In one sense, White House spokesman Joe Lockhardt’s flattery of Egyptian president Muhammad Husni Mubarak was completely routine: government officials often bestow praise upon their visitors and hosts in the course of high-level talks. But this particular acclaim seemed excessive. The irony of rolling out the red carpet for a man who recently presided over the renewal of martial law in Egypt less than a week after President Clinton had talked tough to Pakistan’s Pervaz Musharraf about the importance of restoring democracy to that country was apparently lost on Lockhardt. Also forgotten was that just five months prior to Mubarak’s visit, U.S.-Egyptian relations reached a nadir over the crash of EgyptAir flight 990 on October 31, 1999 near Nantucket Island. In response to U.S. suspicions that an EgyptAir employee might be responsible for the tragedy, Egypt’s official media—with the help of regime spokesmen—heaped venom on a wide range of American individuals and institutions—Boeing, the National Transportation Safety Board (NTSB), the U.S. military, media, general public, and Jewish population in particular.

Lockhardt’s undeserved praise also symbolized a larger problem in U.S.-Egypt relations, for Washington routinely refers to a “long and close friendship” with Egypt¹ and praises that country as economically liberalizing, stable, moderate, and gradually democratizing. Though a superficial case can be made for each of these four descriptions, closer examination finds that U.S. policy-makers are seeing in Egypt merely what they want to see. In fact, this is a troubled relationship and ripe for serious review.

I. Economically Liberalizing?

Egyptians add 2 percent to their population every year and this demographic tide requires that their economy produce more than 500,000 jobs annually until 2017.² The foreign investment necessary for this type of sustained expansion, however, is unlikely to be forthcoming without economic liberalization and the promise of privatization that comes along with it. And so it is that, after years of trying to navigate a middle course between liberal economic reforms and reliance on state-dominated strategies, the Egyptians have seemingly accepted the logic of the former. Since 1995–96 the mantra of the Egyptian regime has been liberalization, privatization, and foreign investment. Mubarak reiterated these goals in a speech in November 1999, stating, “It is essential we [the government] guarantee protection for the private sector and the financial climate in order to encourage and increase investment in our national economy.”³

The results are not hard to see, as Egypt has experienced impressive economic growth since 1995. Between 1995 and 1998, Egypt’s real gross domestic product (GDP) growth rate averaged just above 5 percent, inflation was cut almost in half from 7.3 percent per annum to 3.8 percent, and per capita GDP rose from $966 to $1,297.⁴ Beyond the hard economic figures there are numerous other signs suggesting that Egypt is on its way to economic prosperity: people are making money on the stock market; Western-style supermarkets have cropped up in Cairo’s fancy neighborhoods; and the streets are clogged with luxury sport-utility vehicles.

Yet, the regime’s rhetoric about Egypt’s importance as an emerging market is largely empty. To a certain extent, the prosperity is artificial, helped by the U.S. government’s writing off Egypt’s $7.5 billion military debt and approximately an additional $5 billion in government-to-government loans after the Kuwait war. The debt forgiveness of both the United States and the Paris Club in the spring of 1991 reduced Egypt’s debt from $50 billion to $25 billion. The banks are tapped out and saddled with non-performing loans. The housing market is slumping. Macro-economic mismanagement has led to a hard currency shortage (rendering it nigh impossible to buy dollars in Cairo). Unemployment and underemployment remain stubbornly high. Officially, the unemployment rate has been hovering between 9 and 10 percent, but it is more likely that twice this number are without jobs. This does not, of course, take into account the legions of Egyptians who are underemployed, for which there are no accurate figures.

Further, following some initial success in privatizing Egypt’s more profitable and well-managed public-sector companies, the process seems to have bogged down as the least attractive state-owned concerns are now put on the block. The Egyptian armed forces have declared many sectors of the economy under its control—by no means confined to military production—strictly off-limits to privatization. (Egypt’s military establishment owns such businesses as the Safi spring-water company, aviation services, security services, travel services, footwear production, and kitchen-appliance manufacturing.) And despite the desperate need for foreign investment, Egypt’s law No. 230 of 1989, designed to attract foreign financial resources, is so riddled with loopholes, restrictions, and exceptions that, the regime’s rhetoric notwithstanding, it is extremely difficult for foreign entrepreneurs to put their money in the Egyptian market. In fact, after Egyptian officials and businessmen wined and dined one potential foreign investor in the fall of 1999, he declared: “They made a nice presentation, but we’re not going to invest in Egypt. There is no way we can make money here.”⁵

