A Principle Central to the Islamic Social System

By : Adil Salahi, Arab News.

Abdullah ibn Abbas, the Prophet’s (peace be upon him) cousin and learned companion reports: “The Prophet was seated at the front of his house in Makkah when Uthman ibn Mathoon passed by and smiled at the Prophet. The Prophet said to him: ‘Would you like to sit with me?’ He said: ‘Yes.’ As he faced him and was talking to him, the Prophet looked up to the sky with his eyes fixed... Then he told him: ‘The messenger God sends me came to me now while you are sitting with me.’ He asked: ‘What did he say to you?’ He replied: ‘God enjoins justice, kindness, and generosity to one’s kindred; and He forbids all that is shameful, and reprehensible conduct, and all transgression. He admonishes you so that you may take heed.’ (16: 90) Uthman says: ‘It was then that I felt faith taking hold of my heart and I loved Muhammad.’” (Related by Al-Bukhari in Al-Adab Al-Mufrad and Ahmad).
Perhaps we should say a word about the man at the center of this Hadith, Uthman ibn Mathoon. Apparently this was in the very early days of Islam, because Uthman was the fourteenth person to accept Islam. He says that he only accepted Islam because he was too shy to refuse, after the Prophet had spoken to him about it several times. But only when this verse was revealed that he felt a strong desire to become a Muslim. He also says that he read this verse to Al-Waleed ibn Al-Mugheerah, one of the Quraysh elders, and he commented on the Qur’an, saying: “It is certainly beautiful; it flows so easily. It is like a tree with fruit at the top and goodness at the bottom, and it is in no way the speech of human beings.” Abu Jahl also said: “God certainly enjoins the best of principles.”
The fact that the Prophet spoke to Uthman ibn Mathoon more than once, inviting him to become a Muslim, suggests that the Prophet recognized in him some very fine qualities. In fact his companionship with the Prophet bears that well. He remained very close to the Prophet who valued his companionship highly. Uthman emigrated to Madinah with the Prophet and he was the first of the Muhajireen, i.e. the Muslims of Makkah, to die in Madinah. As he was lying before his burial, the Prophet kissed his forehead and his eyes were tearful. Indeed when Ibraheem, the Prophet’s son, died in his childhood, the Prophet said to him: “Join our good early companion, Uthman ibn Mathoon.”
There is no doubt that Uthman ibn Mathoon was a man of fine character and good qualities. This is why the Prophet was keen that he should accept Islam. The fact that this verse was the immediate cause of his belief testifies to his good character. Let us now look at this verse and the message it gives. Commenting on it, Sayyid Qutb writes:
This book, the Qur’an, has been revealed in order to bring a nation into existence, and to regulate a community; to establish a different world and initiate a new social order. It represents a world message for all mankind, which does not allow any special allegiance to a tribe, nation or race. Faith is the only bond that unites a community and a nation. It puts forward the principles that ensure unity within the community, security and reassurance for individuals, groups and nations, as well as complete trust that governs all transactions, pledges and promises.
It requires that justice should be established and maintained, because justice ensures a solid and constant basis for all transactions and deals between individuals and communities; a basis subject to no prejudice, preference or favoritism; a basis influenced by no family relationship, wealth or strength; a basis that ensures equal treatment for all and subjects all to the same standards and laws.
Along with justice, the Qur’an urges kindness, which mitigates the strictness of absolute justice. It lays the door open for anyone who wishes to win the heart of an opponent to forgo part of what is rightfully his. This means that the chance is available to all to go beyond strict justice, which is both a right and a duty, to show kindness in order to allow wounds to heal or to win favor.
Kindness has an even broader sense. Every good action is a kindness. The command enjoining kindness includes every type of action and transaction. It thus covers every aspect of life, including a person’s relationships with his Lord, family, community and with the rest of mankind.
Perhaps we should add here that some commentators on the Qur’an say that “justice” is the obligatory part, while “kindness” is voluntary, but highly encouraged, particularly in as far as matters of worship are concerned. They say that this verse is part of the revelations received by the Prophet in Makkah, when the legal provisions had not yet been outlined. But the way the verse is phrased uses both justice and kindness in their broadest sense. Moreover, from a purely ethical point of view, both are generally applicable principles, not mere legal provisions.
One aspect of kindness is “generosity to one’s kindred”, but it is specially mentioned here in order to emphasize its importance. From the Islamic point of view, this is not based on narrow family loyalty, but on the Islamic principle of common solidarity that moves from the smaller, local circle to the larger social context. The principle is central to the implementation of the Islamic social system.
The verse proceeds to outline three prohibitions in contrast with the three orders with which it begins, stating that God “forbids all that is shameful, and reprehensible conduct, and all transgression.” Under shameful conduct everything that goes beyond the limits of propriety is included, but the term is often used to denote dishonorable assault and indecency. Thus it combines both aggression and transgression. Hence it has become synonymous with shamefulness.
“Reprehensible conduct” refers to any action of which pure, undistorted human nature disapproves. Islam also disapproves of any such conduct because it is the religion of pure and sound human nature. Yet human nature may become distorted, but Islamic law remains constant, pointing to what human nature has been like before distortion creeps into it.
“Transgression” in this context denotes injustice as well as any excess that goes beyond what is right and fair.
No community may survive when it is based on the spread of shameful, reprehensible conduct and transgression. No community allows shameful conduct in all its connotations, and reprehensible actions of all sorts, and transgression with all its consequences and then hopes to flourish. Hence human nature is bound to rebel against these whenever they are allowed to spread in society.

An Islamic Perspective on the Wealth of Nations

a Paper Delivered at the International Conference on
"Comprehensive Development of Muslim Countries:
An Interdisciplinary Approach from an Islamic Perspective"
An Islamic Perspective on the Wealth of Nations

By: Imad A. Ahmad
Minaret of Freedom Institute, 4323 Rosedale Avenue
Bethesda, Maryland 20814, (301) 656-4717

0. INTRODUCTION

From the Islamic perspective, economic policy must satisfy both the legal requirements of the sharî`ah and the hard cold facts of economic science. Both come from the will of the Allah. As in the case of physical science (see Ahmad 1992), any perceived conflict between them means that either the sharî`ah or the economic facts of life have been misunderstood.
This paper deals not with Adam Smith's book the Wealth of Nations, although much of Smith's analysis is consistent with what I say here and, as I shall note, Smith to large degree was simply picking up where Ibn Khaldun left off. Our main concern is with the politico-economic policies that account for why some nations are wealthier than others and why nations, or dynasties, may be wealthy at one phase of their existence and poor at others. I recently completed a study which demonstrates this principle through an overview of the rise of Islamic economies of the classical Muslim era under the influence of the Qur'an and sunnah and a parallel analysis of the development of economic theory in the same period (Ahmad 1993a, 1994). That review demonstrated the validity of the tradition attributed to the Prophet Muhammad (peace be upon him) that the first generation of Muslims adheres most closely to the principles of the religion and each successive generation drifts farther from it. The gradual devolution of Islamic economic practice away from the sharî`ah stands in contrast to the evolution of Islamic economic theory which reached its peak with Ibn Khaldun. Market principles enunciated in the Qu'ran were eventually abandoned by Muslim society, leading to its inevitable collapse. As the Islamic classical era neared its end, Ibn Khaldun, inventor of modern sociology, identified the economic policies that lead to the rise and fall of dynasties. By that time, reform based on evolving understanding was abandoned (called the closing of the door to ijtihâd) and the Muslim world began its decline into intellectual darkness and economic stagnation. Economic development and technical innovation was taken over by Western civilization, where an analogous departure of practice from theory is now being felt. The knowledge that Ibn Khaldun enunciated went neglected or misunderstood by Muslim society, while the principles that he and his Islamic predecessors identified found their way into Western economic theory on the wealth of nations. In this paper I shall elucidate the specific implications of my analysis for modern economic policy.
The framework of our analysis is the sharî`ah. Islam is, politically, a nomocracy, that is, a system of rule of law (Ahmad 1993b). It is not, as the Western press is wont to misrepresent it, a theocracy, that is a rule by clerics. The concept of theocracy violates the fundamental premise of Islam--that there is none worthy of worship but God. In the Islamic world-view, each human being is directly responsible to the Almighty. The issue of what is it that God commands has been answered in writing, in the Qur'an. It is the unchanging sharî`ah itself, and not some human being or assembly, that man must obey. The nomocratic nature of Islam cannot be overstated. If there were ever a human being who could make a demand of obedience upon the Muslims it would have to be the Prophet himself, yet of him the Qur'an directs only obedience "in any just matter" (see, e.g., 60:12) and in it God warned the Prophet "nor art thou set over them to dispose of their affairs" (39:41). No human being after the Prophet could ask for more allegiance than that due to the Prophet himself. The early caliphs did not do so. Abu Bakr's inaugural address reflects an attitude in sharp contrast to that of political leaders before him: "Now it is beyond doubt that I have been elected your Amir, although I am not better than you. Help me, if I am right; set me right if I am in the wrong; truth is a trust; falsehood a treason.... Obey me as long as I obey Allah and His Prophet; when I disobey Allah and His Prophet, then obey me not." (Siddiqi, pp. 46-47).
The Qur'an recognizes man as a being at once rational, volitional, acquisitive, and ethical. Being primarily a book of moral guidance, the Qur'an advises man that it is in his best interest to pursue a moderate course. That is, man should act to provide for existence on this material plane without sacrificing his moral sensibilities. The Qur'an insists on the harmony of man's spiritual and material interests. It is guidance on how to achieve success "in this life and the next." The Qur'an maintains that its dos and don'ts are not aimed at putting man through a period of earthly misery before he reaps heavenly salvation, but that they are rather the tonic for earthly trials, with some earthly rewards and unlimited heavenly ones as well.
The economic perspective found in the Qur'an has been summarized in a number of places (e.g., Mannan 1970 and Ahmad 1986). The key element of the Qur'an from the economic point of view is its stress on moderation (see, e.g., verses 7:31-32, 18:46 and 17:29). Consumption is permitted ("O ye people! eat of what is on earth lawful and good...." 2:168) while niggardliness (35:29), wastefulness (6:141) and extravagance (17:27) are condemned. The desire for a livelihood (4:5), for comfort (42:36), even for ornament and adornment (18:46) or protection from future uncertainty (4:9) in this world is never called evil. Instead the Qur'an insists that its precepts are the means for achieving success in these things without trading it in for failure in the life to come. The Qur'an "not only permits the Muslims to disperse in the earth and earn their livelihood after Friday prayers (62:10) but also advises the holy Prophet to cut short the morning prayers in order that economic activity is also not hampered (73:20). It also allows its followers to continue their trade during their journey for Hajj (2:198). Along with these incentives to earn, it repeatedly asks man to satisfy his wants and demonstrate his prosperity (4:37, 82:20), without going to the extent of ostentatious extravagance" (uz-Zaman 1981). The only line drawn is overspending (isrâf) which is prohibited even in charity (17:29).
The Qur'an deals with a number of specific economic issues. Private property is protected (2:188). The fulfillment of obligations is commanded (2:177;5:1) and is accompanied by details of contract law (e.g., 2:282-283). There is a prohibition of fraud (26:181) and a call for the establishment of clear standards of weights and measures (55:9).
The Qur'an upholds the principle and sanctity of private property in general--modifying it only in certain details. The modifications to which I refer include such things as establishing women's full rights to private property and the abolition of primogeniture (granting to relatives other than the eldest son, including women a share in the inheritance), obligating Muslims to grant to the poor and needy a share in their wealth, etc. Any Muslim who followed the explicit rules of the Qur'an could not be denied his property without his consent. The Prophet said so explicitly in his farewell pilgrimage: "Nothing shall be legitimate to a Muslim which belongs to a fellow Muslim unless it was given freely and willingly" (Haykal 1976, p. 487).
We shall now discuss how these principles apply to particular issues of primary importance in guiding economy policies of Muslim economies in the modern world: decentralization and preference for private property; requirement of a hard currency monetary policy; limits on taxation; and limits on the domain of the public sector. I shall state the specific policy recommendations for optimal development that follow from the analysis in each of these areas.

