach which builds micro skills and defers engaging with the real world, we start with a real-world problem and then develop whatever tools techniques theories we need to solve the problem. We can also address life experiences and discuss how we go about solving problems that we face in our lives. Whenever we relate something to the experience of the students either as individuals or social problems that we face as communities, they will be very eager to learn about those. For more details about how to implement this educational method in teaching economics, see “How to Motivate and Inspire Students (URDU)“

Lecturing is a very poor way to generate learning. To learn, the students must tackle the subject, must engage with it, and struggle with it. One way to do this is the inverted classroom. We assign students some reading or some materials or some video lecture and then in class we discuss it. One method that I found useful is to put up a list of questions that I plan to discuss. Put up one question on the blackboard, and ask every student to write the answer to that on their front of them in on a piece of paper. Now, exchange papers and then ask a student what is the answer that is written in front of you. Then have a discussion – “is this the correct answer?” “what is the flaw in it?” “how should we grade it?” etc. In the end all of the students acquire a much deeper knowledge not just by learning the right answer but by also learning the wrong answers and the way in which they are wrong. This is tremendously helpful for learning.

Changing the methodology for assignments and exams is also very valuable in generating learning. We can give them take-home exams. By habit, they will initially copy from each other and cheat. We have to inform them that the take-home will not be graded. Actually I need to know how well you’re doing and by looking at your answer I will know what you have learned. If you cheat and deceive me, I will be unable to help you.  Initially, students do not believe this, but eventually they come to realize it. This takes the stress out of exams. They can self- grade the exams in their own classrooms. We can randomly distribute the exams among the students, grade them together. We ask students to discuss the answers and come agreement on what is good and what is bad. This methodology for assignments and exams creates much more comfort and much more learning on the students than the stressful methodology currently in use. It also provides us with a lot more information about what the students are learning, and about the students who are good, as well as those who are having difficulties. We can create small groups of students and ask the good students to help those who are having trouble.

One questions that came up on this material was that we teachers try very hard but when it comes to midterm we find the students fail miserably. Actually this should never happen. It should never  come as a surprise to us what the students are doing on the midterm. If, at the end of every class we assess what the student has learned, we will know exactly what the students are capable of and what they are not capable of. We should be building skills in every class, and we should be evaluating our students progress in every class. If we do this, we will know exactly what the students are capable of doing, and will not have any surprises regarding their lack of learning on the midterm. This is our job as teachers and if the students fail that means that we have failed them. Instead of thinking of exams as means of evaluating our students we should think of them as means of helping the students to learn

So to summarize the job of the teachers is to inspire, to motivate, and to build skills. We have to teach the students that they can do whatever they want to do, and to teach them to reach for the stars. We have to motivate them that acquiring an education, even though it’s a struggle, and even though studying and trying to solve challenging problems can be frustrating, it is worthwhile. Knowledge is extremely valuable, and can change our lives, and change the world. But in addition to this inspiration and motivation, you also need to build skills. If we teach students confidence but don’t teach them how to perform, then performance failures will crush their confidence. So confidence and skills should be developed in parallel. That’s the job of the teacher and that’s both very difficult and very challenging and also extremely rewarding. In fact, it is the most rewarding task in the world: all the prophets were sent as teachers. As teachers, we follow the highest profession. For more details, see Principles of An Islamic Education May Allah T’aala give us the Taufeeq to fulfill our responsibities, to change the lives of our students, and through them the world, for the better.

Nominal Versus Real Models

Modern economics uses “scientific” methodology, under the assumption that economic laws are invariant across time, space, and society. In previous posts, we saw how this leads to loss of precious insights about money gained from historical experiences (Monetary Economies: A Historical Perspective, Lessons from Monetary History: The Quality-Quantity Pendulum). In this post, we will discuss the modeling strategy we will use to derive lessons from history which extend beyond the particular historical context from which they are derived.

Models are simplified representations of reality. When considering monetary history, the factors driving changes are notably intricate. Over the 20th century, the monetary system underwent significant transformations. World War I marked the breakdown of the gold standard, followed by unsuccessful attempts at restoration. World War II further hindered restoration efforts, leading to the Bretton Woods agreement and the adoption of a gold-backed dollar standard. Nixon’s actions in 1971 severed the link between the dollar and gold, ushering in an era of floating currencies detached from commodities. Distilling broader lessons from the complexity of historical specifics necessitates a methodological approach centered on models. Models abstract from specific historical details to illuminate structures which may be widely applicable across various historical and temporal contexts.

