What's really happening in Egypt?


The international capitalist media have largely ignored the tumultuous developments in Egypt unfolding under the pressure of a massive movement for change. Most coverage since the resignation of former president Hosni Mubarak on February 11 has been uncritical reportage of “sectarian” violence. The aim is to convince working people that popular uprisings lead only to violence and reinforce racist and Islamophobic stereotypes.

A closer examination of the English-language Egyptian press and international financial media reveals an extremely dynamic situation.

High profile capitalists who participated in the Mubarak regime are being tried and jailed. The former ruling party is banned, and the murderous State Security Intelligence Service (SSIS) disbanded. The Rafa crossing into Gaza is open, and the Egyptian government, run by the Supreme Council of the Armed Forces (SCAF), is negotiating a higher price for gas exported to Israel.

The military has imposed widespread use of closed military courts to try non-capitalist civilians in both political and criminal cases. It has also passed new laws outlawing strikes and protests.

The IMF, other international financial institutions and national governments have agreed to massive financial backing for the SCAF regime. The 2011-12 Egyptian budget runs against the stream of IMF austerity imposed on Egypt and most of the Third World for the last three decades.

Deadly sectarian incidents, provoked by counter-revolutionary forces, and a sensationalist media scare campaign about the economy are being used to try to confuse and beat back the mass movements. However, a new stage of mass struggle has opened up, calling for a “second revolution”.

Capitalists jailed

Egypt’s attorney general announced on May 24 that Mubarak would go on trial for conspiring with the former interior minister to kill more than 865 people and injure thousands of others during the uprising from January 25 to February 11. That was in addition to charges for corruption and for selling gas to Israel below market price. He has already been fined US$34m for cutting off communications services during February’s uprising.

Mubarak’s wife, who was being held on corruption charges, has been released on bail after handing over assets. Suzanne Mubarak turned over a villa in a Cairo suburb and US$3m in bank accounts in Egypt. However, Hosni Mubarak has not been imprisoned, but is being held in a military hospital for health reasons. Mubarak’s two sons are both jailed in the political prisoner wing of Tora Prison in Cairo. Besides the Mubarak family, many other capitalist families are being charged, and some culprits have already been sentenced.

The former tourism minister, Zoheir Garranah, was sentenced to five years in April for squandering public funds. Earlier, Habib al-Adly, the former interior minister, sometimes described as the most hated man in Egypt and thought to be responsible for overseeing much of the torture carried out by the government, was sentenced to 12 years.

Youssef Boutros-Ghali, a graduate of the IMF, was sentenced to 30 years in prison for corruption and a US$6 million fine for “squandering and abusing public funds”. The press reported that Boutros-Ghali gave away 96 of the 102 luxury cars allocated to the ministry, keeping the remaining six for himself. Both he and his wife were sentenced in absentia, having fled the country hours before Mubarak resigned.

On March 5 and 6 protesters raided SSIS buildings across Egypt, forcing the government to shut down the hated institution. On March 17 the BBC reported: “The head of the SSIS has been arrested and is facing investigation for ordering the killing of anti-government demonstrators. Another 47 of its personnel have been detained on suspicion of destroying evidence.”

Al Ahram newspaper reported on June 17 that the government initially moved all the agents from the SSIS to the Ministry of Interior. “A few not accused of any misdeeds are now being assigned to National Security, the new entity replacing SSI. In total, 28 of 33 generals, 70 of 99 lieutenant generals, and 56 of 105 colonels are being replaced in the new entity.”

Closed military courts

An estimated 7000 Egyptians remain in military prisons. Military trials are still being conducted for non-rich civilians. The military defends the practice by saying that very few protesters have been tried and that most defendants are “thugs”, but little is known about the closed trials. One demand raised at the massive May 27 mobilisation was for an end to military trials of activists, as opposed to all citizens, reflecting that some sections of the movement still believe the military is needed to protect society from criminals and chaos.

On March 23 cabinet adopted a new law that criminalises strikes, protests, public congregations and street assemblies. “Such actions are to be criminalised as long as the Emergency Law is in effect; this law has been in force for the past 30 years, and is expected to remain in effect for another six months until parliamentary elections are held”, the Al Masry Al Youm newspaper reported. Before the May 27 mass action, the government tried to intimidate would-be participants by threatening to use the new law. Eventually more than 1 million people mobilised, and the government was forced to back off.

IMF bankrolls the regime

In May the IMF announced a US$3 billion loan for Egypt, suggesting it expects the country to alter its subsidies system and adhere closely to free market principles, Ahram Online reported on June 6. Several other international financial institutions, including the European Reconstruction and Development bank, have also opened credit for the SCAF. The announcements followed Obama’s May 19 speech on the Middle East, in which he promised US$1 billion to invest in Egypt and to write off $1 billion of Egyptian foreign debt if Egypt uses the money in accordance with US demands.

