The Deception of the Western Economic System


Things are often not quite as they seem in the in West. When they talk about the liberation of nations they actually mean the imposing of colonialist occupation. When they talk about women’s rights they actually mean empowerment of exploitation of women’s femininity. In the UK when they talk about marriage it no longer means the coming together of a man with a woman but a man with a man. When the governments talk about reducing the government budget deficit they are in fact increasing government debt. Deception, sleight of hand, spin and distortion – are in truth what the West relies on in order to proceed from one crisis to another.

Western economics is no different to other aspects of the capitalist way of life. On the face of it capitalism has bought unprecedented economic progress to the world. Never has there been a period in history with levels of industrial activity that exist today. These industrial developments have come about under capitalism. Even so, as is the norm with the West things are not as they seem. When one looks beneath the glitter and the glossy veneer a different picture begins to emerge.

To really appreciate what the West claims it has achieved and what the truth of the matter really is some basic points need to be understood. In this brief article we seek to examine what the west brags about as its achievement in providing for the needs of its people and introduce the Islamic alternative.

What is economics all about?

Economics is about how wealth should be distributed in society, how wealth should be made and spent. Islam has a complete and comprehensive view about economics, as does capitalism. We witness the bitter fruits of the implementation of capitalist economic thinking, whilst Islam is sadly absent from economic life in every nation on the planet.

Economics plays a huge role in everyday life. In buying and selling, in going to work, in starting a business and even in death with rules to do with inheritance being part of the economic system. Life or at least the quality of life depends on having means of buying the necessities of food, clothing and shelter. For this reason humans in all societies spend a large amount of their time in pursuing economic activities.

The government of any state manages economic life and the overall economic activity of the nation. The way a state does this depends on its viewpoint on life, so capitalists run their affairs on the basis of capitalist thinking and Muslims would do it on the basis of Islam if the Khilafah state came into being.

Whilst there are many aspects of economics that we can delve into we would like to explore how the capitalists seek to secure the needs of the people – as fundamentally this is the purpose of economics. What is their thinking and how do they seek to make sure people are fed and their needs for sustenance should be met.

How the West seeks to provide for Society

Without discussing the nuances and the differences amongst capitalist thinkers – it is true to say that a consensus emerged amongst the capitalists that is still an undoubted conviction held by capitalist economists and those involved with managing the economy.

The capitalist economists came to the conclusion that in order to ensure that the needs of the people are met there must be production – meaning the supply of goods and services to satisfy the needs of the people. The thinking being that if production exists then the needs of the people can be fulfilled. They believed that production can be regulated by price. If a need exists within society then someone would enter the market to supply it, if he could make a profit. Therefore a need of the people would be fulfilled. For example people need shoes and they can afford to pay a certain price for shoes – the production would commence as long as the producer could produce at a profit. In this way the capitalists believe that needs of society would be met as long as production regulated by price profit motive exists.

In news reports about the economy is doing well or poorly, the observer sees the constant reference to the economic “growth”, “recession” and measures like “GDP”. The growth in the economy indicates that there is greater production now than period before, recession indicates a decline in production. The GDP (gross domestic product) is a measure of national productivity – if it is high then a nation is deemed as having a high standard of living.

In summary it can be said the approach of the capitalists towards fulfilling the needs of the people is to try to ensure that the economy keeps growing and GDP keeps increasing and then in their view they have a successful economy. They therefore conclude that as long is growth in production occurs, they have discharged their economic duty and the economic needs of people in their society are being well looked after. The needs of individuals are not considered but the production is measured collectively.

Growth a Flawed Premise

Does having growth in production secure the needs of every individual in society or does it restrict the profits to the people with wealth already? Does having a high GDP ensure that needs of the most vulnerable in society are met? The disabled, the elderly the mentally ill are they all expected to seek the capitalist dream?

The statistics speak for themselves in most capitalist nations. Whilst the US by many is perceived to be the land of opportunity and immense wealth- In 2011, a staggering 46.2 million people were in poverty [1]. Additionally, 5.1 percent of all U.S. households (6.1 million households) accessed emergency food from a food pantry one or more times [2]. A huge number of the population of the US does not have enough to buy food without seeking hand outs.

