What is going on in the Muslim world? Why does it produce suicide hijackers on the one hand and, on the other, lethargic and haphazardly capitalist societies that have delivered neither economic development nor democracy? A good if partial answer to these questions--partial because it is limited to the Arab region of that world--can be found in a United Nations "development report" issued in July. As the U.N. assessment concludes, the entire Arab sector, with all its oil wealth, is "richer than it is developed." Its economies are stagnant, illiteracy is widespread, political freedom is hardly to be found, and its inhabitants, especially its women, are denied the basic "capabilities" and "opportunities" of the modern world.

The U.N. report--written, significantly, by a group of Arab intellectuals--was commissioned well before last fall's attacks on the U.S. But its pertinence to those attacks has seemed clear enough to commentators. Thomas Friedman of the New York Times called it the key to understanding "the milieu that produced bin Ladenism, and will reproduce it if nothing changes." An editorial in The Wall Street Journal found "little wonder" in the fact that "such an isolated culture became a breeding ground for the Islamic fundamentalism that spawned September 11."

The Islamism of Osama bin Laden and his followers is indeed inseparable from the developmental failures of the world's Arab societies. All the same, however, it would be a mistake to conceive of the Islamist movement as nothing more than an expression of those failures. The phenomenon of radical Islam is more complicated than that, and in all sorts of surprising ways its long-term effect on the entire orbit of Islamic society may turn out to be more complicated still.

Last September's attacks against the United States were carried out by a group of Muslims led by a gaunt, bearded ascetic sitting in a cave in Afghanistan and spouting unfathomable rhetoric. So all-consuming was the hijackers' hatred of America that they were willing to blow themselves up for their cause--something that set them apart from earlier generations of terrorists. Where did this zeal, so foreign to the modern democratic temperament, come from?

On the part of many observers, the immediate impulse was to attribute it to deep cultural factors, and in particular to the teachings of fundamentalist Islam. And of course there was, and is, much to be said for this view. In particular, the fact that, far from repudiating bin Laden, Muslims and Westerners tended to line up on opposite sides in their interpretation of the events of September 11 gave credence to the paradigm of the Harvard political scientist Samuel Huntington, who predicted a number of years ago that the post-Cold War world would give rise to a "clash of civilizations."

Still, foolish as it would be to downplay the role of religious or "civilizational" factors, it will not do simply to call Osama bin Laden an Islamic fundamentalist. For the Islamism of which he is a symbol and a spokesman is not a movement aimed at restoring some archaic or pristine form of Islamic practice. As several observers have argued, including most recently the Iranian scholars Ladan and Roya Boroumand in the Journal of Democracy, it is best understood not as a traditional movement but as a very modern one.

Groups like al Qaeda, the Boroumands write, owe an explicit debt to 20th-century European doctrines of the extreme right and left. One stream of influence can be traced to Hassan al-Banna, the schoolteacher who founded the Muslim Brotherhood in Egypt in 1928. From Italy's Fascists, al-Banna borrowed the idea of unquestioning loyalty to a charismatic leader, modeling the slogan of his paramilitary organization--"action, obedience, silence"--on Mussolini's injunction to "believe, obey, fight." Taking a cue from the Nazis, he placed great emphasis on the Muslim Brotherhood's youth wing and on the marriage of the physical and the spiritual, of Islam with activism. Unsurprisingly, al-Banna also taught his followers to expect not encouragement but repression from traditional Islamic authorities.

A second European source of Islamism can be traced to Maulana Mawdudi, who founded the Jamaat-e-Islami movement in Pakistan in the early 1940s. A journalist well-versed in Marxist thought, Mawdudi advocated struggle by an Islamic "revolutionary vanguard" against both the West and traditional Islam. As the Boroumands observe, he was perhaps the first to attach "the adjective 'Islamic' to such distinctively Western terms as 'revolution,' 'state,' and 'ideology.' "

These strands of the radical right and left eventually came together in the person of Sayyid Qutb, the Egyptian who became the Muslim Brotherhood's chief ideologist after World War II. In his most important work, "Signposts Along the Road," Qutb called for a monolithic state led by an Islamic party, advocating the use of every violent means necessary to achieve that end. The society he envisioned would be classless, one in which the "selfish individual" of liberal societies would be abolished and the "exploitation of man by man" would end. This, as the Boroumands point out, was "Leninism in an Islamist dress," and it is the creed embraced by most present-day Islamists.

