Egypt Running on Empty

by Joshua Stacher | published March 8, 2016

For background on Sisi’s election, see Andrea Teti, Vivienne Matthies-Boon and Gennaro Gervasio, “Sisiphus,” Middle East Report Online, June 10, 2014.

For background on military corporate interests, see Shana Marshall and Joshua Stacher, “Egypt’s Generals and Transnational Capital,” Middle East Report 262 (Spring 2012).

An authoritarian regime may be unpopular, even loathed, but at least it has rules. The rules may bear little resemblance to the law, but relations between state officials and society come to have a predictable rhythm. People understand where the red lines are, and they can choose to stay within them or to step across. Egypt does not work this way under the field marshal who became president, ‘Abd al-Fattah al-Sisi.

Nearly three years since the military coup that brought Sisi to power, not only are the red lines blurred, but the unconsolidated regime itself is so fuzzily defined that Egyptians doubt it is one coherent entity. The security forces seem to have slipped the leash of the executive branch. As one journalist told me in Cairo, “You never know which security branch it is any more. The only thing that’s clear is that Sisi does not control them. It’s unpredictable and unsettled. That’s what makes everything dangerous. You can’t see it coming.”

The period since the July 2013 coup has been the single most repressive in modern Egyptian history. Whether one is counting dead bodies, imprisoned or tortured activists, or violations of academic freedom, the toll is staggering for uncounted families. In 2015, according to the El-Nadeem Center for the Rehabilitation of Victims of Violence, the documented cases of forcible disappearance at the hands of the state numbered 464. Almost 500 people died in custody while 676 more were tortured. [1] To date, the new year has been terrible as well: In February, the El-Nadeem Center reports, another eight Egyptians died in detention and at least another 80 were tortured.

The 2011 uprising that toppled President Husni Mubarak brought countless Egyptians to political activism. Hundreds of these people, and colleagues who were also active before the uprising, now languish in prison. Others want to leave the country or wish they could. Several have been barred from leaving, even for short trips abroad. This restriction is also haphazard—the dark joke making the rounds is that you have to be at the Cairo airport’s passport control to know if you can travel. Still others cope by dropping their political lives in favor of completely unrelated careers. Few take these measures out of fear. It is just too painful to contemplate what has happened. Some are so depressed they avoid friends and stay home. There are also stories of organizers who are so angry about the course of events that they refuse to practice their craft. As one activist worried, “We are not going to be ready next time. Everyone is paralyzed.”

Yet all the pronouncements that the transition away from authoritarianism failed, all the clichés about spring turning to winter, also miss the mark. The overall level of dissent is much higher than in the penultimate days of Mubarak before the uprising. On average there have been five times more collective labor actions and other protests per day under Sisi than in the period 2008-2010. [2] The country is in dire straits.

The 2011 uprising did not create the mess—the decisions of powerful actors did. Pining for the status quo ante, the elites failed to meet the most basic popular demands; now they are trying to contain the lingering tensions while building a new regime amidst intense competition among old regime figures and newer entrants. These struggles, in addition to the structural fiscal weakness of the state and the poor economy, generate fears of a polity coming undone and explain the viciousness of the backlash.

Is it a house of cards? Many Egyptian observers say that no amount of aid from the Gulf, US diplomatic cover and police brutality can keep the state running. More than one person openly told me that Sisi might be overthrown, despite the huge investments and grand spectacles that went into putting him on the wobbling throne, and despite his attempts to place his sons high up in intelligence agencies. It is a bold prognostication. Yet one need only read the newspapers and be in Cairo to see the outlines of such a narrative.

Just an Average Week

Even a cursory visit to Cairo, first of all, unmasks the fiction that it is Sisi’s Egypt. The posters, chocolates and women’s underwear bearing his visage that popped up in the immediate wake of the coup are all gone. The stray, tattered Sisi sign on the city walls looks like someone forgot to take it down.

On February 24, Sisi delivered the longest speech of his presidency, in his usual colloquial Arabic, and directed at detractors of the post-coup order. He warned, “Please, don’t listen to anyone but me. I am dead serious. Be careful. No one should try my patience or exploit my good manners in attempts to tear down the state. I swear to God that anyone who comes near the state, I will remove from the face of the earth. I am telling you this as the whole of Egypt is listening. What do you think you are doing? Who are you?”

