The Political Economy of the Egyptian Uprising :: Monthly Review

The Political Economy of the Egyptian Uprising | Stephen Maher (Monthly Review)
►http://monthlyreview.org/2011/11/01/the-political-economy-of-the-egyptian-uprising

Not long after Egyptian Vice President Omar Suleiman announced that Hosni Mubarak would resign his post as President, U.S. Secretary of State Hillary Clinton flew to Egypt to congratulate the Egyptian people on a job well done. The revolutionaries had accomplished their goal, she said. Everyone could go home and feel proud of their historic achievement and leave the cleaning up to the responsible adults—the United States and the closely allied Egyptian military, which has ruled Egypt since 1952. To prove that there were no hard feelings against the Egyptians for overthrowing one of the closest and most important U.S. allies in the Arab world, the IMF, World Bank, the G8, and the United States itself—the very entities responsible for supporting Mubarak’s thirty-year rule and imposing draconian neoliberal programs on Egypt—have extended as much as $15 billion in aid and credit to Egypt and Tunisia to assist in their transitions to democracy. This generosity begs the question: why are Western governments, and the international financial institutions (IFIs) that are closely linked to them, falling over one another to show their generosity to the revolutionaries and to display their support for progress in the Middle East? Source: Monthly (...)

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►http://monthlyreview.org/2011/11/01/the-political-economy-of-the-egyptian-uprising

There was considerable economic growth in Egypt under Mubarak. Gross Domestic Product (GDP) per capita rose about fourfold between 1981 and 2006 (in purchasing power parity terms, which is a method of comparing economic activity among countries by keeping the current currency exchange rates among the countries constant). However, this growth was accompanied by rising inequality that “reached levels not before seen in Egypt’s modern history” by the time of Mubarak’s resignation.2 Despite increases in production and wealth, real wages did not rise in tandem, and in many cases actually declined. Egypt’s minimum wage, for instance, has remained unchanged for twenty-six years in the face of increased productivity and significant inflation, particularly in the price of wage goods. Most workers work long hours (according to the ILO, the average Egyptian works forty-eight hours per week) and earn a wage that will not pay for basic necessities. It is not uncommon for employers to simply not pay their employees at all. In short, the neoliberal programs served to consolidate the power of Egypt’s ruling class and concentrate the country’s vast new wealth in the hands of the richest, who gained an increasing portion of a rapidly growing pie while the lower classes saw their share decline (see Charts 1 and 2 for details).