Reflections On the

islamic gift economy (IGE)

By adi setia
1



Introduction

The following are my reflections on the meaning and elaboration of the Islamic Gift
Economy in various exchange contexts. These reflections arose rather spontaneously
out of spirited discussions with like-minded friends who are critical about Islamic
Banking and Finance and concerned about the current economic and financial turmoil.
Critical, constructive feedback are most welcome to help me flesh out these preliminary
reflections further through further exposition, arguments and documentation.

1. Business is Giving Good Advice

When you really think about it, business in Islam is also about giving good advice, e.g.,
you sell a thing only after all relevant true and correct information about it has been
given to the buyer, so that the buyer truly benefits from the purchase.
That is transparency (nu) and fair dealing (adl) in Islam, and an aspect of what
is meant by gift in the Islamic Gift Economy (IGE). We are not allowed to take undue
advantage of anyones innocence or circumstance. Fair dealing also underlies the Fair
Trade movement in the West.
This is of course in contrast to modern marketing and advertising that is all
premised on khid (deception) and window-dressing, including now green-washing to
take advantage of peoples increasing concern for preserving socio-ecological well-
being.
But how many pious Muslims today are proud to have a BA or MA in
Marketing and work as Marketing Executives in monopolistic corporations while
gleefully oblivious of the big, perilous gulf between nu and khid?

2. Convergence of Thought on the IGE

The conceptual parameters of the Islamic Gift Economy (al-Iqtid al-Infq or al-Iqtid
al-Isn) is elaborated in my translation of Imam Shaybns Kitb al-Kasb (Book
of Earning a Livelihood), in Appendix 1 (pp.157191).

1
Dr. Adi Setia is Principal Advisor, Titiwangsa Advisory Group (TAG); and General Coordinator,
Worldview of Islam Research Academy (WIRA); email: adisetiawangsa@gmail.com.
Everything about the IGE is rooted in the Quran, Sunnah, al-Salaf al-li, the
Great Imams like al-Shaybn, al-Khalll, al-Ghazl, al-Musib, Ibn Ab al-Duny, and
and many others. So there is convergence of thought amongst scholars on these
conceptual parameters. The challenge is to be structurally and systemically self-
consistent in our work to revive true mu amalah on the basis of these parameters and
avoid allowing these parameters to be hijacked and corrupted by people who are
heavily invested in conventional secular economics or in the so-called Islamic Banking
and Finance (IBF) industry.
Even the Christians are agreed with us on the Gifting framework as the
basis of socio-economic exchange and on moving away from the silly, nihilistic,
dogmatic obsession with scarcity and wants towards true livelihood for the common
good. On this, please see the detailed Appendix III of the Book of Earning a Livelihood
reporting on our fruitful 5-day dialogue with them in Sabah in October 2011.
Some one read my translation and coined the term zuhdonomics (zuhd +
nomics), because in the IGE framework, zuhd (abstinence) and earning a livelihood go
hand in hand. However, I suggest we stick to the term Islamic Gift Economy in English
and al-Iqtisad al-Ihsani or al-Iqtisad al-Infaqi in Arabic as too many fancy-sounding
terms spoil the broth and confuse the issue and scatter our focus.
Now the next task is to go beyond verbal, conceptual elaboration to
actual application to everything we do in socio-economic exchange. Everything that we
have learnt and practised in modern economics, management, accounting, investment,
business, finance, etc., has to be transformed accordingly. This means we also have
restructure Islamic Banking and Finance away from centralised ribawi/hiyali money
laundering for the affluent toward decentralised debt-free, equity- and asset-based
community investment structures under local control and ownership. This also entails
doing away with the terms Islamic Finance and Islamic Banking altogether.
The ulama and fuqaha must abandon IBF altogether and embrace IGE totally.
For starters, in all masjids, madrasahs and universities there should be lessons on the
Kitb db al-Kasb wa al-Mashah of Imm al-Ghazl, or on Imam al-Shaybnis Kitb al-
Kasb. And then intellectuals, academics and researchers must work to translate these
traditional, classical wisdom and insights into modern economic terms, and the
professionals and business people implement them in their occupations and enterprises
and commercial methods, and so on and so forth.
Varsities should introduce courses on the science of earning and livelihood and
on a new economics redefined as the science of earning and provisioning for the
common-good.