The jokes started before the speech ended. Egyptian and foreign journalists debated whether Sisi is “baby Saddam” or “baby Qaddafi” before someone chimed in that Sisi can only wish he had the authority of either doomed dictator. During an address about his vision for 2030, the president said he would sell himself, if he could, for the good of the country. Less than two hours later, an Egyptian in the United States listed Sisi for sale on eBay. One former protester told me, “Don’t call it a regime because it’s not. This country is a joke, a parody, a satire. We don’t have to be in opposition. We just need to sit and wait.”

The jocularity coexists with palpable anger. On February 18, the week before Sisi’s speech, a policeman got into the cab of Muhammad Sayyid, 24, and asked the driver to transport some furniture in the Cairene district of Darb al-Ahmar. An argument broke out between the cop and the cabbie, known in the neighborhood as Darbaka, over the agreed-upon fare, at the end of which the policeman killed Darbaka with a shot to the head. The response of residents was to beat the cop senseless. At first, the government said, “The bullet mistakenly came out of the gun.” The following day, over a thousand protested outside the Interior Ministry. When protesters invoke the name of the driver in Darb al-Ahmar, they also mention ‘Afifi Husni of Isma‘iliyya and Tal‘at Shabib of Luxor, two others tortured and murdered by police over the winter. [3] Their killings also sparked protests. Sisi and the interior minister, Magdi ‘Abd al-Ghaffar, scrambled to quiet the furor, placing the blame on a few bad apples in police ranks. In response, seven men calling themselves the Coalition of Low-Ranking Police Officers headed to a satellite TV studio to air their discontent. They were arrested before the interview began. The next day, scores of police demonstrated in front of the Security Directorate in the Sharqiyya province to demand release of the seven.

Another flashpoint is the tension between the police and medical doctors, which has sharpened along with the greater incidence of police brutality since the coup. In late January, two officers appeared at Matariyya General Hospital, which is near one of the deadliest police stations in the country. [4] One policeman had minor cuts but wanted a report with a doctor’s signature that exaggerated his condition. The physician, Mu’min ‘Abd al-‘Azim, said no. The unharmed officer punched ‘Abd al-‘Azim. Another doctor intervened to help his colleague, and the cops called for backup. Eight more officers showed up, and dragged the two doctors outside for a further beating. The doctors tried to press charges at the police station, and were threatened with jail time if they insisted. On February 12, nearly 10,000 doctors gathered in front of their professional syndicate building. The physicians issued a set of demands calling for accountability for violent cops and fundamental reform in hospital security, including a firearms ban and installation of video cameras. The rallying cry was “the rule of law.”

Someone connected to the weakened state wants to intimidate the Egyptians who monitor and publicize abuses like those in Matariyya. In mid-February, police showed up at the El-Nadeem Center, which has provided psychological and other support to torture victims since 1993, with a closure order. The Health Ministry claimed that the Center had exceeded its mandate to treat victims and entered the realm of advocacy with its well-researched reports. At a subsequent press conference, Center director Aida Seif al-Dawla was defiant: “We will be at the center every day during work hours until they come and close it down. As long as they keep torturing, the reports will continue to be issued. The only way those reports will not be issued is if they stop practicing torture.”

On February 22, Hossam Bahgat, perhaps the country’s leading investigative journalist, was barred from traveling to a UN conference in Jordan on justice in the Arab world. Bahgat had been summoned and detained by military intelligence in November, because of an article he had published about the secret conviction of 26 army officers on charges of conspiring to oust Sisi. [5] But he had been allowed to leave Egypt twice since that time, so the ban came as a surprise. He joins a growing no-fly list that includes human rights activist Gamal Eid.

The crackdown extends to the arts. On February 20, a Cairo court sentenced novelist Ahmad Naji to two years in prison for offending “public morality” because his latest offering, Istikhdam al-Hayat (The Use of Life), features scenes of sex and drug use. [6] The case was particularly egregious: Naji was acquitted in a lower court and the draconian sentence was imposed after the prosecutor appealed. The novelist’s jailing provoked outrage from many corners in civil society, and even Sisi’s culture minister, Hilmi al-Namnam, attended a solidarity press conference. [7]

Some of these cases may be resolved as the criticism is dampened. Yet only a fool would be unfazed by the frequency of the travesties of justice. As one journalist said, rattling off the previous week’s litany of bad news, “You don’t get over one tragedy, and then another one happens.” His list of incidents sounded like the week of Darbaka, Naji, Nadeem and Bahgat, only with different names and details.

Spaces of Erasure and Surveillance

The spirit of 2011 is no longer audible in chants resounding from Tahrir Square or visible in graffiti covering the walls downtown. For a time after the uprising, the torched headquarters of Mubarak’s National Democratic Party was left standing—a reminder of people power. It has now been demolished. On Qasr al-‘Ayni Street, the main artery leading south from the iconic plaza, a steel gate painted like an Egyptian flag opens and shuts to regulate access. As one researcher told me, “That whole area was closed because that is where the dissent used to gather.”

Whoever gives such sweeping orders has emptied downtown Cairo of much of its leisure activity, as well. The coffee shops no longer bustle on the pedestrian mall near the stock exchange, and art galleries have been closed. A pair of Egyptian journalists agreed, “Oh, we never go downtown anymore. There is too much security and no one wants to have a run-in.”

Indeed, the area is crawling with police, both men in uniform and plainclothes officers who blend in to the crowd. Closed-circuit video cameras protrude from balcony after balcony. Blast walls encircle government buildings such as the Foreign Ministry, the Central Bank, the Court of Cassations and Parliament. The effect is that state security agencies seem to be everywhere and nowhere at the same time. Local journalists regard it as “crazy” to snap pictures downtown.

The security presence might be even heavier in Garden City, southeast of Tahrir Square along the Nile, which is home to the US, British, Canadian and Italian embassies, among others. The Italian mission was busy in February between the press attention to the murder of researcher Giulio Regeni (almost certainly by secret police) and the deal cut by Italian energy conglomerate Eni to develop the “supergiant” natural gas field off Egypt’s Mediterranean shore. Blast walls surround many embassies as well.

Two organizations the government dislikes—the Egyptian Initiative for Personal Rights and the independent newspaper Mada Masr—are also located in Garden City. Both are churning out hard-hitting research and reporting, in both Arabic and English, and both receive regular, thinly veiled threats from anonymous security officers. “They call and say, ‘We know about your personal life. We know you don’t mean to ruin the reputation of the country.’ Stuff like that,” says one contact. Mada Masr is moving into new offices elsewhere in an effort to step away from the glare.

The swanky island district of Zamalek feels less closely watched. Egyptians mingle more freely with foreigners there, and speaking a foreign language arouses less suspicion. The island has its own unnerving sights, such as convoys of black Jeep Wranglers bearing heavily armed paramilitaries in gray-and-black camouflage and, sometimes, black masks. The jeeps are adorned with a decal that reads the People’s Police (shurtat al-sha`b).” But no one can remember when this new force appeared and few seem overly concerned. As one journalist said, “I don’t even notice them anymore. I think they are mostly performative. They do a lot of driving around at night and pointing their guns—only in upper-class neighborhoods, though.” Another reporter concurred, “It is plainclothes security that comes to your house and arrests you at 4 am. They are the ones that carry out the disappearances.”

An Isolated Economic Empire

Besides trepidation about the aggression of the security agencies, the common refrain in Cairo is worry about the economy. The country’s reserves of foreign currency are sloughing away. Purchasing dollars is almost impossible, even at the airport, which angers Egyptians still permitted to travel outside the country. The official exchange rate is 7.6 Egyptian pounds to the dollar, and the black market pays 9.5 to 1. [8] Everyone expects another devaluation of the pound, which will produce inflation and strain the household budgets of the majority even further. A significant devaluation would cause the pension system to collapse.

The military, despite its vaunted economic empire, may not be able to keep the wolf at its own door, let alone Egypt’s. After Mubarak was overthrown, the army strove to enshrine its interests in the constitution and various laws, for instance shielding its budget from parliamentary oversight. But these moves did not give the army access to even greater wealth. “They now subsidize the treasury,” says one analyst, “not the other way around.” In December 2011 the Defense Ministry donated $1 billion to the Central Bank. [9] Military, Inc. is also said to be paying the subsidies on the population’s electricity bills. Such actions send a message to foreign capital that the economy is at risk.

The analyst continues, “Sure, the military gained influence, but they are paying for a civil bureaucracy that cannot be counted on politically. They cannot reform the bureaucracy, so they pay them, while also spending money for development and investment opportunities. It’s lose-lose. It’s a Greek tragedy that is not sustainable.” 

