Monday, June 27, 2011

Egypt Rejects IMF, Revolution Lurches Forward

by Jonathan Rashad
Egyptians have evaded a great pitfall in their quest for freedom, democracy and sovereignty in their rejection this week of loan proposals from the IMF.  Nations across the world, especially in Africa, have time and again during periods of turmoil been tempted into bailouts and loan deals with the IMF and World Bank, always with strings attached: Steeled strings which pull the borrowing nation apart.

While successful in the ouster and trial of Hosni Mubarak, as with any revolution, the true test for Egypt is now coming after the removal of the regime’s figurehead.  A ratification of the revolution is yet to be completed, as the protest movement continues to fight against the faceless architecture of Egyptian power, which is still concentrated in the military, the oligarchy and foreign capitals.  Continued dealings with institutions such as the IMF would leave intact a central pillar of that architecture. 

Among other things which helped to destroy the Egyptian economy was the Mubarak regime’s system of patronage, as well as its borrowing from lenders such as the IMF; who always dictate how their loans are to be spent, as well as dictate economic and social policies generally as conditions for their lending.  These two forces helped to gut social projects, create massive unemployment and exacerbate poverty- ironically laying the groundwork and providing impetus for popular revolt.  Now the IMF and multinational corporations who did much business with Mubarak and who are the ultimate destination for IMF loans- loans which the taxpayers of the host nation must repay- want back in, but the Supreme Military Council has rejected the loans for now, amid popular distrust of the IMF in Egypt. 

Indeed, regardless of whether or not one would argue as to the virtue of the IMF loan package, one cannot deny that democracy has been served:  The people of Egypt do not want dealings with the IMF.  In fact, a rejection of the dictates of foreign influence, international finance and corporate power, in which the IMF is at the center, was a critical theme of the revolution.  While this fact mostly escaped the western media, Egypt’s current leadership is at least aware of it. 

Revolution:  Still in progress...

Apr 8 - Tahrir Square protests continue - Jonathan Rashad
Protests have continued since General Mubarak was finally forced from office on February 11.  There was much speculation afterwards as to how far Mubarak’s ouster would go in assuaging public outrage, which until earlier this year was for a long time a widespread but unexpressed reality.  Would the Egyptian street be placated by a simple rotation of figureheads?  This was the hope of the beneficiaries of the regime in Egypt, the US and in Israel.  According to Reuters, the Mubarak regime had been receiving an average of $2billion per year since 1979, making it the second largest recipient of US “aid” money, neighbouring Israel being the first.  It was always well known that the lion’s share of this money went to paying and equipping the coercive police/military apparatus which held the population in check through violence, subterfuge and torture.  As such, it is not surprising that the US administration did not support the ouster of their ally until the very last, until it became clear that such was already inevitable and perhaps necessary to stifle a more complete revolution which would sweep away not just Mubarak, but in one fell swoop the political, economic and military assets the US has bought in that country.  While Barack Obama spoke platitudes about freedom and democracy in Egypt, US and other foreign officials were working busily in the background to preserve the framework of Mubarak’s regime and find a successor who would be equally compliant to US interests, in spite of the aspirations to freedom of the populist, secular, anti-violent movement which demanded change at Tahrir Square and across Egypt. 

April 9 - Military crackdown continues - Jonathan Rashad
Since February 11, the Supreme Military Council of Egypt has been the official seat of power in that country.  It is made up of close allies of General Mubarak, and has been “overseeing” the transition to democracy in Egypt.  Under this “new” administration, Egyptians have continued to see crackdowns on protesters and torture of detainees.  The hope in the latter case is simply that the wretched habits of police and torturers die hard; however, in the former case the Supreme Military council is responsible for using violence to quell continued protests and criminalising the protesters through trials in military courts without due process.  Roughly 7000 sentences of groups of protesters have been meted out to up to 50,000, whom military officials continue to label as “thugs.” There is still an organised and determined enemy of the revolution wielding power in Egypt.

The land of the Pharaohs has also become a den of spies, with reports and arrests of foreign agents, most recently of one Mr. Ilan Grapel, a dual American Israeli citizen who has been in Egypt since February, and is reported as a former Israeli paratrooper wounded in the 2006 Israel-Lebanon war, a journalist, a law student and/or a spy, depending on what source one checks.  The truth of Mr. Grapel’s intentions in Egypt may never be revealed, but what is on record is that countries with vested interests in Egypt, such as Israel and the US, have in their respective and massively funded intelligence agencies a secretive behemoth with a mandate for espionage, disinformation and interference in favour of the interests of their employers.  This is while the aims of the Egyptian revolution are in vocal opposition to those interests.  Parsing between reality and contrived fiction, between honest help and the Faustian kind, between empty rhetoric and veiled threats is one of the prime challenges to the revolution in Egypt. 

How successful they are at such parsing will be in evidence later this Fall.  Former officials and collaborators of the Mubarak regime are busy rebranding themselves ahead of Presidential and Parliamentary elections set for later this year, with the hopes of maintaining their influence and access to the public treasury.  Other forces whose intentions are less clear are also clamouring; some looking perhaps to exploit divisions which in the past characterised Egyptian society.  The revolution is further threatened by the economic impact of the deconstruction of Mubarak's corrupt economic system and the loss of tourist dollars, which is to say that things always get worse before they get better.  Officials with much to lose in Egypt, foreign and domestic, are beginning to blame the revolution for continued rising unemployment and inflation- people such as the cheerleaders for the rejected IMF loans- as if Egypt’s economic woes are not the culmination of 3 decades of Mubarak’s cannibalistic policies.

However, if an honest parliament can be elected, who with the help of an engaged public can bring out of Tahrir and institutionalise the spirit of dignity, unity and humanity that struck Mubarak down and still grips most of the country, Egypt can begin to pull itself along the long road to reclaiming all that it has lost in more than a half-century:  Having suffered military invasion by Britain, France and multiple times by Israel, trade sanctions and threats by the US and the World Bank, and the wholesale looting of the country’s wealth by Mubarak’s three decades of international cronyism, Egypt now finds itself in a deep hole.  Printed everywhere on signs, painted on walls, sprayed on tanks and chanted on the streets is the continued call of the people of Egypt, as well as Arabs across Syria, Yemen, Tunisia, Bahrain and so on:   

“Aash’ab yureed issqaat in-nithahm!”
“The people want the fall of the system/regime!”
 (!الشعب يريد إسقاط النظام)

By rejecting the IMF, the people of Egypt have rejected the nonsensical idea of digging themselves out of their hole with the same tools that got them there.  


 “Aash’ab yureed issqaat in-nithahm!” 
Hear the people of Tahrir square and across the Arabic world


Read more about Egypt and the IMF:

Egypt since Mubarak’s fall:

Conflicting sources on the strange case of Ilan Grapel: