Ethics of Islamic Economics

Someone may say, "The economics you claim to exist in Islam do not comprise an economic doctrine but an ethical code the religion (of Islam) provides as guidelines which Islam exhorts people to follow. Just as Islam enjoined the prohibition of deception and backbiting, etc., it also enjoined helping the poor.

It prohibits injustice, admonishes the rich to console the needy, forbids the strong from confiscating the rights of the weak, and warns the first against earning their wealth through illegal means. It also imposes a mandatory rite, among others, called zakat. It imposes it besides prayers, pilgrimage and the fast in order to make a variety in the means of worship, and to emphasize the necessity of helping the poor and being generous to them.

"All of this has been done by Islam in accordance with a general ethical procedure, and these injunctions, pieces of advice and directives are no more than ethics which aim at the growth of the good energies within the Muslim individual's own self, and to tie him closer to his Lord as well as brother man. They do not imply an economic doctrine or the level of a generally inclusive organization of the whole society.

"In other words, the above stated injunctions, which have an individualistic ethical nature, aim at the individual's reform and the growth of goodness within him. They do not have a social organizational nature. The difference between the preacher who ascends the pulpit in order to admonish people to be kind and compassionate, to warn them against injustice, wrongdoing and trespassing on the rights of other, and like the social reformer who plans the sort of relations which have to exist among people, defining rights and obligations."

Our answer to all of these arguments is as follows:

The facts about Islam and its economics do not agree at all with such an interpretation which reduces the level of Islamic economics to that of mere providing counsels and ethical codes. It is true that the ethical trend is obvious in all Islamic tenets. And it is true that Islam contains a huge multitude of injunctions covering all spheres of life, the human conduct, and the economic sphere in particular.

It is also true to say that Islam has gathered the most fascinating means to ethically nurture the Muslim individual, help the growth of his good energies and bring out of him perfection personified. But this does not at all mean that Islam confines its teachings to ethically nurture the individual while setting social organization aside. Nor does it mean that Islam preaches only to the individual rather than being, in addition to this, a doctrine and an organization for the society in its various aspects of life, including its economic life.

Islam has not forbidden injustice, admonished people to be just, warned them against transgressing against the rights of others, without defining the concepts of injustice and iniquity, from its own viewpoint, or without outlining the rights not to be trespassed. Islam has not left the concept of justice, injustice and righteousness clouded with obscurity, nor has it left their interpretation for others, as do ethical preachers.

Rather, it has brought a defined image of justice and general rules of coexistence of people in the fields of wealth production, distribution and handling, considering any deviation from such rules and the justice it defines as sheer injustice and flagrant transgression on the rights of others.

This is the difference between the position of the preacher and that of the advocate of the economic doctrine. The preacher preaches about justice and warns against injustice, but he does not lay down the criteria for justice and injustice; rather, he leaves such criteria to the commonly followed customs, those that are recognized by both preacher and the congregation to which he preaches alike.

As regarding the economic doctrine, this attempts to put down such criteria and mold them into a well-planned economic system that regulates various economic fields.

Had Islam come simply in order to say to people, "Quit injustice! Practice equity! Do not be transgressors!"—leaving to them to define the meaning of "injustice," to draw the portrait which embodies justice and to agree on the rights required by equity according to their own circumstances, education and the ideals in which they believe and the interests and needs they realize.

Had Islam left all of this for people to determine, confining itself to enjoining justice and attracting people towards it, forbidding injustice and warning them against it through both methods of attracting and warning…, then it would have, indeed, remained a preacher and nothing else.

When Islam required the Muslims to quit injustice and practice equity, it at the same time provided them with its own definition of justice and injustice. It has taken upon itself to differentiate between the fair method in distribution, handling and production, and the foul one. It has indicated, for e.g., that forceful possession of land without tilling it is injustice, that maintaining it on the basis of utilizing it is "permissible," that the accumulation of wealth by acquiring a portion of the produced wealth in the name of "interest" is injustice, that its own achievement of profit is right, and many such relations and norms of behavior in which Islam has distinguished between injustice and justice.

As regarding Islam urging the rich to help their poor brethren and neighbors, it is true, but Islam did not confine itself to merely urging and ethically admonishing the rich; rather, it has imposed on the State the obligation to guarantee the securing of the rights of the needy, and to provide them with an honorable living standard in a way that falls into the backbone of the Islamic system which regulates the relationship between the ruler and the ruled.

According to the hadith narrated through the authority of Imam Musa ibn Ja'far al-Kazim, peace be with him, the Imam mentioned, while defining the ruler's responsibility in faring with zakat, that he has to take this money in order to divide it in the way which God has ordained to eight shares to the poor and the needy, to distribute it among them till they become self-sufficient for an entire year without fearing any hardship or stringency.

If any amount of it is left, it will have to be returned to his treasury, and if it is not sufficient for the public, the ruler will then have to provide them from the treasury according to their needs and until they become self-sufficient.

It is clear, from this text, that the concept of security and the necessity to provide everybody with a dignified standard of living is not a preaching idea; rather, it is one of the ruler's own responsibilities in Islam; therefore, it falls into the social backbone and it expresses an aspect of the Islamic structure relevant to the economic life.

There is a big difference between the famous text of hadith which says, "One does not believe in God and in the Latter Day if he spends his night satisfied while his neighbor is hungry," and the text that says, "The ruler has to spend on them, each according to his need, until they all have enough." The first text has a preaching nature, while the second is organizational, reflecting, therefore, one aspect of the Islamic system. The latter cannot be seen except as part of a general social system in Islam.

Zakat is one of the most significant of all rites. Its use as a tool to implement social security in the Islamic society, as we have seen in the previous text, is alone sufficient to distinguish it from all other rites of an "individualistic" nature. This proves that it is not merely an individual form of worship, an ethical exercise for the rich to be kind to the poor; rather, it is on the level of social organization of people's way of life.

Add to this the fact that the very legislative structure of zakat expresses a general doctrinal aspect in Islam. The texts which deal with zakat indicate that the latter is given to the needy in order to improve their general standard of living. This proves that zakat is part of a general Islamic plan aimed at finding harmony and a generally unified standard of living for members of the Muslim society. It is obvious that planning for such harmony is not preaching but is an organizational ideology on the level of an economic doctrine.