The US is not the only capitalist nation with a huge chunk of its population that cannot meet its basic needs. The UK for instance without social welfare, would have a large proportion of its population with no means for food or housing. The extensive use of social welfare in Western countries shows that the idea of increasing production leads to the fulfilment of the basic needs for all is flawed. This is why if the thought of the western economists was implemented as a solution alone then a large percentage of the citizens of these countries would find themselves in abject poverty and not have enough for survival. To prevent riots and social turmoil politicians in the west address this flaw by providing government handouts, benefits and welfare schemes, whilst maintaining the pretence that their economic ideas are true and work.

A Model for the Muslim World to Follow?

Due to the years of decline and intellectual and political confusion that exists in the Muslim world, many Muslims see that the people in the Western world live a life that they can only dream of. This is projected by the media and is perceived to be the norm in the West. They fail to realise however that economy of the West moves from crisis to crisis and has to be put on life support via government intervention. In actual fact many people can only afford luxury goods by going into debt. In the US for example the average credit card debt is $15,257, average mortgage debt: $149,782 and the average student loan debt $34,703 [3]. People are not prospering as the West likes to arrogantly project to the rest of the world. Rather those that work tend to go into debt and then have to work like slaves in order pay the debt as it grows with riba over time. Those who can’t are left at the mercy of welfare schemes or resorting to criminality.

The people amongst the existing political classes in the Muslims lands, who are besotted with West, have tried to emulate and apply Western economic principles – and have failed in achieving any success for at least the last century. However Muslims are increasingly beginning to realise that capitalism cannot resolve their issues for them. Rather the solution lies in Islam. It has a detailed economic system that has been fully elaborated in the literature of Hizb ut Tahrir. This is the way forward for the Muslim Ummah.

What does Islam say about securing the needs of the people?

Unlike capitalism Islam does not wash its hands of securing the needs of the people as individuals. The capitalist economists consider that if their growth and GDP statistics are good then the economy is working. To them it does not matter if like in the US 46.2 million people were considered to be in poverty – as longs as the economic statistics look good. This is not the case at all with Islam.

Islam obliges the state to ensure that its citizens have their basic needs and necessities met as well allowing the luxuries as much as possible. This would be done firstly by letting those capable of working to do so.

It is narrated that the Prophet Muhammad ( saw) shook the hand of Sa’ad ibnMuadh (ra) and found his hands to be rough. When the Prophet صلى الله عليه وسلم asked about it, Sa’ad said: “I dig with the shovel to maintain my family.” The Prophet صلى الله عليه وسلم kissed Sa’ad’s hands and said: “(They are) two hands which Allah loves.” The Prophet صلى الله عليه وسلم said: “Nobody would ever eat food that is better than to eat of his own hand’s work.”

It was also narrated that Umar b. Al-Khattab (RA) passed by some people, who were known as readers of the Qur’an. He saw them sitting and bending their heads, and asked who they were. He was told: “They are those who depend (Al-Mutawwakiloon) upon Allah سبحانه وتعالى.” Umar replied: “No, they are the eaters who eat the people’s properties. Do you want me to describe those who really depend upon Allah (Al-Mutawwakiloon)?” He was answered in the affirmative, and then he said: “He is the person who throws the seeds in the earth and then depends on his Lord The Almighty, The Exalted (‘Azza wa jalla).”

Unlike in capitalist economic thinking it is not assumed that all people will be in a position to work and thus earn to secure a livelihood. Islam addressed this issue by firstly obliging the family of such people to look after them and ensure that their needs were being met. If this was not possible then the bait al mal (state treasury) would provide for them. The capitalist economists view is that if an individual is not involved in the production of goods or services then he deserves nothing.

In conclusion, the long absence of Islam in economic life and the fall of communism in the 1990’s has led many to believe that capitalism is the only system that works. Albeit, with its contradictions, flaws and sticky plaster solutions. They are sadly mistaken, as has been witnessed over the past few years capitalism is in crisis. It is a decrepit system that is frail and teetering on the brink of collapse.

Instead of being deceived by the west about their economic system, Muslims need to study and discuss the economic system of Islam with a view to implementation as an alternative under framework of the Khilafah ruling system – capitalism presents no viable solutions to be applied in Muslim countries. Only the economic system of Islam will ensure that needs of all are met and the vast resources that Allah سبحانه وتعالى gifted the Muslims with are used productively and not given away to capitalist corporations.

Abdul hafeez


[1] U.S. Census Bureau. Carmen DeNavas-Walt, B. Proctor, C. Lee. Income, Poverty, and Heath Insurance Coverage in the United States: 2010. September 2011.

[2] USDA. Coleman-Jensen, A., Nord, M., Andrews, M., & Carlson, S. Household Food Security in the United States in 2011.



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