And so remind, for the reminder benefits the believers.
3. Adab, Fiqh, Muamalah & the Role of the Ulama

When respected and well-known public ulama give explicit public endorsement to the
IGE and write their own learned articles and books or booklets expounding on it by
drawing from their own vast learning and experience, the Muslim masses will be
brought to embrace it and withdraw from corrupted IBF.
It is time for them to openly and explicitly call a spade a spade with regard to the
IBF mess and its deliberate, systemic corruption (ifsd) of muamalah which happens
when the ethico-moral substance of adab is taken away from the formal, contractual
form of fiqh just so it could piggy-back on and fit into the imperative of ribawi
capitalism and draw sustenance from it, just imagine! They just have to announce in a
big global loudspeaker: The IBF Emperor has no clothes on, and wake people up
from this self-imposed collective mass delusion.
Without substantive adab, fiqh can be twisted any way you like to fit into any silly
scheme you like, and Imam al-Ghazl wrote the Iy (see the very first book on
knowledge = Kitb al-Ilm) precisely to admonish the fuqaha of his time against that
futile excercise in self-deception and in deceiving others. No wonder some of the
fuqaha of his time didnt like it and burned the Iy in protest. And thats precisely
why Professor Attas is so much against this futile short-sighted legalism and iyal (legal
fictional) acrobatics, which only make the problem worse by giving pseudo-solutions.
Livelihood ideas and initiatives like Permaculture and IGE and so on
can only prosper in our own network of independent community-rooted
enterprises and academiesour own counter academiaand Bill Mollison actually has
a document detailing the imperative of setting up our own autonomous academia. If
these wholesome ideas are pursued in the current myopic university system, they will
definitely be corrupted and subverted to serve totally alien, nihilistic meta-agendas
serving Mammon instead of Islam and the Common-Good.
With the widespread revival of true comprehensive muamalah amongst
ourselves as a community we shall be able to fund all our civilizational revival initiaves
with our own internally generated and enriched resources instead of having to go
begging around far and wide for hand-outs from the indifferent Gulf states or apply for
grants from the Christian Templeton Foundation. Stop begging (sual) and start
earning (kasb), and regain our self-respect and prosperity, inshAllh.

wa man yattaqiLlha yajal lahu makhrajan wa yarzuqhu min aythu l yatasib
Who so fear Allah, He will show them a way out,
and give them sustenance from sources he does not anticipate.

And taqw is the way forward, and we all know that for certain.

4. Investing & the Imperative of Personal Responsibility

When we put our money in impersonal banks or the stock markets, we become passive
investors, alienated from any awareness of how our money is being used and for what
purpose. We abscond personal responsibility for the good or bad use of our money. For
all we know, our money in Citibank, Barclays or HSBC may be used to produce WMDs
like cluster bombs shattering to bits the limbs and lives of our brethrenmen, women
and childrenin Chenya, Yemen, Palestine or Pakistan or Afghanistan
(http://www.realecontv.com/videos/us/cluster-bomb s-r-us.html), or funding Monsantos
seeds of destruction, or even senseless isrf (dissipative, wasteful) pies-in-sands projects
in Dubai, or multi-billion dollar extravangaza like the London Olympics.
It is really silly of us to forgo tabayyun (due diligence) with regard to whom we
entrust our hard-earned money and wealth, and think that our investments in banks
and stock-markets are value-neutral, whereas we know for a fact that these institutions
are value- and interest-laden; hence the question is: laden with what values and what
interestsIslamic values and interests or Mammonic ones? We are not allowed to
entrust our money to fools, and so, much less to evil doers. Where is our sense of self-
accountability in this regard before we are taken to account by the One Who is Quick in
taking into account even a single atom of our deeds and enjoyments in life?
So, when we really come to think about it, we need to move away from passive,
impersonal, disembedded investing to active personal embedded investing. This means
that it is our duty as investors of conscience to personally identify and invest in locally
relevant community-rooted wholesome projects for the common-good, which, in turn,
means creating our own ethical businesses, and that means going back to Ilm al-Iktisb
wa al-Infq 101 (the Science of Earning & Provisioning 101), which entails studying,
learning and applyling both the fiqh and adab of muamalah, which means everyone
taking lessons in Imam al-Ghazls Kitb Adab al-Kasb wa al-Mashah (Book of the
Proper Conduct of Earning and Livelihood), quite apart from the studying and
understanding the standard fiqh of muamalah manuals, and so on and so forth.
Without this systemic downstream to upstream revival of true responsible,
comprehensive and integrative muamalah as outlined above, we can forget about
reviving viable Islamic communities in control of their own autonomous ethico-moral
space for formal and informal exchangewe shall forever be praying in mosques but go
out earning our sustenance by prostituting our minds, bodies and souls to nihilistic,
secular, ribw, isrf structures, though prayers are supposed to preempt iniquities.
And so remind, for the reminder benefits believers.

