I Support Seattle’s Push for Sharia-Compliant Mortgages

By 8 Comments 2,082 views

Caliphornia_Governor_Brown_Sharia

There is a bit of a controversy going on in Seattle. Apparently there is a push for lenders to offer Sharia-compliant mortgages. And taken at just that level, I don’t have an issue with this. As PJ Medias’ Rod Kackley reports:

Buying a home is only one problem facing the Muslims of Seattle. Just as Sharia law prohibits Muslims from earning or paying interest on loans, it also forbids investing in retirement funds that include companies dealing in pornography, alcohol, tobacco or other products that are seen as taboo.

That is the conundrum facing at least 1,000 Muslims who work for Microsoft in Seattle. They’d love to get into their company’s lucrative retirement savings and investment program, but can’t without running afoul of their religious beliefs.
“You have people who aren’t getting the full benefits of their employer’s offering,” Thom Polson told the Puget Sound Business Journal.

He’s the chief executive officer of a new Seattle company, Falah Capital LLC, which works with Muslims to ensure they’re investing without violating Sharia law.

Falah Capital set up its first Islamic exchange traded fund last year on the New York Stock Exchange under the ticker symbol “FIA” in partnership with Seattle-based Russell Investments and IdealRatings of San Francisco.

Polson, who studied Islamic banking and finance and worked as an investment advisor in Saudi Arabia before moving back to Seattle to set up Falah Capital, said he might also be able to help Muslims realize their dream of home ownership in Seattle.

Falah’s clients would be able to buy homes without taking out an interest-bearing loan because Falah would offer Islamic bonds known as “sukuk.” Sukuk bonds are similar to traditional bonds that delay payments to investors until the bond reaches maturity and they are linked to a physical asset. Rather than earning money on interest on money, the investors would realize a return from a share of the profit on that physical asset, in this case a house.

Sharia finance is huge around the world. A Council on Foreign Relations report that came out earlier this year predicted assets held by Islamic banks could grow by more than 15 percent annually and hit several trillion dollars in a few years.

Personally, Sukulk bonds just look like a crapweasel way of pretending you’re not paying interest by tinkering with the definition. But far be it from me to pass judgment on a religious belief that isn’t affecting anyone else but the follower whom it affects. This isn’t all that different from the old practice of Catholics buying Indulgences for their sins or today’s Eco-zealots planting trees to pay for their private jet-setting.

And when we get down to brass tacks, is there anything wrong with a business catering a product to a religious group to drum up business? This isn’t all that different from McDonalds’ annual advertising blitz for its fillet-o-fish sandwiches during lent. If a banks wants to sell sharia-compliant mortgages I have no problem with it, so long as doing so doesn’t require existing banking law to be superseded. As any good capitalist will point out, if there is a market and an organization has the means to legally cater to it, they have an obligation to their stakeholders (shareholders, employees, community members) to do so. But of course, this is Seattle, so it’s not that simple. Kackley also pointed out what made this story controversial in the first place:

Edward B. Murray, the mayor of one of the most politically progressive cities in America — Seattle — wants to make it easier for the 30,000 practicing Muslims in his city to get home mortgages without violating religious Sharia law. It is part of his plan to ease what he says is a “housing crisis.”

Seattle’s economy is booming. That is good. What is bad, as Mayor Murray described in a letter to his constituents, is housing prices and rents have skyrocketed.

“As a result, thousands of families and workers — particularly lower-income people and among communities of color — are unable to afford the cost of living in Seattle,” he wrote.

Here’s his fix: Murray announced a multi-pronged approach to get 50,000 new units of housing built or preserved over the next 10 years, with 20,000 of those homes set up as “affordable housing.”

He and the Seattle City Council City Council commissioned a Housing Affordability and Livability Agenda (HALA) advisory committee last fall. The 28-member HALA committee brought together perspectives from affordable housing advocates, developers, land-use experts, tenants, businesses and nonprofits.

After months of deliberation, they reached consensus on 65 recommendations to consider. One of those recommendations, the most controversial paragraph in the proposal Murray sent to the newly established Seattle Select Committee on Housing Affordability — even more than the idea of making it easier for people with criminal records to buy a house in Seattle — is the idea entitled “Support the Community in Finding Housing Tools for Sharia-Compliant Lending.”

As Murray explained it, strict Muslims can’t use conventional mortgage products for religious reasons. Sharia law prohibits the payment of interest or fees for the loan of money because it is seen as wrong to make money from money.

“For our low- and moderate-income Muslim neighbors who follow Sharia law…there are limited options for financing a home,” wrote Murray.
His proposal would direct Seattle officials to bring together lenders, nonprofit housing organizations and community leaders to talk about how to bring more Sharia-compliant loan products to the city.

Less than a week after Mayor Murray announced his search for Sharia-compliant home mortgage providers, billboards started appearing in Seattle calling for residents to be more tolerant of Islam. The four billboards in Seattle were part of a 100-board national campaign run by the Islamic Circle of North America.

Ah. So this isn’t about free markets, but rather an elected official deciding to either force existing businesses to change their practices or play favorites by helping a new company into the market who couldn’t otherwise compete on its merits. Again, I don’t have a problem with this, as long as it stays local. More from Kackley:

“The mayor of Seattle is opening the door to Shariah, and because he has already shown himself to be compliant, he will receive more demands for accommodation of Shariah in the future,” Geller said. “This is a radical, intolerant, violent, misogynistic, anti-Semitic ideology, and he should not be kowtowing to it.”