Take the case of LaFarge-Titan, a French-Greek consortium that controls 4.8 percent of the Egyptian cement market. It may be rethinking its ability to do business in Egypt on the heels of an early February decision by the Egyptian government to undermine the company’s bid for a 51 percent stake of state-owned Ameriyah Cement. Apparently backtracking on its policy to attract foreign investment, Cairo raised the concern that if the LaFarge-Titan offer were successful, a foreign firm would hold too much sway in the Egyptian cement market. Not coincidentally, in the same week that LaFarge-Titan’s efforts were subverted, Egypt’s Orascom Construction Industries—under the control of business magnate Onsi Sawiris and his sons—unveiled its own plans to take Ameriyah private.⁶

As the Ameriyah Cement situation demonstrates, the Egyptian state evidently cannot move beyond some old and very bad habits. The extension of credit, awarding of contracts, and, of course, privatization process remain linked to domestic political competition and corruption rather than the promise of sound financial return. Egypt’s elite have employed their considerable wasta (Arabic for connections ) to secure loans. As powerful businessmen borrow beyond their means, the political establishment pressures banks to extend additional credit in an effort to prevent default. Fierce political battles are underway between competing groups of the business and political elite vying for everything from infrastructure tenders and bank loans to preferential treatment when bidding for state property. In Egypt, business is never just business; it is also personal and political. Thus, those who are entrenched at the apex of power—the president, the Supreme Council of the Armed Forces, various ministers, and elements of the business community—continue to amass wealth at the expense of Egyptian society, and any effort to foster change remains extraordinarily difficult.

Whatever the rosy economic picture that the official press and government spokesmen like to paint, the Egyptian economy is in reality suffering from both internal and external imbalances. In all, Egypt today looks too much like Mexico in 1995 than anyone, including Washington, cares to admit. Egypt’s banks are unable to recover loans and “crony capitalism” runs rampant. The government remains committed to defending its overvalued currency, which adds to an already considerable trade deficit requiring foreign financing—a primary source of the deterioration in Egypt’s current account balance. Despite the recent discovery of large oil reserves off Egypt’s Mediterranean coast—expected to more than double the country’s current reserves of 3.7 billion barrels and yielding an estimated $164 billion in revenues—these finds will require years to fully exploit. Thus, the Egyptian economy will not likely benefit from last winter’s spike in oil prices as Cairo is not a major player on the world oil market and any additional earnings are too small to provide long-term economic relief.

II. Politically Stable?

Over the last fifty years, five primary interests have conditioned U.S. policy in the Middle East: guaranteeing the free flow of oil from the Persian Gulf and shipping through the Suez Canal; protecting Israel’s security; restraining the Soviet Union; and containing regimes that pose a threat. Despite some notable setbacks (such as the Iranian revolution and the U.S. mission to Lebanon in the early 1980s), the U.S. government has been largely successful in achieving its goals. And since the mid-1970s when Egyptian president Anwar as-Sadat reoriented his country away from the Soviet Union, Washington has found a partner of sorts in Egypt.

The process began when Sadat compellingly made his case to the Nixon administration: Egypt, the largest and most politically influential Arab state, at peace with Israel, would be a reliable ally for the United States. Cairo’s overtures were particularly attractive to Washington with regard to energy security because, until Iraq’s invasion of Kuwait in August 1990, the Persian Gulf states refused to allow a significant American military presence in their area. Egypt thus presented itself as a logical staging area for U.S. forces in the event of a crisis in the Gulf. Sadat’s emphasis on peace and stability established Egypt’s place, along with Saudi Arabia, as a pillar of U.S. regional policy.

More than two decades later, the United States still emphasizes Egypt’s stability as a key factor in the close relations between the two countries. But this oft-cited stability comes at a long-term cost. The structure of the Free Officers regime, established after a military coup in 1952, remains largely in place; every one of Egypt’s presidents and vice-presidents has been a military officer. To be sure, the cabinet has been demilitarized over the last twenty-five years, but the minister of defense is clearly more than one among equals and former military officers control the majority of Egypt’s twenty-six governorates. The Egyptian government, having never been elected, is responsible to no one. Thus the leadership is left to pursue its own interests at the expense of society, sowing frustration, cynicism, and potentially violent opposition and instability.