In this text, we will be using realist models – these differ greatly from the nominalist models used in conventional textbooks of economics. The difference can be explained as follows. Our world comprises observable phenomena as well as underlying structures that produce these observations. Nominalism holds that models should focus solely on explaining observables, disregarding whether they accurately reflect hidden reality. This notion, though counterintuitive, emerged due to the belief that hidden reality is unknowable, making the pursuit of matching it futile. Instead, nominalism advocates for assessing a model’s success based on its ability to explain observed phenomena. Conversely, realist models strive to mirror the hidden reality behind observations.

Friedman’s essay on “The Methodology of Positive Economics” strongly advocates the use of nominal models. This methodological principle has been widely accepted by economists. Friedman illustrates nominal models with the example of a skilled pool player. He suggests that even if the player lacks any understanding of physics, assuming knowledge of the laws of physics can lead to accurate predictions of their shots. In essence, the player behaves as if they comprehend physics, making successful shots based on calculations, despite their ignorance of the underlying principles of physics. This is known as the “as-if” methodology, and it is the dominant approach to models in modern economics.

In contrast, realist approaches reject such assumptions. For the pool player, a realist model might study his past experiences, and his skills at different types of shots. Realism aims to understand the internal workings of hidden reality, while nominalism accepts models that predict outcomes, without concern about matching hidden reality. Friedman developed his as-if theory in response to empirical surveys which showed the most firms do not maximize profits. He argued that the assumption of profit maximization, even if it did not match the motivations of the managers of the firms, should be assessed on the basis of its ability to predict decisions about hiring and production. However, by now, this methodology has been in use for several decades, and it has led to repeated failures. A good fit to observations for a particular finite set of data is not a guarantee of the validity of a model. It can, and often does, happen by chance. For a more detailed discussion of the superiority of real models to nominal models in the context of econometrics, see “A Realist Approach to Econometrics” (bit.ly/azrae)

We will use a recently introduced modeling strategy — Agent-Based Models (ABMs) – which has not made its way into mainstream methodology. ABM models have multiple agents – laborer, producer, shopkeeper, government, etc. – each of which has their own economic decisions to make, and behavioral patterns. This strategy has become feasible because of the vastly increased computational power now available, which permits us to run simulations and compute outcomes. The foundations of modern economic methodology, established around the mid-20th century, relied on simplifying assumptions to facilitate manual computations. For example. Leading macroeconomic models have only one agent, who has perfect foresight. Why? Because computations by hand would be impossible with two or more agents. At a Congressional inquiry into the failure of economists to predict the Global Financial Crisis of 2007, Solow testified that the GFC was caused by large scale deception and fraud. Macroeconomists could not predict it because these are impossible in models with only one agent. In contrast, models with heterogenous behavior are much better at capturing the complex internal structures of modern economies, in accordance with the principle of realist models.

Using ABMs, we can capture three Keynesian insights, all of which are essential for the understanding of money, and all of which are missing from conventional textbooks:

Complexity: This technical term refers to a situation where the group behaves very differently from the individuals within the group. For example, that even though laborers and the firms which hire them may seek to lower the real wage, they can only negotiate on the nominal wage. The real wage involves the price level of the economy which is out of their control. Keynes argued that lowering nominal wages at the micro level throughout the group may end up increasing the real wage – a perfect example of complexity. This phenomenon is beyond the reach of conventional economic theory because the textbook models are oversimplified to prevent the occurrence of complexity.

Radical Uncertainty: In a model with heterogeneity, each agent has access to a limited amount of information. The economic outcomes depend on the actions of all agents, which can never be known to the agents. As a result, the agent operates in an environment where the outcomes of the decisions he takes are not predictable. Standard textbook models use intertemporal optimization, where the agent knows his future incomes, potential consumption bundles and prices. This is simply impossible in our agent-based models. Similarly, profit maximization is impossible for firms because they incur production costs in current period, but will produce and sell goods in the next period. The price at which they can sell will depend on decisions others make, and cannot be predicted. So profits are subject to radical uncertainty, and cannot be maximized.

