Economics for the 21st Century

Published on 22 Jan 2018 in Newsline Magazine as “Cradle of A New Economics

A 1600 word summary of The Presidential Address at the 33rd Annual Conf of PSDE, 12-14 Dec 2017 in Islamabad. Also, link to complete 35m Video-Lecture.

Failure of Economics: After the Global Financial Crisis (GFC) of 2007, the failure of economic theory to provide a warning, explanation, or solution, was noted far and wide. Prominent economists – heads of institutions responsible for policy, such as the World Bank, International Monetary Fund, Federal Reserve Bank, Bank of England and others – said that theories currently forming the basis for policy had failed completely. The Queen of England went to the London School of Economics to ask “Why did no one see it coming?

Resistance to Change: Despite a widespread realisation of this failure, the mainstream response within the economics profession has been characterised by a stubborn resistance to change, and an obstinate defence of inaccurate theories. Models in use at central banks across the globe have been producing flawed forecasts since the GFC. Daniel Tarullo, ex-governor of the Federal Reserve Bank, wrote a paper titled ‘Monetary Policy Without a Working Theory of Inflation,’ in which he pointed out that even though experience had proven all current economic theories about inflation to be incorrect, economists stubbornly stick to them as a basis for making policy. Similarly, even though theories used to assess risk in stock markets failed disastrously in the GFC, these continue to be used to this day.

Why is there such strong resistance to change, even in face of a pressing need for it?

Paradigm Shift Required: The problem arises because the changes required are not minor patches or modifications in existing frameworks. A revolutionary paradigm shift is needed. When Max Planck could not persuade his contemporaries in physics to accept quantum mechanics, he realised that “Science progresses one funeral at a time.” It is not possible to convert the elders of the profession, who have invested their lives in learning incorrect theories. One must catch the youth, and train them in new ways of thinking, to create an economics that will be viable in the 21st Century.

A Heavy Responsibility: This situation represents both a golden opportunity and a heavy responsibility for us in the Islamic world. For reasons to be explained further below, the chances of the required revolution taking place in the West are negligible. Unlike the West, our investment in modern economic theory is small. Furthermore, modern economic theory is designed to enrich the wealthy while counselling the poor to wait for the ‘trickle down.’ Thus, launching a revolution is aligned with the economic interests of the poor countries. The greatest resistance to change would come from those with a professional training in economics. We need to co-opt our PhD economists by asking them to work for the interests of the poor, instead of the wealthy, and to sacrifice personal privilege for justice and social equity .

Three Mistakes: So how can we launch a revolution in economics? Doing so requires noting and correcting three major mistakes made over the course of intellectual progress in the West. Since these major flaws in the structure of Western knowledge have persisted for centuries, and form the foundations of Western thought in social science, they cannot easily be corrected there. That is why it is up to us, in the Islamic world, to launch the revolution that may save humanity from the looming catastrophe that threatens us all due to misguided Eurocentric theories of economics, politics, and society. The three mistakes are:

  1. The Battle of Science and Religion – from the 16th to the 18th centuries in Europe – which led to an exaggerated respect for science as the sole source of valid knowledge, and a rejection of religion as nothing but superstition.
  2. The Battle of Methodologies – in the late 19th Century – which replaced the historical and qualitative approach to economics by a quantitative and scientific approach.
  3. A drastically mistaken understanding of the nature of science, known as logical positivism, became dominant in early 20th century. Social sciences were re-formulated to align with this philosophy, which stressed the importance of observables, and advocated benign neglect of unobservables. Even though this philosophy was later proven wrong, foundations of modern economics have not been revised, and continue to be based on principles of logical positivist philosophy.

Battle of Science and Religion: Eurocentric histories suggest that science sprang up full-blown in Europe, like Athena emerging from the forehead of Zeus. Even careful thinkers like Max Weber were deceived into thinking that scientific thought is unique to Europe. In fact, completion of the re-conquest of Islamic Spain in 1492 gave Europeans access to vast libraries with millions of books containing knowledge gathered from around the globe. The battle of science and religion is just another name for the European struggle from the 16th to 18thcenturies, to assimilate this flood of new knowledge, which was often radically in conflict with the teachings of the Catholic Church. The Church’s mechanisms of massive censorship, and the Inquisition for heretical thoughts, eventually failed to stem the tidal influx, resulting not only in the fracture of the Church, but also in a bitter enmity between progressive thought and religion in Europe (which lasts to this day).

The Resulting Damage: The victory of science over religion in Europe has had adverse effects on the development of social science in many ways. Devaluing religion led to a loss of understanding of the spiritual and emotional aspects of man. European philosophers and social scientists created models of men as being brains suspended in vats, with no heart and no soul. While a strong sense of morality is built into our nature, discarding the heart and soul from scientific consideration led to a loss of the understanding of the nature of morality. As Julie Reuben has described in The Making of the Modern University: Intellectual Transformation and the Marginalization of Morality, changing conception of the nature of scientific knowledge led to the exclusion of morality and character-building from the syllabus and goals of a university education in the West. Since morality cannot be given an empirical foundation, it was abandoned as a meaningless concept within a scientific framework for the construction of knowledge. This has resulted in an economic theory which has become blind to concerns for justice, equity, poverty, exploitation and similar issues, which were central to economics in an earlier era (when it was a branch of moral philosophy).

