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"Some of the people who say that democracy has no place in Islam, what they really express is a sense that the word 'democracy' as presented in international discourse appears to be wholly owned by the West,The word itself has, for some, a connotation of cultural imperialism."(Louay Safi)

The wide range of Islamic movements -- in social make-up, structure, and program -- have left many observers baffled. Since the Iranian revolution there has been a sharpened distinction between two approaches which might be called, respectively, fundamentalism and Islamism. Islamism can embrace both "progressive" 'ulema and those urban intellectuals who believe Islamic tenets are compatible with such modern values as freedom and democracy. The Islamist view stands in sharp contrast to those held by fundamentalist, traditionalist 'ulema who have had a historical monopoly over the right to interpret Islam and its tenets.

Throughout the Muslim world in the twentieth century, many groups that identify themselves explicitly as Islamic attempted to participate directly in the democratic processes as regimes were overthrown in Eastern Europe, Africa, and elsewhere. In Iran such groups controlled and defined the system as a whole; in other areas, the explicitly Islamic groups were participating in systems that were more secular in structure. The participation of self-identified Islamically oriented groups in elections, and in democratic processes in general, aroused considerable controversy. People who believe that secular approaches and a separation of religion and politics are an essential part of democracy argue that Islamist groups only advocate democracy as a tactic to gain political power. They say Islamist groups support “one man, one vote, one time.” In Algeria and Turkey, following electoral successes by parties thought to be religiously threatening to the existing political regimes, the Islamic political parties were restricted legally or suppressed.

There has been much confusion, especially, over the term "fundamentalist," which implies a return to the past in recapturing the roots of Islamic religion. There is also an implication here that other readings of Islam are illegitimate, since they supposedly neglect traditionally accepted concepts for innovations that are often imports from non-Islamic societies.

As Yazdi said, there are: "Two major trends in Islamic movements. One, we call the traditionalist. (The term 'fundamentalism' does not reflect the true facts. All of us are fundamentalists according to the definition in Western culture, that whoever believes the Bible is the word of God is a fundamentalist.) There are the tradition-oriented Muslim intelligentsia, the so-called 'ulema. Then there are the reformist or modernist Muslim intellectuals." Both Islamic "fundamentalism" and "traditionalism" are used here interchangeably as referring to opposition to Islamic reformists, or "Islamists," who are less rigid in their views of Islamic law (Shari'a) and of non-Islamic cultures. In any case, the classification of Muslim movements into traditionalist/fundamentalist and Islamist/reformist can be confusing, since Islamic doctrine itself allows for different interpretations and therefore different opinions on Shari'a and its principles. It is quite possible for a traditionalist religious leader (alim) to share similar Islamic values with an Islamic reformer on the overall position of Islam in society, economy, and politics. The late Ayatollah Taleqani, who played an important role in Iran's revolution, had an activist vision of Islam and an Islamic state, for example, much closer to Islamist views than to those of Ayatollah Khomeini.

The Islamic tradition contains a number of key concepts that are presented by Muslims as the key to “Islamic democracy.” Most would agree that it is important for Muslims not simply to copy what non-Muslims have done in creating democratic systems, emphasizing that there are different forms that

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