The regime pays mere lip service to such principles as political pluralism, rule of law, transparency, and freedom of expression. With the exception of some high-profile individuals like the minister of economy and external trade, the commander of the air force, and some wealthy businessmen, Egypt’s Coptic Christians are subjected to both official and unofficial discrimination, rendering their relations with the majority Muslim population uneasy at best. Moreover, there is little hope to gain redress for grievances through political participation; Egypt’s political parties (officially fourteen in number but only nine are currently active) remain creatures of governmental decree.

It is widely known that senior government officials have enriched themselves through commissions or other forms of corruption, though none have ever been convicted of a crime—unless they fell out of favor with the government. This unfortunate situation results from a lack of governmental transparency. Officially, parliament maintains oversight responsibility, but in practice it is nothing more than a rubber stamp for the regime. Although the defense minister makes an annual presentation to members of the defense and foreign relations committee of the People’s Assembly, for example, his testimony and subsequent questions have very little to do with parliamentary supervision for the simple reason that the legislators are not privy to the defense budget.

Government officials tend to boast about Egypt’s robust freedom of the press and freedom of expression. Again, reality is much different. The press, foreign and domestic alike, is subject to heavy censorship and even closure. In late January 2000, for example, the government reportedly shut down Huquq al-Insan (Human Rights), a publication of the Egyptian Organization for Human Rights, as well as the Ibn Khaldun Center’s magazine, Civil Society. A state of emergency has been in effect for most of the last forty-eight years, making it illegal to hold an unauthorized political rally. Convicted offenders are subject to hard labor in Egypt’s notorious prison system.

As is often the case with authoritarian regimes, a contradiction lurks at the heart of Egypt’s apparent stability. Though outwardly the regime appears strong, it is in fact brittle. The Egyptian state’s manifest scarcity of legitimacy, lack of ideological hegemony, and dearth of financial resources, leaves the Mubarak regime vulnerable to coherent challenges to its authority. Left with the least efficient means of effecting control—coercion—the Egyptian state routinely and brutally represses its political opponents, especially the country’s active and influential Islamist movements.

A former Egyptian government official has summed up the situation with the following analysis: “Though the streets of Cairo are quiet, the Egyptian people are suffering—I’m afraid we are living on the lip of an unpredictable volcano.”⁷ That may be overstating the case: Egypt is not on the verge of a revolution. But as the Islamists warn, there is significant potential for a return to the spasms of violence that rocked the country between 1992 and 1997. Indeed, there are some signs that an increase in extremist-related violence may be in the offing. In September 1999, Egypt’s Central Security Forces engaged in a gun battle with members of the al-Jama‘a al-Islamiya near Cairo. Perhaps more ominously, Rifa‘i Taha, one of al-Jama‘a’s senior expatriate leaders, warned the Egyptian government that the crackdown on Islamist activists begun in late November of that year could provoke a violent response.

III. Becoming Democratic?

A visitor arriving in Egypt during September 1999 could be forgiven for believing that he had landed in a democratic country. Cairo was festooned with political appeals and proclamations. In Port Said, seemingly spontaneous rallies featured a broad spectrum of Egyptians. Elected politicians from the People’s Assembly stumped up and down the country. But was this a country moving inexorably along a path of greater political democracy or just another authoritarian regime going through the motions? More the latter than the former. The “election” was in reality a referendum on the president: he and he alone stood for office, and the choice on the ballot was simply yes or no. The buzz of political activity manufactured by the Interior Ministry did not indicate a burgeoning democracy, even if the Egyptian press insisted otherwise. And the referendum on September 26, 1999, which granted Mubarak a fourth six-year term in office, also gave him the telltale over-90-percent of the vote that characterizes a phony election. (The official figure was 93.79 percent of 18,957,893 votes cast.)⁸

One was hard pressed to find Egyptians who had participated in the referendum. After some prodding, one gentleman explained that, although he did not vote, his mother had. She had voted no. It is not so much that people dislike Mubarak—he is actually quite popular, though there is a growing unease with the development of a personality cult around the president and his family. But many Egyptians loathe the system: a largely corrupt and military-dominated regime that benefits at the expense of the political and economic development of society at large. Though it is difficult to document this type of discontent, owing to the regime’s restrictions on public opinion polling, Egyptians across the socio-economic spectrum are not shy in expressing their dismay over the status quo with each other or even with inquisitive foreign researchers.