The Battle of Methodologies: In the late 19th century, the natural methodology for economics, which is historical and qualitative, lost the battle to the newly developed scientific and quantitative methodology. While the scientific method is well suited to the study of inanimate objects subject to laws, its application to human beings and societies led to a loss of understanding of the nature of both. Modern economics treats human behaviour as robotic, subject to mathematical laws. Studies of actual human behaviour show dramatic differences from the homo economicus, which is basis of the scientific formulae of economic theories. It is these differences which create the ‘irrational exuberance’ that leads to financial crises, which cannot be predicted by economists with their impoverished models of human behaviour. Economic theory ignores, to its great loss, social aspects of human behaviours, which are central to human welfare. The desire to be scientific also leads economists to ignore particular historical events like the two world wars, since these are one-time events which cannot be subjected to universal scientific laws. But this means that economists do not study the historical context within which economic systems operate, leading to a dramatic loss of understanding.

Logical Positivism represents a sophisticated and complex misunderstanding of science, which rose to prominence in the early 20th century, and had a spectacular crash later on, as philosophers became aware of its defects. The main idea of this philosophy is the scientific theories should only be concerned with observables and should ignore, or eliminate, unobservables. Under the influence of positivism, behavioural psychology ignored the deeper and unobservable structures of human thoughts and emotions, and instead focused on observable behaviours, stimuli and responses. A similarly shallow analysis led economists to posit human behaviour as being driven solely by the purpose of maximisation of lifetime consumption. Focus on observables and quantifiables has led to a single-minded concentration on wealth as the sole goal of economic endeavour. It is only with the re-discovery of multi-dimensional nature of our lives that the deep defects in this measure, and the damage it is causing, are gradually becoming visible. The most important aspects of our lives are based on unobservables and un-quantifiables.

Concluding Remarks: The spectacular technological progress of the West has dazzled our eyes, making it difficult to see any defects in their structures of knowledge. But learning how to split atoms and build bombs and spaceships does not lead to insight into the secrets of the human heart. Massive gains in material wealth have been accompanied by increasing social misery everywhere. We can all see the breakdown of communities, families, increasing inequalities and injustice, environmental collapse, and senseless wars leading to millions of deaths, with billions living below the poverty line. At the root of the failure to solve our social problems is a hopelessly defective Western social science which denies the existence of the heart and soul. Hope for the future of humanity lies in a radical re-construction of the social sciences, which re-integrates the heart and soul, as the starting point for the study of human beings and societies.

POSTSCRIPT: This talk was the subject of a classroom discussion, which elaborated on certain points covered briefly above. Slides for the talk, and recording of the discussion are available from Adv. Micro Lec 28

Choosing our own pathways to progress

The Islamic World is deeply trapped in the illusion that we need to emulate the West in order to progress. This article attempts to explain some reasons why this is not so.

WEA Pedagogy Blog

Published in  The News: on June 5, 2008; in Pakistaniaat: A Journal for Pakistan Studies Vol 1, No 2. 2009;    Jakarta Post: From the Rubble of Modernization: on 11/11/2008 ; in Turkish Daily News on Nov. 30, 2007

Pride resulting from global dominance and spectacular scientific and technological developments led Europeans to believe that the West was the most advanced and developed of all societies. Other societies were primitive and under-developed. As these other societies matured and grew, they would follow the same stages that were followed by the West, and eventually become like modern Western societies. Early thinkers like Comte described the stages in growth from primitive society to modern ones in a ‘logical’ sequence. The enterprise of colonizing the non-European world was painted in bright terms as being part of the “White Man’s burden” of bringing enlightenment, good government, science, technology and other benefits…

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The Ways of The Eagles

[] Wo faraib khorda shaheen, jo pala hay kargason mein – usay kya khabar ke kya hai, raho rasme shahbazi  
Suppose that Iraqi children learnt the story of the invasion and occupation of Iraq in schools run by Americans. They would learn of the heroism and bravery of the US troops, who made great sacrifices to bring freedom and democracy to Iraq. They gave their lives, and spent trillions in order to educate and civilize the savage terrorists who lived in Iraq. They would learn to admire the US for their humanity, civilization, and technology, and hate their ancestors for their barbarism, terrorist ways, lack of education, and most of all, lack of appreciation for the American culture. They would reject as enemy propaganda stories of US destruction of millions of lives and billions worth of infrastructure in their greedy quest for control of the rich oil resources of Iraq.
Growing up in Pakistan, we receive an education designed (by Macaulay and followers) to create a class of people who would be the intermediaries between the British rulers and the ruled natives. They are indoctrinated through an education system to be “Indians” only in appearance — they have complete belief in the good intentions of British rule and the philosophy of ‘the white man’s burden’, thus making the task of ruling this vast country easier. They would, without question, believe that the British were there for the upliftment of the Indian people from centuries of ignorance and backwardness. Over a period of time, they would associate all things British with superiority — their physical appearance, their attire, their language, their culture, their religion. This beautifully designed system was to be self-perpetuating – the indoctrinated would be the rulers, and would control the education system to create more people like themselves.

