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Egypt: The "Coup Was Actually Liberal..."

The Buzz

Over the last few years, Egypt has become an object lesson in how narrow interests, greed, and politics can quickly undo noble ideas and aspirations. The time since former President Hosni Mubarak’s departure has been a period of political cynicism, unprecedented violence, and economic dislocation. Yet for all the troubles bearing down on Egyptians, there are many who believe that the country’s trajectory is positive. This is not just elites grateful that the military intervention of July 2013 has restored the old—in their minds, natural—political order, but widespread optimism. Treat the polling with caution, but they demonstrate an overwhelming amount of support for President Abdel Fattah al-Sisi. Friends in Cairo insist that “as much as 80 percent of the population” supports the new program and believe that Egypt’s new leader has set the country on a proper course. If that is the case, then why do Egyptians seem so furious?

Among the most angry is that group of people invariably described in Western accounts as “secular, liberal, and politically active.” There is no doubt that there are those who seem to benefit in some way (financial? political?) from their ostentatious anger while others have become deranged in their fury. For example, Tarek Heggy—a self-styled intellectual who once sought speaking engagements at Washington think tanks, universities, libraries, and other places that helped cultivate his image as a man of letters—recently wrote: “They [Americans] are ruthless and brutal criminals that [sic] deserve a 9th September, 2001 [sic] EVERY SINGLE DAY [caps original].” Heggy is, of course, one end of an extreme and few people ever took him seriously to begin with. There are also Egyptians who are anti-Muslim Brotherhood and anti-coup. Still, in between those people and Heggy, there is a significant number of Egyptians who were eloquent and tenacious advocates for progressive political change during the Mubarak era, but have now become among the most ardent defenders of the July 3 coup, supporters of the new old order under President Sisi, and enthusiasts for dismantling the Muslim Brotherhood, official excesses and all. How did this happen?

Let’s acknowledge that Western analysts—including this one—have been less interested in understanding why people might be anti-Mubarak but pro-Sisi than in dismissing them as faux liberals. We have all come to believe in the alleged axiom of Egyptian politics: Faced with a choice between democratically elected Islamists and the authoritarianism of the military, the liberals will choose the officers, revealing themselves to be not so liberal after all. That seems self-evident, but liberal supporters of the post-July 2013 political process argue that the coup and their support for it were actually quintessentially liberal. To them, the military’s intervention precluded Egypt’s slide into a new authoritarianism of a particular religious bent from which there could be no hope for the survival of liberalism. These folks also make the case that their (mostly Western) critics mistakenly fuse liberal principles and democracy, failing to recognize that democracy can bring about both its own demise as well as that of liberalism. Moreover, the first concern of many of those Egyptian intellectuals who opposed Mubarak but support Sisi is preserving and advancing liberal ideals, which is more important—for now—than the ballot box. It’s an interesting and informed argument, steeped as it is in John Locke. Yet the argument seems like a leap of faith. It is hard to imagine that as Egypt’s authorities go about re-engineering the political institutions of the state to ensure that something like the January 25 uprising never happens again that they are simultaneously creating an environment where liberalism can not only be sustained, but also thrive.

The “coup was actually liberal” line of reasoning is an intellectualization of something else I have heard from numerous contacts. Some months ago, I was Skyping with an Egyptian friend when we stumbled into a discussion of the contradictions of the pro-Sisi liberals. I asked her how one could be an eloquent defender of human rights for herself and others like her, but not for those who happen to have a different view of the world. In an honest, but also enigmatic moment, she declared, “Steven, you have no idea what the year under Morsi did to us. It affected us deeply.” I pressed her, but she could not fully articulate what she meant. Of course she was furious over Morsi’s arrogance, authoritarianism, and incompetence as well as the post-coup violence, which she blamed squarely on the Brotherhood. All of this was perfectly understandable, but there was clearly more going on inside her head that she was not ready to explain.

During the summer of 2013, Egyptians argued that the conflict going on within their society was over Egypt’s identity. Liberals and others claim that in supporting the coup they were protecting Egypt’s polyglot, tolerant, outward looking, and cosmopolitan culture (it does not matter that these things are not necessarily true, just that the people believe they were defending these alleged attributes). What seems lost in all the fury directed at the Brotherhood at the time and ever since is the very fact that the Brothers were crucial actors in forging Egypt’s identity over the better part of the last century. The Brothers were not the only influential voices in Egypt, of course. Liberals, nationalists, Copts, and Nasserists shaped Egypt, but there was also an undoubtedly important role for the Brothers. They were critical in framing the way in which many Egyptians thought about everything from religion, culture, and education to the way Egypt related to the region and the world. When Mubarak fell, the Brothers offered a vision of society that, if the parliamentary elections of 2011 and 2012 are any indication, resonated deeply with many Egyptians. This is not to excuse the authoritarianism of the Brotherhood and Morsi’s disastrous year in office, but whether pro-Sisi liberals like it or even know it, the Brotherhood has had a profound impact on the way many Egyptians interpret their reality.

