All perfect praise be to Allaah, the Lord of the worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His Slave and Messenger.
There are many reasons for the Muslims' setbacks, the most important of which are:
The end of the Muslims’ hegemony. Allaah the Almighty Says (what means): {And do not dispute and [thus] lose courage and [then] your strength would depart.} [Quran 8:46] Many scholars interpreted "strength" here to mean the state. With the collapse of the Islamic caliphate, the Muslim Nation undoubtedly was torn apart and has lost some of its strength and power. It has become mini-states and lost its independence. Moreover the enemy has imposed its influence over many Muslim states, plundering their wealth and fostering hatred and grudges among them. They have begun to live in continued internal strife that weakens their remaining power.
The spread of destructive and devastating ideologies and factions that adopt methodologies alien to Islam and contrary to its teachings. This has taken place with the help of the enemies of Islam while its scholars have not taken heed and its followers are ignorant. People in general and the youth in particular are abandoning Islam. The light of faith is fast fading away in their hearts, under the influence of continued campaigns of doubts and obscene media, including TV, magazines, the Internet and satellite channels.
Excluding the Sharee‘ah as a source of legislation and from life in general, and adopting constitutions from non-Muslim countries, translating them and ruling Muslims according to them. Allaah the Almighty Says (what means): {And whoever does not judge by what Allaah has revealed - then it is those who are the disbelievers.} [Quran 5:44]
Psychological defeat when facing the enemy, as no nation can get colonized or occupied unless it has a tendency towards that. Emir Shakib Arslan said that the main reason behind the Muslims' recent setbacks is their total lack of self-confidence, which is one of the most severe social diseases and spiritual defects. When it afflicts any nation, it leads to its destruction.
The appearance of some leaders who play a vital role in society and execute the plans of the enemies of Islam. In a Hadeeth on the authority of Huthayfah ibn Al-Yamaan, the Prophet mentioned that there will be callers from among this Nation who invite people to Hell, where they will throw those who respond to them. The Prophet even described them as a group of Muslims who speak our own language. [Al-Bukhari and Muslim] However the media, which is mainly controlled by the enemies of Islam, pictures these corrupt persons as caring reformers. Allaah the Almighty truthfully Says (what means): {And when it is said to them, "Do not cause corruption on the earth," they say, "We are but reformers." Unquestionably, it is they who are the corrupters, but they perceive [it] not.} [Quran 2:11-12]
Muslims' idolization of western cultures and desire to imitate them. In a Hadeeth on the authority of Abu Sa‘eed Al-Khudri the Prophet informed that Muslims would follow the ways and methodologies of Jews and Christians, whether they conform to our Sharee‘ah or not, and be mislead. [Al-Bukhari and Muslim]
Love of this worldly life. Once a person is fond of this life and its luxuries and joys, they leave the highest goals and busy themselves with trivialities. They also turn their back to the Hereafter and become attached to this worldly life, a disease which the Prophet warned us of, that can hardly be cured. In a Hadeeth on the authority of Thawbaan the Prophet mentioned that the nations will gather to fight the Muslim Nation as people gather around their food, and this will not be due to its small number. At that time the number of Muslims will be great but they will have no value or weight. Allaah will remove the dread from the hearts of Muslims’ enemies and throw love of this life and hatred of the Hereafter into Muslims' hearts. [Abu Daawood and others]
Allaah Knows best.