While we have achieved independence in form, mentally we are still enslaved by a deeply ingrained inferiority complex vis-à-vis the West. To cure this, we must develop and tell our own history. In bits and pieces this process has begun, as in the replacement of the term “Mutiny of 1857” by the War of Independence. The dramatic change of point of view required for this change of terminology is one that needs to applied on a much larger scale. This essay is an attempt to continue this healing process. It would be impossible to do justice to this project in this short space. I intend only to outline and sketch the dimensions along which we need to reconstruct our history. The stories we tell about our past are extraordinarily important in shaping our identities and in determining the goals worth striving for.    ( seeThe Subaltern’s Tale )

History is nothing more than the conquest song of the victors. Today, as a result of our Western education, we have absorbed a Eurocentric version of history, according to which the sun of reason first rose in Europe in the sixteenth century, when the rest of mankind was covered in the darkness of ignorance and superstition. Since then, European have made fantastic progress on all fronts, like no one else has ever done. Today, all good things we know are creations of the European civilization. This Eurocentric history is poisonous to our souls, and anti-thetic to Islam. Massive effort is needed to debunk this story, and disgorge this poison. One small effort in this direction:

Non-Eurocentric History, needed as an antidote to the poison we have swallowed:

India was looted, not developed, by the British Raj:  Tales of the fabulously wealthy India attracted explorers (like Columbus) from all over the world. India had well developed institutions for the provision of justice, education, health, and social security. Indian textiles and other industrial products were exported to many destinations all over the world. Taxation was not burdensome, and recognized by the citizens as necessary for peace and security. Both citizens and rulers had a clear understanding of their mutual responsibilities towards each other. Localized institutions functioned effectively without reference to central government, and kings were well aware that their wealth was tied to the prosperity of their citizens. As a result, the average citizen was not much concerned about the fortunes of the kings and empires. The populace failed to resist or unite against British invaders, under the mistaken impression that they would be essentially benevolent like other kings. Subsequently, many people from many walks of life wrote letters of appeal in vain to British Queens and Kings. Unfortunately, unlike previous kings who had supported the public against cruel and corrupt administration, the British were firmly on the side of the “Raj,” and had no concern for the welfare of the public.
Effects of British Racism: At the time of colonization, Europeans did not consider non-whites to be human beings. For example, Australian aborigines were hunted like animals, and the Dred Scott decision in the USA declared that blacks were “beings of an inferior order, and altogether unfit to associate with the white race, either in social or political relations, and so far inferior that they had no rights which the white man was bound to respect.”  Even now, there is debate at the highest levels in the USA as to whether or not Muslims can self-govern! Nobel Prize winner Watson has suggested that differences in development levels may be explained by genetic endowments. Harvard professor Bell maintains that non-white races have lower IQ than whites. This deeply embedded racism has had tremendous consequences in terms of the ruthlessness with which non-whites have been treated by colonizing whites. By machinations, deceit, treachery, good luck, superior weaponry and related war technology, the British managed to acquire control of the entire country. Initial foothold in India was supported by production and sale of opium in India and China. European double standards continue to this day as sales of harmful drugs and chemicals are banned in the West and promoted in the East for profits.   British consolidation of power following the conquest of Plassey was so rapacious that one third of the entire population of Bengal died of starvation and famine. Millions of pounds of yearly profits were sent to England without concern for welfare of the inferior beings in India.
Our Traditional Educational Systems: There exist numerous testimonials to the excellence of educational systems of India prior to the colonial times. In The Last Mughal, Dalrymple quotes a contemporary account of pre-colonial India that “He who holds an office worth twenty rupees a month commonly gives his sons an education equal to that of a prime minister. … After seven years of study, the young Muhammadan … (is the equal of) … a young man raw from Oxford. ”  These educational systems were supported by a culture which valued learning and provided many forms of financial support to scholars so that all could obtain an education without any payment. Indians were specially skilled at mathematics, logic, and philosophy; the great mathematical genius of Ramanujan did not come from a void, but from indigenous intellectual traditions. A deliberate British policy of denigrating traditional learning, denying jobs to scholars, degrading the Ulama, and seizing financial resources meant for provision of education, led to the destruction of the educational institutions which served the country. This has led to widespread illiteracy and ignorance in a land once famous for its scholarship, and one which attracted many students from far away lands in search of wisdom.
Health Systems: Health care was provided via a number of systems of medical knowledge based on experience of local doctors. Precious medical knowledge based on centuries of experience was passed down via a system of apprenticeship. Health care was an honorable profession entered into for the service of mankind. The Western idea of using medical knowledge and medicines to make money from the misery of others was considered immoral. Development of an inferiority complex and depreciation of all indigenous knowledge has led to the near extinction of many of these schools of medicine. Destruction of local institutions for healthcare has led to lack of access to basic health care for vast portions of the population.  The Chinese system of acupuncture has received a boost in its fortunes after its effectiveness was recognized by Western doctors. Similarly, some attention is now being paid to preservation of local knowledge systems in India and Pakistan.
Justice: Justice was provided by local panchayats, which were effective and efficient in settling disputes and allowed everyone, rich and poor, equal access to justice. The British destroyed these institutions and replaced them by our current system of courts and lawyers. Because of the typically lengthy and elaborate proceedings, and the expense and remoteness of these from the average citizen, justice became effectively inaccessible to the populace. There was no way to handle problems except by bribing local representatives of British imperial power. Forces of poverty created by huge tributes paid to the colonizers, desperation, and lack of access to legal means for resolving problems led to the spread of corruption of in land of honest and hospitable people with high levels of integrity.
Social Welfare: Because of strong religious injunctions for charity, Muslims even today give away much more of their incomes to the poor than other comparable communities. There were a large number of Awqaf which provided for a huge variety of social needs of the community. Care of orphans, widows, travelers, as well as people in need, together with provisions for education and health, food and water, all were catered to by voluntary organizations funded by the Muslims in the form of perpetual trusts. These institutions formed the fabric of society, and gave concrete expression to the Islamic idea that the society as a whole must take care of its needy. Vast amounts of money locked into trusts for funding these activities were seized by the British, and led to a collapse of these social institutions. The resulting vacuum in provision of social services for the needy has never been filled. As a result, there were over fifty famines in the British colonial period, and vast numbers of people died of starvation and disease.
De-Industrialization of India: Many sources including The Rise and Fall of Great Powers provide evidence for the strong industrial manufacturing sectors of India on the eve of colonization. In textiles, ship-building and steel industry, glass blowing, among others, India was second to none. Our manufacturing sector was creative and efficient, and many technologies flowed from our industries to the backwards England. However, adoption of power looms in India posed a threat to British textiles and were banned by the Colonial powers. When muslin weavers shifted to hand production, their thumbs were cut off to prevent production of competitive muslins. Similarly many attempts at development of industry, tanneries, etc. were prevented directly by British intervention, which saw the future of India as a supplier of raw materials to England, and not as a producer of industrial goods. This transformed India from an industrial country to an agricultural one, and lead to deaths in large numbers of those who had once earned comfortable livelihoods from industry. One Viceroy stated that ” the bones of the cotton weavers are bleaching the plains of India. The misery hardly finds a parallel in the history of commerce.”
Causes of British Victory: If India was prosperous and relatively well-governed, why did it succumb so easily to British invaders? History testifies to the frequency with which barbarian hordes have defeated, looted and pillaged more advanced civilizations. The Mongol conquest of Baghdad provides an important example from Islamic history. Conquest proves military superiority, but not philosophical, cultural or moral superiority. If thieves, pirates and bandits took over and pillaged and looted our country for over a century, it does not follow that we should seek to emulate them. An important additional factor is the centuries of constant warfare in Europe, which led to development of military strategies and tactics. Relative peace prevailed in Islamic lands, so that techniques of warfare did not develop with equal speed. A thousand years of success led to confidence and pride, and under-estimation of Europeans, who were deemed to be barbarians and incapable of development by our early historians like Ibn-e-Khaldun. Thus reports of European developments in warfare reached the Ottomans but were discounted by Muslims, who later paid a heavy price for this neglect.
Moral Degeneration of the West: This retelling of history is not for the purpose of romantic and idealistic glorification of our past. It is of vital importance in showing us the way to the future. The unpleasant and bitter reality of the present is that pirates, robbers, and thieves are firmly in control of the world, and dominate the stage. Those at the reins of power in the West have such low standards of morality that they cannot even honor their commitments to be faithful to their wives. They openly state in international public forums that the killing of half a million Iraqi children is a fair price to pay for control of oil. Deceit, torture, damage to environment, violation of treaties, use of assassinations and murder, and all manners of immoral behavior is justified in the name of profits. The law of the jungle prevails, and any country can be invaded and conquered on the flimsiest of pretexts if it suits the interests of the West.  In this situation, it would be the greatest of folly to think that Western powers have (as they claim in Iraq) our own best interests at heart. Those in power who make such claims to justify compliance with Western dictates have either been purchased or are being incredibly naïve.
Complicity of Local Elites: To compound the problem, the ruling elites all over the developing world are in the pockets of the West. Colonial administrative structures designed for efficient extraction of revenues are now utilized by local political parties for the same purpose. Foreign power and bribes prop up regimes which carry out policies favorable to Western interests and harmful to the public.  Oppression and injustice, and extraction of revenues from a colonized public by alien powers, continues as in the colonial era. Western education systems teach the morality and ethics of pirates and thieves to our children. There is emphasis on luxurious lifestyles, greed, acquisitiveness, selfish pursuit of career goals, wealth etc. The concept that we should serve humanity, even if it takes sacrifice of personal interests, is not taught.
Pathways to Progress: Current society bears a striking resemblance to the Jahiliyya of pre-Islamic Arabia. Loose morals, drugs, unbridled pursuit of pleasures, callous disregard for those not of your tribe (nation), and even the murder of babies by their own parents (see Mothers who Kill Their Children) has become commonplace. The message of Islam transformed this society into one which became exemplars of human behavior for all time to come. This message carries the same power today, but unfortunately at the present time we are looking to the West to solve our problems for us. We need to re-learn our own heritage, which provides solutions not on the menu of choices offered to us by the West. The Quran tells us that God does not change the conditions of a people unless they change themselves. If we strive for the inner transformation demanded by Islam at the individual level, that of surrendering our will to the will of Allah, then Allah will change the condition of the Ummah.

