Ulasannya lagi.......(Dr Ahmad Kameel Mydin Meera)
2. The Maqāsid al-Sharī’ah

"Al-Ghazzāli states that the very objective of Sharī’ah is to promote the welfare of the
people, which encompasses the safeguarding of faith, life, intellect, posterity and wealth.
Anything that protects or promotes these is considered as serving the maslahah and hence
desirable13. Similarly, Ibn al-Qayyim al-Jawziyyah states that the basis of the Sharī’ah is
wisdom and welfare of the people in this world and the hereafter; and welfare is said to
lie in justice, mercy, well-being and wisdom14. Abu Ishaq al-Shatibi too contends that
the Sharī’ah aims at the welfare of the people in this life and in the life hereafter by
protecting its objectives or maqāsid which can be classified as follows15: 1. Daruriyyah
(Necessities), 2. Hajiyyah (Requirements) and 3. Tahsiniyyah (Beautification).
Daruriyyah are objectives which are must and basic for the establishment of
people’s welfare in this world and the hereafter; the ignoring of which can cause fasad to
prevail. Daruriyyah basically relates to the protection of the following five crucial
matters as stated by al-Ghazzāli: 1. Faith (Dīn), 2. Life (Nafs), 3. Posterity (Nasl), 4.Property (Māl) and 5. Reason (‘Aql). These are necessary or daruriyyah for the
establishment of welfare in this world, as well as in the hereafter. In other words, these
are daruriyyah for the establishment of Islam itself on earth. The renowned Muslim
economist, M. Umer Chapra states16:

The maqāsid al- Sharī’ah is everything that is needed to realize
falah and hayat tayyibah; and faith is the most important ingredient
for human well-being. It puts human relations on a proper
foundation, enabling human beings to interact with each other in a
balanced and mutually caring manner to help ensure the well-being
of all. It also provides a moral filter for allocation and distribution
of resources in accordance with the dictates of brotherhood and
socio-economic justice, and a motivating system that brings biting
power to the goals of need-fulfillment and equitable distribution of
income and wealth. Without injecting the dimension of faith into
all human decisions, ….it may not be possible to realize efficiency
and equity in the allocation and distribution of resources, to
minimize macroeconomic imbalances and economic instability, or
to overcome crime, strife, tensions and the different symptoms of
anomie.

Hajiyyah are Sharī’ah provisions that remove hardship and thereby facilitate life while
tahsiniyyah are provisions that bring comfort and beauty to life. Unlike these two,
daruriyyah is essential; and Shātibi puts it that daruriyyah is fundamental to hajiyyah and
tahsiniyyah. Deficiency in daruriyyah brings deficiency to hajiyyah and tahsiniyyah, but
not vice versa17.
The next section discusses the socio-economic effects of the seigniorage of fiat
money, and how it negates the attainment of the daruriyyah category of the maqāsid al-

Sharī’ah.

3. Seigniorage of Fiat Money and the Continuous Growth of Money Supply

and Debt
"Seigniorage is the gain to the one who issues fiat money. It’s the benefit one derives
from the first use of fiat money. In today’s interest-based fiat money system, the bankers
create money through multiple credit creation and lend this out at interest. Money
created through this fractional reserve banking system and the interest charges thereupon
are basically also seigniorage. Most governments get the benefit of seigniorage from the
issuance of their respective national currencies (paper notes and coins) but the
seigniorage of credit money and interest charges go to the bank.
In this regard, three main features of the current monetary system, that have been
much criticized by Muslim scholars, and pertinent to our discussion are: 1. Fiat money –
which includes paper money and bank money (demand deposits including electronic
money). 2. Interest. 3. Fractional reserve banking. These three features are fundamental
to the process of money creation by the banking sector19. The banking sector gives birth
to most money, by means of the fractional reserve system, i.e. through multiple credit
creation. Money is created for the first time by the bank when it extends loans. Hence
money in most part takes the form of accounting entries or computer electronic records.
This simple accounting entry that carries with it purchasing power created out of nothing
is the seigniorage of fiat money. An important fact to note is that all this new money is
introduced into the economy predominantly as loans20. It is important to note here that
the Islamic banks, operating within the fractional reserve banking system, also do create
money in this form, but focuses on the use of this newly created money according to
Sharī’ah principles."