In this paper, we draw some optimistic, socio-liberal conclusions about Islam in the world system. Countering some alarmist voices in the West, neither migration nor Muslim culture are to be blamed for the contemporary crisis, but the very nature of unequal capitalist accumulation and dependency that is at the core of the world capitalist system. For one, our analysis is based on current thinking on Kondratiev waves of world political development inherent in recent work by IIASA and the NATO Institute for Advanced Studies. We also present analyses in the framework of the debate on cross-national determinants of human well-being in the world system. While we are cautiously optimistic about a socio-liberal, non-interventionist policy alternative, we come to the conclusion that present patterns of global governance, modeled around the neo-liberal Washington Consensus and American hyperpower, are doomed to failure. First we present a rigorous re-analysis of United States Department of State data on acts of global terrorism in the framework of Kondratiev cycle waves. We then proceed to an analysis of the determinants of economic growth and ecological and social development in 140 nations with complete data. The data presented show that before the present war in Iraq the global war on terrorism already showed very positive effects, and that the strong linear downward trend in global terrorism, to be observed during the last two decades, coincided with rising globalization in both the centers and the peripheries of the world system, and that the percentage of people with less than 2 $ a day even declined in the Middle East and North Africa. We also found no systematic interaction between the differentials of growth in the center and the periphery or inequality differentials in the center and the periphery and patterns of global terrorism. I. e. a western socio-liberal, multi-lateral and non-interventionist policy could have won the fight against international terrorism. We then refute empirically the Huntington hypothesis about the incompatibility of Islam and successful socio-economic development. Our paper re-establishes the notion that capitalist development is of cyclical nature, with strong fluctuations every 50 years. For us 1756, 1832, 1885, 1932 and 1975 are the beginnings of new Kondratiev waves, while 1756, 1774, 1793, 1812, 1832, 1862, 1885, 1908, 1932, 1958, 1975, and 1992 are the turning points (troughs) of the Kuznets cycles. Vigorous upswings of the capitalist world economy need to be supported by a tightly organized new world political hegemonic order, while the strength of the downswings and the severity of the depressions always are a function of the waning world political order. We show the fatal interconnection between these world political and world economic “tsunami waves” in a more systematic fashion. In the most recent phase of capitalism, its “Casino” character becomes ever more apparent, with a sharp distinction between the winners and losers of the system. Winning the war against global terrorism would imply arriving at more inclusive and less unilateralist structures of global governance. While our analysis on world development 1990 – 2003 shows the detrimental effects of dependency and globalization on the social and ecological balances of the world, data on membership in the Organization of the Islamic Conference or Muslims per cent of total population were compared in their effects on a number of dependent variables of socio-economic development in 140 countries of the world with complete data: · economic growth, 1990-2003 · eco-social market economy (GDP output per kg energy use) · female economic activity rate as % of male economic activity rate · freedom from % people not expected to survive age 60 · freedom from a high quintile ratio (share of income/consumption richest 20% to poorest 20%) · freedom from civil liberty violations, 1998 · freedom from high CO2 emissions per capita · freedom from political rights violations,1998 · human development Index · life expectancy, 1995-2000 Ceteris paribus, Muslim culture (measured by the percentage of Muslims in the respective population of a given country) significantly and positively affects the human rights record, human development, and the ecological balances. Further dispelling irrational immigration-phobias and Islamophobia in general, the present work also shows that, by and large, pretty much the same functions of key (positive or negative) UNDP development indicators (y-axis) hold in comparison with purchasing power per capita (x-axis) in the Muslim world and the non-Muslim countries. It is shown furthermore that the analysis of the new UN data on migration balances per total population in over 100 countries also supports the socio-liberal view that ceteris paribus, not only Islam, but also inward migration are very much compatible with successful and egalitarian patterns of development. While neo-liberal globalization, ceteris paribus, contributes to the social polarization of the host countries of transnational capital penetration, Muslim communities or membership in the Organization of the Islamic Conference are to be regarded as socially stabilizing and growth enhancing factors. Thus a new, socio-liberal global consensus on global migration, global order and global governance could emerge.