Property as Trust: The Forgotten Ethical Foundations of Ownership

Introduction: The Radical Transformation of Property Rights {bit.ly/LKprop}

A central element of the Great Transformation brought about by the Industrial Revolution in European societies was a radical change in the conception of property rights. Property, once regarded as a trust with social responsibilities, became an absolute right, where the owner had complete control and personal gain took precedence over communal well-being. This shift had profound social and ethical consequences.

Earlier conceptions of property, rooted in Christian ethics, emphasized the common good. Avarice, or the unrestrained pursuit of wealth, was condemned as a deadly sin, and property was considered legitimate only if justly acquired, widely distributed, and used to support the poor. Wealthy individuals were expected to share their resources with those in need.

This view was overturned by the secular, capitalist conception of property that emerged during the Enlightenment, which defined property as an absolute right of the individual. In this new framework, property could be exploited for personal profit without any inherent obligation to the wider community.

This shift, from property as a trust to property as an absolute right, lies at the core of modern capitalist societies. Yet this view is inherently flawed. Men are transient, while land endures; granting unchecked, permanent rights over land to impermanent owners has led to social inequality, exploitation of resources, and environmental degradation.

In contrast, Islamic property law views property as a trust from God, deeply grounded in ethical principles and communal responsibility. Islamic law offers a far more balanced and just approach to property, one that emphasizes the welfare of society over individual gain. This essay will explore the differences between Islamic property rights and capitalist property rights, examining why Islamic law offers a viable and superior alternative for modern societies.

1. Islamic Property Rights vs. Capitalist Property Rights

Islamic property law is fundamentally different from the capitalist conception of property, where land and wealth are commodities to be owned, hoarded, and exploited for personal gain. In Islam, land is a trust (Amana) from God, and ownership is tied to social responsibility and the public good.

• Stewardship, Not Ownership: In Islamic law, property is not an absolute right but a stewardship. Owners are expected to use their property in ways that benefit the community. For example, the waqf system (charitable endowment) is a powerful mechanism for redistributing wealth, ensuring that land is used for the public good—such as funding schools, hospitals, and infrastructure.
• Redistributive Justice: Islamic property law mandates redistributive mechanisms like zakat and sadaqat, which ensures that wealth is shared with those in need, preventing the concentration of land and wealth in the hands of a few. This contrasts sharply with capitalist systems that allow unchecked accumulation of property and wealth.

The Quran insists that the poor have a right in the wealth of the rich. Denial of this right by the Capitalists and the commodification of land has led to inequality, environmental degradation, and ongoing struggles of indigenous populations against powerful corporations, seeking to displace them, and reduce their habitat to rubble, for private profits.

3. Colonization and the Destruction of Indigenous Institutions

The emergence of absolute property rights, together with racism, which denied humanity to non-whites, created a deadly combination that provided the philosophical basis for the European colonization of the globe. Cultures and Civilizations across the globe were considered to be irrational and therefore less than human, because their cultures and philosophies did not match Europeans. This allowed for proclamations that land belonged to the first white who set foot on it. The Americas are named after an Italian discoverer, completely ignoring the multiple civilizations that inhabited the continents for millennia.

The process of colonization extended the capitalist property system across the globe, wiping out indigenous social and legal institutions and replacing them with capitalist structures. This was particularly devastating in the Islamic world, where centuries-old systems of communal land management were dismantled. During colonization, property rights were explicitly racist, privileging European settlers while denying indigenous peoples—often including Muslims—the right to own land. Colonial powers, from the British in Egypt to the French in Algeria, imposed capitalist property laws on Muslim lands, expropriating land from the resisters among the native populations, and awarding them to those ready to collaborate with the colonizers.

Islamic property systems were dismantled and replaced with laws that facilitated the exploitation of land and resources for the benefit of the colonizers. The expropriation of waqf lands, dismantled an extensive public welfare system throughout the Islamic lands, and left the indigent population at the mercy of the menial jobs created by the imposed capitalist economy.

4. Post-Independence: Continuation of Colonial Systems

Following independence, Muslim-majority countries failed to return to their Islamic legal traditions. Instead, the elites who took power were trained by the colonial rulers and had internalized admiration for Western legal and economic systems. They inherited a colonial system designed for exploitation and continued to use it for their own benefit, rather than reforming the laws to serve the needs of the people.

Rather than restoring Islamic property law, these elites maintained the capitalist legal framework that allowed for the continued concentration of land and wealth in the hands of a few. This perpetuated the inequalities created during the colonial era, as the legal systems left behind by the colonizers remained intact.

5. Islamic Property Law as a Viable and Superior System

Despite the damage wrought by colonialism, Islamic property law continues to offer a viable and ethical alternative to capitalist property systems. Far from being an outdated or impractical framework, Islamic property law is deeply grounded in principles of justice, fairness, and social responsibility, and it remains highly applicable to modern contexts.

• The Revival of Waqf: As Sait and Lim (2005) demonstrate, the revival of the waqf system in countries like Malaysia and Turkey has shown that Islamic property mechanisms can be successfully adapted for modern use. These endowments continue to fund public welfare projects, from education to housing, illustrating the practicality of Islamic property law in contemporary societies.
• Islamic Microfinance and Housing: Islamic finance principles, such as interest-free loans, are being applied to provide housing for the poor in Muslim countries. Starting from scratch around twenty years ago, Akhuwat Microfinance in Pakistan provides billions of Rupees to millions of borrowers, enabling them to transition out of poverty. Similarly, Islamic financial principles have been used innovatively to provide housing for the poor using diverse methods across the Islamic world. These systems empower communities and ensure that land is not treated solely as a commodity, but as a resource that serves the needs of all.
• Redistributive Justice through Zakat and Sadaqat: The principle of zakat ensures that wealth is continually redistributed to those in need, preventing the extreme inequalities that are rampant in capitalist systems. This form of social safety net is embedded in Islamic law, offering a more just and humane approach to property management. Many research studies show that the Quranic injunctions to spend result in significantly higher levels of charity in Islamic countries.

Islamic property law offers a model that prioritizes the public good, promotes sustainability, and ensures that land is not hoarded or exploited for personal gain. It is a practicable and superior alternative to the capitalist systems that dominate today.

Conclusion: A Call to Reimagine Property Rights

The transformation of property rights in Europe, particularly through the Enclosure Movement, was not just an economic change—it was a profound injustice. The destruction of the commons and the commodification of land left the poor dispossessed while enriching the powerful and providing them absolute power, without corresponding social responsibility.

In contrast, Islamic property law offers a vision of land as a trust from God, to be used for the benefit of all. With its emphasis on stewardship, redistributive justice, and communal welfare, Islamic property law remains a viable and ethical alternative for Islamic societies today. In an age of rampant inequality and environmental destruction, it is time to reimagine property rights and return to a system that prioritizes justice, sustainability, and the public good.