For Related Materials and Links, see collection of materials at The Ways of the Eagles. For another motivational and inspirational talk, see “Reaching Beyond the Stars“, and also “Iqra Univ: Learning how to become a human being, instead of a human resource


Re-defining Prosperity

Central to the message of Islam is the need to focus on goals of Akhira, instead of goals of Dunya. Economic theory is directly opposed to this message, since it teaches us that the purpose of life is to maximize consumption in this world, and furthermore, all human beings actually act in this way. My lecture below discusses the problems created by this assumption, which does not hold for actual human behavior, and is extremely noxious as a normative principle. [Shortlink:]

Quaid-e-Azam Lecture at PSDE 33rd AGM & Conference held on 14th Dec, 2017 at Islamabad. Published in Express Tribunethe Nation 13th Jan 2018. 43m Video Lecture on YouTube:

1000 Word Summary of Lecture: Quest for Prosperity: Culture & Economy

The main thesis of our lecture is that our quest for prosperity has failed to deliver the sought-after goals because we have misunderstood the meaning of prosperity , and looked for it where it cannot be found. We base our economic policies on modern economic theory, which is based on the amazing assumption that human beings act to maximize lifetime consumption, since this is the sole source of human welfare. Human beings are far more generous and cooperative than the assumptions of economic theory allow for. Even more important is Richard Easterlin’s discovery that enormously increased levels of consumption do not bring about corresponding increases in happiness. Consumption only brings short-run happiness; long-run happiness has no correlation with consumption, and is far better correlated with character traits like generosity and gratitude. Mindless pursuit of wealth, implemented by policies to maximize growth, has led to increasing misery, instead of prosperity . Growth-oriented policies have destroyed family lives, engaging all members in production of wealth, and they have damaged our environment, destroying the future of our species for short run gains. Can this damage be reversed? Can we improve human lives and welfare, and also stave off the impending environmental crisis? At the core of the crisis we face is the prioritization of wealth over human beings. A market economy cheapens human beings because it is based on the idea that human lives are commodities for sale in the labor market. Reversing these priorities requires the recognition that all human lives are infinitely precious, with amazing potentials and capabilities for growth in dimensions unknown. Taking this principle seriously would require re-writing all economics textbooks, and radically re-organizing our economic, political and social institutions. Taking collective responsibility to ensure that all members of a society get the chance to develop their capabilities would be a new definition of prosperity , very different from GNP per capita, which is the current focus of policy makers across the globe.

Modern economic theory makes accumulation of wealth the goal of economic activity, and values human lives only to the extent that they contribute to production. How can we reverse these priorities, putting the enrichment and empowerment of human lives at the center, and valuing wealth only to the extent that it is helpful in achieving this goal? The first requirement is to win the battle of ideas, creating consensus on the prioritization of human beings over material wealth. To do this, we need to recognize modern economic theory for what it is, instead of what it claims to be. To accomplish this goal, it is useful to label modern economic theory as Economic Theory of the Top 1% — or ET1% — and explain how all aspects of this theory are designed to portray increasing wealth of the top 1% as the goal of society, and also to show that this serves to benefit the entire society. For example, use of GNP per capita as a yardstick of social welfare exactly fits this description, since gains to the top 1% are first divided over the entire population and then measured, thus appearing to be generally beneficial, when in fact they are not. Overcoming this deception will involve replacing ET1% by ET90% — a new economic theory for the bottom 90%.

Karl Marx clearly recognized the deceptive nature of economic theory, and stated that functioning of capitalism requires convincing the laborers of the necessity and fairness of their own exploitation. ET1% does this by arguing the growth is the best policy to pursue for all, since benefits which obviously accrue to the rich will eventually trickle down to the poor. In contrast, Marx offered us ET90% by asking for a shift from each according to his abilities (to gather wealth) to “each according to his needs”, thereby prioritizing the needs of the poor over growth to provide more wealth to the already wealthy.

