A Democratic Revolution? Egypt at Two Years

Since the Egyptian revolution of January, 2011, the democratic process has been working in fits and starts. The international press has focused its attention on the machinations of the Muslim Brotherhood, whose political party won the first round of elections handily and then forced its vision of the new constitution through the constitutional referendum of December, 2012. However, other movements and parties have also been organizing and working to proliferate political forces beyond the pre-revolutionary establishment and the typical big business interests and crony networks of neoliberal governance.

IMF Loan Terms Attack the Democratic Legacy of the Arab Spring

With IMF officials visiting Egypt this week, negotiations have resumed on the terms of a bailout loan to address the Morsi government’s plummeting credit profile and foreign reserves. The IMF loan, if the agreement is successful, will come only with terms that demand reductions in social support spending following the classic lines of neoliberal economic policy demands. The IMF’s technical assistance to Egypt has repeatedly advised the government to trim energy subsidies and implement broader tax reforms, and investor tax reforms were also announced this week. Yet the investor-friendly policies and social support reductions are only part of the picture.

Egypt's subsidies are long-standing, many begun during the Nasser period but becoming essential when global commodity prices rose dramatically in the 1970s, and are now particularly urgent given Mubarak’s neoliberal policies and their impoverishment of a substantial portion of the population. Egypt spends close to 10 percent of its GDP on subsidies, and almost everyone agrees that the subsidies are not effective at reaching the poorest of the poor.