News:

The Prime Minister of Malaysia once mentioned that 2014 is going to be a year of ‘endless possibilities'. However, from recent occurrences, 2014 is more suited to be called a year of endless price increases! The prices of sugar, electricity, petrol, toll rates, and property assessment rate and transportation fares have risen sharply over the past few months. As 2014 nears, Malaysians are beginning to feel the heat of further price increases. What made things worse are the justifications and comments given by various ministers on these price hikes. The Prime Minister for example, mentioned in the 2014 National Budget presentation that the subsidy on sugar is abolished because there has been a high rise in diabetes cases in Malaysia. On the increase in toll fares, a minister coldly dismisses the anger of the public by saying that the public has a choice to use toll free roads if the increase seems too much for them. And on the increase of electricity tariff, the government commented that the rise is really very small that the public will not feel its impact. And then there is also the issue of the Goods and Services Tax (GST) which the government plans to introduce in 2014...

Comment:

Naturally, these price hikes serve as ammunition for the opposition to criticize and undermine the Barisan Nasional government led by Najib Razak. Issues were raised by the opposition ranging from corruption to unwise government spending to explain these price hikes. And of course, the opposition persistently claims that if they were in power, none of these price increases would occur. There may be truth in what the oppositions are saying in that corruption and bad spending may consequently bring about price increase but in reality these price hikes, stripped down to its core, boils down to the ill effects of the current economic system implemented in Malaysia. Malaysia is a capitalist country and just like any other capitalist country, the evils of this corrupt system are now manifesting themselves in unprecedented ways. The capitalist system whose basis are the usurious banking system and the use of fiat money as a means of exchange are at the very core of today's economic woes. Capitalism's inherent weaknesses are usually blocked out when solutions are pursued in order to solve these serious economic problems. These so called ‘solutions' only tackle the symptoms of the inherent problems of capitalism and even so, only with very limited effectiveness. For example, if the economy slows down, besides interest rate, money supply may also be manipulated in the form of money printing without the backing of real wealth. However, with banks in the capitalist system being given the freedom to create money based on the fractional reserve system, excessive money creation brings about inflation. Since the practice of creating money without the backing of real wealth is the very basis of this wicked system, inflation will persist and the purchasing power of money will continually decline. This will continue to be so as long as capitalism remains the dominant economic system of the world.

Under Islam, money is based on gold and silver, giving it an intrinsic value. As a result, money cannot be created out of thin air and this has the effect of strengthening and stabilizing the currency. A stable currency avoids inflation which had and is still crippling households, industries, societies and nations today. Under Islam, the economic system will also be free of banks and interest based finances. The absence of these prominent symbols of capitalism will eradicate a major portion of the inherent economic woes of Malaysia and the world in general. Hence, even if the opposition were to rule Malaysia, prices of everyday stuff will still be on the increase if their ‘solutions' are based on the very same basis that brought about the problems in the first place. Clearly, only Islam can free us from these predicaments.

Written for The Central Media Office of Hizb ut Tahrir by
Dr. Muhammad / Malaysia