Non-Neutrality of Money:  Once we take into account heterogeneity and uncertainty, new insights into the role of money emerge, not available in conventional textbooks. Workers save money, and firms acquire money profits, but, due to radical uncertainty, no one knows what the value of money will be in the next period. A stable value of money allows for some degree of planning, but the QQ-pendulum shows that this stability cannot be relied upon. The assumptions of full information made in conventional textbooks make money merely an accounting unit, which does not play an essential role in the economy. However, with radical uncertainty, and differential information and behavior of different agents, money plays an essential role in the economy. Workers save money as insurance against adverse outcomes in the job market, and firms save money to guard against future losses. These different motivations for holding money, and the psychological aspects which relate to public trust in the future value of money, will come to the fore in our ABM models.   

To wrap up, we have discussed two types of models – nominal and real. Nominal models dominate mainstream economics, and are judged for their ability to match observations. In contrast, Realist models are judged on whether or not they match the hidden structures of reality which produce the observations. In the next section, we will build some simple realist monetary models, and show that these produce results and yield insights outside the range of orthodox monetary models.

Links to Related Materials

• Bit.ly/ME01  Monetary Economies: A Historical Perspective
• Bit.ly/MONE02 Lessons from Monetary History: The Quantity-  Quality Pendulum
• Bit.ly/MONE03 Nominal and Real (Monetary) Models
• Bit.ly/WEAmar  Models and Reality

Lessons from Monetary History: The Quality-Quantity Pendulum

In the previous section, we saw how economic theories changed from Classical to Keynesian to Monetarist over the course of the 20^th century. These changes were driven by historical events. Taking this historical context into account deepens our understanding of economic theories. This contrasts with the conventional methodology of economic textbooks, which treats economic theories as scientific laws, which are universally applicable to all societies. In this section, we describe one of the central lessons which emerges from the study of money over the millennia.

The transition of economic theories from Classical to Keynesian to Neoclassical can be seen as a miniature illustration of the Quality-Quantity Pendulum, which is a consistent pattern relating to money observed over millennia. Modern economic theory strips theories of their historical context, depriving us of critical insights into both theories and history. Before studying the QQ Pendulum, we will pause to discuss how this defective methodology was adopted by economists.

The Battle of Methodologies: As Geoffrey Hodgson has detailed in his book entitled “How Economists Forgot History”, a challenger to the dominant historical and qualitative methodology emerged in the late 19^th century. The new methodology was quantitative, mathematical, and empirical, in imitation of scientific methodology. The devastation of World War 1 destroyed the prestige of the traditional approach to social science, so that this scientific approach became the dominant methodology in economics by the 1950s.  This ahistorical approach blinds us to the fact that all social theory is developed to analyze a particular society situated in a particular historical context. Treating it as a universal scientific law, invariant across time and space, is hugely mistaken.

Lessons from History: In this section, we will discuss some insights about the nature of money, and monetary economies, derived from the study of history by Glyn Davies in “A History of Money: From Ancient Times to Modernity”. Davies writes that: “… despite the antiquity and ubiquity of money its proper management and control have eluded the rulers of most modern states partly because they have ignored the wide-ranging lessons of the past or have taken too blinkered and narrow a view of money.” For example, Keynesians and Monetarists agree that a contraction of the money supply was the immediate cause of the Great Depression of 1929, whose ill effects persisted until the outbreak of World War 2 in 1942. From a broader perspective, a study of the history of money should have made both the nature of the depression, and the remedy, abundantly clear. Unfortunately, as the previous quote indicates, policymakers ignored the lessons history teaches us about the role of money, and made errors which caused misery to millions for decades.

Money as a Social Institution: A study of history shows that money has played a central role in shaping history across the centuries. Also, history teaches us money is not purely a transaction technology; it is deeply embedded in the social fabric of society. The use of money requires building social consensus on the trustworthiness of monetary institutions. Building this trust requires building high-quality institutions and mechanisms that guarantee the value of money in the eyes of the public. The quality of money refers to the public trust and social consensus both on the value of money, and the stability of this value across time.

High Quality Money: History provides us with an incredibly diverse set of examples of monetary institutions which provided society with trustworthy money with stable value across time. Cattle and cowries in Africa, paper money in China, Wampum in America, and Yap stones in the Pacific Islands, were used as money for centuries. Many systems even survived in competition with modern monetary systems. So, we conclude that there are a wide variety of ways to create high-quality money.