Though developed among Sunnis, this virulent ideological mix reached the Shiite world as well, most notably through its influence on Ayatollah Khomeini in Iran. Indeed, the Iranian revolution of 1979 conferred on Islamism a degree of religious respectability that it had never before possessed. But the fact that the movement could so easily bridge the bitter Shiite-Sunni divide also suggests just how sharply divorced it is from Islamic history and custom. As the Boroumands conclude, the key attributes of Islamism--"the aestheticization of death, the glorification of armed force, the worship of martyrdom, and 'faith in the propaganda of the deed' "--have little precedent in Islam but have been defining features of modern totalitarianism. The seeming rigor of Osama bin Laden's theology belies the reality of his highly heterodox beliefs.

So much for the ideological side of things. On the sociological side, there is still another close parallel between Islamism and the rise of European fascism. Though Hitler was a great entrepreneur of ideas, the roots of his movement, as described in classic analyses like Fritz Stern's "The Politics of Cultural Despair" (1974), lay in the rapid industrialization of central Europe. In the course of a single generation, millions of peasants had moved from tightly knit village communities to large, impersonal cities, losing in the process a range of familiar cultural norms and signposts.

This rapid transition--captured in Ferdinand Toennies's famous distinction between Gemeinschaft (community) and Gesellschaft (society)--was perhaps the most powerful impetus behind modern nationalism. Deprived of local sources of identity, displaced villagers found new social bonds in language, in ethnicity and--ultimately--in the mythopoetic propaganda of Europe's extreme right. Though the various right-wing parties pretended to revive ancient traditions--pre-Christian Germanic ones in the case of Nazism, Roman ones in the case of the Italian Fascists--their doctrines were really a syncretic mishmash, old symbols and new ideas brought together by the most up-to-date forms of communications technology.

Islamism, as the late Ernest Gellner was among the first to note, has followed a similar path. Over the last several decades, most Muslim societies have undergone a social transformation not unlike that of Europe in the late 19th century. Large numbers of villagers and tribesmen have moved to the vast urban slums of Cairo, Algiers and Amman, leaving behind the variegated, often preliterate Islam of the countryside. Islamism has filled the void, offering a new identity based on a puritanical, homogenized creed. Syncretist in the manner of fascism, it unites traditional religious symbols and rhetoric with the ideology of revolutionary action.

Some observers, especially after September 11, have suggested that the real engine of Islamism's growth is poverty, but this is not the case. According to the recent U.N. report, for example, the Arab world actually compares favorably to other developing regions when it comes to preventing abject want. Rather, like European fascism before it, Islamism is bred by rapid social dislocation. More often than not, its leaders and propagandists are newcomers to the middle or upper classes. Islamism introduces these educated but often lonely and alienated individuals to a larger umma (community) of believers, from Tangier to Jakarta to London. Through the magic of the cassette tape recorder (in Khomeini's case) or video (for bin Laden), they become members of a vibrant, if dangerous and destructive, international community.

Seeing Islamism for what it really is goes beyond correct taxonomy. It also points us in the direction of an important, if seemingly perverse, question: Could it, like both fascism and communism before it, serve inadvertently as a modernizing force, preparing the way for Muslim societies that can respond not destructively but constructively to the challenge of the West?