Despite the Egyptian leadership’s use of coercion to impede the institutionalization of the political system—a truly independent judiciary, viable political parties, and a professional military establishment, to name just a few—there is a consistent effort to maintain the illusion of democratization. The Egyptian state-controlled press is fond of using the phrase “process of democratization” and the political leadership often claims they are “preparing state institutions for democracy.” In reality, these concepts are devoid of any meaning, except as a convenient way to put off significant political change indefinitely. While engaging in the rhetoric of democratization, the Egyptian government consistently alleges that, despite its diligent efforts, the institutions of state are not yet ready for democracy, so liberalization must remain on hold. Indeed, as one young Egyptian intellectual put it, “The state just talks about these things, it’s not interested in democracy. If anything, Mubarak has narrowed the space for political participation.”⁹

The Egyptian opposition is subject to complex regulations severely restricting its actions and rendering its members vulnerable to arbitrary arrest, all of which has the effect of diffusing, controlling, and ultimately destroying centers of political power outside the purview of the state. The Muslim Brethren, for example, has repeatedly signaled its willingness to operate within the regime’s established political framework, only to find itself repressed. This brutal policy has a de-stabilizing effect, for it weakens those Islamists willing to accommodate the state while strengthening other, potentially violent, organizations such as the Jihad organization and al-Jama‘a al-Islamiya. Paradoxically, this serves the interests of the state, permitting it to justify the continued state of emergency and therefore authoritarian rule. In the late fall of 1999, Egyptian security forces rounded up more than two dozen members of the Muslim Brethren in the Cairo suburb of al-Ma‘adi and in Minya governorate under the all-too-often cited pretext of battling terrorism. Rather than plotting violence against the state, however, the meetings were being held to develop the Brethren’s strategy for elections to the professional association representing Egyptian lawyers in the spring of 2000. Clearly, the regime was sending a message to the organization that it will not tolerate the Muslim Brethren’s efforts to take part in Egypt’s circumscribed political system.

IV. Reliable Ally?

Cairo’s alleged moderation is also invoked as a primary rationale for U.S. support of the regime. And this has been a reality, one that has paid dividends to Washington. Cairo’s moderate stance over the past two decades on a range of issues (Arab-Israeli peace, the security of the Persian Gulf, the battle against Islamism) has strengthened the American position among Arab and Muslim countries by giving it an indispensable political cover.

Since late 1995 and 1996, however, disturbing signs of change have become apparent. The Egyptian regime has been active in efforts to obstruct or undermine U.S. interests in three areas: Arab-Israeli diplomacy, Iraq, and Sudan.

Arab- Israeli diplomacy. It is still axiomatic in Washington to think of Egypt as a key player in Arab-Israeli peace making—a legacy of the Camp David accords (1978) and the Egyptian-Israeli peace treaty (1979). Yet a review of recent years reveals an Egyptian involvement in diplomacy different from that which the United States seeks. The regime offers no more than a cold peace with Israel, which has the effect of dampening Israeli interest in new peace treaties with other Arab states. On the Palestinian track, the Egyptian leaders have devised a strategy (in coordination with their Palestinian counterparts) that designates Egypt a counterweight to Israel. Throughout late 1999 and early 2000, Palestinian leader Yasir Arafat frequently visited Egypt for the purpose of enlisting Mubarak’s support during tough negotiations with Israel. Seizing the opportunity to demonstrate its unrivaled position in protecting Arab interests, Cairo consistently and very publicly took the government of Ehud Barak to task on Israeli settlements, the status of Jerusalem, and the applicability of U.N. Resolution 242 to the occupied territories. With the resumption of Syrian-Israeli negotiations in January 2000, there was a significant improvement in relations between Cairo and Damascus. On the eve of the opening round of talks between Barak and Syria’s foreign minister Faruq ash-Shar‘a, Al-Ahram reported that Egypt and Syria had agreed to “continuous coordination” with each other.¹⁰ When those talks bogged down in mid-January over Syria’s requirement that Israel commit to a complete withdrawal from the Golan Heights before a resumption of negotiations, the Egyptian president went to Damascus to declare Egypt’s unequivocal support for Syria’s demand.¹¹