The Gold Standard: One of the ways to create high-quality money is to use gold or silver. These metals have characteristics – discussed in textbooks – that make them particularly suitable for use as money. There is very little public awareness that there are many different varieties and conflicting interpretations of what the “gold standard” means. The best reference for this is Morrison’s England’s Cross of Gold: Keynes, Churchill, and the Governance of Economic Beliefs. The strictest form of the standard – the use of actual gold – has been very rare, historically. Coins of minted gold have been far more popular. The mint certifies the quantity and quality of gold in the coin, making it far more convenient for public use.   

Minted Money and Token Money: The highest quality of money comes from minted coins, which have a value equal to the content of the metal (gold or silver). This is because the coin itself is the guarantor of its own value. There is still the question of what it is about gold and silver that creates a nearly universal consensus on their intrinsic value. Perhaps the answer is that love of gold and silver has been built into human nature, as Quran (3:14) suggests.

The numismatic evidence from buried coins shows that high quality gold coins are almost always followed by “debased” coins – coins with significantly less gold content than the face value of the coin. History tells us of the varied reasons for such debasements. Most often, the high expenses of wars require vast amounts of money, beyond the available stocks of gold. Governments resort to debasement to get more money from the same gold stock. Since gold is very valuable, even the smallest gold coins are not useful for daily transactions. So, token monies, made of copper or other cheap metals, are often used for small change. The metal value of these coins is not equivalent to their market value; instead, these coins are considered as fractions of the gold coins, and can be exchanged for them.

From Quality to Quantity: The Quality-Quantity Pendulum is a theory that illustrates the historical shifts in economic focus between the quality and quantity of money. The lesson of history, repeated across the globe, and across the centuries, is that the temptation to expand the stock of money – more quantity – proves irresistible in the long run. A modest expansion of money stock via small dilutions of gold content or small issues of token money, brings major economic benefits. Small expansions of money stock beyond gold content do not cause noticeable changes in public trust which is the central guarantor of the value of money. However, over a longer period of time, the temptation to expand the quantity beyond safe limits becomes irresistible. Events like wars, private greed, or government needs, lead to over-expansion of the money stock. An excessive quantity of money causes inflation, a loss of value, and a breakdown of public confidence in money. The drive to expand the money stock leads to a low quality of money. But large fluctuations in the value of money disrupt lives, and cause distress to all members of a monetary economy. As a result, consensus builds on monetary reforms required to create high quality money. Eventually, excess money is removed from circulation, and a high-quality money is restored, to complete the swing of the pendulum between quality and quantity.

The Pendulum of Economic Theories: Many authors have noted that history is a battle between the creditors and the debtors. In eras of high-quality money, money is scarce, and the creditors are few and powerful. They propagate pro-creditor economic theories which favor “sound” money: high quality with restricted quantity.  However, the need for expansion of money stock becomes overwhelming in many different scenarios. Then, pro-debtor economic theories emerge. These favor the expansion of the money stock, and cite numerous advantages from doing so. Creditors argue in vain against these theories and warn that they will lead to ruin. The benefits from expansion are immediate and obvious to all in the short run. But in the long run, the creditors’ gloomy predictions turn out to be valid. Over-expansion destroys the quality of money, and also the reputation of the pro-debtor economic theories.

This drama has played out over the centuries in many different guises, and with different terminologies in use to describe the two opposing schools of thought about money. Confusingly, the quantity theory of money (QTM) advocates the maintenance of high-quality money, and argues against expansions of the money stock to bring prosperity to the masses. As opposed to it, the Real Bills Doctrine (RBD) argues that the money supply should be expanded to finance productive investment.

The RBD versus the QTM, the Anti-Bullionists versus the Bullionists, the Banking School versus the Currency School, Keynesians versus Monetarists, and most recently, Minsky’s Financial Fragility Hypothesis versus the Real Business Cycle theories, are all illustrative of the quantity-quality controversy which spans centuries of monetary history.