5. IGE & Distributive Economy

The so-called distributive economy has to be understood and elaborated in the context
of iktisb-wa-infq as outlined in the IGE paper, otherwise it can be just another bailout
or QE (quantitative easing). In classical Muamalah this is pretty clear in detailed
black and white terms and everyone knows that or should: distribute what you earn to
(i) your self, then (ii) to your family, then (iii) to your dependents, then (iv) to relatives,
then (v) to to neighbours, then (vi) to your local community, then, if there is surplus (v)
to the larger society, and then (vi) even overseas, like the Awqf al-aramayn in our
economic history. And the mechanisms of distribution are all spelled out too in great
detail in the fiqh of Muamalah (all alluded to in the IGE article).
So when western, modern secular ambigious terms are used like distributive or
any other fancy jargons, we must re-define them (if we find them useful) in our very own
muamalah terms, otherwise people get confused in all this pointless sloganeering, and
we should do away with that approach if we have any degree of dialectical savvy. As a
friend has said:

We dont want people confusing that [i.e., infq = provisioning]
with income distribution or wealth distribution, which is based on
the false premise that life is a zero-sum game, i.e., the wealth pie
(so to speak) is limited and therefore rich people are the actual
cause of poor people. As...pointed out in the IGE article, Allahs
bounty is limitless.

6. The Irrationality of IBF and Its One-Size-Fits-All Standard

This is to share a discussion (edited) I recently had with a friend working in IBF (Islamic
Banking and Finance) in Abu Dhabi as Shariah Advisor.
Conventional IBF and AAOFFII standards in practice do not care a jot about the fate of
the Amazon forests or Fair Trade. It is not just the problem of interest (riba) or standards that
is involved, it is the very conception of money (nuqud) and its relation to real wealth (ml) and
the role of the economy (muamalah) in society that is the problem ever since the privately
owned Bank of Englands fiscal takeover of the English economy centuries ago.
Talking about Islamic Finance is like putting the cart before the horse when the
conception of Islamic economics and even classical muamalah in their socio-historical and
legal aspects are still all messed up and corrupted due to the current obsession with quick hiyali
(legalistic fictional) stratagems and fixes in order to make a quick buck for big corporations
and their petro-dollar money laundering operations passing off as bona fide business
investments. IBF is nothing but a fatwa-selling-to-the-highest-bidder industry. In short, a fatwa-
auctioning business subsidiary of the riba-embedded banks.
And why are we talking about centralised banks and centralised global standards and
then talk about direct community relevance and rootedness in the same breath? Muamalah or
the IGE (Islamic Gift Economy) in our economic and legal history has never been centralised
or monotonized in terms of (fiqhi? hiyali?) standards. We do not share common rigid
operating standards decided by arbitrarily chosen (by whom?) scholars and decided (by
majority vote?) imposed top-down from some disembedded centers in the desert.
But we do share common, creative, dynamic muamalah principles as outlined in the IGE
article, and it is up to the local community-rooted learned fuqaha and shuyukh and business
professionals to set standards relevant to their particular socio-economic context (urf, needs,
interests, etc) in accordance with their own respective schools of law. And when they do inter-
community trading between different madhhab communities, then it is up to the respective
fuqahas of those interacting communities to set mutually acceptable standards for equitable
exchange. In short, IGE is for creative unified principles, but operative diversified standards.
So, principles are fixed and we all know them without being need to be told or taught
about them by Ethica or AAOFFII or the World Fiqh Council, but standards are flexible
because they are rooted in diverse communities first and foremost, and it is definitely not the
business of any disembedded outsiders in Dubai or Jeddah calling themselves Shariah experts
to set their one-size-fit-all standards and impose them (by leveraging on their global political
and corporate influence) on local Muslim business and financial transactions in Papua New
Guinea or Canada or South Africa. Islam is not Popish and neither is it fiqh. Ijma (consensus)
is not imposed top-down, but arises out of intra-community and inter-community consensus,
because the end of Ijma is truth and maslahah not compromise and convenience.
Frankly speaking, I will do away with the term Islamic Finance altogether; it has already
been conceptually and practically corrupted beyond repair. The same with the term Islamic
Bank. We dont have banks. We have viable, dynamic business partnerships, awqaf and various
community-rooted investment structures, and so it is all the way with the IGE or no way. No
more talbis, but only tahqiq.
IGE will bypass IBF altogether to revive classical muamalah on its own integrative ethico-
moral terms by working directly with local communities and their local scholars, fuqaha,
shuyukh, lawyers, accountants and business people, while IBF can go ahead and implode
with the soon to come implosion of the global ribawi system in which it is so clearly and
thoroughly embedded.
We wont sink with the IBFatanic, we wont even be bothered with its lifeboats or with
patching up its self-inflicted gaping holes in its hull. We are into creating our own boats and
ships of different appropriate sizes and makes with our own internal intellectual and material
resources, and thereby reclaim our self-respect, our prosperity and our civilizational role as
bearers of Prophetic mercy to all the nations of the world, amin! So it is high time for us to
wake up and desist from this silly exercise in mass self-delusion.
I urge our learned fuqaha and shuyukh to take back direct ownership of our mu'amalah
from the IBFers, for the sake of the economic prosperity of their communities, and for the self-
respect and honour of Islam.