It may very well be that people are rejecting what the Brothers have been offering them in the last 86 years, but no one should deny the significance of the Brotherhood in forging Egyptian identity in the twentieth century. The way in which the regime and its supporters have essentially declared that the Brothers are not authentically Egyptian is a politically motivated misconception and misinterpretation of modern Egypt. Yet what remains to be explained is how a group of people who loathed Mubarak and hated Morsi have come to revere Sisi whose record demonstrates as little respect for democracy and liberalism as his predecessors. I remain respectfully stumped.

This piece first appeared in CFR’s From the Potomac to the Euphrates blog here.

Image: Wikicommons. 

TopicsSecurity RegionsEgypt

Hong Kong Protests: Tiananmen Square 2.0?

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Hong Kong is not Beijing, 2014 is not 1989, and Civic Square is not Tiananmen Square. Still, the images of tens of thousands of Hong Kong Chinese demonstrating in the streets for democratic reform cannot help but bring back memories of a quarter century ago. Like the 1989 Tiananmen Square demonstrations in Beijing, those in Hong Kong are spearheaded by extraordinarily passionate, articulate, and inspiring young leaders. Both movements include Chinese people from all walks of life. And both movements, while at heart represent a call for fuller democracy and more direct political participation, also engage issues of economic well-being and inequities within the system. Of course they are linked in other ways as well: had the 1989 Tiananmen protests turned out differently, there likely would be no need for the 2014 student boycott of their classes and more broadly based Occupy Central demonstrations in Hong Kong.

That the two sets of protests twenty-five years apart are not the same, of course, leaves open the hope that the demonstrations underway in Hong Kong will not result in the same violent suppression that befell those in Tiananmen. Hong Kong, unlike Beijing, has a strong recent history of large-scale peaceful demonstrations, and the protestors in Hong Kong include experienced politicians as well as passionate students and citizens. Students in Hong Kong have even received a degree of institutional support from at least one university, the University of Hong Kong, which stated in a letter that it “will be flexible and reasonable in understanding the actions of students and staff who wish to express their strongly held views.” Moreover, Hong Kong’s rule of law will likely afford greater protection to the demonstrators: in the midst of the protests, several student leaders were arrested and then released; in referring to one of them, a judge noted that seventeen-year-old Joshua Wong had already been held longer than was lawful and that there was insufficient cause to keep him further.

And yet the question remains: what are the next steps? While various groups within the larger protest movement in Hong Kong have slightly different lists of demands, the resignation of the unpopular Chief Executive Leung Chun-ying and the ability to vote for at least one candidate for chief executive not preselected by Beijing top most people’s lists. Given these reasonably straight-forward demands, Beijing has a number of options. It can: enforce a harsh crackdown in Hong Kong in the hopes that brutally suppressing the protestors will stave off further reform demonstrations; confine the protests to a small area of Hong Kong and hope that they run their course: eventually the students will return to school and the occupy central protestors will return to work; remove Chief Executive C.Y. Leung, who has been a weak and unpopular leader from the outset as a stopgap; or establish a committee including representatives of various Hong Kong political actors to consider the next stage of suffrage, post-2017. (It could also, of course, decide to grant the protestors their biggest demand—an open slate of candidates determined by universal suffrage for the 2017 election—but this seems well outside the realm of possibility.)

None of the options is likely very attractive to the Chinese leadership. All come with not insignificant political and economic costs. No doubt, the government wishes that the Hong Kong activists would simply concede, perhaps following the advice of Tsinghua University Professor Daniel Bell, who suggests that Hong Kong political activists are doing more harm than good. He notes, “The Hong Kong special administrative region is the most important experiment in political reform. But the system assumes that the central government has the ultimate power to determine what works and what doesn’t. If that power is threatened, the experiment may be put to an end. Hong Kong political activists who, willingly or not, harm the relation with Beijing also harm the chance for Hong Kong-style political reform in mainland China.” Of course, Dr. Bell may want to consider that Beijing has already had fifteen years to witness the success of the Hong Kong political experiment and has done nothing to emulate it on the mainland. It hardly seems reasonable to ask the Hong Kong people to keep their interests at bay in the hopes that mainland leaders might suddenly come to appreciate the value of universal suffrage.