Beyond the immediate area, the Mubarak regime uses its diplomatic influence to obstruct Israeli relations with friendly Muslim states, such as Turkey and Mauritania, and pressures states in North Africa and the Persian Gulf against moving toward normalization with Israel. Cairo made strenuous (but unsuccessful) efforts to convince Turkey that its burgeoning strategic alliance with Israel destabilizes the region and is ultimately harmful to Ankara’s interests. The Egyptian foreign ministry uses Israel’s possession of nuclear arms, which Egypt considers a serious threat, as yet another issue over which to lambaste the Israelis and demonstrate Cairo’s leading role as guardian of Arab interests. Egypt’s ongoing campaign to force the Israeli government to acknowledge its nuclear arsenal has succeeded in putting Israel on the defensive without altering the Israeli strategic posture. It only brings about ill-will.

Egypt has also used the Washington-sponsored Middle East and North Africa (MENA) Economic Summit as a stick, however weak, to induce the Israelis to make concessions. MENA 2000 was tentatively scheduled for spring 2000 in the Egyptian capital. So, as early as September 1999, Egypt’s foreign minister Amr Moussa warned Israel that Cairo would proceed with the conference only if there were substantial progress on all Arab-Israeli negotiating tracks.¹² Despite the fact that MENA would highlight Egypt as an attractive place to invest, the clashes between Israel and Hizbullah in southern Lebanon in February led the Egyptians to postpone MENA indefinitely.

The U.S. government expects Cairo to play a more constructive role in establishing regional peace. But the latter seems not to understand this. Thus, over the last few years—most recently during Mubarak’s July 1999 visit to Washington—the Clinton administration has reportedly told Mubarak that it was time Cairo made some effort to establish warmer ties with Israel.¹³ U.S. officials reason that an improvement in the bilateral relationship would render Israel more willing to make concessions for peace. As had been the case previously, Mubarak rebuffed the United States, preferring to ensure his position in the Arab world with a negative stance toward Israel.

Iraq. The Egyptians no longer play their former role of pushing the Arab states to confront Saddam Husayn. To the contrary, in late 1999 Egypt began a rapprochement toward Iraq. For example, Cairo welcomed Iraq’s leadership at September’s foreign ministerial meeting of the Arab League and considerably softened its position toward economic sanctions against Iraq. The Egyptian foreign ministry now implies that the Security Council (read: the United States), not Baghdad, is the recalcitrant party impeding the full ending of sanctions. More alarming, according to a variety of Egyptian political and military analysts, were Iraq to invade Kuwait again, it is clear that the United States would not receive Egypt’s diplomatic or military support in countering the aggression.

Sudan. Sudan’s stability may be the single most important security issue confronting Egypt because of a fear that the headwaters of the Nile River—Egypt’s lifeblood—can be diverted or dammed in that country. Cairo has every right to fashion a resolution to the ongoing crisis in Khartoum and the southern part of the country in the way that it sees fit. But why coordinate these policies so closely with Libya’s Mu‘ammar al-Qadhdhafi? The Egyptians argue that Libyan participation is crucial to a successful resolution of the Sudanese problem, yet by all measures, Tripoli has very little diplomatic weight to bring to the table, whereas Washington enjoys quite a bit. For example, the relationship between the United States and John Garang, southern Sudan’s main political and military power broker, may be the key to accomplishing Egypt’s objectives in Sudan—the stability and unity of the country. Yet Egypt regards Washington’s relations with Garang as part of an effort to set up a viable alternative to Khartoum, despite U.S. reassurances to the contrary. Thus, Cairo has decided to go its own way on Sudan, rebuffing Washington’s support and in the process demonstrating—through close coordination with Qadhdhafi—Egypt’s ability to act independently of the United States.

Egyptians offer several reasons for their differences with the United States regarding Arab-Israeli peacemaking, Iraq, and Sudan. First, they are concerned not to be seen as Washington’s lackey either in the international community or domestically—the latter, in particular, is not a convincing argument given how little public opinion usually counts for the regime. Second, the Egyptians argue, quite rightly, that they have their own interests and expertise on Middle Eastern issues that result in legitimate policy differences with Washington. Yet, Cairo also acknowledges that disagreements with the United States stem from Egypt’s desire for a special role in its competition with Israel. In practice, this means U.S. acknowledgment of Egypt’s rightful place as the Middle East’s primary economic, political, and cultural power.

