Transforming Knowledge

{bit.ly/AZ3GIE} Islamic Economics is being taught around the globe as a modification of capitalist economics. 3rd Generation Islamic Economics is based on the premise that the two systems cannot be combined. Instead, we must reject Capitalist Economics, and rebuild the entire discipline on Islamic foundations

Slides: bit.ly/SSbom - Economics textbooks propagate a lot of myths about money. The goal of this lecture is to counter these, and provide some basic facts about money which enable us to understand the vital role money plays in modern economies. Textbooks teach that money does not matter -- it only affects prices. But money is vital to the production process. Insufficient money will lead to unemployment and recession. The Quantity of money must be aligned with the need of the economy. This is why commodity money has been replaced by token money in the global economy. Token money can be created costlessly, bringing great benefits to the creators. The power to create money has been captures by a small group of financiers, and this has brought them enormous power and wealth. It is possible to create alternative institutional arrangements which would utilize this power for the benefit of the people. The first step towards such a revolution would be to understand how money functions.

{writeup: bit.ly/AZddd} Western education teaches the superiority of Western civilization and knowledge. An Islamic education should teach us that the Quran provides us with complete and perfect guidance for all times to come, and knowledge revealed by God to mankind is superior to any knowledge which could be or has been created by man. Today, our models for Islamic Education end up reinforcing ideas of Western superiority, instead of teaching the value of the Quran and Sunnah for our modern lives. There is no easy solution to this dilemma. The greatest challenge facing the Ummah today is to devise an educational model which builds the entire stock of human knowledge on Islamic foundations.

A dramatic transition took place in 18th century England, when insufficiency of gold for commerce led to the creation of credit money - only partially backed by gold. The Bank of England led the way, showing how to reliably print paper money, while maintaining confidence in convertibility, so as to create public trust. Later, this model was replicated all over the world, and continues to be the basis of modern money. Studying this history teaches us unique lessons about money, not available even in Ph.D. textbooks, or latest specialized research journals. This is lecture 10 of a series on A New Approach to Islamic Economics. See course website at http://bit.ly/IslamicEcon2023

Economists confidently assert that their discipline is a value-free and scientific approach to the study of economic dimensions of modern societies. In contrast, many authors have argued that economics is the religion of Capitalism, which makes worship of wealth the goal of individuals and societies. Studying the history of economics provides guidance about settling the dispute. Since Christianity led to continuous warfare for over a century, it was rejected as the basis for organizing society. The secular social sciences emerged as a response to the rejection of Christianity. Instead of seeking for a heaven on the day of Judgment, they sought to achieve "progress" towards building a heaven on Earth, characterized by plentiful wealth for all - abundance, instead of scarcity. The motto "all is fair in love and war" characterizes modern economics. Pursuit of pleasure, power, and profit are ultimate goals, and no moral considerations can stand in their way. Obviously, this is a religion which is antithetical, not just to Christianity, but to any natural conception of morality.

First Lecture of course on A New Approach to Islamic Economics. Explains how the attempt to construct Islamic Economics as an adjunct to Western Economics fails because the two systems are based on anti-thetical premises. Instead, we must build the discipline on foundations of generosity, cooperation, and social responsibility. These are radically different from Western Economics foundations of greed, competition, and individualism.