1. DECENTRALIZATION AND THE PREFERENCE FOR PRIVATE PROPERTY

My research (Ahmad 1993a, 1994) established that Abu Bakr followed the Prophet's sunnah to the letter. In the Prophet's time three methods of land title were known: individual ownership, communal ownership, and state ownership. The Qur'an neither advocated nor rejected any of these. The Prophet made use of, and thus legitimized, all three of these. However, he showed a preference for decentralization. In Medina he not only confirmed the existing individual ownership, but granted allotments for residences and farms to those who could make use of them. The state held only those lands needed for state purposes, and any property taken for state use was paid for. Communal usage was also defended, as in the prohibition of burning bushes within 12 miles or hunting within 4 miles of Medina, evidently aimed at protecting communal grazing. The Prophet limited "communal" property to three cases: water, grazing, and fire.
As the Muslim community came into possession of a dazzling quantity of lands under Umar, new challenges were confronted. Umar disliked the prospect of taking away these enormous tracts from the conquered people and giving them to the relatively few Muslim soldiers. While such an action might appear, on the surface, to follow the practice of the Prophet, it would violate the spirit of decentralization that had been its foundation. When the victorious soldiers demanded that Umar distribute the conquered lands among them, Umar met with his cabinet and devised the following solution: Noting that the previous owners of the land had paid a land-tax to their Persian overlords, he decreed the following resolution:
1) land covered by peace treaties belonged outright to the former owners, with no taxes except as specified in the treaties;
2) privately-owned land conquered by force would be turned over to the former owners with their property rights restored, provided they agreed to pay a vastly reduced (typically by two-thirds) land-tax, called kharâj, to the Muslim state;
3) unoccupied lands, wasteland, and Sasanian crown lands (as well as lands abandoned by the aristocracy) became the property of the state; part of these became the Muslim equivalent of crown lands, with sale prohibited (fay'), while another part was made available for homesteading on a usufruct basis, that is, in exchange for kharâj payment, provided the land was put to use within three years.
What are the implications of Umar's decree for Islamic economic policy? In particular, what was the purpose of the immobilization of the Sawad lands?
Some scholars (e.g., uz-Zuman 1981) seem to be under the impression that Umar denied right of sale of any lands on which kharâj was paid (which would in effect make them state property rented to the tenants), supposedly to prevent the wealthy conquerors from buying out the property rights of the native people and instituting a feudal society. This view has been refuted by those (e.g., Morony 1981, in Udovitch 1981) who have shown that such acts actually seem to have arisen in the Umayyad period. Their attribution to Umar was an invention that served to justify that dynasty's departure from the sunnah of Muhammad and Abu Bakr. In fact, the prohibition of sale of kharâj-land to Muslims only emerged after 100/718-19 (Lambton 1953, p. 53). The evident purpose "was to maintain the kharâj status of the land through the fiction of communal or state ownership. Islamic legal scholars like Mâwardî ultimately reached a position that while the property in the Sawad could not be sold, the enjoyment of such property could be sold," according to Morony (1981), who further claims Umar II's policy was a special policy not intended to be applied outside Sawad. Thus, the implication that Umar deviated from the sunnah seem unjustified, and the innovations attributed to him were probably introduced by the Umayyads.
Only through zealous protection of the property rights of the people (both their private property and the environment) can society spontaneously develop the optimal division of labor that characterizes productive economies. While earlier Islamic scholars, like Ibn Taymiyah, took the legitimacy of property for granted, Ibn Khaldun pointed out its scientific necessity for a prosperous society. He quotes from Al-Mas`udi report of Môbedhân's speech before Bahrâm: "Men persist only with the help of property. The only way to property is through cultivation [lit. `imârah]. The only way to cultivation is through justice" (Ibn Khaldun 1967, v. I, p. 64). Wehr (1976) translates `imârah as "building, edifice, structure" or "real estate, tract lot." From the context it seems we should take cultivation as development in its widest sense, not restricted to agricultural activity. This fits in with Ibn Khaldun's (1967, v. I, p. 80) assertion that four things make man unique: crafts and science; the need for "restraining influence and authority"; earning a living; and civilization. He emphasizes the need for human cooperation and social organization, for without it, "God's desire to settle the world with human beings and to leave them as His representatives on earth would not materialize" (Ibid., p. 91).
The idea that property is a consequence of development does not differ from--and anticipates--Locke's notion that use establishes the right of property. We find in Ibn Khaldun the economic concepts which appear in a rudimentary form in earlier Muslim writers have acquired a sharp definition. His analysis of the issue of the need for social cooperation stands up to Adam Smith's discussion three centuries later:
[T]he individual human being cannot by himself obtain all the necessities of life. All human beings must cooperate to that end in their civilization. But what is obtained through the cooperation of a group of human beings satisfies the need of a number many times greater (than themselves). For instance, no one by himself, can obtain the share of wheat he needs for food. But when six or ten persons, including a smith and a carpenter to make the tools, and others who are in charge of the oxen, the plowing of the soil, the harvesting of the ripe grain, and all other agricultural activities, undertake to obtain their food and work toward that purpose either separately or collectively and thus obtain through their labor a certain amount of food, (that amount) will be food for a number of people many times their own. The combined labor produces more than the needs and necessities of the workers. (Ibid., p. 272).
The function of political authority is to defend the stability of the social organization against aggression and injustice for "when civilization has thus become a fact, people need someone to exercise a restraining influence and keep then apart, for aggressiveness and injustice are in the animal nature of man" (Ibid.). It is only for this reason that someone must have authority over others, "so that no one of them will be able to attack another. This is the meaning of royal authority" (Ibid., p. 92). Ibn Khaldun ridiculed the claim of the philosophers that the ruler is necessarily one endowed by divine guidance for the exercise of the restraining influence of the religious law by noting that the majority of people have political communities without revealed guidance (Ibid., p. 93).
According to Ibn Khaldun there is only one effective method for government to increase its revenues, and that is "through the equitable treatment of people and property and regard for them" so that "they have the incentive to make their capital bear fruit and grow." His bottom line is found in the section title "Injustice brings about the ruin of civilization" (Ibn Khaldun 1967, v. II, p. 103):
It should be known that attacks on people's property remove the incentive to acquire and gain property. People then become of the opinion that the purpose and ultimate destiny of (acquiring property) is to have it taken away from them. When the incentive to acquire and obtain property is gone, people no longer make efforts to acquire any. The extent and degree to which property rights are infringed upon determines the extent and degree to which the efforts of the subjects to acquire property slacken.... Civilization and its well-being depend on productivity and people's efforts in all directions in their own interests and profit. (Ibid., p. 104)
Once a government has lost popular support, it is sustained by force.
Even though coercion makes its appearance at that time [the later years of a dynasty] and the revenues decrease, the destructive influences of this situation will become noticeable only after some time, because things in nature all have a gradual development.
In the later (years) of dynasties, famines and pestilences become numerous. As far as famines are concerned, the reason is that most people at that time refrain from cultivating the soil. For, in the later (years) of dynasties, there occur attacks on property and tax revenue and, through customs duties, on trading. (Ibid., pp. 135-136)
Ibn Khaldun leaves no room for uncertainty as to his definition of injustice:
Whoever takes someone's property, or uses him for forced labor, or presses an unjustified claim against him, or imposes upon him a duty not required by the religious law, does an injustice to that particular person. People who collect unjustified taxes commit an injustice. Those who infringe upon property rights commit an injustice.... (ibid., p. 107)
Muhammad (peace be upon him) forbade injustice because the purpose of the law is the preservation of civilization, that is, "(1) of the religion, (2) the soul (life), (3) the intellect, (4) progeny, and (5) property (Ibid., p. 107)." Decentralization of ownership of the resources down to the level of the individual, protected by a system of well-defined private property rights including the internalization of costs incurred by environmental impact must then be the first concern of any Islamic government towards the end of an economically successful society.

2. REQUIREMENT OF A HARD CURRENCY MONETARY POLICY

The oft-debated question of interest is only sub-issue of the more general matter of monetary policy. It is disturbing that modern Muslim economists have overlooked the fact that a sound money is an indispensable pre-requisite for a sound economy. Although Umar found the issue of ribâ problematical, the necessity of sound money was universally accepted not only by the Prophet and the righteous caliphs, but by every Muslim government in the early centuries of Islamic civilization. The example of the Prophet himself, who never resorted to clipping, debasing, or the issuance of unbacked paper currency, was generally followed by the Islamic society until about the year 1000. Like the Prophet, the society favored the three monetary commodities most appropriate for use as hard currency in Arabia at that time: gold, silver, and hard wheat. The righteous caliphs followed this principle without exception, and it remained the general rule until the Islamic civilization began to unravel at the turn of the millennium.
Significant departures from this principle began to appear only after the tenth century (Cahen 1981, p. 318). In 1294, the vizier of the Ilkhan Gaikhatu sought to deal with the deficit spending of his day by issuing "paper money, modeled on the Chinese paper currency. The experiment was a complete failure, as the people refused to accept the banknotes. Economic activities came to a standstill, and the Persian historian Rashid ud-din speaks even of 'the ruin of Basra' which ensued upon the emission of the new money" (Ashtor 1976, p. 257).
The door to debasement opened in the next century when the silver to gold exchange rate suffered its first serious change since the rise of Islam. In the early centuries of Islam the rate had always been around 20:1. In the thirteenth century changes in the market led scholars to speculate that the rate had changed to 10:1, but the official rate remained fixed at 20:1. "The stocks of silver in the mints decreased progressively from about 1380.... Whereas the exchange rate of the dirham had for 130 years been 1/20 dinar, that of the debased dirham was 1/25 and later 1/30 dinar" (Ashtor 1976, p. 305). The "main reason was the increased demand in Italy, where the value of silver had risen considerably at the end of the fourteenth century.... At the beginning of the fifteenth century the striking of silver dirhams was discontinued altogether" (Ibid.) Al-Mikrizi blames a high court dignitary who tried to "enrich himself by the striking of copper coins" (Ibid.). The monetary crisis was accompanied by famine and a lengthy civil war. High taxes were levied to equip the armies against repeated revolts.
Interest rates rose from 4-8% during the crusades to 18-25% in the fifteenth century (Ibid., p. 324). Although "the supply of gold from the Western Sudan was never interrupted," Sultan Barsbay in 1425 devalued the dinar "for the first time in the history of the Muslim Near East" (Ibid.). Until then the dinar had always been a gold coin of approximately 4.25 grams. With the devaluation a 3.45 gram dinar called al-Ashrafi "remained the gold coin of Egypt until the end of Mamluk rule" (Ibid.). This was the weight of the European ducat, evidence for the swing in monetary standards away from the Muslim world to the rising Christian West.
A discussion of ribâ and interest can only be meaningful within the framework of the more general issue of monetary policy (see Appendix). The main component of the nominal as opposed to real) rate of interest in modern economies is the anticipated rate of inflation and that, in economies using paper currency, this rate is dominated by government's tendency to debase the money supply. Most of the nominal interest could be eliminated by using sound currency, and a study of the legality of interest can center around any residual. Such an analysis, given in a paper before the American Muslim Social Scientists, is presented in Appendix to this paper. Its principle policy conclusion is that a prohibition on all interest may come at the expense of a decrease in the most revolutionary forms of development. This is because profit sharing cannot induce anyone to invest in an enterprise so radically innovative that only its originator can see foresee its impact and profitability. Nevertheless, most capital investment needs can be met by profit-sharing mechanisms. In any case sound monetary policy is a pre-requisite for sustainable comprehensive development. Hard money is the sunnah method for establishing sound money through the natural process of the market.