Long-Run Versus Short-Run Perspectives: Davies emphasizes that this quantity-quality pendulum becomes discernible only in the long run. Over any short period of time, spanning a few decades, the immediate benefits of one or the other school of thought seem overwhelming. When tight money is creating recession and unemployment, the benefits of looser money seem obvious to all, and tight money adherents find little support for their positions among the masses. However, in periods of high inflation, the harms of loose money again appear obvious, and tight money policies gain public support. Over any short period of time, one or the other policy seems obviously superior. It is only a long-term examination of history which shows the regularity with which the pendulum swings between the two poles.

There are three conclusions we would like to draw from the quantity-quality pendulum, which emerges from the study of millennia of monetary history.

1. The study of equilibrium in monetary economics is an illusion. A stable and high-quality money creates an irresistible temptation towards expansion, leading to a breakdown in quality. Excessive money stock destabilizes the value of money and creates powerful forces which seek to stabilize its value and create high-quality money. At no point in the trajectory of the monetary pendulum do we see any resting place, or equilibrium.
2. The value of money rests on the social consensus created by confidence in the monetary institutions governing the creation of money.  History is full of examples where this confidence was weakened or strengthened, leading to changes in the value of money. Recently, a crisis of confidence in the Euro was stemmed simply by an announcement by Mario Draghi that he would do “whatever it takes” to stabilize and protect the Euro. Conventional treatments of money pay no attention to these psychological aspects of money.
3. The historical perspective provides deeper insights into monetary theory than conventional methodology. When the Great Depression created tight money, Keynesian theory favoring expansion of money stock emerged and became popular. Inflation in the 1970’s led to rejection of Keynesian theory and a return to the tight-money policies implemented by Volcker. Conventional methodology searches for absolute scientific truths, without realizing that truth may be relative to a particular historical context.

Monetary Economies: A Historical Perspective

{bit/ly/ME01} A Monetary Economy is one in which the use of money is essential to the functioning of the economy. That is, without money, people would starve, and massive amounts of economic misery would result. Since monetary economies have dominated the world for centuries, this seems to us like a natural state of affairs. However, a study of history reveals that monetary economies came into existence only a few centuries ago, and eventually came to dominate the globe. Most pre-modern societies were not monetary economies. For instance, a feudal economy was not a monetary economy. The landlord owned the land, and workers on the land would receive all necessary support – food, clothing, housing, etc – from him. In return, they would work the land and produce crops, and provide other services. No money was needed for the basic necessities of life. The landlord could sell excess crops for money, and buy fineries from foreigners, but this was not essential for existence. Even today, in many areas of the world, rural subsistence economies far from urban centers are often self-sufficient, and can function without money. These non-monetary economies are excluded from the scope of our study.

Our goal in this textbook will be to clarify how monetary economies function, and how they have evolved over time. This is important because conventional modern textbooks of economics do not correctly describe monetary economies. In these textbooks, money does not serve an essential function. This point is recognized and articulated in these textbooks using the terminology “neutrality of money”. For instance, a popular textbook by Mankiw states that:

Over the course of a decade, for instance, monetary changes have important effects on nominal variables (such as the price level) but only negligible effects on real variables (such as real GDP). When studying long-run changes in the economy, the neutrality of money offers a good description of how the world works.

Exactly contrary to this, Keynes stated clearly in his landmark book entitled The General Theory of Employment, Interest and Prices, that money plays an important role in both short and long run – it is not neutral. If money is neutral, then money plays no essential role in the economy, and so there is no essential difference between monetary and non-monetary economies. In this textbook, we will explain how money, far from being neutral, is a central driver of economic activity. Conventional textbook analysis, which takes money as neutral, leads to deep misunderstandings about modern real-world economies.

The false assumption of neutrality of money led to the failure of economists to understand the causes of the Global Financial Crisis in 2007, and also to their failure to take corrective actions which could have prevented the Great Recession which followed. The battle of ideas, embodied in economic theories about money, is described in “Completing the Circle: From the Great Depression of 1929 to the Global Financial Crisis of 2007”. It is useful to briefly outline how economic theories changed over the course of the 20^th Century:

