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Islam seeks to guarantee the freedom
of property owners to spend, give away, and invest it as he or she
deems fit. With the exception of three general guidelines, set for
the befit of society, such freedom of disposal is virtually
unrestrained.
The first guideline is that earnings should not be based on cheating
and swindling. It is imperative that the Muslim perform all his or
her financial transactions and dealings with no cheating whatsoever.
The Islamic stance on this point is so firm that the Prophet
Muhammad (peace and blessings be upon him) said a phrase to the
effect that one who cheats is not of the Muslims. Cheating infringes
upon the rights of others and weakens the fabric of financial
interdependence.
The second guideline is that there is no monopolization of
necessities. Islam forbids the hoarding or monopolizing of goods and
services, such as sources of water, that are necessary for the
continuation of life and that properly belong in the public domain.
Such monopolies would harm the public for the sake of a gain in the
hands of a select few, thus the Islamic system expressly forbids
them.
The third, and possibly the most well-known guideline, is that riba
(loosely translated to mean “interest”) is strictly forbidden. The
Qur’anic verses and Prophetic Hadiths (sayings or traditions of the
Prophet Muhammad) that outlaw interest are clear and irrefutable.
Islam strictly forbids the giving or taking of interest on any loan
in any amount. Interest is defined as a set return on a loan, and as
such implies a profit based on no risk or effort – a principle
completely against Islamic ideals. Financial profit is a result of
effort or risk (or both), and interest seeks to undermine the
risk-based nature of trade. Furthermore, in many instances interest
is exploitative – it is typically used as a means of deriving profit
from the financially weaker members of society by a wealthy class in
whose hands the lent money is concentrated. With these people, a
loan is not a favor done to help others or the society, but is used
as a means of oppression and undermines social cohesion.
At the same time, Islam encourages investment and loans given as a
means of charity. Such loans are given by Muslims with the
expectation that they be paid back. However, the intention behind
helping a fellow Muslim in distress is not profit but the pleasure
of Allah. Interest, as known today, is ubiquitous in the financial
markets of the world. It allows richer nations to capitalize on the
resources of poorer nations under the guise of “paying back national
debt.”
Interest has crumbled empires, while making oppressors out of
others. Most importantly, our sustenance is determined by Allah, and
He has promised to decrease the sustenance of the collector of
interest and increase the sustenance of the one who gives alms.
While the reality of this may seem against intellect, it is a fact
that will be clear tone with a proper understanding of the Ability
of Allah.
As the religion of the middle path, Islam decries extremism to
either side and encourages moderation in all affairs. In terms of
spending on oneself and on others, Islam condemns both niggardliness
and extravagance. Niggardliness stems from a misunderstanding of the
nature of wealth, which is from Allah and is bequeathed to people
for a limited time. Whatever we do not spend of our wealth in this
life is in reality not our wealth in the first place. Allah
describes the abject nature of the niggard as a man having his hand
tied to his neck and unable to extend it.
On the other hand, extravagance is also seen as distinctly
un-Islamic. Lavishness and excess often lead to arrogance, and at
the least, produce a tendency toward base desires. Additionally,
they can breed envy and resentment between the affluent and less
wealthy segments of society. The true Islamic way lies in temperance
between extravagance and miserliness. It entails spending generously
and practically, for to others, society, and oneself, while
sincerely intending the pleasure of Allah.
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What is Islam
What is Quran
Who is Muhammad
Introduction to
Hajj
Human Rights and
Justice in Islam
What About Those
Muslim Women?
Freedom of
Economic Activity
The Chlorophyll
Life After Death
Neighbors
How can Islam be
the religion of peace?
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