Islamic State an Impossibility?

I was invited to a seminar by Faculty of Sharia and Law, UIN Sunan Kalijaga Yogyakarta on 18th April 2012. I think this was the first time I visited Yogyakarta which is known as the culture capital of Indonesia. Probably because of the Borobudur and Kraton Palace where the Sultan of Yogyakarta still has an official position in the Indonesian politics that gave Yogya that title. One of the prominent western scholar invited was Professor Dr. Wael Hallaq. From what I know Prof Hallaq is a historian with focus on Islamic law. Thus his approach or methodology would be historical. Probably some faculties of UIN were Prof Hallaq's students that explain for his present here. Many Indonesian undertook sandwich studies program at MacGill University in Montreal, Canada where Prof Hallaq was sometime a Professor there. During the presentation given by Prof Hallaq, he confidently stated that Islamic state is not only an impossibility but also a contradiction to modern world for four reasons:

(1) Incompatibility with modern concept of constitutionalism with the stress on equal rights among its citizen without due regards to one's religion, freedom of expression and belief (right to choose), superiority of personal rights or choice etc among others.

(2) Legislature of modern state is a different concept from the Shariah in the sense that all citizens Muslim and non Muslim alike can participate.

(3) Globalization has changed dramatically, the world view of Shariah especially the concept of abode of peace and abode of war.

(4) The idea of modern corporation is anathema to the Islamic idea of fair economy where wealth is amassed by a few at the expense of many.

I am sure that for the protagonist of the Islamic state they will have answers for every details of the above reasons. But for me Islamic law must not be viewed solely or largely to its letters. When we limit ourselves to the expressed meaning of the letters of the law which are largely arrived at by cognitive process and confirmed later on through dogmatic principles such as ijma' of the scholars and taqlid, then probably Prof Hallaq's claim is true.

The mission of Islamic religion is both spiritual and moral. It is for the blessing or rahmat and mercy to human kind and universe (alam). Thus anything that is good for human kind, it is good in the eye of Allah. Islam moreover is the religion of change and progress with character of adaptability and flexibility. Combination of both I think will make Islamic Shariah dynamics and inclusive as well as responsive to the changing needs of the modern world. So the picture is not so gloomy after all!