The IMF’s deputy director of the Middle East and Central Asia Department, Ratna Sahay, concluded her Cairo visit stressing “private sector-led economic growth”. “The transition to a VAT-like consumption tax and reform of the highly inequitable and costly system of subsidies are needed to improve the efficiency of public spending and help reduce the fiscal deficit in the medium term”, she said. In fact, basic commodity subsidies disproportionately help poor people.

The perspectives advocated by the IMF decimated Egyptian working people’s lives from 1980. According to Helmy al-Rawy, head of the Budgetary and Human Rights Observatory, “If we adjusted standards of living to inflation since 1980, wages should now be around US$340” per month. When Mubarak fell, the legal minimum wage for government employees was US$67 per month. Unemployment was officially 11.5%, and 1 in 4 young people.

While the IMF has signed over the loan money, it was forced to abandon its usual austere terms. Sahay is quoted as stating that the IMF and Egyptian government agreed that immediate changes are unrealistic and the country needs to build an effective safety net to protect low income households. These unusual words are an implicit recognition that the Egyptian movement is frightening world financiers.

Saudi Arabia has pledged US$4 billion in loans to Egypt, while the Kuwait Investment Authority announced in April that it was establishing a US$10 billion sovereign wealth fund that it would invest in Egyptian companies.

Budget concessions and violence

The 2011-12 financial year budget raised the minimum wage for government employees 75%, to almost US$4 per day. Social security benefits and wage support increased by around 20%. Subsidies on petroleum and other goods increased about a third and are now close to 20% of the total budget.

For the first time since Mubarak took power in 1981, the budget introduced progressive taxation. Companies whose profits exceed US$1.7 million will have their tax rate increased to 25% of profits.

Spending on education increased 3% and health care 8%, though combined they still account for less than 10% of expenditure.

Asef Bayat, in an article published on the Al Jazeera website, notes that British colonialism fostered sectarianism by attempting to instil the idea among Christians that they formed a separate community. Sectarianism took a back seat under the progressive government of Gamal Abdel Nasser after the Egyptian revolution of 1952, when Egyptian identity and “Arab socialism” became state ideology.

Nasser’s successor resurrected sectarian violence. Sadat gave a free hand to the Islamist movement. He supported sharia as the main source of law. Sadat was also responsible for the opening shots of neoliberal economics in Egypt. His successor, Mubarak, deepened it. Under Mubarak, Bayat writes, “The 1980s and early 1990s, during the peak of the Islamist movement’s activity in the country, witnessed the most frequent sectarian violence in Egypt’s history”.

The popular mass movement of 2011 was in large part a reaction to the injustice and poverty caused by neoliberal economic policies. Among the protesters their anti-sectarian stance has been clear. From its first mobilisations in January through to the present, the protests and their spokespeople have declared cross-religious solidarity using slogans like “Islam and Copts are one hand”. The May 27 mobilisation was organised in response to the sectarian provocations in April and May.

Even in the Cairo suburb of Imbaba, scene of the worst sectarian violence in 2011, in which 13 people were killed, local residents interviewed by Al Ahram saw the conflict as more political than communal. Nader Nessim, a Coptic Christian who runs a local mobile accessories store, told the paper: “Things are quite normal here, I don’t feel threatened at all ... Those who attacked us mustn’t have taken part in the January 25 Revolution, where Muslims and Christians came together to change the whole country.”

While there are small fundamentalist Islamic groups in Egypt, these are tiny and disparate compared with the parliamentarist Muslim Brotherhood – Egypt’s largest political organisation – which had the support of 15% of voters according to a Gallop Poll conducted in late March and April. It is a widely held belief that elements of the 100,000 personnel who used to work for the SSIS are acting as agents provocateurs in cahoots with wealthy Egyptians or others hostile to the mass struggle.

Movement for a ‘second revolution’

The May 27 action took place despite opposition from the Muslim Brotherhood, who not only refused to mobilise their own members but in some cases actively opposed the demonstration, calling participants secularists and communists. The military government threatened to ban the protest using new anti-protest laws. For the first time, more people mobilised in the city of Alexandria than in Cairo.

The mobilisation called for a “second revolution”. While there are many versions of what that slogan means, it reflects an increasing anger about military rule. January and February’s slogan, “The people and the military are one hand”, was no longer popular. Many protesters openly called for the overthrow of the SCAF, despite the risk of being jailed and tried in a military court.

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