Studying Islamic Finance

السلام والازدهار العدالة المجتمعي
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Wednesday, October 3, 2012

Usury Acceptance and the State Nexus

Usury is forbidden by all major religions, but in one way or another they tolerate it.   How that came to be is a long story, told by various writers, upon whom I'll be commenting over time.

As contemporary Muslims struggle with the question of usury, they study where the Catholic Church went wrong on this matter.  There too is a fascinating study.

What I read in both instances, it is not the religion or faithful who give usury its opportunity to play, it is the state.  In its secular roles, the functionaries of the state claim many emergencies in which many laws must be broken, for example, engaging in usury, and even requiring people engage in usurious conduct.

No this is curious because each tradition has its own view of the state.  Islam seems to tolerate the state as a necessary evil, whereas Christianity tends to embrace it.  Yet both clearly teach the state is inferior to religion.   Even inferior to the family or person. Just so.

But each religion with its hands-off approach allows usury to gain a foothold and grow, like a cancer.  Now this is not to say the religions should condemn the state, or somehow try to force the state functionaries to change their ways.  No, at most I would suggest the religions need to do a better job of teaching what they believe, so voters would reject such bad ideas as bonds to pay for public works.

There is one more alternative, and that is to explain more fully why we need no state at all.  I often refer to 1 Samuel 8 as evidence Christians need no state.  I can add 1 Samuel 12, in which immediately after inaugurating their first king there is faithlessness and God destroys Israel's crops in punishment.

16 “Now then, stand still and see this great thing the Lord is about to do before your eyes!17 Is it not wheat harvest now? I will call on the Lord to send thunder and rain. And you will realize what an evil thing you did in the eyes of the Lord when you asked for a king.”

God offers leaders, but He wants no king, no state.  For reasons He explained in 1 Samuel 8.  Why religions tolerate a state is curious to me, a matter for some reflection.

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