The Re/volution/gime Continues: Footnotes to the Winter of Discontent

By: Tor Håkon Tordhol.

This fall, the political development in Egypt is mostly the hardening battle lines between the Muslim Brothers with allies, and a multifaceted opposition slowly coalescing against the powers that be. And so, the revolution continues – sort of. And the current stalemate was not solved by the referendum, though it might have given President Morsi and the Muslim Brotherhood some respite. Underneath it all though, as footnotes to a text, other projects and developments are underway equally indicative of what might come to pass in the next year(s).

Egyptians still encounter the state every day, but less in the political arena than in a variety of different microspaces, be they schools, hospitals, courts, state bureaucracies, the police, electricity and gas and even food distribution centres. These everyday encounters generate much of the resentment and frustration that the revolution voiced, since these services are found wanting more often than not. More importantly (but not unexpectedly) little has changed. President Morsi addressed such problems in his first 100 days, but he has by and large failed to solve them. And since then, the president has directed his attention elsewhere. Of course, a valid point is that most of the many different problems Morsi sought to solve cannot be solved in a hundred days (nor in four years). However, citizens were expecting improvement and Morsi claimed he could deliver – a testament to his and his circles’ initial optimism, which was soon followed by frustration and disillusionment.

One of the prime obstacles facing them is the passive malevolence or sometimes even active opposition of old regime cronies in many key positions. This, however, is aided and abetted by general structural shortcomings in the state apparatus. Take the issue of farmers, for example. In his early days, the president promised the forgiveness of debts less than 10 000 Egyptian pounds to the Bank of Development and Agricultural Credit (BDAC). A promise he repeated in his speech on the cid al-fellahin in September, explicitly denying reports that only non-performing loan would be forgiven. And, for good measure, he included at the end of that speech a word of warning to the bank employees, telling them not to manipulate his decisions.

This particular decree had of significant symbolism to it, not lost to the farmers. To them, perpetual indebtedness is one of the most important factors generating rural poverty under the current system. So improving the lot of farmers could potentially generate both support among the largest Egyptian voting block, while also represent the regime as defenders of the interests of the peasantry, a symbolic position still occupied by Gamal Abdel Nasser and his revolution of 1952. However, farmers quickly discovered that no change was forthcoming. In stead they learned that in fact only non-performing loans were being cancelled. Now, there are several possible reasons for this particular non-delivery of Morsi’s promise, not one of which was insincerity on his part. First there is the issue of the bank itself, which is being run as a commercial bank, charging nominal interest rates of 6 and 14 percent on agricultural loans and investment loans respectively (though sometimes even closer to 20 percent). The fact of BDAC’s commercialisation since the 1970s means than losses incurred have to be covered by earnings somewhere else. Especially when, as the case was, the funds allocated by the government were not sufficient, covering only some 75 000 farmers’ debts. This made the failure of the initiative all but certain. Furthermore, the cancellation of investment loan debts has been omitted leaving the president’s promise to cover only agricultural loans and making his promise nothing but empty. Farmers have confirmed this as well.

The fate of this initiative thus mirrors the fate of an equally ill-fated yet even shorter-lived promise of debt relief made by former Prime Minister Ganzoury a year ago. As such, it continues the policies of the Mubarak regime of empty promises towards the small farmers, all the while legislation and public policy favours the big landowners often with intimate ties to the regime. This reveals both a self-interested bureaucracy generating adverse effects on implementation, and even more a structural condition in which said bureaucracy are incapable of fixing the problems for which they are responsible.

To take the former point first: Morsi’s caution not to ‘manipulate’ his decision cannot be understood save as an outright warning to old regime or oppositional elements within the bank. As such, it resonates with the wider strategy of the Morsi presidency, either to try and co-opt the willing elements of the bureaucracy or going to ‘war’ on the recalcitrant ones. Several observers, e.g. Hesham Sallam, have made more than a mention of the uneasy alliance between the Muslim Brothers and Morsi and the Egyptian ‘deep state:’ the entrenched interests residing in the military and security establishments. Though they have often cooperated, they have nevertheless refrained from jumping squarely on the MB-bandwagon. Other sectors are even less enticed: as e.g. the judges and lawyers have proved time and again being only too happy to oppose the current president. And the MB in turn takes no prisoners, as is evident with their handling of another bureaucratically based opposition: the courts. Issandr El-Amrani looks at how even the newly adopted constitution has tailored the text specifically in order to remove certain individuals from the High Constitutional Court. So is the current end to the saga of the former General Prosecutor Abd al-Majid Mahmud. After his failed (or foiled) attempt to dismiss the unpopular GP from office, he simply changed the rules (in the constitutional declaration) to succeed the second time around. None of the other factions shared any great love for Abd al-Majid Mahmud. Rather than finding a consensus candidate to replace him, however, Morsi appointed ostensibly his own man to the post provoking ever more enmity among other parts of the judiciary ending with the new general prosecutor tending his resignation. This willingness to go it alone does not bode well for future consensus politics.

Another example here is decree no. 97 of 2012 on trade union elections passed only hours after Morsi’s constitutional declaration, which postpones elections within the trade union while at the same time removing all board members over 60 (meaning in practice Mubarak era officials) so they may be replaced by people appointed by the Minister of Manpower, MB-member Khalid al-Azhari. On the face of it, it might seem democratic to remove the fulul: the old regime cronies. The process here though, where a government interferes and appoints the new leadership of Egypt’s trade union federations, exhibits exactly the same authoritarian traits as l’ancien regime. And while Morsi’s warning to the BDAC-functionaries reveals his lack of control, it also reveals that the president and his men are aware and convinced that non-implementation is due to a subversive bureaucracy.

However, what may often appear to be the workings of an active oppositional bureaucracy may well be the effect of structural incoherence in stead. I have previously written about Morsi’s scramble for cash abroad, part of which is a requested IMF-loan, the negotiation for which nears completion. The willingness to borrow there is an indication of the acceptance of neoliberal economic system within the MB and the presidency, as is the new constitution. However, the unquestioned acceptance of neoliberal economics renders them unable to question the instances where the structures themselves are betraying the president’s promises rather than some politicised bureaucrats. Again the promise of debt cancellation serves as example: whereas Nasser not soon after his revolution (six weeks) enacted the land reform law to redistribute land from big landowners to the landless and giving tenant farmers security of tenancy, Morsi’s merely sought to ease the debt burden. Nasser’s measure in effect changed the agricultural ownership system and thereby the economic and social condition of Egyptian farmers. Morsi’s initiative falls well short of such aspirations for systemic alteration, being wholly wedded to the current free market system that governs Egyptian agriculture. The proposed debt relief seeks only to alleviate the victims from some of the system’s most adverse effects, not to reform it. The BDAC with its effective interest rates approaching 20 percent, has long since seized to be a tool for agricultural development, leaving it to be just another profit- seeking bank, and thus an integral part of the problem of farmers’ indebtedness. Hence, it raises questions as to whether the BDAC can ever be part of a solution. In other words, the economic structure that produced the conundrum is allowed to continue, and rendering probable the reproduction of the same situation even if the debts should be cancelled. The implications are that policy failure is blamed on intransigent members of the state apparatus, and not instigating a critical examination of the way that very same apparatus structurally produces poverty and disenfranchisement. And so the regime continues.