There is also the argument made by two members of Congress in 2008, when American International Group (AIG) tried to offer Sharia-compliant insurance, that working with Islamic banks is tantamount to helping terrorist organizations launder money.

“You may defend your decision to offer Sharia products and will probably state that they have no real ties to Sharia law, and therefore pose no threat. You are wrong,” Fox News reported that then-Reps. Frank Wolf (R-Va.) and Sue Myrick (R-N.C.) wrote in a Dec. 18, 2008, letter. “Like Britain, the way to America’s legal code is through its wallet, and if Sharia law gains a strong footing in the United States, it will be through Sharia finance and Sharia products.”

“The funny thing is PC-progressives will stand up for Islam even though the Muslim faith stands against everything the Progressives believe in,” Jason Rantz wrote.

Exactly. I understand the argument for not wanting to see Sharia law take a foothold in our legal system, but if contained to radical leftist enclaves like Seattle I think it will be great to give the left a taste of how some groups reciprocate their tolerance. I look forward to seeing how many openly gay employees these new banks employ. I look forward to seeing Muslim-owned bakeries being forced to serve gay weddings, and who else is excited over the tolerance and respect that will no doubt be shown to the first gay pride parade that trots though a Muslim neighborhood?

But most importantly, let’s ensure that these sharia-compliant banks lead the way in paying every employee a minimum wage of $15 per hour!

Follow Brother Bob on Twitter and Facebook

Cross posted from Brother Bob’s Blog

Blogging by the credo of "Making the world a more offensive place, one blog post at a time", Brother Bob started writing posts around the beginning of the Obama presidency over at Brother Bob's Blog. A born-again Existentialist and self-professed libertarian with conservative tendencies, he has ironically chosen to live in the Washington, DC area - deep behind enemy lines. He has always loved history, and spent eight years volunteering as a tour guide on weekends, giving over 200 tours to roughly 2,500 mostly foreign guests. His tours were highlighted by stories generally not found in the history books or most other tours, such as the importance of the Battle if Antietam, the origins or Arlington Cemetery, and dispelling the myths of FDR's New Deal. Although his favorite subject to blog about is Economics, as seen in his Economics for Politicians series, his posts try to address angles that other conservative writers and the mainstream media (naturally!) miss. "There's no point in putting up a post on a subject that someone smarter than me has already written". He believes in the "Happy Warrior" approach, and tries to inject humor in his posts, sometimes successfully. Two such examples are his posts comparing the modern left to the horrible Star Wars prequels, and analyzing the laments of a DC woman in search of a feminist boyfriend. Brother Bob lives with his very patient wife known as Sister Babe, and their fantastic son. Little Bob. Little Bob is also the reason that being a tour guide came to an end, as spending Saturdays raising a son takes priority over giving lectures to foreign visitors on the folly of Keynesian economics. BB is also grateful for the opportunity to take his place among the outstanding writers at Flopping Aces, appreciates every person who takes the time to read his posts, and especially those who join him in the conversation in the comments.

8 Responses to “I Support Seattle’s Push for Sharia-Compliant Mortgages”

  1. 1

    john

    I thought that when Seattle raised its minimum wage that it was going to completely kill Western Civilization.
    But it’s booming? OMG ??? How can that be true?

  2. 2

    Nanny G

    Just as I can take advantage of a Filet of Fish price break during Lent without changing my religion, so, too, if it is a better deal than a traditional home loan, non-Muslims ought to be able to use Sharia-compliant set-ups to buy homes.

    In Australia, a few years ago, the law enforcement system started to set up a double-tracked spousal beating reaction.
    If you were Muslim your spouse’s call for help was ignored.
    You could literally get away with anything short of murdering her.
    So, what happened to scuttle this?
    Simple.
    Non-Muslim repeat offenders of spousal violence ”converted to Islam,” putting their wives’s calls on the police’s ignore list.

    If we are a nation of laws and not men, we have to agree on one set of laws for all.
    If a Sharia compliant home buying scheme is legal, it must be free for anyone to use.

  3. 3

    Brother Bob

    author

    @John: Seattle is booming, but how many service industry workers have lost their jobs because they don’t bring in enough revenue to cover their total compensation? Yet another case of leftists supporting income inequality.

    @Nanny: Good point about making sharia loans available to all – I hadn’t thought of that angle. That will be one to keep an eye on for follow up

  4. 4

    Enchanted

    Soon Seattle will be like France. They will find the muslims will begin to rebel and protest. Until the muslim is out of office, they will continue to take over.

  5. 5

    Petercat

    @Nanny G: #2
    Yes, I will enjoy watching the left implode with the first instance of a bank refusing a sharia loan to a gay couple.
    Or a Christian. Unfortunately, it won’t happen. They will come up with some noble sounding excuse.

    I think that I’ll open a real estate office in Seattle, breaking my rule against investing in any USA Business…
    This is just too attractive.
    I’ll purchase homes for $250,000 and offer to sell them with a no-interest, sharia loan…. for 1.25 million dollars.
    That’s how it’s done in the Middle East.
    Or else they just tack on fees until the return to the lender is the same as it would be with an ordinary, interest-bearing loan.

Leave a Reply

Your email address will not be published. Required fields are marked *