The question is not as absurd as it may sound. Comparisons are especially tricky here, but the Bolsheviks succeeded in creating an industrialized, urbanized Russia, and Hitler managed to get rid of the Junkers and much of the class stratification that had characterized prewar Germany. Through a tortuous and immensely costly path, both of these "isms" cleared away some of the premodern underbrush that had obstructed the growth of liberal democracy. There are, of course, much safer and more peaceful routes toward modernization, such as those taken by countries like South Korea or Britain or the United States, and less expensive paths to modernity were surely available to Russia and Germany. But one has to deal with what one has, and in Islamic cultures, in any case, there is arguably much more underbrush to be cleared away. If Islamism is directed as much against traditional forms of Islam as against the West, could it, too, be a source of such creative destruction?

There are myriad ways in which not only Islamic practice but the rigid legal framework within which it is encased has obstructed change. The economic historian Timur Kuran has documented in painstaking detail a series of traditional Islamic institutions whose inflexibility and legalism have served as immense barriers to development. Interest rates are fixed by religious authorities, schooling focuses on rote learning of religious texts and discourages critical thinking, women are kept out of political and economic life, and so on. Even an institution like the waqf, or traditional Islamic charity, which could serve as a bulwark of civil society in a reformed Islamic order, fixes the bequests of wealthy individuals in perpetuity, with no opportunity for adaptation to changing circumstances.

Many of these same constraints existed historically in the Judeo-Christian West, and were eliminated or ameliorated only after long struggle. All of them continue to exist in the Islamic present, and can only be removed through the exercise of political power. Islamism has already demonstrated the capability of doing this, and even of accommodating Western norms when it has to. Though Khomeini brought back the chador, or veil, for women, he also reluctantly sanctioned women's right to vote in Iranian elections, a practice (won under the shah) that he had once likened to prostitution.

In Egypt, the Muslim Brotherhood as well as other, even more radical Islamist organizations have created a layer of voluntary associations standing between the family and the state. It was, for example, Islamist charities that stepped into the breach at the time of the 1992 Cairo earthquake, providing important social services unavailable from the inept and corrupt Egyptian state. The Islamists clearly hope to reunite religion and political power one day, which would be a disaster. But they are learning--and inculcating--habits of association and independent action that, if somehow divorced from their radical ideology, might yet help lay the groundwork of a true civil society.

There is another area in which the reactionary ideas of the Islamists may play a potentially progressive role, and this has to do with the fundamental sources of authority and legitimacy in the Islamic world.

The traditional system of Islamic jurisprudence--with its rigid rules and hierarchies--has been under attack, in one way or another, since at least the 19th century. The most important early figures in this effort were modernizers, like the Iranian Jamal al-din al-Afghani (1839-97) and his student, the Egyptian reformer Muhammad Abduh (1849-1905). Abduh was among the first to depart from the rigidly textual form of interpretation that had characterized the Sunni world since the earliest caliphates. In his view, human reason was the only appropriate tool for applying the fundamental truths of the Koran and the Sunna (the traditions of the Prophet). Appointed mufti of Egypt toward the end of his life, Abduh issued rulings reflecting, in the words of one scholar, his desire "to render the religion of Islam entirely adaptable to the requirements of modern civilization."

The implications of this turn were profound. Though the institutional base of orthodox Sunni Islam remained intact, the long-sealed gates of doctrinal explication were unhinged. Like a Muslim Luther, Abduh shook up the clerical establishment by reviving, under the influence of his mentor al-Afghani, the possibility of independent legal interpretation. His example gave unprecedented latitude to all subsequent construers of Islamic tradition, whether saints or demagogues--the latter including anti-Western radicals like the Muslim Brotherhood's Sayyid Qutb and, eventually, Osama bin Laden.

In the battle for interpretative power, it is no coincidence that the primary breeding ground for Islamism has been the brittle oligarchies of Saudi Arabia and Egypt. Both regimes have co-opted the traditional clergy, forcing the populist current of Islam into back alleys and storefront mosques and turning it into an ideological guerrilla movement. Detached from the moorings of tradition, the Islamists have proved adept at manipulating the symbols of faith and appropriating them for their own revolutionary purposes.

