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Unmasking the State


Beyond the 'democratic transition'

The Egyptian revolution that overthrew the Mubarak dictatorship in January also created the conditions for uniting the masses of North Africa and the Middle East, with the new movements that have emerged, particularly in southern Europe, against a common enemy.

In overthrowing the corrupt authoritarian regime, the masses found themselves face to face with the harsh reality that the economic conditions which had driven on the uprising remain unchanged after Mubarak was removed. These take a unique Egyptian form. The armed forces, which were the backbone of the Mubarak state, own factories that make a range of products ranging from weapons to drugs, and even home appliances such as cookers. The state is reckoned to own a third of the economy through the army. The banking sector is also largely state owned.

Under pressure from the International Monetary Fund (IMF) and the United States, its major creditor, Egypt in recent year set about “liberalising” the economy and introducing “market reforms” through “structural adjustment programmes” (SAPs). These led to massive unemployment, rising poverty – about 44.4% of the Egyptian population were designated extreme poor to near poor in 2005 – and inflation, fuelling the revolution that swept Mubarak out.

The point of this story is that the IMF, Washington and agencies like the European Bank for Reconstruction and Development will, if they have their way, redirect the revolution’s energy into even deeper “reforms” and bigger SAPs that will integrate Egypt into the global market capitalist economy. This is also the plan for Tunisia and Libya.

The detail is brilliantly outlined in an article by Adam Hanieh for the ezine Jadaliyya. He explains:

Despite the claims of democratic transition, the institutions of the Egyptian state are being refashioned within this neoliberal drive as an enabling mechanism of the market. Egypt is, in many ways, shaping up as the perfect laboratory of the so-called post-Washington Consensus, in which a liberal-sounding ‘pro poor’ rhetoric – principally linked to the discourse of democratisation – is used to deepen the neoliberal trajectory of the Mubarak-era. If successful, the likely outcome of this – particularly in the face of heightened political mobilisation and the unfulfilled expectations of the Egyptian people – is a society that at a superficial level takes some limited appearances of the form of liberal democracy but, in actuality, remains a highly authoritarian neoliberal state dominated by an alliance of the military and business elites.

In essence, the financial initiatives announced over recent weeks represent an attempt to bind social layers such as these – Egypt’s military and business elites, the ruling families and large conglomerates of the GCC [Gulf states], and so forth – ever more tightly to the Western states. The revolutionary process in Egypt represented an attack against these elements of the Arab world. The uprising cannot be reduced to a question of ‘democratic transition’ – precisely because the political form of the Egyptian state under Mubarak was a direct reflection of the nature of capitalism in the country, the uprising implicitly involved a challenge to the position of these elites.

Hanieh is right. Democracy is neutralised while the power of the ruling corporate and military elites remains in place. That is the lesson not just of Egypt. In Spain, which had a “democratic transition” in 1975 after the death of the fascist dictator Franco, and in Britain where capitalist democracy has held sway for about 150 years, corporate and financial power predominates more openly than ever.

In Spain, the Real Democracy Now/M-15 movement is challenging the political system, while in Greece – which the IMF has bankrupted – anti-government struggles grow. In Britain, hundreds of thousands of workers are set to strike against the Coalition’s measures at the end of the month.

These confrontations effectively join with the Egyptian revolution, which is at a crucial stage. Democracy, if it is to mean anything, must embrace co-ownership and control of economic and financial resources, the repudiation of foreign debt and telling the money markets to get lost. That would constitute a genuine revolutionary, democratic transition and could be achieved through a network of people’s assemblies in each country. That’s what you’d call a structural adjustment programme of a positive kind!

Paul Feldman
Communications editor
3 June 2011

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Your Say

Tim says:

I haven't read the full article by Hanieh but I agree with the analysis as summarised here. All this fluidity creates opportunities but the forces of the status quo have the luxury of control of the resources - political and economic structures etc. - to watch and wait and nudge here and there - so that when things begin to settle down again the old order will be re-established, just with new faces and a fresh veneer. The people battlng to create something better neither have the luxury of resources nor time. That is why they must quickly create an anchor to resist a drift back to the same old system and create a strong foundation upon which to build a new one. This presents a considerable challenge!

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