The blood of the victims was still wet on the pavement in Bali when Gerard Henderson, executive director of the Sydney Institute think tank, wrote his opinion piece for Tuesday's Sydney Morning Herald.

It was a bitter attack on "the asinine utterances of the infantile left", and those who would forgive the Islamic fundamentalists who had perpetrated September 11 and now, it seemed, the bombings in the place called "the island of the Gods".

Under the heading "Bleeding hearts left exposed as fools", Henderson railed against the naivety of those who would be peacemakers with extremists and those who blame America's actions for the attacks last year. He stated bluntly that "contemporary terrorism amounts to an attack on Western civilisation".

It's a fair bet Australians watching the body count climb and coming to terms with the enormity of the Bali explosions would have agreed with Henderson.

The earlier assaults in the United States had now been globalised to put their murderous embrace around tourists and local people in a holiday paradise.

But what is becoming increasingly clear as we analyse the actions of Islamists - that growing number of Muslims who see Islam as a political philosophy - is that the nature of this wave of terrorism is not simple. It reflects the complex nature of the schism - political, emotional and developmental - between Islam and the modern world.

It is telling that Henderson - as have Tony Blair, Colin Powell and George W. Bush - characterised these events as occurring between Muslim extremists and the "civilised" world.

The implication behind that, perhaps unwittingly, addresses an important aspect of the discussion: that in many places the Muslim world suffers from economic deprivation and stagnation, repressive and inward-looking regimes, and is under unbearable pressures as tradition grapples with modernity.

Muslim communities have long questioned how their traditions and faith could survive in the modern world where their young people are assaulted by the secular Coca-Cola culture of consumerism.

It has seemed to them that nowhere was Islam free to flower, safe from the secular infidel.

Historically the Islamic world pulled on the handbrake just as the rest of the world was speeding up. From the Renaissance through the Enlightenment and into the Industrial Revolution, the West made rapid intellectual and social progress which valued precepts such as scepticism and modern rationalism, both anathema in a fundamentalist religious culture.

And the Muslim world was divided from within, its own people struggling with poverty, how to interpret the Koran and how to keep the faith while being battered by the culture and economic power of the West.

The Islamic world might be disparate and diverse - well over a billion people in more than 50 sovereign states - but it is clear there is an intellectual dichotomy emerging as the Muslim world grapples with modernity yet in which fundamentalism is growing.

While there are voices in the West suggesting a moderate and reasoned approach to the Islamic world, it can have been no comfort to see the results of the elections in Pakistan.

The alliance of five fundamentalist parties that opposes the US hunt for al Qaeda in Pakistan and wants to impose strict sharia law, swept to power in two provinces bordering Afghanistan, Baluchistan and the Northwest Frontier. They made significant gains elsewhere and are now the third-largest political block in the 342-seat National Assembly.

"[General Musharraf] has got the entire frontier now controlled by the Mullahs," said Asfandyar Wali Khan, who was president of the liberal Awami National Party in the Northwest Frontier Province but who resigned after his party's crushing defeat.

There is concern the new Muttahida Maklis-i-Amal alliance will try to "Talebanise" the country.

Significantly, however, the vote for fundamentalists might indicate a more simple schism within Pakistan as it has elsewhere in the Muslim world: that between rich and poor.

The MMA supports the poor and is perceived to have emerged from their ranks. There are links between the desperation of poverty and the rise of extremism which gives hope of control and identifies a clear, outside enemy.

In large families which cannot afford to support all their children, it is not uncommon for children to be taken by religious groups and parents can be proud if one of their sons is a religious leader. And so the cycle grows of fundamentalism, the culture of jihad and, perhaps, more attacks like Bali.

Middle East expert Gilles Kepel notes there are clusters of different social groups with diverse agendas within Islamist movements and a significant group is what he calls the Young Urban Poor which emerged in the 70s.

It makes up a significant percentage of the population throughout the Muslim world, between 70 and 75 per cent in the Middle East and North Africa.

These young people were urbanised, educated in Islam (often by the most conservative teachers), disillusioned by their failure to make social progress because of the dysfunctional economies they inherited, and aspirational when they saw Western culture.

Out of this emerged frustration and anger and many - as those in Pakistan have done - adopted a fundamentalist position and rejected modernism. They found solace in the certainties of yesteryear and the most extreme forms of Islam such as Wahhabism, the Saudi Arabian variant which has been widely exported.

"Osama and the House of Saud don't agree on very much," said a Pakistan human rights worker in Peshawar last year, "but they do agree on the spread of Wahhabism."

Wahhabism demands a strict adherence to a literal interpretation of Islam as formulated in the 18th century by cleric Muhammad ibn Abd al-Wahhab, who sought to remove the various readings of the Koran and codify the culture.

Quite how Muslim countries - with or without the support, assistance or condemnation of the West - can rein in militants is as unclear. This is low-cost terrorism and may be fuelled as much by resentment of Western wealth as by an aberrant view of the tenets of Islam.

Western moderates have frequently argued that if America tempered its support for Israel in its conflict with the Palestinians, then militant Muslims would have less fuel to fire their extremists.

What that means in Indonesia is another matter. There have been suggestions the Bali bombing is aimed less at the West than against the secular Government of President Megawati Sukarnoputri.

The extremist group Jemaah Islamiyah, believed to be responsible for the attacks, is said to have links with Osama bin Laden's al Qaeda, but al Qaeda and bin Laden were conspicuously quiet on the Palestinian situation until long after September 11.

Many Palestinians were sceptical when the link was belatedly made by bin Laden - and this week the reported statement from bin Laden congratulating those who led the anti-Western attacks in Kuwait and Yemen didn't mention the Palestinian struggle or Israel.

The tone of that statement was elevated. It pointedly spoke of the American "crusade" (George W. Bush's unfortunate choice of word) against the Islamic world, was religious in nature, addressed the Afghanistan situation exclusively, and was specifically anti-American.

It might, therefore, be naive to think a resolution of Palestinian grievances would mean an end to attacks by Islamist fundamentalists. For al Qaeda, Jemaah Islamiyah and other as yet unidentified or emergent extremist groups, this may simply be a holy war and the world - anywhere in the world, be it the West or in Muslim Indonesia - is the battlefield.

It is possible that even the best of intentions by the Muslim world and the West will have no effect on this small, but apparently growing, group of extremists.

As the BBC's Islamic affairs analyst Roger Hardy wrote two months ago before the attacks in Bali: "The current crisis could lead either to greater understanding between Muslims and the West - or to greater polarisation. But Muslim societies are in a painful transition.

"Governments are reluctant to accept political change - and all too often are failing to offer a sense of direction, as conservatives and modernists, secularists and Islamists put forward competing visions of Islam and modernity."

He added: "Finding a solution depends not only on how Islam engages with modernity, but on how the West engages with Islam."

Fine and worthy words, but, perhaps typically, within Pakistan's newly emerged fundamentalist coalition there is little will to compromise. This issue is tossed back to the West.

"Hatred is increasing because of America's foreign policies," says Maulana Sami-ul-Haq, a senior member of the alliance. "Wherever there are Muslims in the world, if America continues its present policies, it will create problems."

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Feature: Bali bomb blast

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