The dilemma is not a new one for Egypt’s rulers. Around the time of the 2011 uprising, political economist Samer Soliman published a study of the deterioration of the Egyptian state’s fiscal health over the course of Mubarak’s 30-year presidency. [10] As rents like foreign aid and Suez Canal transit fees shrank as a percentage of the economy, the state had less revenue to work with. The state reduced social expenditures to prevent foreign debt from spiraling upward. Yet, alongside the cuts, the civil service burgeoned to more than 5 million employees, and no one dared to touch the most important subsidies on gas and electricity. This tepid neoliberalism made the state a liar in two senses of the word: It was not cutting fast enough to please the international financial institutions, but it was cutting more than enough to spark popular discontent. It was neither a command economy nor neoliberalism that led Egypt to erupt in protest in the late Mubarak years. It was the state’s schizophrenic attempt to maintain both systems at once.

Quality of life and purchasing power eroded throughout Mubarak’s tenure. Hundreds of thousands of families suffered tremendous hardship, particularly those dependent on wages in stagnant state sectors like the civil service and industry, as well as those running small businesses. The population started to rebel. The state had no systemic response but to double down on repression.

Yet the more money Mubarak funneled into the Interior Ministry, the less was available for affordable housing, hospitals, schools, universities, public transportation and recreational space, all of which crucial infrastructure slipped into unusable condition. Households stretched their fixed incomes to accommodate rising food costs, private tutors and clinic visits. Savings vanished, and millions were thrown into the informal economy to earn a little extra cash. Luxury housing developments served a tiny fraction of the population while everyone else worked two or more jobs just to get by.

Military, Inc. was relatively protected from both the economic malaise and the public anger about it. Everyone knew the military had its perks but they were mostly hidden from view. Then the coup thrust Sisi and the generals into the spotlight. It is lonely at the top: Sisi has no party patronage machine like Mubarak did. But he does have to contend with the same assertive public sector, which is now larger than any time since 1952. By the calculations of the Central Agency for Regulation and Administration, the state employed 5.6 million workers in 2010. According to media reports, another 900,000 employees have been added to the rolls since the uprising. [11]

One of Sisi’s first gambits was to issue a presidential decree (there was no parliament when he took office) altering the civil service payment system. Previously, 80 percent of pay was made up of bonuses awarded by seniority and the rest was fixed salary. The edict switched the percentages, tied bonuses to performance and capped their size. The civil service unions objected that the changes amounted to pay cuts. In January, a new parliament was seated and charged with passing all of Sisi’s 342 decrees into permanent law. The assembly was widely expected to have a wet noodle for a spine, and indeed approved most of the executive orders, but MPs struck down the civil service decree by a count of 332 to 150, with seven abstentions. According to the Finance Ministry, the public-sector wage bill rose by 8.4 percent from July to December 2015, even with the decree in effect. [12]

Sisi thus confronts the same catch-22 as Mubarak did. As one academic put it, “The reproduction of the post-independence state is the trap. If you do nothing and let it continue, the fiscal crisis undermines the state. If you liberalize the economy, you undermine the state. Instead, it’s a bloated civil service, new and more police, and piecemeal cuts that produce protests.” Indeed, in the first week of March a wave of strikes, mostly by public-sector workers upset about stagnant wages, rolled across the country. [13]

Meanwhile, there is friction between the military and big business, almost the only Egyptians to prosper under Mubarak. After the uprising, Military, Inc. might have expected to profit from the exile of select Mubarak cronies and the prosecution of others. Yet when the army took over the state, problems started.

There is evidence that Military, Inc. is pursuing two contradictory policies. First, as political economist Abdel-Fattah Barayez has shown, the armed forces are reaching out to civilian big business to pursue the grand national prestige projects over which Sisi presides. [14] To help excavate the New Suez Canal, for example, they contracted with more than 70 private companies, including Orascom, owned by the super-rich Sawiris family. Given that Sisi gave the New Suez Canal to Military, Inc., these contracts are effectively subsidies to private capital that diminish the army’s own profits. In other cases, the military subsidized the civilian state. In 2014, to build 1 million housing units, the military was to provide the Emirati corporation Arabtec with land at no cost in exchange for that company’s agreement to hire Egyptian labor and buy Egyptian materials. Arabtec apparently balked, so the military turned the project over to the Housing Ministry, which brought the Emirati company back on board. A similar sequence of events occurred with a military deal with General Electric to build 12 turbines to generate power. The military paid GE an enormous advance, some 25 percent of the contract’s value, and then gave project management to the Electricity Ministry. The generals, Barayez argues, are putting political goals ahead of economic ones. “The military is gradually abandoning its long-standing role as a partner to the ruling establishment,” he writes. “Instead, it is becoming an active participant in the construction of a new authoritarian order.” These moves are also attempts to build an alliance with Egypt’s private business class.