As a prescription for change, Marx urged the laborers of the bottom 90% to unite, and throw off their chains.  Experience shows that we can successfully unite laborers to revolt against the capitalists, but after the revolution, control necessarily remains in the hand of a small minority. The nature of power is such that this small minority is likely to be corrupted by it, and use it for personal gains, and to oppress the majority. Just like democracy has failed to give ‘power to the people’, so alternative systems of government also fail.

The Islamic solution works along different dimensions. It seeks to co-opt the rich and powerful, instead of killing them off, and replacing by another set of rich and powerful. This is done by creating social norms of generosity and social responsibility. Fourteen centuries ago, the revolutionary teachings of Islam led backwards and ignorant Arabs to world leadership. These teachings include the ideas that the best leader is the servant of the people, that power is given to us in order to protect the weak, and wealth is meant to be given to the needy. Widespread acceptance of these ideas created a society which provided basic needs, health care, and education to all members using the institutions of Waqf, and the norms of collective social responsibility and brotherhood. Because these ideas have been forgotten, they continue to have the same revolutionary potential today, as they did 1400 years ago. The most important first step in this revolution is sensitizing our hearts to feel compassion for sufferings of all mankind. The feeling that all of the creation is the family of God, and service to humanity, and all living creatures, is the highest form of worship, is essential motivation for the Herculean efforts required to create revolutionary changes required to reverse the increasing concentration of wealth at the top and misery at the bottom.

The Marginalization of Morality

Today, shock-and-awe of the West has led the Islamic World to adopt Western educational systems without examining their roots and foundations. This has led to the failure to realize that these system are not designed to achieve explicit goals of an Islamic educations. In the context, it is very useful to examine the book of Julie Reuben referenced and discussed below. She shows that in the early twentieth century, universities and colleges all over the USA had the explicit goal of developing character, creating leadership skills, creating awarenes of social and civic responsibilities, and generally training students in how to be better human beings. However, this goal was reluctantly dropped from the curriculum due to inter-denominational conflicts, and lack of agreement over appropriate goals, as well as appropriate means to achieve these goals. Since building character is a central goal of an Islamic education, it is imperative for us to re-examine our educational systems, and build alternatives which remedy this deficiency. Our failure to do so reflects strongly in the high proportion of our youth which are being misled by the Western message of hedonism and individualism.

Essay on Marginalization of Morality (published in Express Tribune, June 15, 2015)

Harvard professor Julie Reuben has documented an important historical transition in the life of US universities over the period 1880-1930 in her book entitled, The Making of the Modern University: Intellectual Transformation and the Marginalization of Morality. Rueben describes a variety of intellectual and historical developments that led universities to abandon their longstanding tradition of building character as well as imparting education, and makes the argument that universities’ abandonment of morality caused great social damage to Western society.

Most colleges in the US started out as religious seminaries. The concept of the unity of knowledge led them to embrace scientific and technological teaching within their curricula. Since all knowledge illuminates the Divine, in teaching physics, astronomy etc., teachers were expected to attend to the beautiful truths to be read in the works of God. Many difficulties arose in the execution of this educational programme. One source of difficulty was the conflicts among different denominations of Protestant Christianity.

To resolve such conflicts, scholars with an implicit faith in unity of knowledge proposed a purely scientific approach to morals in the hope that this would lead to scientific support for traditional Christian morality. Courses were developed to “arouse in (the student) a consciousness of his relationships and a realization of his responsibilities,” in many universities. The promotion of social sciences became, on this view, a moral mission. In the early 20th century, social scientists portrayed themselves as agents of moral progress. World War I reinforced these views as many thought that these awful calamities were a result of ignorance about the social and political sciences. The phenomenal growth of social sciences provides evidence of the university reformers’ strong desire to continue the traditional association between higher education and moral leadership.

The development of the philosophy of logical positivism  dealt a deadly blow to the desire to integrate moral, spiritual, intellectual and scientific traditions within the university curriculum. According to this philosophy, which became widely accepted, facts and values are sharply separated. Science is based only on facts, while there is no empirical basis for values. The moral, spiritual and humanitarian traditions fall outside the boundaries of science. As an additional blow, the philosophy of emotivist ethics relegated all such human concerns to being mere emotional responses, not subject to intellectual discussion. Under the influence of these ideas, social scientists hid normative concerns within apparently objective frameworks. Increasingly, specialization and fragmentation of knowledge became the norm for a university education.

Reuben describes the multidimensional efforts made by the universities to retain an element of character building, moral and spiritual training within their curricula. All such efforts failed, and gradually and reluctantly, universities chose to focus solely upon providing technical knowledge, abandoning moral goals.

