Mile
Zero

The Islamic Development Bank's lecture series is a bit of an oddball on B-SPAN. It's not directly World Bank sponsored, and it's not your typical economics lecture. It may also seem a little odd as a feature here: I have no love lost for any particular organized religion, much less the orthodox variety. But these are fascinating glimpses into a new perspective on commerce and banking--one that many Americans, steeped in the pro-market ideological slant of Christianity, have probably never considered. It's been a real education for me. You can watch the lectures here, although as usual you must have RealPlayer to view them.

The basic dilemmas at the heart of Islamic banking, and forgive me if I get any of these wrong, are that the Koran forbids charging interest or trading in financial risk as part of its prohibitions against usury and gambling. There is also an element of socially responsible investing here: the Islamic banks put their money in halal enterprises, and profits and losses are to be shared as an extension of charity. In other words, the goal is not to take advantage of customers, but to reach a win-win arrangement for them.

Nevertheless, it is hard to actually be a bank without charging interest or some kind of compensation for loans, which leads to arrangements like murabaha, in which the bank purchases an item for the lendee and sells it to them at a higher agree-upon price, with the implicit profit making up the role that interest would have played for a conventional bank. This is not an uncontroversial method, since some have claimed that it is just a legal workaround.

I recently finished reading Mark Noll's The Scandal of the Evangelical Mind, which calls for more evangelical Christians to become scholars and lead a "life of the mind." It is, for the non-evangelical reader, often a confusing book. When Noll states that the titular scandal is that no mind arises from evangelicalism, we can all think of the three Republican presidential candidates who disbelieve in evolution and nod in agreement, but when he speaks of an "evangelical life of the mind," it is much less clear what exactly he means--how does one conduct "Christian" science or research, at least in any valid form? Oddly, the Islamic Development Bank lectures have helped me get a firmer grasp on what he seems to want in terms of applying religious thought and frameworks to intellectual challenges. I am of course not in favor of religiously-run financial institutions for myself, but I do have to say that the basic principles being followed--charity, empathy, and protection from risk--hold a certain appeal.