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The prime objective of Existentialism and Subjectivism in this era, is the satisfaction of a maximum amount of desires through a 'high' rate of economic growth. The entire machinery of production is geared towards this satisfaction without taking care of the fulfilment of human needs. Illicit wants such as pornography, aimless fashions and unnecessary model changes are being systematically thrust upon us through persistent advertising. As pointed out by Henry Leibenstein in 'Beyond Economic Man',

"False symbols of prestige are thus being promoted and wants are made infinite and insatiable as compared with 'real' human needs."

The economic crisis faced by the modern capitalist society is, according to Daniel Bell, due to three basic inconsistent forces: the 'bourgeois appetite', the 'democratic polity' and the 'individualist ethos'. The 'bourgeois appetite' creates a perpetually insatiable demand for goods and services which are not possible to satisfy with the available resources. The 'democratic polity' induces the electorate to demand, in the absence of moral constraint, more and more social services that natural entitlements cannot fulfil. The 'individualist ethos' resists and evades the social responsibilities and sacrifices that which social welfare and balanced growth demand.

As diagnosed by M. Umer Chopra,

"the artificial demands for goods and services, propped up by consumerism and financed by large budgetary deficits and expansionary monetary policies, can never be fulfilled with the available resources. In the absence of a moral transformation and change in economic thinking, an effort by any government further creates recession, unemployment and unrest. Neither democracies nor dictatorships are able to eliminate these."

The current crisis of the world economy has been aggravating and the secular economists have not been able to devise any solution. The wrong step is that the symptoms are taken as the source of the crisis and antidotes are applied to ease the crisis temporarily, this causes the problems to reappear in greater depth and to be of a more serious nature. The correct step would be to analyse the underlying causes of the problems in the light of the basic philosophy of life.

Human beings constitute the living and indispensable elements of an economic system. They are the main players, and unless they are reformed, nothing can work. As individuals, in turn, receive important stimuli from the economic system and its institution, a spiritual reform is meaningless unless it penetrates the economic system and removes all sources of injustice, exploitation and instability. Islam does not solve the problems through cosmetic changes. It advocates a complete reform.

In Islam, to start with, a moral transformation of the individual and the society is required which should produce 'social health emerging from the inner core of human consciousness, occupied by justice and fairness at all levels of human interaction.' Islam changes man's entire outlook towards life, motivates him/her to act rightly in accordance with certain eternal values, thus generating moral uplift among the individual and the society.

Islam makes wealth a trust from God and its 'proper' use a test of faith. Wealth does not actually belong to man. It belongs to God and its human owner is just a trustee, entrusted with it to implement the directives of God of which general human well-being and socio-economic justice, are the two most important. Thus Islam provides an economic system that makes it absolutely imperative to use God-given resources to fulfill the essential needs of all human beings and providing them with decent living conditions. Islam propounds to establish justice by eradicating from human society all forms of zulm, a comprehensive Islamic term referring to all forms of inequity, injustice, exploitation, oppression and wrong-doings, whereby a person either deprives others of their rights or does not fulfil his obligations towards others.

There are three basic resources - finance, skill and management - that are to be pooled for the production and distribution of goods and services in order to fulfil the needs of society. In Islam, the pooling of resources is to be organised within a just and altruistic or mutually profitable manner. Hence, riba (interest) is prohibited in Islam and thus the resources cannot be pooled through the present interest-based banks.

Islam recognises the legitimate role for the private sector and also the role of capital as a factor of production. Moral value, socio-economic justice and general social welfare are the constraints on private property, while the return on capital can be determined only after meeting all the costs, and thus it may be either positive or negative without any portion of pre-determined rate of return. Islam requires profit-and-loss sharing in an equitable manner whereby the investor shares in the loss, if any, in proportion to his capital in the business. Thus Islamic Economy is Equity-based, Riba-free Economy.

A better replacement of the predetermined rate of interest is the predetermined profit-sharing ratio in the Islamic economy. This profit-sharing ratio shall not fluctuate as much as the rate of interest because the former will be based on social and economic circumstances that may change after prolonged negotiations through the presence of market forces. Moreover, the variable for monetary policy in an Islamic economy is the reserve of currency in place of the level of interest rate.

Moreover, the growth rate in the Islamic economy shall be aimed to be steady, realistic and sustainable over the medium and long term, and, not unrealistic and erratic like that of the capitalist economy. Abolition of interest and the levy of zakah would not only tend to minimise the speculative monetary demand (triggered by interest-rate fluctuations in the capitalist economy) and reduce the 'locking-in' effect of interest rate but would also impart greater stability to the total demand for money.

There are three areas in which Islamic economists have to face the challenges. First is the presentation of a comprehensive view of the monetary system of Islam in its fullness. Second is the critical review of the different models of Islamic banking for reforming the theory and improving the practice. Third is the theory and practice of Islamic economy in the perspective of the Islamic norm and social order. Thus, there is the need of the integrative equity-based system with its successful functioning in replacing the interest-based economy.

The abolition of riba, though indispensable, is not sufficient because it is not the only measure necessary for realising the goals of Islam. It must be realised that the successful operation of an individual riba-free bank is different from the successful management of a riba-free, equity-based economy. Hence it is not enough to establish interest-free banks. The Islamic economic system is one in which a riba-free economy is actually brought into reality.

The very unfortunate situation is that there is a wide gulf between the Muslims as depicted in the Quran and Sunnah and the Muslims of the present world. The basic demands of faith are not being upheld. There is ignorance, dishonesty, corruption, cheating, adulteration and degradation in the Muslim world. The three basic characteristics of an Islamic society: strength of character, strong bond of brotherhood and incorruptible justice, are not found in the present Muslim countries. Even more disturbing is the fact that there is not even adequate awareness of the high quality of character and personality that Islam demands from a Muslim.

The complete transformation of the Muslim Ummah requires a reform of all aspects of the Muslim society, economy and polity. This transformation requires, initially, a sincere commitment and an active role on the part of the Muslim governments. Muslim governments should first come forward with their own true commitment to Islam. Moreover, for every initiator of Islamic economy the ultimate goal must be clear from the very beginning, and the direction must be firmly established towards this goal.

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