At the same time, however, Military, Inc. is trying to expand its commercial ties at the expense of big business. Before the 2011 uprising, the armed forces sold plots of land to Egyptian tycoons at below market rates. The businessmen then partnered with foreign investors to build high-end housing and tourist villages. Foreign capital came into Egypt through big business. Now the military is overseeing groups like the National Service Project Organization and the Armed Forces Land Project Authority to cultivate foreign capital directly.

This development is stoking animosity between the military and business elites but also fusing state power and wealth. As one analyst argued, “This is reconfiguring all the crony networks. The same people that allocate the land are now directly profiting. They become more powerful, are armed and have resources.” The tensions surfaced the November 2015 freezing of press mogul Salah Diab’s assets on charges of appropriating state land. [15] They are also visible in the anemic performance of the Long Live Egypt fund, a presidentially supervised charity that Sisi hoped would attract billions of pounds in citizen donations. Despite the thicket of billboards that advertise upscale residences across the capital, it is not business as usual. The military’s economic empire is powerful but, ironically, it is more isolated now that it is more fully integrated into the state.

Sisi the Magician?

In private, or out of earshot of the lone informer sitting in the corner, nearly every Egyptian observer says that neither the political system nor the economy is working. No one uses the word “stability,” unlike under Mubarak, when many gave it lip service though most thought it was an illusion. No one defends Sisi or his policies, though charitable sorts might say, “It’s not him. It’s his people”—the Interior Ministry, army, parliamentarians, judges and media personalities. If Sisi had a honeymoon with Egyptians, it is clearly over.

It is one thing to dictate outcomes behind the scenes and another thing to govern, in the open, with constituencies that one has to appease. In just five short years, the military’s private economic empire has transformed into a new domestic subsidizer of the state. Pencil-pushing bureaucrats, sweaty laborers and fed-up consumers, as well as rehabilitated crony capitalists of the Mubarak era, are bringing Military, Inc. and its public faces to heel.

While the dust settles in this multi-sided melee, the only certainty is more protest, whereby ordinary Egyptians try to preserve their bare-bones prerogatives in a capricious system that will arrest and torture anyone who does not have several layers of protection. If Sisi survives to fashion a regime as falsely stable as what reigned in the bad old days of Mubarak, he will be a magician. At present, he resembles a quasi-comical warm-up act, albeit one with an army, while everyone awaits the next chapter of Egypt’s tumultuous story.

Author’s Note: This article is dedicated to the memory of Giulio Regeni.

Endnotes

[1] Markaz al-Nadim lil-‘Ilaj wa al-Ta’hil al-Nafsi li-Dahaya al-‘Unf wa al-Ta‘dhib, Hisad al-Qahr fi ‘Am 2015 (Cairo, January 2016).
[2] Amy Austin Holmes and Hussein Baoumi, “Egypt’s Protests by the Numbers,” Sada, January 29, 2016.
[3] New York Times, December 3, 2015.
[4] Amira Howeidy, “Matariyya, Egypt’s New Theater of Dissent,” Middle East Report Online, June 4, 2015.
[5] Hossam Bahgat, “A Coup Busted?” Mada Masr, October 14, 2015.
[6] See Ursula Lindsey, “Cairo: A Museum of Ghosts,” The Nation, March 21, 2016.
[7] Mada Masr, February 25, 2016.
[8] Reuters, March 3, 2016.
[9] New York Times, December 28, 2011.
[10] Samer Soliman, The Autumn of Dictatorship: Fiscal Crisis and Political Change in Egypt Under Mubarak (Stanford, CA: Stanford University Press, 2011).
[11] Ashraf Hussein, “Do We Really Have Big Government?” Mada Masr, September 10, 2015.
[12] Mada Masr, March 7, 2016.
[13] Mada Masr, March 8, 2016.
[14] Abdel-Fattah Barayez, “More Than Money on Their Minds: The Generals and the Economy in Egypt Revisited,” Jadaliyya, July 2, 2015.
[15] Mada Masr, November 7, 2015.

Images: The steel gates on Qasr al-‘Ayni Street; empty cafes near the stock market. (Joshua Stacher)

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