Hilary Putnam, and other contemporary philosophers, have shown that facts and values are inextricably entangled — they cannot be separated. Logical positivism has collapsed. Since the effort to find a scientific basis for morality has failed, it is necessary to re-think the university curriculum and to re-introduce spiritual and moral training alongside the scientific and technical. Failure to do so has led to university graduates who have committed great crimes against humanity without recognition or remorse. David Halberstam’s classic, The Best and Brightest, shows how graduates of elite universities bombed Vietnam and Cambodia, killing more than two million civilians without compunction. Loss of a moral compass is also illustrated by the secret Congressional testimony of the physicist Oppenheimer who described the brilliant fireworks that would result from atom bomb first, and the carnage in terms of human lives later. Jonathan Glover’s book Humanity: A Moral History of the Twentieth Century documents genocide, mass killings and levels of barbarism unparalleled in human history. The necessity of re-introducing moral training is evident from the fact that elites educated in the finest universities have participated in, and crafted, strategies for killing millions of innocents. The Islamic tradition is full of materials designed specifically for spiritual and moral development which form the basis of character. Unfortunately, the merits of Our Traditional Educational Systems have been forgotten by the Ummah, which has blindly adopted Western curriculum, syllabi, and educational methods, fulfilling the prophecy that my Ummah will follow the Christians and Jews even into snakeholes. Eyes dazzled by the bright glare of a Western technical education are unable to see the Blind Spots of Modern Education.


An URDU talk on Getting a Real Education: (YouTube 1 hr Video Talk):



What is Development?

[] Today, it is imperative for humanity as a whole, and for us as individuals, to think more clearly about our individual and collective goals. Without explicit discussion, we have been deceived into adopting the idea that the goal of life is to earn money as individuals, and to accumulate wealth as a society. At the individual level, pursuit of wealth is poisonous for our happiness, which depends on cultivating social relationships, and characteristics of gratitude and generosity, rather than greed. At the collective level, the mad desire to make more and more money at any cost, has led to deaths of millions and destruction  of lives of billions, just for the sake of corporate profits.

The following lecture at National Institute of Management (NIM), Peshawar, on Friday, 17th Nov 2017 addressed the topic of “What is Development?” and presented radical alternatives to conventional views. (52m YouTube Video) — PPT Slides


A Brief Summary of Some Key Concepts in the Lecture above is available from the following article (Published in The Express Tribune, May 18th,  2015.). Longer, 3500 word summary is available from What is Development?

Changing Our Development Paradigms (LinkedIn) (WEA Pedagogy Blog)

Growing up in British India, my father learnt that Great Powers had certain special characteristics. For global influence, they had to have sea power which required indented coastlines and natural harbours, coal mines for energy, extensive telegraph cables for communications. Furthermore, they had to have a cold climate to make them hardy, and be isolated from the mainland so as to have natural defences against potential rivals and enemies. In light of these criteria, it would be obvious even to a child, that the UK was the sole and unrivalled leader of the world.

The 1930s editions of Encyclopedia Britannica did not even have an entry for the word ‘democracy’. However, the emergence of the US as a world power changed everything. The First World War ruined European economies, leaving the US as the wealthiest. The winners redefined the criteria for development as being wealth alone. However, when certain oil-based economies with small populations overtook the US in GNP per capita, the criterion was revised to include an equitable income distribution. Later, when Switzerland and certain Scandinavian economies with good income distribution overtook the US, development theorists added the possession of infrastructure and natural resources. The gigantic US with its huge network of highways, dams, railroads, fertile agricultural land, etc. cannot be matched by the tiny European economies. But the point of this story is that the winners define the criteria for development, and ensure that the ongoing discourse acknowledges their leadership. To a much bigger extent than is commonly recognised, leadership and power are built upon structures of knowledge created by the powerful.

How world leaders define development is tremendously influential in setting the goals which everyone strives for. The British aristocrats preferred culture and philosophy, leaving technology to the working classes. Followers like Sir Syed established Aligarh University which emphasised arts; engineering was added only 50 years later. With the rise of the Americans, wealth, which was considered crass by the British, gradually became the sole criterion for development. All over the world, countries are pursuing GNP per capita as the single-most important goal. We need to change this definition of development, which has caused tremendous harm to society and environment.

One of the greatest surprises to economists has been the Easterlin paradox — huge amounts of increasing levels of wealth have not led to corresponding increases in happiness. A book by Professor Richard Lane documents the “Loss of Happiness in Market Democracies”. Studies of Happiness are re-discovering the ancient truths that money cannot buy love and friendship, and that social relationships are key components of happiness. Our development experience reinforces the need to change developmental paradigms. Mahbubul Haq implemented conventional growth policies in Pakistan and learnt that wealth does accumulate, but only in the hands of a select few. He then pioneered the Human Development Index as a superior alternative. Followers like Amartya Sen have pursued the concept to argue that we should concentrate on development of human capabilities. Taking this idea seriously would create radical changes in our approach to development.

