Money under Islam

Re: “Why economics can’t ‘ Islamic,’ ” Peter Foster, Oct. 8 The removal of the former Judeo-Christian ban on interest is not an example of morality evolving. Rather, it is a case where socioeconomic developments prompted a new understanding and application of the same moral principle.

For much of history, there typically wasn’t an opportunity cost of capital anywhere near that existing today. The “mobility of capital” was severely restricted in the societies where Urban III, Aquinas, Aristotle, Cato and others condemned the charging of interest.

Without the modern benefits of the rule of law and market infrastructure (including accepted processes and the trust that comes from experience), investing some spare gold coins would have entailed huge transaction costs in terms of identifying opportunities, monitoring performance and hiring thugs to enforce one’s property rights.

So there was little if any forgone opportunity in lending money, and it was reasonable to see charging interest as unjust under such circumstances. Dave Eden, Toronto Islam shuns economic exploitation by forbidding usury and interest. “O ye who believe, do not devour usury, doubled or multiplied, but be conscious of Allah so that you may prosper” (Qur’an, 3: 130). This prohibition is part of a comprehensive economic system that is to be implemented in its totality.

The exploitation of individuals as well as nations through debt and its compounded interest is one of the major evils that plague our world. Many nations are so beholden to their creditors that it could be classified as economic slavery.

Interest and usury is the cornerstone of today’s economy and the bread and butter of our banking systems, our trade and commerce. We have been trapped in to believing that there is no alternative. Unfortunately, the only beneficiaries of this present system are the multinational corporations, big business and the banks. While we may earn a few dollars on our meager savings, we pay more in interest rates on our mortgages, our car payments and bank charges. The time has come to look at alternatives and to work for change.

Islam, while encouraging free enterprise, discourages the accumulation of wealth in few hands. For this purpose it has made the paying of an annual charity ( zakat) calculated at 2.5% of the total assets or actual capital as obligatory on every Muslim with income and investments. This ensures that all in society are provided for — and that Muslims consider establishing economic harmony as part of worship and therefore their duty.

Unfortunately, while the Muslim middle class continues to give zakat, some rich and the powerful do not. The governmentcontrolled zakat funds in some cases do not reach the needy, but become private slush funds for these corrupt regimes. Shahina Siddiqui, Winnipeg be Peter Foster overlooks the fact that Islamic financing is continuously evolving and takes many forms and has many nuances. I find it interesting to see the broad concept of Islamic finance linked to “Islamic fundamentalist resentment.” Having worked on Islamic financing transactions in the Middle East, my impression was that Islamic financing is a stepping stone in spreading capitalistic principles in yet another large market — on their terms.

It would be really interesting to engage in an informed debate on the actual nature of Islamic finance, and how it can be encouraged in Canada for the benefit of our growing Muslim population — and also for the benefit of the businesses that serve them. Gabriel van Loon, Ottawa

Free ride ends

Re: “Higher fees make merger of funds plain unattractive,” Barry Critchley, Sept. 14 We read Mr. Critchley’s column with appreciation and delight that Juniper Equity Growth Fund’s merger with the Capstone Canadian Equity, Global Equity and Balanced Fund (“Cfunds”) would receive such national press attention, but this euphoria was quickly diluted by certain of Mr. Critchley’s statements, which in our opinion are not entirely accurate

Firstly, we do not think Mr. Critchely’s comments on the OSC’s special interest in this merger are accurate. Our assessment is that the OSC took no more or less of an interest in this merger than they would with any other merger.

Secondly, it is true that post-merger the CFund unitholder will experience a higher MER, than what he/ she has experienced. But the reality of the matter is that all these unitholders have benefited in the past from “free rider” economics. Specifically, Morgan Meighen shareholders have for several years subsidized and financed the operating expenses and losses of the CFund. Post-merger, CFund unitholders will be subject to industry practice: fund operating expenses are paid by the income of the fund.

Thirdly, the Juniper Equity Growth Fund’s investment strategy is very broad. As a result, we are able to incorporate the various CFund investment objectives and their security positions without compromising any of the individual CFund investment objectives. Roy Brown, president, Juniper Fund Management Corp., Oakville, Ont.

More wireless choice

Re: “Providers shun number portability,” Kevin Restivo, Oct. 11 Earlier this year the government of Canada indicated an interest in the deployment of wireless number portability. The Canadian Wireless Telecommunications Association and its carrier members unanimously committed significant resources ( both financial and human) to the task.

A report by PricewaterhouseCoopers concludes the most efficient, cost-effective and fastest way to implement wireless number portability is to leverage the number portability systems already in place. This will allow the highest number of customers access to the most numberportability choices possible.

The Canadian wireless industry’s plan for implementing portability was developed as per the definition of WNP set forth by Industry Canada, which includes complete intermodal portability ( wireless to wireless, wireline to wireless and wireless to wireline). In fact, Canada will become only the third country in the world to implement intermodal portability. All this will be accomplished in the length of time many countries have taken to implement only wireless- to- wireless portability.

From the time WNP was mandated in the United States until it was launched in most urban areas of the country, the implementation process lasted close to eight years. Additionally, there continue to be technical and procedural problems with WNP in the United States two years later, illustrating the complexity of the undertaking. Japan, arguably one of the most wirelessly advanced countries in the world, will be introducing WNP in the same time frame as Canada. However the Japanese process will only offer wireless-to-wireless portability. Peter Barnes, chief executive, Canadian Wireless Telecommunications Association, Ottawa

Selling off Alaska

Re: “Spouting off to Peter Foster, Oct. 12 Peter Foster asserts that our prime minister should not have spoken up in New York opposing drilling in Alaska’s Arctic National Wildlife Refuge because: (a) arguments that this would threaten wildlife and native culture are “overblown;” (b) the fact that the refuge would only supply 200 days of U. S. oil consumption is “nonsensical;” and (c) defending the refuge is not helping the Americans understand Canada’s position on softwood.

I suggest: (a) arguments that roads, drilling pads and contamination in a caribou calving area will not affect a declining 130,000 caribou herd, or the Gwich’in people who depend on them, are overblown; (b) the U.S. refusal to focus on reducing energy demand, improving efficiency and developing renewable alternatives to oil, is nonsensical; and (c) that not speaking up on the refuge would only ensure that the U. S. administration remains offside on both the refuge and softwood.

Our prime minister should be resoundingly supported for defending Canadian interests, not subjected to cheap shots by a columnist whose ideology is no grander than to sell anything, including our country, for the best price. Monte Hummel, president emeritus, World Wildlife Fund Canada, Toronto Americans,”