David Yerushalmi charts one aspect of “the baneful work of…Western imams and their infidel advisers in business suits.”
“Shariah finance: The deadly Jihadist weapon with a dollar sign,” by David Yerushalmi in the Washington Examiner, December 30:
News of the recent financial meltdown of Dubai World — a quasi-sovereign global concern that owns 77 percent of the international port manager DP World and the single largest real estate developer in Dubai known for its palm-tree shaped luxury residential developments — raced from the business pages to the headlines of the front pages in a matter of days.
Since the first reports on Thanksgiving, the Wall Street Journal and just about every other major media outlet reported extensively on the worldwide implications of this latest financial shock wave.
What makes this story more than simply one of a massive real estate investment company gone bad is the double-edged sword so prevalent in the chase for oil-based Middle East wealth: Sovereign wealth funds and Shariah-compliant finance.
Beginning in the 1970s with the Carter-era oil embargo and accelerating during the post-9/11 $100+ oil price spikes, Persian Gulf countries like Saudi Arabia and the United Arab Emirates’ wealthiest city-state of Abu Dhabi have been awash in liquidity. And, these trillion-dollar cash reserves are controlled in every case by the respective royal families, typically in sovereign or quasi-sovereign wealth funds.
Another phenomenon that followed the great oil rush of the post-9/11 era was the promotion and aggressive exportation of the Muslim Brotherhood doctrine of SCF.
The concept of SCF was articulated by men like Sayyid Qutb of Egypt and Abul Ala Maududi of Pakistan in the mid-20th century, both of whom argued for a Jihad against Westernization, and the creation of Islamic polities that would ultimately join in a hegemonic worldwide caliphate. The goal was that of establishing Shariah not merely as the supreme law of the land, but as the supreme law of the world.
In the post-9/11 era, Western imams and their infidel advisers in business suits speaking the queen’s English have understood that given the global Jihad’s reliance on the dictates of Shariah to murder apostates and to terrorize the infidels into submission, SCF must be attired in a kind of progressive Western garb to attract the attention of the financial centers in London, Hong Kong and New York.
So it was that SCF became known as “ethical investing” and Western and Muslim financiers began lecturing the world that the fraud and abuse of the financial markets, such as the Enron debacle and more recently the subprime securitization meltdown, were all driven by the desire for forbidden gain through interest and gambling.
They told us that SCF was based not on forbidden interest and speculative paper assets, but profits through equity participation and sound investing in real assets.
Dubai World, a company wholly owned by the Dubai sovereign has funded itself through debt to the tune of $60 billion. The Dubai debt now in default just happens to be SCF bonds, or “sukuk.”
These bonds pay interest just like their forbidden cousins in the Western markets, but the interest is put into a black box of Shariah-created fictions and “special purpose vehicles” to keep the forbidden interest off the books.
What we now see as a real estate bubble collapse in Dubai is no different and no more or less ethical than any other financial failure. But, what makes this collapse so problematic is precisely what makes SCF and sovereign wealth funds so dangerous….