Every human life is unique and infinitely precious. All babies are born with amazing potential, with capabilities to astonish the whole world. Our job as a society is to nurture these capabilities and provide an environment which allows them to come to fruition, instead of crushing them beneath the burden of economic deprivations. All our planning, resources and our institutional structures must be adapted towards the achievement of this goal. As a society, we must take collective responsibility to ensure that all children have the chance to achieve their potential. This is radically different from the current view of human beings as a resource to be used for the production of wealth. Education is designed to remove all irregularities and uniqueness, so as to allow the human cogs to fit together well, as interchangeable parts, to be plugged into the capitalist machine for the production of wealth. Shifting the target of our efforts to human development requires building social capital and empowering of communities. The greatest obstacle in our path is a top-down bureaucratic mindset which insists on centralised planning and control. We must learn to ‘trust people daringly’. Engaging citizens is a game-changer in the development process.

CENTRAL LISTING on: AZ Articles: Video/Talks: What is Development? Re-blogged on AZ Seminars. 



The Business of War

shortlink for WEA PedaBlog post:

WEA Pedagogy Blog

The highly decorated war hero, Major General Smedley Butler, described a well-hidden secret in his classic book, War is a Racket: “I made Mexico safe for American oil in 1914 … I helped in the raping of a half a dozen Central American republics for the benefit of Wall Street … In China in 1927 I helped see to it that Standard Oil went its way unmolested.” Butler came to see himself as a gangster, a muscle-man for the protection of business interests. History textbooks fail to mention what Butler saw as the main cause of the First World War: the more than 20,000 millionaires and billionaires created by war profiteering.warishell

Butler writes that a “racket” is a deception: war is not what it appears to be to the majority of people. Only a small “inside” group knows the truth, and makes huge fortunes from war while the…

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Three Books to Study

Today, we are all deeply under the influence of Western ways of thinking, due to the dominance of Western modes of education. To understand, analyze, and eventually liberate ourselves from this influence, it is essential to study the history of development of Western thought. Three books are important for this purpose. The links provide more detailed discussion of the brief summary given here.
  1. The first of these is RH Tawney: Religion and the Rise of Capitalism, which shows the changes in religious thought in England that accompanied the rise of capitalism. Reading and understanding this material, about how Christianity CHANGED in response to the rise of Capitalism, is very important for our Ulema today. This is because Islamic Law – Shari’ah — is being subjected to the SAME pressures today.
  2. The second is Karl Polanyi’s The Great Transformation: Political and Economic Origins of Our Times. I have written a lot of material summarizing his works, and detailing different aspects of the Great Transformation. This material is linked in my post on: Resources for the Study of Polanyi’s Great Transformation. An element of central importance here is that living in a market society shapes our mindsets into certain patterns and ways of thinking. A central element of the teachings of our Prophet Mohammad SAW was to bring people out of the marketplace (the worst of places) to the Masjid ( the best of places). That is, change mindsets from commercial to human.
  3. The third is Peter Manicas, “History and Philosophy of Social Science” which explains how social sciences emerged in the West. From the Islamic point of view, an analysis of crucial importance in this regard is: “Origins of Western Social Sciences.”; this explains how social sciences emerged in response to the need for analysis to replace earlier Christianity-based approaches. Modern Social Science is based on an explicit rejection of religious ideas regarding the nature and purpose of human lives. This is extremely important to understand, because study of social science automatically biases us against core Islamic teachings, forcing us to make compromises about our faith.
The binary epistemology that we have learnt from our Western education teaches us NOT to look at the source or historical context in which knowledge was generate — rather, we only need to concern ourselves with whether it is TRUE or FALSE. This is the wrong approach. Almost all knowledge is situated historically and cannot be understood without contextually understanding the chains of transmission, and the interests of the transmitters within the historically relevant configurations of power.  This is what Iqbal means by saying that Muqam-e-Aql say asan guzar gya Iqbal — the place of reason is concerned with TRUE/FALSE, and we need to go beyond this, to arrive at wisdom, and to arrive at spiritual and heart-truths, which are beyond logic.
In order to understand the FUNDAMENTAL weaknesses and defects of modern economics, it is necessary to understand the background intellectual battles which eventually gave birth to the modern discipline of economics and shaped .

Spirituality & Development

WEA Pedagogy Blog

Friday, 26th Jan 2017: Lecture by Dr. Asad Zaman, VC PIDE to students at University of Cambridge, Center of Development Studies for Religion & Development paper. 40 minute video recording of lecture on you-tube. For related posts, see: An Islamic Approach to Humanities.

Part 1: “What Is Spirituality?”:  Modern Secular thought takes spirituality and religion to be diseases which affect weak minds not properly trained in the scientific method. Part I of this lecture explain why this view, which is based on positivist ideas, is seriously mistaken. OUTLINE of this lecture is given below

Separate Lecture Part 2:” focusing on how spirituality affects how we think about development and how to achieve it.

  1. Standard Modern Answer
    1. Spirituality is a literary term, used to spice up poetry and novels.
    2. It is like Phlogiston, Unicorns, Ghosts, Souls, God
    3. It is one among many medieval beliefs, like flat Earth, which have been…

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