3. LIMITS ON TAXATION

Taxation is the most direct means of government intervention into the economy, and usually the first resorted to. The Qur'an names only four sources of public revenues: zakât, sadaqa, jizyah, and khums. The first is an obligation of Muslims only. It is actually a religious obligation rather than an ordinary tax. Sadaqa is purely voluntary and thus is not a tax at all in the usual sense of the term. Jizya is levied on non-Muslims only in lieu of military service and may be set by treaty. The practice of the early Muslims make it clear that it was a fee for protection of the minorities, reimbursable when the protection could not be rendered, and thus it falls in that category of taxes called user fees. Only the khums is taken purely by force, but as it is taken from the enemy in battle, it is not a tax on the citizens, but a share of the spoils of war. In the Prophet's time the khums was given to the Prophet for use at his discretion both for his personal and family needs as well as for disbursements to the poor and needy and public works. One can interpret this as state property out of which the ruler may take a share or as private property of the commander-in-chief out of which he is expected to give sadaqa. In the former case it is a tax on booty rather than on persons. In the latter case, the required public expenditures constitute a tax on the commander-in-chief and not on the general public.
On this account, it appears that taxation authorized by the Qur'an is strictly limited. This is as we should expect, based on the Prophet's hadith that one should not take the property of another Muslim without his consent. The sunnah supports this view. In the time of Muhammad and Abu Bakr, there was no other source of public revenue beyond those authorized by the Qur'an. An alleged exception is found in the claim that the Prophet collected kharâj from the Jews of Khaybar. Siddiqi (1970, p. 17) writes:
When Khaybar was conquered by the Prophet, ... the Jews recognizing the conquerors as the owners of the entire conquered land (after the custom of the day), offered to cultivate the lands as the tenants of the State and paid a part of the produce. The Prophet granted them their request and fixed the Kharaj at half of the produce.
There are two ways to interpret this. Taken at face value the Jews were recognizing the lands as state lands (fay'). In this case the payments constituted rent and not a tax. If, however, the payments were a land-tax, then the rate having been set by treaty constitutes a negotiated jizyah and is still not outside the authorization of the Qur'an.
Thus it is clear that the Prophet never assessed any taxes beyond those specified in the Qur'an except as a user fee. The same is true of Abu Bakr. The general practice of the righteous caliphs supports this analysis. Thus Abû `Abdullâh Mu`âwiya ibn `Ubayd Allâh wrote in a treatise on taxation for the caliph al-Mahdî (Lapidus, 1981):
"all the expenses of digging, including supporting poles, the construction of vaulted passages and bridges, the cleaning up of rivers and the maintenance of post-stations and dams on the great rivers are to be borne by the treasury." Otherwise, however, irrigation canals are evidently considered part of the private domain, and lawyers discuss the questions of water rights and the distribution of irrigation expenses among private persons. They leave the impression that the responsibility of the state was rather limited.
Umar, however, did introduce two new taxes: he imposed tariffs and he expanded the kharâj to cases other than a modified jizyah. Tariffs had been unknown in Arabia. We can imagine Umar's distaste at finding the nations of the world engaged in this form of highway robbery against the merchant who crossed their borders. As the Qur'an authorizes like-kind retaliation against aggression (2:194), he imposed a policy of reciprocity. In an economically savvy effort to minimize the burden of the retaliatory tariffs on Muslims and the dhimmis under their protection, however, he gave a 50% discount to dhimmis and a 75% discount to Muslims.. Further, he counted as a dhimmi for this purpose any non-Muslim whose stay in Muslim lands exceeded one year. It is ironic that Umar's strategic actions to fight against tariffs have been misinterpreted by some modern Muslim economists as an indication that Umar believed that the state can impose any kind of taxes it wants. It has also been disastrous for the freedom and prosperity of the Muslim ummah.
We have already discussed Umar's use of kharâj in the section on the land issue. We may presume that he saw a similarity between the Persian land tax and the usufruct form of jizyah which the Prophet accepted in the case of the Jews. Since the tax that he levied was so much lower than that assessed by the Persians, we may also presume that both he and his new subjects looked upon the terms as agreeable ones, comparable to terms fixed by treaty. Unfortunately, the kharâj here resembles the Persian land tax (which was called kharâg and from which the term kharâj may stem) more than jizyah precisely because it is not fixed by treaty, but may be altered by the state at its discretion. Umar was concerned about this and is reported to have repeatedly warned his governors not to set the rates oppressively high. He interrogated the assessors of Sawâd: "Perhaps you assessed the land at a rate which it cannot stand," and they replied, "No, on the contrary, we have assessed it at a rate which it can stand, although if we had assessed a higher rate the land could still stand it" (Ra`ana 1977, p. 93).
When the Umayyads took power the governors repeatedly raised the kharâj until revenues plummeted under the Hajjaj--legendary for his oppressive tax policies. Subsequently the pious Umar II attempted a return to Umar I's tax policies. "The spirit of economic laws is justice (`adl) and generosity (ihsâ)," he declared (uz-Zaman 1981, p. 75). Revenues rebounded. Unfortunately, his successors strayed from his policies. As the Umayyad dynasty came to a close its ruler confessed: "We committed injustice to our subjects and they became disappointed with our justice. They wished to get rid of us. Our tax-payers were overburdened so they deserted us, destroyed our estates, and emptied our treasuries" (Ibid., pp. 75-76). Yazîd III responded to the outcry against public spending by pledging spending and taxing limitations, but it was too late (Ibid., p. 101).
Throughout Islamic history tax policies seesawed as dynasties rose and fell. Studying them, Ibn Khaldun came to his famous conclusion (recently reincarnated as the "Laffer curve") that dynasties obtain large revenues from low tax rates at their beginnings and small revenues from high tax rates at their ends (Ibn Khaldun 1967, v. II, p. 89).
In the twelfth century, the Seldjukids sought to compensate for the loss of revenue from the land-tax by increasing other taxes or imposing new ones. There were a long series of farcical repeals and reimpositions of taxes (uz-Zaman 1981, p. 217). In at least one cases the demand for repeal came from the minbar. As Iraq became increasingly burdened by the taxes--and by government attempts to monopolize important industries, like silk (Ashtor 1976, p. 214)--Iraq lost its capacity for technological innovation. Thus, the chronicles of Ibn al-Djauzi speak "of mills which were turning and grinding grain on the earth without anyone knowing how they were operated," Ibid., p. 219). The infrastructure crumbled throughout the twelfth century and engineers failed in massive projects. A "contemporary Arab chronicler says explicitly that the government services were incapable of repairing the breaches" in dams in Iraq (Ibid., p. 245).
This stagnation took place as European technology was beginning to blossom. "The great industrial enterprises" could no longer "afford experiments which resulted in technological innovations" once the Seldjukids and Ayyubid "princes curtailed freedom of enterprise, established monopolies and imposed heavy taxes on the workshops. This brought about a slow decline of private industry" (Ibid., p. 247).
The Mongols (Ilkhanids) imposed numerous and arbitrary taxes. Ghazan (1295-1304) attempted some reforms like a fixed tax on land, the abolition of "the quartering of soldiers and officials in private houses and he forbade the use of violence in the collection of taxes" (Ibid., p. 250) and also made feudal fiefs hereditary. Any positive effect of these reforms was washed out by the expansion of the feudal system in other respects. Not only prisoners of war, but even clients and retainers were treated as slaves. "According to the law of Ghazan a peasant who had run away from a feudal estate even thirty years earlier was caught and sent back" (Ibid., p. 258). Under these circumstances, Ghazan's policy of offering state lands to those who would cultivate them with grants of tax reductions as incentives, a policy followed by his successors, met with "only partial success" (Ibid.) and after Ghazan a "new downward trend in agricultural production began" (Ibid.).
Mongols increased state lands including confiscation of waqf property. But later, as early as the 1280s, the government initiated land sales. The increasing private estates "took the lead in Irak's agriculture, as to both output and means of cultivation" (Ibid., p. 261). They responded to the drop in grain demand due to depopulation by switching to other crops, notably cotton and fruit trees. After the death of Abu Said (1316-35) civil war ensued. In subsequent dynasties the merciless misgovernment continued.
The Djalairid dynasty was overthrown in 1410 by Kara Yusuf, chieftain of a federation of Turcomen tribes called the Kara Koyunlu. Their dynasty, by contemporary accounts, brought about the most wretched conditions in the history of Iraq (Ibid., p. 268). Uzun Hasan, prince of the Ak Koyunlu conquered Baghdad in 1469, and then most of Persia. Uzun Hasan codified tax practices with the aim of removing their arbitrary nature and also reduced the land tax (Ibid., p. 272). Taxation was still oppressive however. While peasants of Diyar Bakr province were subject to a 20% tax on crops, they were also subject to forced labor and "many other taxes" besides (Ibid., p. 273).
The Turcomans perfected the feudal land system in Iraq. Fiefholders received a perpetual hereditary grant and "administrative and judicial immunity" (Ibid.). Uzun and his successors granted fiefs to the clergy to win their support. When the Ak Koyunlu realized that they were headed down the road of disintegration they tried to take back many of the fiefs and waqf land but were opposed by both the lords and the theologians.
The domestic and foreign trade of Iraq was seriously set back under the Djalairids and the Turcomans and the economy sank into barter (Ibid., p. 274) . Rather than undo the measures driving down so many areas of domestic and foreign trade, the Turcomens increased taxes on trade. The tamgha, for example, which the scholar Nasir ad-Din Tusi advised should be set at 1/240, was levied in Tabriz at 5% in the early 14th century. Uzun Hasan's advisors dissuaded him from abolishing it. Of course, governors and feudal lords were exempt from the taxes (Ibid., p. 275).
Unsurprisingly, the trade route shifted from the Persian Gulf to the Mediterranean (Ibid., p. 277). In addition to the factors discussed above, changing political conditions at the end of the 15th century (deteriorating conditions in Persia, Genoese victories adversely affecting the Venetians, and Mamluk and Mongol conquests all favoring a resurgence of Red Sea trade) forced Venetians to return to trade through Alexandria and Beirut (Ibid., p. 326).
The history of Muslim tax policies demonstrates the validity of Ibn Khaldun's thesis on the rise and fall of dynasties. At the beginning of their power new dynasties are led by men of bedouin inclinations with no taste for luxury. Their spartan existence makes small demands on the body politic and they devote themselves to the proper purpose of government. The success of their rule leads to a thriving urban civilization. The high prosperity for a while permits government diversion of profits into luxuries. By the time the adverse effects (due to hidden costs) of the expansion of government activity into luxury areas is noticeable, it is too late to change for the generation raised in luxury have lost the meritorious attitudes of their ancestors that made effective minimalist government possible. As the dynasty grows old, the beneficiaries of urban civilization and of government largess
have become used to laziness and ease. They are sunk in well-being and luxury. They have entrusted defense of their property and their lives to the governor and ruler who rules them, and to the militia which has the task of guarding them. They find full assurance of safety in the walls that surround them, and the fortifications that protect them. Thy are carefree and trusting, and have ceased to carry weapons. Successive generations have grown up in this way of life. They have become like women and children, who depend upon the master of the house. (Ibid., p. 257)
The dynasty expands its authorities in various ways to try to maintain its luxuriant expenditure policies. In addition to tampering with the currency, there is, of course, taxation. Initially increasing tax rates serves the purpose, but eventually high tax rates have a deleterious effect on productivity. "It should be known that at the beginning of the dynasty, taxation yields a large revenue from small assessments. At the end of a dynasty, taxation yields a small revenue from large assessments" (Ibid., p. 89).
Among the reasons that no capitalist will be able to accumulate limitless wealth is the envy of the government (Ibid.):
... a sedentary person who has a great deal of capital and has acquired a great number of estates and farms and become one of the wealthiest inhabitants of a particular city, who is looked upon as such and lives in great luxury ... competes in this respect with amirs and rulers. The latter become jealous of him. The aggressiveness that is natural to human beings makes them cast their eyes on his possessions. They envy him and try every possible trick to catch him in the net of a government decision to confiscate his property. Government decisions are as a rule unjust, because pure justice is found only in the legal caliphate that lasted only a short while. Muhammad said: "The caliphate after me will last thirty years; then, it will revert to being tyrannic royal authority."
If Muslim states wish to see prospering economies they should reduce the variety and size of taxes. Ideally they should impose only those taxes authorized by the Qur'an and at those rates practiced by the righteous caliphs: zakât on Muslims), jizyah from non-Muslims which may include kharâj. In addition voluntary sadaqah may be accepted for worthwhile purposes and user fees (including kharâj and ushr) assessed for payment for services desired by the public and provided by the state for reasons of expedience. This interpretation of kharâj is supported by the use of the term in the Qur'an (23:72, for example). Also the state would remain entitled to the khums from the spoils of war. All protective tariffs should be dropped except for reciprocal tariffs, and even they should be subject to discounts of 75% for Muslims and 50% for dhimmis. The degree to which states exceed these taxes is at once the degree to which they transgress beyond the sharî`ah and the measure by which they detract from the welfare of the society as a whole by diverting wealth needed for investment into less productive, or destructive pursuits.

