For a combination of reasons—some psychological—the Muslim powers have formed a notion of contemporary capitalism that is fundamentally flawed, in that it takes over a reasonless optimism from Western speculators, regarding the profitability of industrialisation.
There are several revolutionary movements within the Muslim world which have, for reasons of their own, rejected the capitalist assurances of Western advisors, and adopted a more-or-less Leninist view of the likely fate of local industries, but even this view is defective, because it fails to penetrate to the heart of what Marx really said about industrial profit. Instead, the critique they offer focuses on the well-known problems of distribution, notably demand deficiency. This leaves them wide open to the counter-critique, to the effect that boosting demand with hand-outs of fiat money is inflationary.
In reality, however, the marxian analysis of capitalism makes a fundamental distinction between the capitalism of the merchant and that of the industrial entrepreneur. The dynamic of the latter is in the marxian view self-defeating, in that the progressive substitution of machine for labour power—necessitated by competition—gradually undermines the basis of profitability itself, which is exclusively fresh human labour.
This argument is of course extremely difficult to prove. First one must push out of the way the analytical non-concepts promoted by liberal economics, which appear self-explanatory but in fact foreclose all the essential questions. For example, what is meant by “the productivity of labour”? Output per worker, obviously, but the choice of this concept rather than the concept of “the productivity of capital” makes it appear that labour forces must compete among themselves for the honour of producing most product for least wages, while the competition of capitals goes on elsewhere, quietly automating their jobs and thus overcoming their unprofitable idleness with faultless mechanical activity. On the basis of this sort of analysis, each gain in “labour productivity” authorises a further investment in plant, which destroys the very jobs whose “labour productivity” was the source of self-congratulation. This is not a neutral framework of analysis at all.
If instead one looks at “the productivity of capital” one discovers that indubitably, the higher the technological level involved in capital investment, the harder it is to predict any profitable result from making it, once the period of “technological rent”, which occurs while the individual industrialist is more technologically advanced that his competitors, is over. When they all catch up, the industry as a whole is less profitable, and governments must offer more and more incentives to acquire investment in such industries, since they are politically essential. I have in mind here aircraft, giant computers, nuclear reactors, major transport projects, and other state of the art technological feats. We need them, but they just don’t pay. In Marx’s view, this is because the prices that entrepreneurs buy and sell at are not, collectively, random, but are the necessary results of objective laws, one of which is that only fresh “labour-power”—the potential to work, purchased with a wage—is worth more than its cost.
The ultimate consequence of this is that a fully automated industry could run very successfully for an indefinite period, but it would yield no profits. It would merely cover its costs, with precision, but it would never generate a surplus, since only the injection of fresh labour can do that. Thus, in a profit-seeking world, it would become “a white elephant”, which no one but an asset-stripper could be expected to buy.
On this theory, one can see why industrial capital, in extremis, turns to war. For one thing, the customer is a government, able to guarantee payment for giant military plants out of the state treasury, and to some extent out of a predatory stock market which anticipates new imperial gains from a successful war. For another, the effect of war is to destroy the built-up industrial capital base of the country attacked, and often of the attacker too, allowing industrial investment to start all over again with a lower technological level, a higher proportion of human labour to capital goods, and a resultant higher rate of profit.
Why is this dynamic—if it really exists—hidden not only from the capitalists themselves, but also from the apparently objective Muslims? I think there are both logical and historical reasons. First, I want to make it clear that Marx himself is an incredibly over-ambitious writer, constantly spiralling off from the demonstrable and commonsensical fact into sequences of apocalyptic dementia. Second, I want to stress that what I have said—and indeed what Marx himself says—only applies to industrial capitalism, not to mercantile capitalism, on which the glories of Muslim civilisation were founded. It is only industrial capitalism which methodically replaces human labour with machines.
One can to some extent automate the processes on which mercantile capitalism relies, such as goods transport, which can be automated via containerisation, and the resulting long-range falling rate of profit will then begin to manifest itself, upon the ruins of the transport entrepreneurs who have priced one another out of the market by competing in this way. However, the mercantile empire of the Muslims never showed any interest in doing this, and indeed, has never quite found a specific response to the development of industrial capitalism as such. The leaders of the Muslim world remain torn between the liberal ideology of Western business, which they dubiously assume can generate great wealth if freed from neocolonialist unequal exchange, and the marxian ideology of total state control, which is not only tyrannical and irreligious, but unnecessary, once one finally sees that the marxian critique applies only to industrial capital, not to mercantile capital which can be left in private hands with great advantage.