Osama bin Laden's famous 1998 fatwa, in which he declared jihad on the United States and any American fair game for his followers, is a case in point. Though the content of this declaration is itself contrary to traditional Islamic moral teachings--as the eminent Middle East scholar Bernard Lewis has observed, "At no point do the basic texts of Islam enjoin terrorism and murder"--the most notably radical thing about it is the identity of its author. Osama bin Laden has no credentials as a religious authority and no right, under traditional Islamic practice, to issue a fatwa. It is a bit like Hitler issuing a papal encyclical, or Lenin a decree in the name of the Russian Orthodox church. The mere fact that bin Laden was willing to cross this line shows the extent to which Islamism has undermined traditional Islamic legal authority. But a line crossed in the name of waging all-out war against the West may yet be crossed in the name of healthier purposes.

We should not kid ourselves. The modernization of Islam is hardly imminent, and it will not occur without enormous struggle. There are several deeply imbedded obstacles in Islamic society, not least the often-noted lack of a tradition of secular politics. To many Muslims, what may simply seem more "natural" is a totalizing ideology that seeks to unite society and the state within a single revolutionary whole. Nor is it clear, despite the UN's recent report, that the Muslim world is capable of the realistic self-appraisal necessary for a modernizing shift to occur.

Many non-Western societies, after all, have tried the path of violent resistance to the enormous military, economic and cultural power of the West. It was only when faced with defeat and domination that nations like China and Japan undertook a serious study of what, in Mr. Lewis's phrase, "went wrong." Joining the West when they could not beat it, they adopted a variety of Western institutions while retaining a core of their own culture. This process of social learning has been much slower in Muslim societies; for Arabs in particular, it has been all too convenient to blame Israel and the United States for their own lack of progress.

If the wait for Muslim modernization is likely to be a long one, how, then, should the West respond in the short term as it faces the continued prospect of terrorism, suicide bombings and weapons of mass destruction? The determined application of military power is certainly part of the answer. European fascism did not fall because of the inherent wickedness of its animating ideas; having brought havoc to the societies that embraced its doctrines, it lost legitimacy because it was crushed on the battlefield. Just as Osama bin Laden and his cause gained status and support with the successful attacks of September 11, so the rout of al Qaeda from Afghanistan and continuing U.S. operations against radical Islamic terrorism are absolutely key to dampening Islamist fervor.

But the more important struggle must take place within the Islamic world itself. For too long, genuine Muslim modernizers have sat in the wings while traditionalists and Islamists battled one another on center stage. The great need now is for Western-oriented Muslims to take advantage of the turmoil created by September 11 to promote a more genuinely liberal form of their religion.

There is reason to think that such an opening exists. Though many Muslims continue to favor Islamism in the abstract, the movement has left a disastrous record everywhere it has come to power. Saudi Arabia, home of the extremist Wahhabi strain of fundamentalist Islam, is one of the most corrupt and mismanaged regimes in the contemporary world. Even with the country's vast oil wealth, per capita income fell in real terms from $11,500 in 1980 to $6,700 in 1999. As for Afghanistan under the Taliban, ordinary Afghans were overjoyed to be liberated from their yoke, and eagerly returned to such simple modern pleasures as watching cheesy Indian movies on their long-buried VCR's.

It is the Iranians, who, having lived under Islamist rule for the past generation, are most likely to lead the Islamic world out of its current impasse. Though Western hopes for the seemingly reform-minded President Khatami have proved misplaced, there is one basic demographic fact working in favor of eventual liberalization: 70 percent of Iran's population is now under the age of 30, and from all reports these young people tend to abhor the Islamic theocracy. Having brought the first Islamist regime to power, Iran would set a powerful example for the rest of the Middle East--and beyond--if it were to move toward liberalization on its own steam.

In the end, it is as important not to overestimate the strength of Islamism as it is fatal to underestimate it. It has little to offer Arabs, much less the rest of the Muslim world. Its glorification of violence has already produced a sharp counterreaction, and--provided it is defeated--its "successes" may yet help pave the way for long-overdue reform. If so, this would certainly not be the first time that the cunning of history has produced so astounding a result.