4. LIMITS ON THE DOMAIN OF THE PUBLIC SECTOR

The Islamic societies' experiments with government involvement in economic activity track with its gradual downfall. In the time of Umar the state contented itself with matters of defense, the judicial system, weights and measures, and such major public works as irrigation canals which were paid for by the kharâj and `ushr user fees. None of the righteous caliphs sought to engage the state in competition with the private sector, let alone to monopolize any part of it. Umar's involvement in land distribution was aimed at decentralization and the prevention of the rise of a feudalistic system. Even charges that Uthman's administration favored certain groups and individuals comes under the category of corruption rather than monopoly. State intervention in the economy became an increasing problem as the centuries rolled on, however.
In the Umayyad dynasty, Umar II felt that state participation in commerce is a form of unintended abuse of trust: "I am of the view that the ruler should not trade. It is (also) not lawful for the officer to trade in the area of his office (fî sultanihî...), because when he involves himself in trade he inadvertently misuses his office in his interest and to the detriment of others, even if he does not like to do so" (Uz-Zaman 1981, p. 94). He did, however, intervene in cases where the costs of risks were falling to the state: "As I considered over it I found that gain in mining was but particular (khâs) but its harm was general (`âm) so stop people from working in mines" (Ibid.)
After the fall of the Abbasids, the government was not so scrupulous. The devastating effects of the government's intervention into the Egyptian sugar industry has been well-documented by Ashtor (1976, 1981). The rise of the hitherto unknown sugar industry in the Middle East is a testimony to the economic dynamism of Islam and its openness to technical innovation both from the scientific and economic side. The Egyptian sugar industry began its boom in the 11th century:
The sugar industry in Egypt and Syria under the Fatimids had a capitalistic character. The complicated methods of refining the juice of the sugar cane could only be employed in big factories. ... Rich and enterprising industrialists had to make costly efforts to improve methods, the expected profits being the stimulus. Sugar production also enjoyed freedom of enterprise. The attempt to monopolize it made by the odd and whimsical al-Hakim was not repeated" (Ashtor 1976, pp. 199-200).
In the second half of the thirteenth century the number of Egyptian sugar factories boomed as the Mamluk amirs, lured by the demonstrated high profitability, broke with earlier Muslim law and practice to compete against the private entrepreneurs (Ashtor 1981, p. 99ff). In our summary of Ashtor's analysis (Ahmad 1993 a,b) we have shown in sufficient detail how such expansion of the public sector into the sugar industry led to its downfall, to be replaced by Western producers.
The declining economies caused declining demand. The shift in sources of sugar for Italy can be seen in the tariff records. Early fifteenth century Venetian documents show a shift in the point of origin of molasses for Italy from Egypt to Palermo (Ibid., p. 113). Although the relative abundance of water power for mills in Europe played a factor, the role of government is more significant:
The system of government as it had been developed in the Middle East created conditions that were unfavorable to technological innovations. The feudal lords did not retain their fiefs in perpetuity; since changes were frequently made, they had little interest in building new factories. The musâdara system was a sword of Damocles poised over the heads of all the rich or near rich. The mukûs, commercial taxes, were another check to technological development.... Technological progress also depended, to a certain degree, on the structure of industry. Owing to the large share of government in the sugar industry, there was a lack of competition, a tendency towards corruption in the monopolized industries, and a lack of incentive for innovations. (Ibid., p. 119)
Ashtor implicates demographic trends in the downfall of the Egyptian sugar industry (Ibid., p. 120), but governmental policies also affect demographic trends. The increasingly feudalistic land tenure structures had an adverse affect on population patterns. Nizam al-Mulk, in the Book of Politics states that "the peasants, having been impoverished by heavy taxation and extortion, are ruined and dispersed." (See Ashtor 1976).
At the beginning of the fifteenth century most of the monopolized industries (sugar, soap, paper, silk and other fabrics, glass) collapsed. "[A]l-Makrizi writes that after 1404 people were compelled to dress themselves in the woolen stuffs imported by European merchants" (Ibid., p. 307). The role of government factories in the technological decline of Near Eastern industry is unmistakable. With cheaper sources for raw materials (in part produced on the royal estates), the "sultans and amirs used their power to curtail the activities of their competitors by taxation or by the establishment of monopolies. ... The royal factories themselves were ruined by corrupt managers whose maladministration induced the sultans in the course of time to abolish the tiraz system altogether. Industrial production sank to the level of small workshops which could not afford long and costly experiments" (Ibid., p. 308-309).
According to Ibn Khaldun, shipbuilding skills had declined to the point that "in case of need the governments must have recourse to foreign help" (Ibid.). As Muslim skills in, for example, silver inlay vanished, Venetians picked it up from Syrian Jews.
The decline of wheat was a landmark. It had been the staple, but with the arrival of the last decade of the fifteenth century, millet and dhura bread were being consumed in Cairo and barley in Damascus--even by the governor and the princes (Ibid.). With the breakdown and flight to the cities there came thousands of unemployed paupers, victimized by diseases--chronic and epidemic. Desperate, they provided a recruitment pool for warring factions and rebels. "The lowest stratum of this class were the so-called harafish, beggars who were to be found near the mosques and elsewhere and who were allied to certain groups of dervishes" (Ibid., p. 320). Skilled workers were in better shape only because there was such a shortage of them. The petty bourgeois, however, "were impoverished by the fiscal policy of the Mamluk government" (Ibid.).
In addition to the burdens of trade taxes there were numerous other extortions. We have already mentioned the tarh, which compelled merchants to buy overpriced products from their government competitors. Such measures were periodically abolished and then resurrected. Muslim jurisprudence did not allow for price-fixing outside times of emergency, but the Mamluks fixed prices when it suited their interests (Ibid.).
At the same time land-tenure changes gave rise to a feudalist system placing the bourgeois in an inferior position. The legal scholars were also made subservienbt to the state through government appointments to judgeships or teaching positions at schools endowed by the Mamluks, inducing collaboration (Ibid., p. 284). Using a practice resurrected in current-day Egypt, the government avoided responding to the theologians' protests against the governmental extortions, by instead wooing them by such measures as "promulgating decrees against the Christians and Jews" (Ibid., p. 285) Thus an intellectual aristocracy of judges and professors appointed by the government arose. The disfavored classes engaged in mob riots, but no organized revolutionary movement. "[A]ll classes of society were imbued with a spirit of rigid orthodoxy which made a social revolution allied to sectarian tendencies unthinkable" (Ibid., p. 322). Yet, the co-option of the religious scholars pre-empted any jihâd against the oppressive regime.
Despite the consequent favorable balance of payments due to the change of trade routes discussed in the preceding section, and continuing supply of Sudanese gold, "the economy of the Mamluk kingdom crumbled in the second half of the fifteenth century" (Ibid,, p.327). "The flourishing economy of the Near East had been ruined by the rapacious military, and its great civilizing achievements had been destroyed through inability to adopt new methods of production and new ways of life" (Ibid,, p. 331). The economic breakdown led to the political and military collapse. Reasons for breakdown: decay of Egyptian industry; extravagant luxury of the ruling class; hoarding of money (a consequence of musâdara?); and military spending. At the same time Portuguese were expanding and in the second half of the 15th c. Their seizure of "great quantities of Sudanese gold" was felt in Cairo (Ibid., p. 329-330).
Ibn Khaldun analyzed and denounced government competition with the private sector as a means of revenue enhancement. He titles a section of the Muqaddimah "Commercial activity on the part of the ruler is harmful to his subjects and to the tax revenue" (Ibid., p. 93). He elaborates that the ruler has an unfair advantages in (1) using state wealth in competition with private resources; (2) having taxing authority; (3) having ability to force purchases at above market prices; (4) intimidating competition and suppliers to force selling below market (Ibid., p. 94). The consequent "financial difficulties and loss of profit ... takes away all incentive to effort, thus ruining the fiscal (structure)" (Ibid., p. 95). With the merchants and farmers driven out of business, tax revenues dry up and the government has undermined its best source of revenue.
Furthermore, (the trading of the ruler) may cause the destruction of civilization and, through [it] the destruction of the dynasty. When the subjects can no longer make their capital larger through agriculture and commerce, it will decrease and disappear as a result of expenditures. This will ruin their situation. This should be understood. (Ibid., p. 95)
Muslim states which wish to see an industrial revolution should pursue a policy that permits the private sector to engage in any and all halâl pursuits. The primary role the Muslim state is the establishment of justice. Arbitration is better suited to this goal that regulation and licensing. While there are some infrastructure tasks that can be expeditiously handled by the state without jeopardizing or contradicting its primary task, they are few in number and increasing them constitutes a slippery slope to economic failure.