There is considerable concern among the Egyptian political elite that the United States prefers Israel to play this role despite Cairo’s objections. This perspective was brought into sharp relief late last February after Mubarak’s historic visit to Lebanon (the first by an Egyptian leader in forty-one years) to demonstrate Egypt’s “support for the Lebanese people’s right to resist the [Israeli] occupation.”¹⁴ In an article entitled “Back in the Lead,” Egypt’s Al-Ahram Weekly quoted an unnamed Egyptian diplomat as declaring, “Egypt is sending a clear message to the Israelis, the West, and the Arab world that it is not prepared to forgo its role as the leading Arab state come war or peace.”¹⁵

EgyptAir Flight 990

Egypt’s troubling response to the investigation surrounding the loss of EgyptAir flight 990 serves as a metaphor for all that is wrong in the U.S.-Egypt relationship. In the immediate aftermath of the tragedy, Cairo’s streets, universities, offices, and restaurants were rife with competing theories concerning the Boeing 767’s mysterious plunge into the Atlantic Ocean. When an American agency, the National Transportation Safety Board, directed suspicion for the crash toward relief co-pilot Jamil al-Batuti, the Egyptian state’s machinery kicked into high gear to refute this possibility. The most energetic author of these conspiracy-laden accounts was Samir Rajab, editor-in-chief of the government controlled daily Al-Jumhuriya, but he was quickly joined by the other major dailies and magazines. Four explanations for the EgyptAir tragedy gained the most currency in Egypt:

1. A secret U.S. military battle station located on the eastern end of Long Island brought down the plane with either a surface-to-air missile or a “death ray.”

2. There is something taking place in the waters off Long Island that caused three airliners and John F. Kennedy Jr.'s plane to go down in the same area between 1996 and 1999.

3. Jews control New York City and thus “Jewish groups” engineered the downing of flight 990.

4. Israel’s intelligence service, Mossad, placed explosives aboard the aircraft.

The unfortunate fact that there were thirty-three Egyptian military officers on the plane added ominous undertones to these theories and fueled an increasing hysteria in the Egyptian media.

After a two-month lull, the EgyptAir 990 story once again became the subject of headlines in February 2000. First, the crash of Alaska Airlines flight 261 prompted Egyptian editorialists to question why the NTSB was not blaming the pilots, despite the clear evidence of mechanical failure. The very fact that the Alaska Airlines crew was not under suspicion indicated to Egypt’s media that the NTSB and the U.S. government were smearing the good name of EgyptAir and the Egyptian government. Then on February 4, 2000, Hamdi Hanafi Taha—a senior pilot for EgyptAir—requested political asylum in London, claiming knowledge about the loss of flight 990 (though it appears he did not in fact have such information). Egypt’s press and even the chairman of EgyptAir suggested that Taha was in the employ of the Central Intelligence Agency (CIA) and being used to slander the airline and Egypt.

Particularly disturbing about the EgyptAir episode is the fact that the Egyptian authorities abet this type of activity. Indeed, not a single government spokesman sought to refute the media’s allegations as the conspiracy frenzy actually served the state’s ends. The regime often uses the press, which Cairo disingenuously claims is free and reflects public opinion, to establish a basis for pursuing an agenda contrary to Washington’s interests. In this way, Cairo insulates itself from official protests or other expressions of displeasure by claiming that public opinion is driving its policies. This strategy is in fact a recurrent feature of Egyptian-Israeli relations and has been employed increasingly with regard to Sudan and United Nations sanctions on Iraq.

