Studying Islamic Finance

السلام والازدهار العدالة المجتمعي
You are visiting a blog associated with an online noncredit course studying the topic of Islamic Finance, moderated by John Wiley Spiers. Feel free to participate in our discussion, and if you are interested in taking the course visit http://www.johnspiers.com/Islamic_Finance/Welcome.html

Thursday, September 27, 2012

Outlaw Usury?

Outlawing usury would be a mistake, because it assumes there would be a state to enforce a ban on usury.  Business is far too important to let the state get involved.  Indeed, life is too important to have a state.

God Almighty Himself rejected the state, but was prevailed upon to allow it.  What followed was sheer disaster.

God does want us to have leaders, for peace and prosperity, and before we made the mistake of having kings, prophets and judges is what we got.

Today some Christians live in fear of "Islamic Fundamentalists" who will take over their countries if not stopped by war.  They point to how quickly the Moslems took over North Africa and Spain.  But they ignore the terrible economic system enforced in the name of Christianity and they ignore the ease with which populations surrendered to the relative anarchy (no + king) and peace, prosperity and order Islam brought to those poorly governed lands.

When Cortez with 504 men overthrew Montezuma's million man army it was at the head of his small band and native tax-resistors.  When the people of the Yucatan and the rest of Mexico saw Cortez and his tax-resistors approaching, they defected to the tax resistors, so much they hated the state.

It was precisely these Moslems, with their leader from a merchant class, with their concept of government as a secondary institution, that so attracted North African and Spanish Christians.

When I visit Hong Kong I get a sense of this, where the government is minimal but Moslems, Jews, Christians, Buddhists and so on all live in peace and prosperity.

Outlawing usury might be a good idea, but that a state would be required makes it a bad idea.

Better yet to merely not support claims mad eon usury.  If someone lends out money at usury, and then refuses to pay usury, that is no concern of anyone.  Should one refuse to pay back the loan as well, then that would be sanctionable.  Who sanctions?  Who is the cop?

In that Bible passage above, the key line is "to get others to fight our battles for us."  This is exactly what is objectionable.  God wants us to trust and depend on Him, not our weapons.  Who is the cop?  You are the cop.  If someone refuses to repay a loan, then the degree you refuse to work with such a person is the sanction.  As more and more people take action based on their judgment of he who refuses to pay back a loan, collectively the sanction is pitch-perfect.

This is a big topic, one I'll be addressing from time to time.

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