5. CONCLUSIONS

Those who, of their own free will and without any compulsion act according to the Book (Qu'rân) and the News (Hadîth) wear the turban of freedom (Khwaja-i-Jahan Mahmud Gawan quoted by Sherwani 1959).
We conclude by showing the implications for comprehensive development of Muslim countries in the modern era. A proper mindset for understanding what economic policy can and cannot do is aided by always remembering that bay`ah is a contract between the rulers and the people. Ibn Khaldun (Ibid., p. 429) notes that the scholar "Mâlik pronounced the legal decision that a declaration obtained by compulsion was invalid..." for which he was persecuted. We can sense his distaste when he notes that in his own day the shaking the leader's hand had been replaced by "greeting kings by kissing the earth (in front of them), or their hand, their foot, or the lower hem of their garment" (Ibid.).
The list of the proper functions of government is a short one: (Ibid., v. II, p. 3):
1) "defend and protect the community from its enemies."
2) "enforce restraining laws among the people, in order to prevent mutual hostility and attacks upon property. This includes improving the safety of the roads."
3) "cause the people to act in their own best interests, and ... supervise such general matters involving their livelihood and mutual dealings as foodstuffs and weights and measures, in order to prevent cheating."
4) oversee the mint to prevent fraud in currency.
5) Exercise political leadership.
Items 2-5 are distinctly economic in purpose. It is interesting that item 4 permits private minting which was in fact the early Muslim practice. Ibn Khaldun comments (Ibid., p. 55): "The government paid no attention to the matter. As a result, the frauds practiced with dinars and dirhams eventually became very serious" in the year 74 A. H. or 75 A. H. Thus in 76 (695-696 C. E.) Abd-al-Malik standardized the dirham with the emblem "God is one, God is the samad."
F. A. Hayek (1967) attributed to David Hume the "invention" that in its positive aims government was entitled to "no power of coercion and was subject to the same general and inflexible rules which aim at an overall order by creating its negative conditions: peace, liberty, and justice." Centuries before Hume was born, however, the applicability of sharî`ah to government was a seminal concept in Islam. The claim that Islamic society was governed more by situation ethics (see, e.g., Talbi 1981) than by the Qur'an and sunnah contains some truth, but is misleading. Muslim society strayed away from these principles gradually. Initially by constraints on land distribution and expansion of taxation, later in government interference in the economy, and finally in the loss of respect for private property and individual liberty. But until the thirteenth century, Muslim scholars, largely independent of the government, continued to develop a fiqh grounded in the Qur'an and sunnah as they understood it (Ahmad 1993a, 1994). It was only with the closing of the door to ijtihâd that actual practice substituted for the standards of the divine law. Islamic society paid the price for it.
Muslim scholars who interpret early Muslim practice as a precedent for whatever intervention in which a modern state wishes to engage do so only by ignoring the clear text of the Qur'an and dropping the context of the Prophet's advisory in the farewell pilgrimage. The best hope for an Islamic renaissance is to return to the fundamentals of Islam, i.e., the Qur'an and the principles exemplified by the practice of the Prophet. They do the ummah a disservice. Muslim nations eager for economic development should neither imitate the majoritarian policies of developed countries entering into the declining phases of their economic success nor should they retain authoritarian policies which account for their current stagnation. Rather, they should emulate the policies which permitted industrial development to occur in the first place. And what nascent society would be better to emulate than the Islamic society at the outset of its golden era? The implications for economic policy are clear:
1) Define and defend the property rights of the people, which should be as expansive as possible;
2) Issue a currency fully backed by hard monetary commodities;
3) Restrict public revenues to sources authorized by the sharî'ah and practiced by the khalifah rashidûn (zakât, jizyah, sadaqa, khums, and justifiable user fees including kharâj and `ushr) and limit them to the lawful limits;
4) End all government interference with economy apart from the prohibition of the initiation of coercion, fraud or other harâm activities.
The implicit limitations on the size and scope of government (as well as its decentralization) can also be a mechanism for the elimination of corruption which is another major problem for economic growth.
APPENDIX:

RIBA AND INTEREST: DEFINITIONS AND IMPLICATIONS

(delivered at 22nd Conference of American Muslim Social Scientists
Oct. 15-17, 1993 in Herndon, VA)

[ABSTRACT: The overwhelming majority of scholars have historically held that all interest falls under the rubric of ribâ, banned by the Qur'an. We argue that neither ribâ nor interest have been well defined in the Islamic literature. If we define ribâ as it is used in the Qur'an and sunnah and define pure interest as the term is used by Böhm-Bawerk, we discover that the terms are not synonymous. We demonstrate that some of the criteria traditionally used to identify ribâ, such as time-element, contradict the sunnah. We conclude that ribâ includes all forms of overcharging, including overcharging on interest (usury). We show that some practices held as harâm by the traditionalists are in fact mandatory in order to avoid ribâ. On the other hand the now common practice of issuing unbacked paper currency, scrupulously avoided by Muslims in the first 400 years of the Hijrah era, constitutes a form of ribâ which puts economies at great risk.]
Most of the scholars who have investigated the issue of ribâ have simply assumed that ribâ and interest are synonymous, and then pointed to the unambiguous denunciation of ribâ in the Qur'an to justify their opposition to all forms of interest. This is a very poor methodology. It trivializes an issue so complex that Umar listed as one of the three matters on which he wished the Prophet (peace upon him) had provided more guidance. My approach shall be to take for granted the prohibition of ribâ as being glaringly evident from the Qur'anic texts (3:130;2:275-279) and seek to establish what the word means. We shall then compare this concept against the concepts of interest, usury, and overcharging, and argue that the latter two are, depending on the context, better translations of the term ribâ than interest.
Semantically ribâ means an excess or an addition. The context of the discussion of ribâ in the Qur'an makes four things (besides its prohibition) abundantly clear: (1) that it involves amounts which are in some sense large; (2) that its distinction from legitimate trade is so obvious that only a madman could confuse the two; (3) that it may be contrasted to charity; (4) that it is unjust. It is critical to notice that the principle exposition on the subject of ribâ occurs in the middle of a passage on charity (in Surat-al-baqara):
(267) O ye who believe! Give of the good things which ye have (honourably) earned, and of the fruits of the earth which We have produced for you, and do not even aim at getting anything which is bad, in order that out of it ye may give away something, when ye yourselves would not receive it except with closed eyes. And know that God is free of all wants, and worthy of all praise.
(268) The Evil One threatens you with poverty and bids you to conduct unseemly. God promiseth you His forgiveness and bounties. And God careth for all and He knoweth all things.
(269) He granteth wisdom to whom He pleaseth; and he to whom wisdom is granted receiveth Indeed a benefit overflowing; but none will grasp the Message but men of understanding.
(270) And whatever ye spend in charity or devotion, be sure God knows it all. But the wrong-doers have no helpers.
(271) If ye disclose (acts of) charity, even so it is well, but if ye conceal them, and make them reach those (really) in need, that is best for you: It will remove from you some of your (stains of) evil. And God Is well acquainted with what ye do.
(272) It is not required of thee (O Apostle), to set them on the right path, but God sets on the right path whom He pleaseth. Whatever of good ye give benefits your own souls, and ye shall only do so seeking the "face" of God. Whatever good ye give, shall be rendered back to you, and ye shall not be dealt with unjustly.
(273) (Charity is) for those in need, who, in God's cause are restricted (from travel), and cannot move about in the land, seeking (for trade or work): the ignorant man thinks, because of their modesty, that they are free from want. Thou shalt know them by their (unfailing) mark: they beg not importunately from all and sundry. and whatever of good ye give, be assured God knoweth it well.
(274) Those who (in charity) spend of their goods by night and by day, in secret and in public, have their reward with their lord: on them shall be no fear, nor shall they grieve.
(275) Those who devour usury will not stand except as stands one whom the Evil One by his touch hath driven to madness. That is because they say: "trade is like usury," but God hath permitted trade and forbidden usury. Those who after receiving direction from their lord, desist, shall be pardoned for the past; their case is for God (to judge); but those who repeat (the offence) are companions of the fire: they will abide therein (for ever).
(276) God will deprive usury of all blessing, but will give increase for deeds of charity: for he loveth not creatures ungrateful and wicked.
(277) Those who believe, and do deeds of righteousness, and establish regular prayers and regular charity, will have their reward with their lord: on them shall be no fear, nor shall they grieve.
(278) O ye who believe! Fear God, and give up what remains of your demand for usury, if ye are indeed believers.
(279) If ye do it not, take notice of war from God and his apostle: but if ye turn back, ye shall have your capital sums: deal not unjustly, and ye shall not be dealt with unjustly.
(280) If the debtor is in a difficulty, grant him time till it is easy for him to repay. But if ye remit it by way of charity, that is best for you if ye only knew. Interest is a predetermined fixed rate of return. Usury means an excessive interest. Overcharging means an excessive price of any sort.
In the Prophet's day few loans were for the purpose of raising venture capital. The usual purpose of a loan was to allow persons in deep financial need to make it to next week. Due to the state of extreme need of such borrowers, the rate of interest on these loans tended to be exorbitant ("doubled and multiplied," 3:130), resulting in additional debt to the borrower as the interest charges made him worse off. The context of the quotes above, immediately followed by a fiery denunciation of ribâ and an entreatment to charity makes this circumstance clear (2:275-281). It is thus unsurprising that the early Islamic scholars perceived all commercial interest as usury.
At root of the attacks on interest is the assumption that by one standard or another it is unearned. There is certainly a distinction between the function of the entrepreneur and of the capitalist. The entrepreneur makes decisions, studies markets, takes risks in that his profit is not predetermined, etc. The capitalist does nothing. He is the owner of the money which the entrepreneur uses. (Note that the entrepreneur may also be a capitalist to the degree that he uses his own money, and the capitalist is an entrepreneur to the degree that he makes investment decisions and assumes risks). It is not risk that makes up "pure" interest, for to the extent that risk is involved that may also be considered entrepreneurial profit. The "capitalist" is then actually an "investor" who is then part entrepreneur and part capitalist. But the risk in a long term government bond does not explain the 6% interest rates current as this paper is being written.
Böhm-Bawerk (1959) has shown that the market rate of interest is not an addition to (or excess over) capital value. This is due to the fact that the source of value is the subjective desire of the participants in the market, and it is a fact that, subjectively, people tend to prefer access to their money now rather than in the future. The key here is access to money. It is true that there are numerous circumstances under which I would want to store my money for future use: a child's education, retirement, a nest egg against emergencies, etc. But even in these cases, I would prefer to have the right to get my principle on demand in case I change my mind. Thus there is a difference between demand deposits and time deposits. In the former case I have given up nothing, and it will indeed be an excess (ribâ) to collect interest. In the latter case, the present value of money inaccessible until a set future time is less than the present value of the same money with no such constraint. This time-preference means that a person considering a time-deposit is being offered a diminution of the subjective value of capital unless a compensatory interest is also offered. Those for whom the market rate of interest exceeds this value difference would be making a profit, but those for whom it is less will be taking a loss. Forcing someone to accept less than the market rate would thus constitute a diminution of the capital sum, a violation of the Qur'anic explication of the terms of the Qur'anic prohibition of ribâ: "but if ye turn back [i.e., abandon ribâ] ye shall have your capital sums; deal not unjustly and ye shall not be dealt with unjustly" (2:279). Thus we see the reason that discounts for cash and surcharges for credit, agreed to between vendor and buyer, have always been permitted by Islamic law.
How does interest on a loan issued by a third party differ from the discount for cash or surcharge for credit? From an economic point of view it does not, except that it adds greater flexibility to the market. Consider the case in which a buyer is willing to pay $2100 next year for a used car but the seller wants $2000 right now. A deal is impossible. But if a third party agrees to lend $2000 to the buyer in exchange for $2100 a year from now, the buyer is happy, the seller is happy, and the lender is happy. Prohibiting such a transaction serves no purpose. Islamic scholars who maintain that all interest is usurious are in the position of claiming that although it would be permissible for the buyer to pay $2000 now, or for the seller to accept $2100 next year, it prohibited for the lender to make both of these possible at the same time.
Abu-Saud (1986) agrees that such a transaction is not harâm, but distinguishes between it and loans for more general purposes. In the example I have cited the loan is for a specific purchase, with the lender as a clear substitute for the buyer in a clearly halâl transaction. Abu-Saud does not believe that the analogy can be further extended to what he calls "charitable debt." Should we consider all "clear cash loans" to be examples of charitable debt? Following the overwhelming majority of scholars, Abu-Saud (1986) argues:
The prohibition of paying an extra amount to the lender of cash is originally based on the fact that money is a "quasi commodity" and has no intrinsic utility, though it serves the purpose of obtaining the utilities of other commodities and goods. Unless its holder uses it, i.e. spends it, it would not give him any economic satisfaction. Thus, Islamicly speaking, if there is a surplus of money in the hands of its owner, it would not, and indeed should not, earn any yield as long as does not exert any effort or undertake any risk. The Islamic principle we should always remember is there is no reward without work and no work without reward.
This argument is erroneous, however, on a number of grounds. In the first place, money commodities like gold do have an "intrinsic" value (one should say use value). Natural monetary commodities, unlike paper currency, evolve a monetary value after being prized initially for their utility. The fact that their monetary utility comes to outweigh their other uses (say in industry or as ornamentation) does not change this fact. Indeed their monetary use only adds to their value. Further, the argument suggests a reliance on the theory of labor value that dominated the thinking of Adam Smith, David Ricardo, and Karl Marx, but which has been demonstrated to be false. Value is not determined by labor, but is subjective. The subjective nature of value leads to numerous consequences in economics, such as marginal utility and time preference. Following the discussion above, it is time preference that brings about a positive rate of interest. Thus the payment of interest is a means of compensating the lender for agreeing to defer payback, which constitutes a loss of value to the lender whom the Qur'an has guaranteed shall suffer no such loss.
The traditional Muslim position has been defended against this type of criticism on the grounds that it is merely the institution of interest that is opposed and not the de facto interest involved in all time-dependent transactions. Given the fungibility of money it seems that a prohibition on the institution of interest is easily circumvented, and there are numerous examples of such circumvention in Islamic history. I propose that there is one very important case where a prohibition on interest is difficult to circumvent, and I suggest that this may be the explanation for the peculiar fact that Islamic world in the classical era never achieved an industrial revolution.
In most cases any proposed fixed interest transaction can be converted into an equivalent (for purposes of marketability) profit-sharing transaction. This is the theory behind the so-called "Islamic banking." There are a few exceptions. Treasury bills, which pay an interest that is not derived from business profits, are a problem, but that problem is gotten around in an Islamic economy by avoiding deficit spending. A more serious problem is reflected in the fact that extremely high risk investments are difficult to finance in the absence of fixed interest. This has been demonstrated by Abdul Aziz (1993) in the case of Islamic economies, but the general principle is obvious in the following hypothetical case. Consider an entrepreneur with an idea so revolutionary that he cannot persuade anyone of its profitability. His offers to various capitalists to permit them a share in profits that they are certain shall be non-existent is fruitless. No profit/loss sharing ratio can be advantageous enough to entice them. Even if he offers them 100% of the profits and none of the losses, they would decline because they would not sacrifice the opportunity costs for what they perceive to be non-existent chance of profit. This would explain why it was the West and not the Muslim world that produced commercial products like electricity and the automobile which were considered laughable ideas by all but the visionaries who brought them to the market.
Let us now return to the definitions of the terms of interest. Most authorities claim that ribâ involves a fixed non zero rate of return for one commodity against a like commodity over time. An examination of the hadith which Abu-Saud (1986) deemed authentic on this subject demonstrates that this interpretation is incorrect on the following grounds. The Prophet (peace be upon him) included in this prohibition certain spot transactions such as the exchange of dates of differing quality unless the exchange was mediated by a market price evaluation of the commodities being exchange. This is traditionally known as ribâ al-Fadhl. Thus we have a kind of ribâ in which no time element exists. Conversely, one can have transactions in which deferred payment with a surcharge for credit is permitted, as we have seen above. Then time element is clearly not the defining element of ribâ.
Then what is the defining element of ribâ? I propose that it is overcharging. This is the element in common in every example given in Qur'an and hadith. The insistence on a market evaluation of the dates in the barter exchange of unlike materials is clearly representative of a concern over overcharging. The same applies to the Prophet's prohibition of brokers' taking unfair advantage of caravans unaware of changes in market prices. A fraudulent misrepresentation of the market price constitutes ribâ:
A man displayed some goods in the market and took a false oath that he had been offered so much for them, though he was not offered that amount. Then the following Divine Verse was revealed: "Verily those who purchase a little gain at the cost of Allah's covenant and their oaths ... will get a painful punishment." (3:77) Ibn Abâ Aufâ added, "Such a person as described above is a treacherous Ribâ-eater (i.e. eater of usury).
When overcharging is applied to fixed rates of interest, it is called usury.
It follows that interest may or may not be usurious, depending upon whether or not the rate charged exceeds the market clearing rate of interest. But when would an agreed-to interest rate exceed the market rate? The answer is clear when we return to the context in which the Qur'an denounces ribâ: namely, when a charitable loan is at issue. It is only the poor and needy, etc. who agree to pay usurious interest rates because of their disadvantaged position in the market place. The Muslim is prohibited not only from charging such rates but from paying them. That is, because such a rates is illegal, lenders who would charge higher rates than they themselves are willing to accept are forced to take market rates. But the context makes clear that in these cases we should give charity instead. This may be in the form of an interest-free loan, or outright sadaqa.
To understand this consider the following case of overcharging to which the principle enunciated in the Qur'anic passages would clearly apply even though there is no time element:
A boatman takes people across the river for one dinar. One day, as he is crossing the river he sees a drowning man calling for help. He tells the drowning man, I will give you a ride, but you must pay me. The drowning man, of course, agrees. The boatman says: the cost will be everything you own plus everything you ever earn from now on. The man is no position to argue, he agrees. The boatman takes him aboard and delivers him to the other side, and demands his payment. The man refuses and offers instead to give him the one dinar standard payment. The boatman drags him before a qâdî and demands payment in full. One would hope that the qâdî would apply the Qur'anic principles and say that the EXCESS (ribâ) charge is harâm, and that while the boatman is entitled to the market value (i.e. one dinar) that in this case charity would be better for him. Such overcharging constitutes ribâ (al-Fadhl) despite the absence of a time element.
Ribâ, as the term is used in the Qur'an, clearly refers to usury. In the hadith it appears to be extended to all forms of overcharging as "having an element of ribâ in them." Such overcharging was made possible by the disadvantaged position of the borrower in the former case and by the withholding of information about market price in the latter case. Discount for cash and surcharge for credit, which are Islamicly permitted are examples of interest and clearly demonstrate that interest and ribâ are not synonymous. Further, there is no distinction between rental for money and rental for non-depreciating land, so that a prohibition of one without a prohibition of the other is a contradiction. Finally, the misidentification of ribâ with interest combined with the common use of unsound currencies permits borrowers to engage in ribâ with impunity. To wit, consider of I wish to borrow a certain quantity from someone which is equal to 100 units of some currency. If interest is prohibited, then I will pay him back in 100 units of this currency one year later. If the currency is sound, he has his principle returned to him (ignoring the fact that I've cheated him of his time preference). But if the currency is unsound, like an Israeli shekel, it may only be worth half of what he loaned me as measured in a sound currency. Now I have robbed him of half the principle, which is undeniably a violation of the Qur'anic injunction.
Of course, if Islamic countries would issue sound currency, then at least this component of ribâ could be removed from time-dependent transactions. The main component of the nominal (as opposed to real) rate of interest in modern economies is the anticipated rate of inflation and that, in economies using paper currency, this rate is dominated by government's tendency to debase the money supply. Neither the Prophet, nor the khulufah rashidûn, nor any other Muslim rulers of the first 400 years of Islam engaged in the fraudulent practice of debasing the money supply, which was a principle reason for the society's dynamism and success [see main paper]. Return to the practice of relying in sound currency would eliminate most nominal interest. Then debates over the legality of interest could center around the small residual which is attributable to time preference.

