The nexus of power and wealth in Mubarak‟s Egypt
Christopher Haynes14/5/12
“
People are naïve when they get the idea that we fix elections. Nothing of the
kind. It just comes down to the fact that we‟ve studied the Egyptian people well.
Our Lord created the Egyptians to accept government authority. No Egyptiancan go against his government. Some peoples are excitable and rebellious bynature, but the Egyptian keeps his head down his whole life long so he can eat. Itsays so in the history books. The Egyptians are the easiest people in the world torule. The moment you take power, they submit to you and grovel to you and youcan do what you want with them.
”
(Aswany, 84-5)
This quote from Kamal El Fouli, a corrupt politician from Alaa El Aswany‟s
the Yacoubian Building
, reveals not some fundamental truths about Egyptian culture, which proved him wrong
in January of 2011, but the contempt in which Egypt‟s
elites held the common man. The
Mubarak regime‟s monopoly on power came by generously rewarding the elites at the expense
of the majority. It presided over the tight interlacing of business and political interests thatcreated a small, very rich group of men who corruptly controlled political power and economicmarkets. It was a group in which businessmen and politicians became effectivelyindistinguishable, because political power and market control had themselves becomeindistinguishable.The protesters who rose up in January and February 2011 against the Mubarak regime cited thestate of the economy and corruption as among their main grievances. Many commentatorsblamed neoliberalism. Neoliberalism is a theory of political economy that favours individualentrepreneurial freedom through private property, free markets and free trade. The state shouldguarantee security and the rule of law, but not intervene in markets. (Harvey, 2) Hasneoliberalism worked this way in practice?
Developing countries have adopted (or had thrust upon them) neoliberal policies to a greater orlesser degree since the 1980s. The results of the past two decades have not been encouraging.Neoliberalism has not reduced state control over the economy. Instead, neoliberalism hasconcentrated wealth and given the coercive power of the state to those with the wealth. If Egyptis, as many claim, a sterling case of neoliberalism, neoliberalism leads not to a free market but toa state in which a tiny elite control the levers of the economy and enrich themselves in theprocess.Corruption may be simply defined as the abuse of state power for personal gain. It may meanwhen politicians, bureaucrats or police accept bribes, or when well-connected members of thepublic receive favours from cronies in power (nepotism or patronage/clientelism). This paper
argues that “corruption” insufficiently explains the nexus of business and political elites and their
effect on the Egyptian economy. There is no doubt the police and bureaucracy are corrupt:Transparency International ranks Egypt 112 out of 183 on its Corruption Perceptions Index.(Transparency) But that is not the focus of this paper. Bribery may place burdens on thoseseeking to start businesses or develop land, but they also supplement the incomes of low-rankingbureaucrats. Low-level corruption does not place the same stranglehold over an economy thatEgypt
‟s elites have.
The focus of this paper is the effects on privatisation; specifically, howprivatisation in Egypt concentrated wealth in the hands of a few insiders.The low capacity of the Egyptian state under Mubarak to provide services did not reduce itspower over the economy, or its ability to collect rent. Why was the state so weak? Let us firstconsider the argument that pre-revolution Egypt was a free-market economy gone wild.
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The nexus of power and wealth in Mubarak’s Egypt
How the Mubarak regime came to concentrate power and wealth in the hands of a tiny elite.
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