There is no easy solution—the best outcome for now might be to test the waters by replacing C.Y. Leung not with a lackey of Beijing or a democracy activist but with a politician such as Anson Chan or Christine Loh, who have impeccable political credentials, as well as strong managerial experience. The next three years could then be a test case for what a more independent-minded Hong Kong leader might mean for the island’s relations with the mainland and provide guidance for further revisions to Beijing’s current limited conception of universal suffrage.

Hong Kong is not Beijing, and here is hoping that Beijing knows that too.

Editor's Note:This piece first appeared on CFR’s Asia Unbound blog here.

Image: Wikicommons. 

TopicsPolitics RegionsChina

President Abbas’ Speech to the UN: A Lost Opportunity

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Last week Palestinian President Mahmoud Abbas gave a controversial speech to the United Nations General Assembly.

Reactions have been strong. The U.S. State Department said “President Abbas’ speech today included offensive characterizations that were deeply disappointing and which we reject. Such provocative statements are counterproductive and undermine efforts to create a positive atmosphere and restore trust between the parties.” The Palestinians replied by saying the American comments are “irresponsible, indecent and rejected.” What did Abbas say?

Some highlights:

Israel has chosen to make it a year of a new war of genocide perpetrated against the Palestinian people….the occupying Power has chosen to defy the entire world by launching its war on Gaza….the third war waged by the racist occupying State in five years against Gaza….This last war against Gaza was a series of absolute war crimes….In the name of Palestine and its people, I affirm here today: we will not forget and we will not forgive, and we will not allow war criminals to escape punishment….Israel refuses to end its occupation of the State of Palestine since 1967, but rather seeks its continuation and entrenchment, and rejects the Palestinian state and refuses to find a just solution to the plight of the Palestine refugees….Israel has confirmed during the negotiations that it rejects making peace with its victims, the Palestinian people….It is impossible, and I repeat – it is impossible – to return to the cycle of negotiations that failed to deal with the substance of the matter and the fundamental question.

In that speech, Abbas said not one word of criticism of Hamas, nor did he acknowledge what is obvious: that Hamas started this war by its ceaseless bombardment of Israel with mortars and rockets. Presumably he decided that Palestinian domestic politics required him to avoid that truth and blame Israel for the conflict. Nevertheless, he always pays a price when making assertions that his listeners in the General Assembly hall know are not accurate. The accusation of genocide is particularly vile when thrown at Israel. The word has a meaning, and it is obviously absurd to claim that Israel’s actions in the Gaza war last summer were aimed at killing every Palestinian or a very large number of them or at eliminating the Palestinian people.

As to the negotiations, it’s worth recalling what U.S. negotiator Martin Indyk has recently said. Here is one account:

“We gave it everything we had, and we got nowhere,” Indyk said, laying the blame “50-50″ between Netanyahu and Abbas. Negotiations officially ended in April when Abbas opted to press for statehood through the United Nations rather than continue, a move that Israel had long said would be a deal-breaker. In recounting a nearly yearlong series of negotiations, Indyk said that both sides identified the agreement gaps early on and that Netanyahu eventually moved into “the zone of a possible agreement” on such thorny issues as the status of territories, Jerusalem, and mutual recognition of Israel’s and Palestine’s rights to exist. But during Abbas’s visit to Washington in March, he effectively “checked out” from the talks and stopped responding to proposals from the Obama administration on how to close a deal, Indyk said.

Abbas “shut down,” Indyk stated. Indyk spreads the blame to the Israelis and Palestinians both, but that of course was not what Abbas was doing.

Every head of government or head of state who addresses the General Assembly presents his own case, not that of critics or opponents, but when the speeches lose touch with facts and reality they do more harm than good. So it is with Abbas’s words, which have been firmly denounced and rejected not only by the U.S. Government and the Israeli government but perhaps more significantly by the Israeli left as well. This kind of language by Abbas weakens Israel’s “peace camp,” but Abbas does not seem to care. He is playing to a different set of audiences, including the many governments in the United Nations that would not recognize a serious, truthful speech if smacked in the face with it.

Perhaps his main audience is at home, but I wonder how much good it does him, and his Fatah Party, to give Hamas a pass. It is true that Hamas’s popularity rose during and after the war, but that was predictable and the question is where it’s heading now. Hamas promised that this war, and the destruction and death it caused, would be compensated by new and vastly better conditions after the war. But soon it will be getting colder and rainy in Gaza as winter arrives. Will there be a reconstruction bonanza? Will Israel and Egypt open the passages? Will construction begin on a seaport, much less on an airport? And when Gazans see that the answer is no, where will Hamas’s popularity then be?

Abbas’s frustrations must be great, especially after he heard President Obama say very little about the Israeli-Palestinian conflict other than to remark that it is simply not central. In his own address Obama said:

The situation in Iraq, Syria and Libya should cure anyone of the illusion that this conflict is the main source of problems in the region; for far too long, it has been used in part as a way to distract people from problems at home.