REFERENCES

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Aziz, Abdul 1993, "Islamic Corporate Finance: A Tool for Economic Development of Muslim Countries," Procedings of the AMSS Fifth International Islamic Economics Seminar (9-10 Oct. 1993) Washington DC), in press.

Böhm-Bawerk, E. V. 1959, Capital and Interest, vol. II, trans. by W. Smart (New York: Kelley & Millmanm, Inc.).

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Hayek, F. A. 1967, "The Legal and Political Philosophy of David Hume," in Studies in Philosophy, Politics, and Economics, (Chicago: Univ. of Chicago Press), p. 121.

Haykel, Muhammad Husayn 1976, The Life of Muhammad, Isma`il R. al-Faruqi, trans. (USA: North American Trust Publications).

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Rosenthal, trans. (Princeton: Princeton Univ. Press).

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the Age of the Umayyad and Early Abbasid Caliphs," in Udovitch 1981, p. 177.

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Talbi, Mohamed 1981, "Law and Economy in Ifrîqiya (Tunisia) in the Third Islamic Century: Agriculture and the Role of Slaves in the Country's Economy," Udovitch 1981, p. 209.

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von Mises, Ludwig 1980, The Theory of Money and Credit, trans. by H.E. Batson (Indianapolis: Liberty Classics).

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[Minaret of Freedom Preprint Series 96-4]

Islamic Astronomy

by: Owen Gingerich.
Scientific American, April 1986 v254 p74(10) COPYRIGHT Scientific American Inc.

Historians who track the development of astronomy from antiquity to the Renaissance sometimes refer to the time from the eighth through the 14th centuries as the Islamic period. During that interval most astronomical activity took place in the Middle East, North Africa and Moorish Spain. While Europe languished in the Dark Ages, the torch of ancient scholarship had passed into Muslim hands. Islamic scholars kept it alight, and from them it passed to Renaissance Europe.

Two circumstances fostered the growth of astronomy in Islamic lands. One was geographic proximity to the world of ancient learning, coupled with a tolerance for scholars of other creeds. In the ninth century most of the Greek scientific texts were translated into Arabic, including Ptolemy's Syntaxis, the apex of ancient astronomy. It was through these translations that the Greek works later became known in medieval Europe. (Indeed, the Syntaxis is still known primarily by its Arabic name, Almagest, meaning "the greatest.")
The second impetus came from Islamic religious observances, which presented a host of problems in mathematical astronomy, mostly related to timekeeping. In solving these problems the Islamic scholars went far beyond the Greek mathematical methods. These developments, notably in the field of trigonometry, provided the essential tools for the creation of Western Renaissance astronomy.
The traces of medieval Islamic astronomy are conspicuous even today. When an astronomer refers to the zenith, to azimuth or to algebra, or when he mentions the stars in the Summer Triangle--Vega, Altair, Deneb--he is using words of Arabic origin. Yet although the story of how Greek astronomy passed to the Arabs is comparatively well known, the history of its transformation by Islamic scholars and subsequent retransmission to the Latin West is only now being written. Thousands of manuscripts remain unexamined. Nevertheless, it is possible to offer at least a fragmentary sketch of the process.

