Writing at National Review's The Corner, David Yerushalmi of the Center for Security Policy outlines the thesis that Sharia-compliant finance is a Trojan horse used by Islamic radicals to institutionalize Islamism in the west --
What makes this institutionalization a bit tricky is that the financial jihadists must convince the Western financiers and their governmental counterparts that Shariah-inspired finance is somehow distinct from Shariah-inspired global jihad against the infidel West. In other words, how do you export a financial model among infidels when that model is built upon a doctrine that manifestly calls for the death and destruction of the infidels and their political and social systems? The answer to this quandary is found in the second group of SCF advocates: the Western facilitators.
The financial jihadists built their strategy upon both sovereign wealth and the cravenness and fecklessness of the Western facilitators who would sell their own well-being and physical security for a place among the Fortune 500. Led by the Saudis but also joined by the other oil-soaked Persian Gulf regimes, the Shariah-inspired jihadists learned quickly that Western financial institutions and their professional lackeys in the legal and accounting fields would do anything for that next billion-dollar transaction.
Greed, self-indulgence, and even treason are of course not new to the international banking and multinational corporate worlds. But what the Shariah advocates have found even more to their liking is the fact that the Western technocrats and government policymakers have been more than willing to ignore Shariah’s call for global jihad and its resonance as the common doctrine articulated by jihadists around the globe.
There are a few practical problems with this thesis, as the factual evidence surrounding it signals. From the minor errors elsewhere in the post ("the Carter-era oil embargo" -- it was Nixon) to more on-point mistakes --
Dubai World, a company wholly owned by the Dubai sovereign, has funded itself through debt to the tune of $60 billion in the form of Shariah-compliant bonds (or “sukuk”).
Much of Dubai World's funding is boring old conventional syndicated loans or bonds. And the real Islamic scholars aren't sure if its sukuk was actually Sharia-compliant.
But most of all there is the absence of any demonstrable objective or outcome of all this Islamo-infiltration of western finance. As the global financial crisis shows, Wall Street and London did a fine job pulling down the roof all on their own, and likewise this massive Persian Gulf conspiracy to popularize Islamist finance helped pull down the roof in, er, the Persian Gulf.
The bottom line: trying to look at financial crisis through the War on Terror lens is just not very helpful. Sometimes a sukuk is just a sukuk.