Historically, the current Muslim leaderships are to a great extent impacted by the processes of Western colonialism and neo-colonialism, which for a long time concentrated on reinforcing the “anti-communist” doctrine, to the effect that marxism was in every respect a maniacal creed akin to nazism but based on the idea of “the dictatorship of the proletariat” instead of that of the dictatorship of a “race”. This is unattractive enough, to rulers of largely traditional religious and agricultural societies, but it can be made worse by demonstrating that in fact all the marxian communist regimes, having degenerated through every phase of tyranny, are now extinct or close to it. This fact is supposed to suggest that liberal economists were right all along.
As far as I know, no one has managed to extract from the large and disagreeable body of Marx’s writings his essential arguments about the constant and inevitable fall in the intrinsic rate of profit of all industrial enterprises. Perhaps it is fortunate that I come from a non-Muslim background, and that during my earlier years I spent many unpleasant hours working my way through the three volumes of Das Kapital, so that I could eventually spill the essential contents in a way that conforms to Muslim sensibilities and aspirations instead of to those of the revolutionary stock villains of which our popular literature is so full.
My reasoning is that the “technosphere”, so to speak, the body of industrial enterprises that exists within any given Muslim state, and which is essential to the civilised survival of both state and people, should be regarded as a sort of waqf, or divinely mandated charitable asset. Thus, it can be maintained at cost in its full functionality, and not sold to asset-strippers or demolished by the bombs of competitors who claim it to be an offense against “the free market” (and against Western, judeo-christian, usury-based world power).
I can’t deny that the Western powers would like to strangle any such thing at its birth, or failing that, to bomb it to smithereens. This is why I want to explore the ideological, theoretical, and even moral questions which underlie the so-called “hegemony” of industrial capitalism. I shall steadfastly insist that it is not “capitalism as a whole” that I am analysing, but solely industrial capitalism, which I define as the process of substitution of machine for human labour in production. It is only within this context that the conventional moral arguments about the merit of “working for one’s living” become problematic, since the industrial worker, unlike any other sort of worker, is perpetually working himself out of a job, and often finds himself specifically employed on the task of making other employees redundant—and all this leading to a state in which there are no workers at all, and no profit at all, just gleaming machines standing in unused factories waiting to be purloined by an asset-stripper and sold off cheap to yield a momentary opportunistic profit elsewhere, since at their full cost they cannot yield profit.
Let us imagine that, by means of a waqf type of administration, the basic automated industries that supply the everyday needs of the citizens can be maintained in operation despite yielding no profit. The question will then arise, with what are the citizens to pay for their produce? Some will possess sufficient incomes from other sources to purchase the produce, and some not. We must look at existing waqfs in the Muslim world, at their history, at the moral, political and economic arguments used to explain their methods of functioning, at their limits—for instance, I do not know of any “free food for the masses” waqfs, but I know of plenty of “free water for the animals” waqfs—and finally at the confused and confusing Western protestant-jewish idea that “there is no such thing as a free lunch”.
There is nothing in the Qur’an to compare with the sheer sadism of the judeo-christian curse of Adam, found in the book the Christians call Genesis and the Jews Bereshith :
3:17 And unto Adam he said, Because thou hast hearkened unto the voice of thy wife, and hast eaten of the tree, of which I commanded thee, saying, Thou shalt not eat of it: cursed is the ground for thy sake; in sorrow shalt thou eat of it all the days of thy life;
3:18 Thorns also and thistles shall it bring forth to thee; and thou shalt eat the herb of the field;
3:19 In the sweat of thy face shalt thou eat bread, till thou return unto the ground; for out of it wast thou taken: for dust thou art, and unto dust shalt thou return.
However, there is an acceptance in general terms of the fact that this world is an arena of struggle (if not a “vale of tears”) and that it is not morally, emotionally, psychologically or physically healthy for mankind to simply loll around eating the fruit off the trees. Rather, mankind is expected to grasp that, just as in childhood one’s parents make considerable real effort to ensure one’s welfare, so in adulthood one should make considerable efforts to ensure one’s own welfare, and the welfare of any family one is blessed enough to have, and not expect “the welfare state” to provide everything automatically.
I leave to the reader the question of whether bringing into existence, and protecting from criticism, a “technosphere” that is nevertheless able to provide e.g. free food and housing for the masses, would be a meritorious piece of work in itself. I think that it would be highly meritorious, and I think that people’s creativity, their “productivity” in a broader sense than the usual, would be enhanced, not destroyed, if they were free from the basic “care for the morrow”.
In order to find the limits that should really be placed on such a project, limits of good taste and decorum as much as limits of basic morality, I propose a detailed study of the history of the waqfs (correctly, awqaf) of the Muslim world : their finance, their purpose, their achievements, and their limits. I would like to be able to indicate the maximum extent to which such awqaf could remove the cares of everyday survival from Muslims, without inhibiting their “capitalist” initiative, and without adopting the (often perceptibly insane) atheist and materialist views of the unfortunate “marxists” on this much vexed topic.