The House of Wisdom

The foundations of Islamic science in general and of astronomy in particular were laid two centuries after the emigration of the prophet Muhammad from Mecca to Medina in A.D. 622. This event, called the Hegira, marks the beginning of the Islamic calendar. The first centuries of Islam were characterized by a rapid and turbulent expansion. Not until the late second century and early third century of the Hegira era was there a sufficiently stable and cosmopolitan atmosphere in which the sciences could flourish. Then the new Abbasid dynasty, which had taken over the caliphate (the leadership of Islam) in 750 and founded Baghdad as the capital in 762, began to sponsor translations of Greek texts. In just a few decades the major scientific works of antiquity--including those of Galen, Aristotle, Euclid, Ptolemy, Archimedes and Apollonius--were translated into Arabic. The work was done by christian and pagan scholars as well as by Muslims.
The most vigorous patron of this effort was Caliph al-Ma'mun, who acceded to power in 813. Al-Ma'mun founded an academy called the House of Wisdom and placed Hunayn ibn Ishaq al-'Ibadi, a Nestorian Christian with an excellent command of Greek, in charge. Hunayn became the most celebrated of all translators of Greek texts. He produced Arabic versions of Plato, Aristotle and their commentators, and he translated the works of the three founders of Greek medicine, Hippocrates, Galen and Dioscorides.
The academy's principal translator of mathematical and astronomical works was a pagan named Thabit ibn Qurra. Thabit was originally a money changer in the marketplace of Harran, a town in northern Mesopotamia that was the center of an astral cult. He stoutly maintained that the adherents of this cult had first farmed the land, built cities and ports and discovered science, but he was tolerated in the Islamic capital. There he wrote more than 100 scientific treatises, including a commentary on the Almagest. Another mathematical astronomer at the House of Wisdom was al-Khwarizmi, whose Algebra, dedicated to al-Ma'mun, may well have been the first book on the topic in Arabic. Although it was not particularly impressive as a scientific achievement, it did help to introduce Hindu as well as Greek methods into the Islamic world. Sometime after 1100 it was translated into Latin by an Englishman, Robert of Chester, who had gone to Spain to study mathematics. The translation, beginning with the words "Dicit Algoritmi" (hence the modern word algorithm), had a powerful influence on medieval Western algebra.
Moreover, its influence is still felt in all mathematics and science: it marked the introduction into Europe of "Arabic numerals." Along with certain trigonometric procedures, the Arabs had borrowed from India a system of numbers that included the zero. The Indian numerals existed in two forms in the Islamic world, and it was the Western form that was transmitted through Spain into medieval Europe. These numerals, with the explicit zero, are far more efficient than Roman numerals for making calculations.
Yet another astronomer in ninth-century Baghdad was Ahmad al-Farghani. His most important astronomical work was his Jawami, or Elements, which helped to spread the more elementary and nonmathematical parts of Ptolemy's earth-centered astronomy. The Elements had a considerable influence in the West. It was twice translated into Latin in Toledo, once by John of Seville (Johannes Hispalensis) in the first half of the 12th century, and more completely by Gerard of Cremona a few decades later.
Gerard's translation of al-Farghani provided Dante with his principal knowledge of Ptolemaic astronomy. (In the Divine Comedy the poet ascends through the spheres of the planets, which are centered on the earth.) It was John of Seville's earlier version, however, that became better known in the West. It served as the foundation for the Sphere of Sacrobosco, a still further watered-down account of spherical astronomy written in the early 13th century by John of Holywood (Johannes de Sacrobosco). In universities throughout Western Christendom the Sphere of Sacrobosco became a long-term best seller. In the age of printing it went through more than 200 editions before it was superseded by other textbooks in the early 17th century. With the exception of Euclid's Elements no scientific textbook can claim a longer period of supremacy.
Thus from the House of Wisdom in ancient Baghdad, with its congenial tolerance and its unique blending of cultures, there streamed not only an impressive sequence of translations of Greek scientific and philosophical works but also commentaries and original treatises. By A.D. 900 the foundation had been laid for the full flowering of an international science, with one language--Arabic--as its vehicle.

Religious Impetus

A major impetus for the flowering of astronomy in Islam came from religious observances, which presented an assortment of problems in mathematical astronomy, specifically in spherical geometry.
At the time of Muhammad both Chistians and Jews observed holy days, such as Easter and Passover, whose timing was determined by the phases of the moon. Both communities had confronted the fact that the approximately 29.5-day lunar months are not commensurable with the 365-day solar year: 12 lunar months add up to only 354 days. To solve the problem Christians and Jews had adopted a scheme based on a discovery made in about 430 B.C. by the Athenian astronomer Meton. In the 19-year Metonic cycle there were 12 years of 12 lunar months and seven years of 13 lunar months. The periodic insertion of a 13th month kept calendar dates in step with the seasons.
Apparently, however, not every jurisdiction followed the standard pattern; unscrupulous rulers occasionally added the 13th month when it suited their own interests. To Muhammad this was the work of the devil. In the Koran (chapter 9, verse 36) he decreed that "the number of months in the sight of God is 12 [in a year]--so ordained by Him the day He created the heavens and the earth; of them four are sacred: that is the straight usage." Caliph 'Umar I (634-44) interpreted this decree as requiring a strictly lunar calendar, which to this day is followed in most Islamic countries. Because the Hegira year is about 11 days shorter than the solar year, holidays such as Ramadan, the month of fasting, slowly cycle through the seasons, making their rounds in about 30 solar years.
Furthermore, Ramadan and the other Islamic months do not begin at the astronomical new moon, defined as the time when the moon has the same celestial longitude as the sun and is therefore invisible; instead they begin when the thin crescent moon is first sighted in the western evening sky. Predicting just when the crescent moon would become visible was a special challenge to Islamic mathematical astronomers. Although Ptolemy's theory of the complex lunar motion was tolerably accurate near the time of the new moon, it specified the moon's path only with respect to the ecliptic (the sun's path on the celestial sphere). To predict the first visibility of the moon it was necessary to describe its motion with respect to the horizon, and this problem demanded fairly sophisticated spherical geometry.
Two other religious customs presented problems requiring the application of spherical geometry. One problem, given the requirement for Muslims to pray toward Mecca and to orient their mosques in that direction, was to determine the direction of the holy city from a given location. Another problem was to determine from celestial bodies the proper times for the prayers at sunrise, at midday, in the afternoon, at sunset and in the evening.
Solving any of these problems involves finding the unknown sides or angles of a triangle on the celestial sphere from the known sides and angles way of finding the time of day, for example, is to construct a triangle whose vertexes are the zenith, the north celestial pole and the sun's position. The observer must know the altitude of the sun and that of the pole; the former can be observed, and the latter is equal to the observer's latitude. The time is then given by the angle at the intersection of the meridian (the arc through the zenith and the pole) and the sun's hour circle (the arc through the sun and the pole).

The method Ptolemy used to solve spherical triangles was a clumsy one devised late in the first century by Menelaus of Alexandria. It involved setting up two intersecting right triangles; by applying the Menelaus theorem it was possible to solve for one of the six sides, but only if the other five sides were known. To tell the time from the sun's altitude, for instance, repeated applications of the Menelaus theorem were required. For medieval Islamic astronomers there was an obvious challenge to find a simpler trigonometric method.
By the ninth century the six modern trigonometric functions--sine and cosine, tangent and cotangent, secant and cosecant--had been identified, whereas Ptolemy knew only a single chord function. Of the six, five seem to be essentially Arabic in origin; only the sine function was introduced into Islam from India. (The etymology of the word sine is an interesting tale. The Sanskrit word was ardhajya, meaning "half chord," which in Arabic was shortened and transliterated as jyb. In Arabic vowels are not spelled out, and so the word was read as jayb, meaning "pocket" or "gulf." In medieval Europe it was then translated as sinus, the Latin word for gulf.) From the ninth century onward the development of spherical trigonometry was rapid. Islamic astronomers discovered simple trigonometric identities, such as the law of sines, that made solving spherical triangles a much simpler and quicker process.

Stars and Astrolabes

One of the most conspicuous examples of modern astronomy's Islamic heritage is the names of stars. Betelgeuse, Rigel, Vega, Aldebaran and Fomalhaut are among the names that are directly Arabic in origin or are Arabic translations of Ptolemy's Greek descriptions.
In the Almagest Ptolemy had provided a catalogue of more than 1,000 stars. The first critical revision of the catalogue was compiled by 'Abd al-Rahman al-Sufi, a 10th-century Persian astronomer who worked in both Iran and Baghdad. Al-Sufi's Kitab su-war al-kawakib ("Book on the Constellations of Fixed Stars") did not add or subtract stars from the Almagest list, nor did it remeasure their often faulty positions, but it did give improved magnitudes as well as Arabic identifications. The latter were mostly just translations of Ptolemy.
For many years it was assumed that al-Sufi's Arabic had established the stellar nomenclature in the West. It now seems that his 14th- and 15th-century Latin translators went to a Latin version of the Arabic edition of Ptolemy himself for the star descriptions, which they combined with al-Sufi's splendid pictorial representations of the constellations. Meanwhile the Arabic star nomenclature trickled into the West by another route: the making of astrolabes.
The astrolabe was a Greek invention. Essentially it is a two-dimensional model of the sky, an analog computer for solving the problems of spherical astronomy [see "The Astrolabe," by J. D. North; SCIENTIFIC AMERICAN, January, 1974]. A typical astrolabe consists of a series of brass plates nested in a brass matrix known in Arabic as the umm (meaning "womb"). The uppermost plate, called the 'ankabut (meaning "spider") or in Latin the rete, is an open network of two or three dozen pointers indicating the position of specific stars. Under the rete are one or more solid plates, each engraved with a celestial coordinate system appropriate for observations at a particular latitude: circles of equal altitude above the horizon (analogous to terrestrial latitude lines) and circles of equal azimuth around the horizon (analogous to longitude lines). By rotating the rete about a central pin, which represents the north celestial pole, the daily motions of the stars on the celestial sphere can be reproduced.
Although the astrolabe was known in antiquity, the earliest dated instrument that has been preserved comes from the Islamic period [see cover of this issue]. It was made by one Nastulus in 315 of the Hegira era (A.D. 927-28), and it is now one of the treasures of the Kuwait National Museum. Only a handful of 10th-century Arabic astrolabes exist, whereas nearly 40 have survived from the 11th and 12th centuries. Several of these were made in Spain in the mid-11th century and have a distinctly Moorish style.
The earliest extant Arabic treatise on the astrolabe was written in Baghdad by one of Caliph al-Ma'mun's astronomers, 'Ali ibn 'Isa. Later members of the Baghdad school, notably al-Farghani, also wrote on the astrolabe. Al-Farghani's treatise was impressive for the mathematical way he applied the instrument to problems in astrology, astronomy and timekeeping.
Many of these treatises found their way to Spain, where they were translated into Latin in the 12th and 13th centuries. The most popular work, which exists today in about 200 Latin manuscript copies, was long mistakenly attributed to Masha'allah, a Jewish astronomer of the eighth century who participated in the decision to found Baghdad; it probably is a later pastiche from a variety of sources. In about 1390 this treatise was the basis for an essay on the astrolabe by the English poet Geoffrey Chaucer. Indeed, England seems to have been the gateway for the introduction of the astrolabe from Spain into Western Christendom in the late 13th and 14th centuries. It is possible that scientific activity centered at Oxford at the time contributed to the surge of interest in the device. Merton and Oriel colleges of the University of Oxford still own fine 14th-century astrolabes.
On them one finds typical sets of Arabic star names written in Gothic Latin letters. Included on the Merton College astrolabe, for example, are Arabic names that have evolved into standard modern nomenclature: Wega, Altahir, Algeuze, Rigil, Elfeta, Alferaz and Mirac. Thus as a result of the astrolabe tradition of Eastern Islam, transmitted through Spain to England, most navigational stars today have Arabic names, either indigenous ones or Arabic translations of Ptolemy's Greek descriptions.

Refining Ptolemy

It would be wrong to conclude from the preponderance of Arabic star names that Islamic astronomers made exhaustive studies of the sky. On the contrary, their observations were quite limited. For instance, the spectacular supernova (stellar explosion) of 1054, which produced the Crab Nebula, went virtually unrecorded in Islamic texts even though it was widely noted in China. Modern astronomers struck by this glaring gap often do not realize that Islamic astronomers failed to document most specific astronomical phenomena. They had little incentive to do so. Their astrology, unlike that of the Chinese, depended not so much on unusual heavenly omens as on planetary positions, and these were quite well described by the Ptolemaic procedures.