1. Classical Economists argued for the neutrality of money, along with other ideas, which lead to the conclusion that unemployment can only be a short-run phenomena. In the long run, unemployment will be eliminated by the workings of the free market.
2. Following the Great Depression of 1929, large amounts of unemployment which persisted for long periods of time was observed. This was directly in conflict with theories of classical economics.
3. Keynes then came up with a new theory, which had many revolutionary ideas, dramatically different from the assumptions of classical economics. One of the central ideas was that money is not neutral. In particular, in the labor market, the supply and demand for labor, and hence the rate of employment is strongly affected by the quantity of money available.
4. Keynesian ideas came to dominate macroeconomics for about three decades following World War 2. In particular, the idea that free markets will not automatically eliminate unemployment, leads to the necessity of the government policies required to create full employment. Application of Keynesian policies led to full employment in USA and Europe for about three decades.
5. The oil shock of the 1970’s led to the failure of Keynesian policies. Development of monetarism by the Chicago school of economists led to the re-instatement of pre-Keynesian ideas about the neutrality of money and the idea that free markets lead to elimination of unemployment. This came to be known as neoclassical economics, because it rejected Keynesian ideas, and went back to classical economics. See The Keynesian Revolution and the Monetarist Counter-Revolution
6. A concerted campaign was carried out by monetarists to discredit Keynesian theories and rebuild Economics on neoclassical foundations. See Understanding Macro III: The Rule of Corporations. This was highly successful. The Monetarists went from a minority and eccentric school to mainstream orthodoxy by the early 1990s. It became impossible to publish Keynesian and post-Keynesian views in mainstream top-ranked journals.
7. Over the decade of the 1990s economic performance in the Western world became flat – fairly low growth, but no ups and downs of business cycles which had been characteristic of capitalist economies for a long time. This led to celebrations of “the Great Moderation” by the monetarists. Robert Lucas, Nobel Laureate and leading Chicago school economist, announced triumphantly in his Presidential Address to the American Economic Association in 2003, that we economists have conquered the business cycle, and from now on, recessions will not happen.
8. The Global Financial Crisis of 2007 took the economics profession by surprise, just as the Great Depression of 1929 had come as a surprise. Paul Krugman wrote the book “The Return to Depression Economics” arguing that insights of Keynes continued to be valid, and to provide deeper insights into the GFC than was available from leading neoclassical macroeconomic theories of the time. Paul Romer wrote a scathing article entitled “The Trouble with Macro” in which he argued that modern macroeconomics is based on fundamentally flawed doctrines, and leads to wildly incorrect predictions.

This is more or less the current state of affairs, as good alternatives to conventional macroeconomics are unavailable in the mainstream. The mainstream macroeconomic theories are based on assumptions which have no relation to reality. For more details, see “Why Do Economists Persist in Using False Theories?”

We will conclude this introduction to monetary economies by discussing some of the key elements of the approach we will be using. First, while mainstream macroeconomics rejected Keynesian ideas, a group of theorists known as Post-Keynesians have continued to develop the ideas of Keynes, building on his fundamental insights. This has led a branch of macroeconomics which provides much deeper insights into modern economies then the monetarism which dominates universities today. Our text borrows from these ideas. However, the critical innovation of this textbook is to study economic theory within its historical context.

As described earlier, historical events, and economic crises, have played a major role in shaping economic theories. In fact, we cannot understand economic theory as an abstraction, removed from its context. This is in conflict with the claim implicit in the use of the word “science” – lessons from study of European societies are universally applicable to all societies across time and space (see: The Puzzle of Western Social Science). In fact, all social theory is developed as an attempt to understand historical experiences of a particular society, and cannot be understood as an abstraction, detached from this historical context. Studying economics within its historical context requires a methodology radically different from that currently in use, in both orthodox and heterodox textbooks of economics currently in use around the world. We will discuss this methodology in the next section.

The Opposition between Capitalism and Islam

The surprising title is due to the fact that Capitalism is the religion of worship of wealth, so Islam (not Islamic Economics) is the right contrast. Max Weber characterized capitalism as the pursuit of wealth for its own sake, without regards to any benefits obtained from this wealth. For more details see: The Religion of Economics.