Rethinking U.S. Policy

Protests to the contrary not withstanding, Washington and Cairo have conflicting regional interests that result in significant policy differences. There is no better way to sum up the current state of affairs than to cite what an Egyptian policy analyst declared over Turkish coffee in a Cairo café in early 2000: “Much of what goes on in Egypt is based on appearances only—there is an appearance of democracy, economic development, strong relations with the United States, and peace with Israel. Don’t be fooled by appearances.”¹⁶ Indeed, once one scratches beneath the surface, it is clear that the suppositions that have guided Washington’s Egypt policy over the last quarter century may no longer be appropriate. If Egypt continues to take only half-hearted measures to reform its economy, is not stable, falls far short of democracy, and pursues policies opposed to Washington’s interests, why then does Washington continue the close ties with Cairo, as exemplified in Lockhardt’s effusive words quoted above? Because, more than twenty years after the Iranian revolution, the United States still remains spooked by that event and its Middle East strategy is overly based on maintaining stability in the region. The policy may seem realistic and sensible, but it is shortsighted and entails two main problems. First, though the State Department has consistently criticized Egyptian human rights violations, the U.S.-Egypt relationship is so politicized that U.S. officials are unwilling to broach many of the less-than-pleasant aspects of Egypt’s political system with their counterparts. Washington resists such protests for fear they would encourage Cairo to retaliate by further complicating the achievement of U.S. goals in the region. This unwillingness risks the development of false assumptions regarding the stability of the Egyptian state that necessarily translates into poor policy. Egypt in 2000 is hardly comparable to Iran in 1978, but the U.S. government’s approach to the Mubarak regime is all too reminiscent of Washington’s relationship with the shah, in which long-term problems were left unaddressed or overlooked until it was too late. In the case of Egypt, the premium placed on stability may, ironically, foster instability. As Egyptians continue to bear the costs of living in an authoritarian regime, the potential for popular unrest remains strong, as the country’s large and sophisticated internal security apparatus suggests.

Second, after almost twenty-five years and $55 billion of U.S. government aid invested in Egypt, the United States has become inextricably linked to the Egyptian regime. This has consequences of its own, as unwavering support for a corrupt military-dominated regime generates anti-American sentiments among intellectuals and would-be political activists who otherwise are sympathetic to the United States. As one independent Egyptian intellectual asked, “the exigencies of the bi-polar system made it necessary for the United States to establish close relations with Egypt, but why continue this relationship unaltered almost a decade after the Soviet Union surrendered?”¹⁷ From his perspective, not only is U.S. policy insidious (it indirectly reinforces repression and corruption), but it also places U.S. regional objectives at risk.

A regime that routinely violates all the principles for which the United States stands, lacks transparency, and is based on the aspirations of a military elite that clings tenaciously to power is no longer a good choice for a regional partner. At the moment, Egypt may seem to be only a recalcitrant friend, but in time its government could damage U.S. interests by obstructing Washington’s efforts to foster Arab-Israeli peace, contain Iraq, or isolate Libya and Sudan. To ensure that this does not happen, Washington must relinquish its cynical Egypt policy in favor of one that encourages genuine political reform. Why should Egypt be different from other states around the globe in which the United States has sought to foster democratic practices, the rule of law, and respect for human rights?

Concretely, this means encouraging Cairo to engage in constitutional reform, relinquish the executive’s control over political parties, fight corruption, invest the parliament with real oversight power, and separate the military from the presidency. This may seem like asking too much, but in the first half of the twentieth century Egypt, though under British control, did maintain a number of important liberal traditions—a free press, an independent judiciary, a functioning parliament, and a tolerance for pluralism. To many Egyptians, the Free Officers’ coup of July 1952 remains illegitimate and did little more than suspend Egypt’s political development. There is an element of the Egyptian society—in their thirties through fifties—that finds inspiration in Egypt’s past and supports substantial economic and political reforms in an effort to bring capitalism and republicanism to Egypt. Though but a small group in Egypt’s population of almost 70 million, they deserve Washington’s support. One area from which they are receiving indirect support is the international business community; multinational corporations hoping to do business in Egypt are telling the leadership, in essence, “You want our investment? Then reform your bureaucracy, establish laws protecting intellectual property rights, and fix your economy.”

There may be some danger in encouraging Egypt to reform along both political and economic tracks simultaneously. Russia’s nightmarish transition is a stark reminder of the difficulties associated with this path. So why not an approach like that of Taiwan—focus on the economy first and then gradually move toward political transition? In Egypt, this may be difficult because of the persistent influence of the military establishment. Because the president must assure his own political survival by keeping the interests of the senior officer corps in mind, economic reform will not result in political liberalization (which would threaten the military’s status and privileges). A dual track approach is not certain to succeed either, but the United States maintains considerable leverage with the Egyptian armed forces. Indeed, only Washington possesses the necessary influence to encourage, prod, and aid political reform.