A speech that merely expresses anger and frustration is unlikely to help Abbas personally, his party, the Palestinian Authority, or Palestinians more generally. It was a lost opportunity–or perhaps more accurately, another lost opportunity. Perhaps the best description is the via the words his own spokesman used in attacking what the United States said: the Abbas speech was “irresponsible, indecent and rejected.”

This piece first appeared on the CFR Blog "Pressure Points" here

Image: Wikicommons. 

TopicsSecurity RegionsMiddle East

King of the World: Why the Almighty US Dollar Dominates

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Rumors of the dollar’s demise have been greatly exaggerated. Its status as the world’s reserve currency is not under siege. In many ways, it is under less pressure than it has been in quite some time. Most recently, the Yuan or RMB has been cited as a possible replacement. Before that, it was the Euro threatening to dethrone the dollar. And before the Euro, it was the Yen. Yet there never seems to be any real, tangible shift in the global trading system. With $3.8 trillion dollars held in reported reserves in 2013, the dollar remains the world’s reserve currency.

It is often tempting for economists to point out the most intriguing trends and predict the most extreme destruction and doom scenarios. Remember when the Japanese economy was set to overtake the US? Japan spent the next decade with GDP and price level growth of about 0 percent. Sometimes, it is difficult to state a continuation of the status quo.

The data on currency reserves is less than comprehensive. The IMF Currency Composition of Official Foreign Exchange Reserves (COFER) provides some level of detail but has a number of sources missing. (The report analyzes the currency composition of assets—so a US Treasury Bill denominated in dollars counts as dollars). But there are some interesting takeaways from the data. The US dollar constitutes 61 percent of all reported reserves. While this is certainly far from its peak of 72 percent in 2001, it is similar to the levels seen in the mid-90s. In 2013, the dataset covered 53 percent of official reserves—down from a peak of 79 percent in 1997. In other words, the data does not suggest an end to the dollar’s run as the predominant reserve currency. Granted, the 47 percent of reserves labeled “unallocated” could be hiding something, but it is unlikely they are hiding anything momentous.

It is worth understanding how the US dollar won the role of reserve currency in the first place. Though the exact timing is debated (and in this debate time is denominated in decades, not years), the best evidence—from Eichengreen and Flandreau—is that the dollar overtook the sterling somewhere in the mid-1920s, lost it briefly, and then regained it in 1929. The Great Depression saw the sterling regain its prominence only to lose its status again to the dollar soon after. France, the China of its day in terms of foreign currency reserves, largely tipped the scales towards dollar dominance.

There is no clean shift from one currency to another. In considering how the dollar could lose its reserve status someday, it is necessary to understand what the shifts look like. It is a slow process, typically accompanied by a crisis. We might reasonably ask why the Great Recession did not have more of an effect on the dollars dominance. The simple answer is that there is, at the moment, no viable alternative. The RMB is heavily manipulated, the Euro has the overhang of its possible dissolution hanging over it, and the Yen is impaired by the Bank of Japan’s relentless easing. Granted, the US Dollar has not performed ideally for a reserve currency, but no currency ever will.

It takes economic stability and the ability to hold value across time to seize and maintain the mantle of reserve currency. The era of quantitative easing could have brought the dollar’s durability as a store of value into question. But it didn’t. The US dollar lost value—but it was never at risk of dissolving. And the only currency with markets liquid enough to challenge the US dollar—the Euro—had deep, idiosyncratic issues of its own. In essence, there was no alternative to the dollar during the crisis, and there remains no alternative now.

Any potential replacement must have enough debt and a large enough economy and a liquid enough market to support it. After all, other countries need to place tremendous amounts of money into the currency—in 2013 official foreign exchange reserves reached just under $11.7 trillion. In other words, being a country with a strong economy and stable currency is not enough. It must have deep and reliable debt markets and be able to support tremendous amounts of asset purchases. The Euro is the only currency with a market of similar depth to the dollar. China does not have the open system necessary for the RMB to be a reserve currency, and would require significant liberalization of currency movements. It may be able to develop a deep market in RMB—we simply do not know. These are not steps China is keen on making while attempting to avoid a slowdown of its own economic growth.

At the moment, the US dollar looks like a far less risky bet than the currencies bandied about to be its replacement. At the moment the Euro is inept, and the RMB is incapable of taking the mantle. The dollar will lose its place as the hegemon of currencies at some point, but it should continue to dominate for the foreseeable future.

Image: Flickr/Creative Commons. 

TopicsEconomicsPolitics RegionsUnited States

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