The planetary models that Ptolemy devised in the second century A.D. had the sun, the moon and the planets moving around the earth. A simple circular orbit, however, could not account for the fact that a planet periodically seems to reverse its direction of motion across the sky. (According to the modern heliocentric viewpoint, this apparent retrograde motion occurs when the earth is passing or being passed by another planet on its way around the sun.) Hence Ptolemy had each planet moving on an epicycle, a rotating circle whose center moved about the earth on a larger circle called the deferent. The epicycle, together with other geometric devices invented by Ptolemy, gave a fairly good first approximation to the apparent motion of the planets. As a great theoretician, Ptolemy must have been fairly confident of the particular geometry of his models, since he never described how he settled on it.
On the other hand, the idea of applying mathematics to a specific numerical description of the physical world was something rather novel for the Hellenistic Greeks, quite different from the pure mathematics of Euclid and Apollonius. In this part of his program Ptolemy must have realized that improved values for the numerical parameters of his models were both desirable and inevitable, and so he gave careful instructions on how to establish the parameters from a limited number of selected observations. The Islamic astronomers learned this lesson all too well. They limited their observations, or at least the few they chose to record, primarily to measurements that could be used for rederiving key parameters. These included the orientation and eccentricity of the solar orbit and the inclination of the ecliptic plane.
An impressive example of an Islamic astronomer working strictly within a Ptolemaic framework but establishing new values for Ptolemy's parameters was Muhammad al-Battani, a younger contemporary of Thabit ibn Qurra. Al-Battani's Zij ("Astronomical Tables") is still admired as one of the most important astronomical works between the time of Ptolemy and that of Copernicus. Among other things, al-Battani was able to establish the position of the solar orbit (equivalent in modern terms to finding the position of the earth's orbit) with better success than Ptolemy had achieved.
Because al-Battani does not describe his observations in detail, it is not clear whether he adopted an observational strategy different from that of Ptolemy. In any case his results were good, and centuries later his parameters for the solar orbit were widely known in Europe. His Zij first made its way to Spain. There it was translated into Latin early in the 12th century and into Castilian a little more than 100 years later. The fact that only a single Arabic manuscript copy survives (in the Escorial Library near Madrid) suggests that al-Battani's astronomy was not as highly regarded in Islam as it was in Europe, where the advent of printing ensured its survival and in particular made it available to Copernicus and his contemporaries. In De revolutionibus orbium coelestium ("On the Revolutions of the Heavenly Spheres") the Polish astronomer mentions his ninth-century Muslim predecessor no fewer than 23 times.
In contrast, one of the greatest astronomers of medieval Islam, 'Ali ibn 'Abd al-Rahman ibn Yunus, remained completely unknown to European astronomers of the Renaissance. Working in Cairo a century after al-Battani, Ibn Yunus wrote a major astronomical handbook called the Hakimi Zij. Unlike other Arabic astronomers, he prefaced his Zij with a series of more than 100 observations, mostly of eclipses and planetary conjunctions. Although Ibn Yunus' handbook was widely used in Islam, and his timekeeping tables survived in use in Cairo into the 19th century, his work became known in the West less than 200 years ago.
Throughout the entire Islamic period astronomers stayed securely within the geocentric framework. For this one should not criticize them too harshly. Until Galileo's telescopic observations of the phases of Venus in 1610, no observational evidence could be brought against the Ptolemaic system. Even Galileo's observations could not distinguish between the geo-heliocentric system of Tycho Brahe (in which the other planets revolved about the sun but the sun revolved about the earth) and the purely heliocentric system of Copernicus [see "The Galileo Affair," by Owen Gingerich; SCIENTIFIC AMERICAN, August, 1982]. Furthermore, although Islamic astronomers followed Ptolemy's injunction to test his results, they did not limit themselves simply to improving his parameters. The technical details of his models were not immune from criticism. These attacks, however, were invariably launched on philosophical rather than on observational grounds.

Doubting Ptolemy

Ptolemy's models were essentially a mathematical system for predicting the positions of the planets. Yet in the Planetary Hypotheses he did try to fit the models into a cosmological system, the Aristotelian scheme of tightly nested spheres centered on the earth. He placed the nearest point of Mercury's path immediately beyond the most distant point of the moon's path; immediately beyond the farthest excursion of Mercury lay the nearest approach of Venus, and so on through the spheres for the sun, Mars, Jupiter and Saturn.
To reproduce the observed nonuniform motions of the planets, however, Ptolemy adopted two purely geometric devices in addition to the epicycle. First, he placed the deferent circles off-center with respect to the earth. Second, he made the ingenious assumption that the motion of celestial bodies was uniform not around the earth, nor around the centers of their deferents, but instead around a point called the equant that was opposite the earth from the deferent center and at an equal distance. Eccentric deferents and equants did a good job of representing the varying speeds with which planets are seen to move across the sky, but to some minds they were philosophically offensive.
The equant in particular was objectionable to philosophers who thought of planetary spheres as real physical objects, each sphere driven by the one outside it (and the outermost driven by the prime mover), and who wanted to be able to construct a mechanical model of the system. For example, as was pointed out by Maimonides, a Jewish scholar of the 12th century who worked in Spain and Cairo, the equant point for Saturn fell right on the spheres for Mercury. This was clearly awkward from a mechanical point of view. Furthermore, the equant violated the philosophical notion that heavenly bodies should be moved by a system of perfect circles, each of which rotated with uniform angular velocity about its center. To some purists even Ptolemy's eccentric deferents, which moved the earth away from the center of things, were philosophically unsatisfactory.
The Islamic astronomers adopted the Ptolemaic-Aristotelian cosmology, but eventually criticism emerged. One of the first critics was Ibn al-Haytham (Alhazen), a leading physicist of 11th-century Cairo. In his Doubts on Ptolemy he complained that the equant failed to satisfy the requirement of uniform circular motion, and he went so far as to declare the planetary models of the Almagest false.
Only one of Ibn al-Haytham's astronomical works, a book called On the Configuration of the World, penetrated into Latin Europe in the Middle Ages. In it he attempted to discover the physical reality underlying Ptolemy's mathematical models. Conceiving of the heavens in terms of concentric spheres and shells, he tried to assign a single spherical body to each of the Almagest's simple motions. The work was translated into Castilian in the court of Alfonso the Wise, and early in the 14th century from Castilian into Latin. Either this version or a Latin translation of one of Ibn al-Haytham's popularizers had a major influence in early Renaissance Europe. The concept of separate celestial spheres for each component of Ptolemy's planetary motions gained wide currency through a textbook, Theorica novae planetarum, written by the Viennese Georg Peurbach in about 1454.
Meanwhile, in the 12th century in the western Islamic region of Andalusia, the astronomer and philosopher Ibn Rushd (Averroes) gradually developed a somewhat more extreme criticism of Ptolemy. "To assert the existence of an eccentric sphere or an epicyclic sphere is contrary to nature...," he wrote. "The astronomy of our time offers no truth, but only agrees with the calculations and not with what exists." Averroes rejected Ptolemy's eccentric deferents and argued for a strictly concentric model of the universe.
An Andalusian comtemporary, Abu Ishaq al-Bitruji, actually tried to formulate such a strictly geocentric model. The results were disastrous. For example, in al-Bitruji's system Saturn could on occasion deviate from the ecliptic by as much as 26 degrees (instead of the required three degrees). As for the observed motions that led Ptolemy to propose the equant, they were completely ignored. In the words of one modern commentator, al-Bitruji "heaps chaos on confusion." Nevertheless, early in the 13th century his work was translated into Latin under the name Alpetragius, and from about 1230 on his ideas were widely discussed throughout Europe. Even Copernicus cited his order of the planets, which placed Venus beyond the sun.
At the other end of the Islamic world a fresh critique of the Ptolemaic mechanisms was undertaken in the 13th century by Nasir al-Din al-Tusi. One of the most prolific Islamic polymaths, with 150 known treatises and letters to his credit, al-Tusi also constructed a major observatory at Maragha (the present-day Maragheh in Iran).
Al-Tusi found the equant particularly dissatisfactory. In his Tadhkira ("Memorandum") he replaced it by adding two more small epicycles to the model of each planet's orbit. Through this ingenious device al-Tusi was able to achieve his goal of generating the nonuniform motions of the planets by combinations of uniformly rotating circles. The centers of the deferents, however, were still displaced from the earth. Two other astronomers at the Maragha observatory, Mu'ayyad al-Din al-'Urdi and Qutb al-Din al-Shirazi, offered an alternative arrangement, but this system too retained the philosophically objectionable eccentricity.
Finally a completely concentric rearrangement of the planetary mechanisms was achieved by Ibn al-Shatir, who worked in Damascus in about 1350. By using a scheme related to that of al-Tusi, Ibn al-Shatir succeeded in eliminating not only the equant but also certain other objectionable circles from Ptolemy's constructions. He thereby cleared the way for a perfectly nested and mechanically acceptable set of celestial spheres. (He described his work thus: "I found that the most distinguished of the later astronomers had adduced indisputable doubts concerning the well-known astronomy of the spheres according to Ptolemy. I therefore asked Almighty God to give me inspiration and help me to invent models that would achieve what was required, and God--may He be praised and exalted--did enable me to devise universal models for the planetary motions in longitude and latitude and all other observable features of their motions, models that were free from the doubts surrounding previous ones.") Yet Ibn al-Shatir's solution, along with the work of the Maragha astronomers, remained generally unknown in medieval Europe.

Influence on Copernicus?

Ibn al-Shatir's forgotten model was rediscovered in the late 1950's by E. S. Kennedy and his students at the American University of Beirut. The discovery raised an intriguing question. It was quickly recognized that the Ibn al-Shatir and Maragha inventions were the same type of mechanism used by Copernicus a few centuries later to eliminate the equant and to generate the intricate changes in the position of the earth's orbit. Copernicus, of course, adopted a heliocentric arrangement, but the problem of accounting for the slow but regular changes in a planet's orbital speed remained exactly the same. Since Copernicus agreed with the philosophical objections to the equant--like some of his Islamic predecessors, he apparently believed celestial motions were driven by physical, crystalline spheres--he too sought to replace Ptolemy's device. In a preliminary work, the Commentariolus, he employed an arrangement equivalent to Ibn al-Shatir's. Later, in De revolutionibus, he reverted to the use of eccentric orbits, adopting a model that was the sun-centered equivalent of the one developed at Maragha.
Could Copernicus have been influenced by the Maragha astronomers or by Ibn al-Shatir? No Latin translation has been found of any of their works or indeed of any work describing their models. It is conceivable that Copernicus saw an Arabic manuscript while he was studying in Italy (from 1496 to 1503) and had it translated, but this seems highly improbable. A Greek translation of some of the al-Tusi material is known to have reached Rome in the 15th century (many Greek manuscripts were carried west after the fall of Constantinople in 1453), but there is no evidence that Copernicus ever saw it.
Scholars are currently divided over whether Copernicus got his method for replacing the equant by some unknown route from the Islamic world or whether he found it on his own. I personally believe he could have invented the method independently.
Nevertheless, the whole idea of criticizing Ptolemy and eliminating the equant is part of the climate of opinion inherited by the Latin West from Islam. The Islamic astronomers would probably have been astonished and even horrified by the revolution started by Copernicus. Yet his motives were not completely different from theirs. In eliminating the equant, and even in placing the planets in orbit around the sun, Copernicus was in part trying to formulate a mechanically functional system, one that offered not only a mathematical representation but also a physical explanation of planetary motions. In a profound sense he was simply working out the implications of an astronomy founded by Ptolemy but transformed by the Islamic astronomers. Today that heritage belongs to the entire world of science.