To understand why capitalism is a religion, we need to study the Historical Origins of Capitalism. A brief sketch, in outline form, is given below:

1. Scholastics attempted to build social theory on basis of the Bible and Christianity
2. Centuries of Religious Wars in Europe led to the realization that society cannot be built on Christian principles.
3. As a result, Christianity confined to a personal belief in Europe.  Study of social, political, and economic institutions was to be done on secular basis.
4. Hobbes was the first to build a political theory on purely secular grounds.
5. Study of Economics on secular grounds soon followed. This eventually replaced the idea of Economics as a branch of moral philosophy

The fact that modern economics is based on the rejection of Christianity is obvious from the way the subject is treated in textbooks. We start with the premise that there is no God, Judgement Day, Heaven or Hell. This means that Man is just another type of animal, and Human society is governed by laws of the jungle: Greed, Competition, Individualism. Since there is no life after death, we should strive to create heaven on earth. For this purpose, individually and collectively, we should strive to maximize weath. Pursuit of pleasure, power, profits is the goal of our lives. These are the founding principles of Capitalism, and are more or less explicitly exposited in modern economics textbooks. There is a stark contrast between these, and the fundamental principles of an Islamic Society:

1. Generosity vs Greed
2. Cooperation vs Competition
3. Social Responsibility vs Individualism
4. Success on Judgement Day vs. Pleasure, Power, Profits of this world

We briefly discuss each of these contrasts separately.

Generosity vs Greed: The greed of the financial sector has been recognized by many as the root cause of the Global Financial Crisis of 2007. The institution of banking did not emerge until the Biblical “Love of Money is the root of all evil” had been replaced by the Shavian “Lack of Money is the root of all evil”. In contrast with banks, representing greed, the Waqf, representing generosity, is the central financial institution of an Islamic society. One third of the registered land in Ottoman Empire was devoted to Waqf. People acted in the accordance with the Islamic ethic of spending excess wealth on others, to buy rewards of the Akhira

Cooperation vs Competition: The assumption that life is a jungle governed by survival of the fittest leads to the theory of perfect competition. If all agents are selfish, then monopolies are harmful. A monopoly of doctors would be able to extract massive amounts of revenue from the population, as the American Medical Association does in the USA. In contrast, if traders join to provide service, they can bring great benefits to the population. The Guilds of Al-Andalus and Ottomans had the goal of providing service to the population. This is the critical difference between Islamic and Capitalist Firm: Islamic firms are motivated by Service whereas capitalist firms are motivated by Profits

Social Responsibility vs. Individualism: The individualist philosophy of Everyone for himself has led to breakdown of the family in the West. Over 50% of children are born to single mothers. Islam teaches us that the Ummah is like one body, and every part feels the pain of the others. Islam places great emphasis on our duties and responsibilities to our family, elders, children, neighbors. Social responsibility is manifested by spending on others, for the sake of the love of Allah, and is heavily emphasized in the Quran.

Success: Akhira vs Dunya? Corporations causing enormous damage to humanity and the planet due to short term greed for worldly profits and power. Islam teaches us to sacrifice worldly pleasures for the sake of the success of the Akhira: You will not reach the GOOD (BIRR) until you spend of that which you love!  Striving for success on the day of Judgment leads to radically different behavioral patterns from the capitalist striving for pleasure, power, and profits.

We have argued that the Foundations of An Islamic Society are radically different from Capitalism: Generosity, Cooperation, Social Responsibility, Success in Akhira stand in dramatic contrast to Greed, Competition, Individualism, Worldly Success. But this immediately leads to the embarrassing question:

SO – WHERE IS this Islamic Society? WHY, if it is so superior, do we not have a working model, to show the world?

The answer was given by Ibn-e-Khaldun’s landmark history written seven centuries ago. All Civilizations Evolve Over Time from Youth to Maturity to Old Age. Teachings of Islam catapulted ignorant and backward Bedouin into world leadership. These teachings created a civilization which enlightened the world with knowledge for more than a thousand years.

For the past three centuries, the West has taken the lead in the production of knowledge.

Today, the challenge facing the Muslims is to show how we can implement the complete and perfect guidance of the Quran to solve our problems today. This is a deep and difficult discussion, and some aspects are available from The Ghazali Project for
Revival of Islamic Societies. Some talks addressing this issue are available from the links below:

1. Central Ideas of the Ghazali Project: http://bit.ly/Ghazali1
2. The Ghazalian Webinars: http://bit.ly/AZwebinars
3. How to Launch an Islamic Revival: http://bit.ly/azlir
4. What the World Lost due to the Decline of Islamic Civilization:  http://bit.ly/azrdm