BOX: Does Egypt Threaten Israel Militarily?

There is some concern that the Egyptian military modernization program based on the annual $1.2 billion in U.S. military assistance package and the Badr training exercises—held every three years—serves as preparation for conflict with Israel. But these are probably not much of a threat to Israel, for several reasons. First, the Egyptian military’s posture is in general defensive. Second, Egyptian threat perceptions require that they prepare for a possible conflict with Israel just as the Israel Defense Force prepares for a potential crisis involving the Egyptians. Most military professionals and analysts would regard both the Israeli and Egyptian war games as little more than prudent military planning. The Egyptians are outclassed, but they do believe they should be prepared to defend themselves effectively in the event of a crisis and this is, indeed, the purpose of the exercises. They have a long way to go, however. Third, whereas the Egypt-Israel peace treaty permits a division of Egyptian troops—approximately 20,000 men—in Sinai (but not more than fifty kilometers east of the city of Suez or the Suez Canal), Egyptian forces have never deployed even half that number since the peninsula was returned to Egypt in 1982. Thus, in the event of a conflict, Israel would have more than adequate warning time.

Fourth, on the question of equipment, the Egyptians do possess an array of advanced U.S. manufactured weaponry. For example, Egypt’s army possesses the M1A1 tank—certainly a high-tech and lethal machine—but the Egyptians are able to employ them only as set battlefield pieces. This is a function of the fact that Egypt’s land forces, the most advanced of all the Egyptian services, cannot refuel and re-supply its forces beyond a limited range. The situation is far worse for the Egyptians in terms of air power. While the Egyptian and Israeli air forces both fly F-16s, Egyptian pilots are reportedly barely proficient in navigation, air-to-air combat, and delivering their ordinance on target, thus they pose a minimal challenge to Israel’s skilled air crews. This does not even take into consideration Israel’s formidable force of F-15s—perhaps the best air-superiority and strike aircraft in the world—that is missing from Egypt’s inventory. The Egyptian military is typical of many third world authoritarian regimes—more important for prestige and internal political control than projecting power outside of national borders.

¹ Department of State spokesman James Rubin, Reuters, Nov. 18, 1999.
² Niall Kishtainy, “The Money Market,” Business Today—Egypt, Nov. 1999, p. 60.
³ Address before the joint session of the People’s and Consultative Assemblies, Nov. 13, 1999.
⁴ Figures for key economic indicators come from the Central Bank of Egypt. It is important to note that some question the reliabity of the Egyptian Central Bank’s numbers. In fact, the World Bank uses two sets of books when dealing with the Egyptians. One with Egyptian generated data and another with the World Bank’s own data. When I asked a friend at the Bank who deals with Egypt to provide some of their own numbers he declined. Apparently, Egypt’s relationship with the World Bank is so sensitive that the Bank’s own estimates are not freely available to any of us without the appropriate clearances. Moreover, despite having another set of books, the World Bank people are required to use Egypt’s numbers. Unfortunately, I do not currently have access to the rating agencies’ data. If you do, I would be interested in seeing this stuff and happy to make adjustments to the text accordingly. Otherwise, I can add to the footnote or text that the Egyptian data is suspect.
⁵ Interview with a potential foreign investor in the Egyptian market, Cairo, Nov. 15, 1999.
⁶ “Business in Brief,” Cairo Times, Feb. 10-16, 2000.
⁷ Interview with a former Egyptian government official and prominent intellectual, Cairo, Dec. 8, 1999.
⁸ Al-Ahram, Sept. 28, 1999.
⁹ Interview with confidential informant, Cairo, Dec. 8, 1999.
¹⁰ Al-Ahram, Dec. 31, 1999.
¹¹ Al-Akhbar, Jan. 23, 2000.
¹² Al-Ahram, Sept. 15, 1999.
¹³ Al-Ahram Weekly, Oct. 7-13, 1999.
¹⁴ Ibid., Feb. 24-Mar. 1, 2000.
¹⁵ Ibid.
¹⁶ Interview with confidential informant, Cairo, Feb. 25, 2000.
¹⁷ Interview with confidential informant, Cairo, Oct. 19, 1999.