And so remind, for the reminder benefits believers.


7. Arabic Rendering of the Islamic Gift Economy

Isn has the meaning of giving, being charitable, generous, gracious, magnanimous.
Imam al-Ghazali and al-Lubudi actually talk about ihsan in muamalah and devote a
whole chapter on it, right after the chapter on adl = justice in muamalah. Whereas
justice means you just give or deliver what is due, ihsan means you go one step further
and overdeliver what is due, always give a little bit extra to play safe as per the imperative
of wara (prudence) and as a mark of magnanimity. And be gracious as Allah has been
gracious to you, for He not merely gives you what is just enough, He gives much more
than you need or even request for. Plus a friend, Sidi Mahdi Lock has said:

...ihsan ultimately means to worship Allah as if you are seeing
Him. Buying and selling is worship, so buy and sell as if you
are seeing Allah. You cant see Him, but if you know that He
is seeing you in the marketplace then you wont cheat and
steal, but rather you will try to please Him, and with Allah
alone is every success.

The problem with the term fal (bounty, favour) is that it also means excess,
something superflous even waste, hence it is too equivocal; whereas isn is unequivocal,
and the Qur'an praises the musinn and exhorts to isn
Ergo, the best Arabic rendering of the Islamic Gift Economy is either al-Iqtid al-
Infq (the Provisioning Economics) or al-Iqtid al-Isn (the Charitable, Giving, Gifting
Economy), and I am inclined to the latter.
Of course, we can opt to do away with all these academic semantics and stick to
good old muamalah but we need a contemporary dialectical device to bring classical
muamalah to bear forcefully and evaluatively on current nihilistic capitalism and IBF,
and hence the totality of muamalah was recast kalam jadid wise into IGE terms so that it
can come to a close engagement with both ribawi capitalism and hiyali acrobatic IBF,
and thereby carve an autonomous ethico-moral space for true, holistic mumalah to be
revived. Hence, the schematics of this close engagement is as follows:

ClassiCal MuaMalah<<>>Modern Capitalism<<>>Revived Neo-Classical Muamalah

where <> signifies dynamic two-way dialectical, critical, evaluative engagement.

We either exercise this creative, proactive kalamic engagement or continue to
allow our muamalah to be cooptated into the service of the worldview of Mammon
rather than the Worldview of Islam. All this (and more) is part of the kalam al-asr
project outlined in the long paper entitled Kalam Jadid, Islamization and the
Worldview of Islam: Operationalizing the Neo-Ghazalian, Attasian Vision.

wa jdilhum bi allat hiya asan
And debate with them with what is better.