[Marxism] Out with Mubarak, in with Marx?
lnp3 at panix.com
Fri Aug 19 12:58:12 MDT 2011
Out with Mubarak, in with Marx?
Hosni Mubarak's extreme capitalism demonstrably failed Egypt. Now
social justice is on the mainstream agenda
by Austin Mackell
A defaced image of former Egyptian president Hosni Mubarak
Egyptian protesters hold a defaced photo of former president Hosni
Mubarak during his trial in Cairo, on 15 August 2011. Photograph:
In a recent TV discussion, Hossam el-Hamalawy, the prominent
Egyptian leftist blogger, was asked: "So you're the president of
Egypt. You wake up, what's the first thing you're going to do to
reorient the economy?"
Hamalawy's answer was admirably concrete: raise the minimum wage
to 1,200 Egyptian pounds ($198) per month, set a wage ceiling of
15,000 pounds ($2,480), renationalise the corruptly privatised
factories, cut military spending and redirect those funds to
health and education.
That a Marxist should suggest such steps is not surprising, but in
Egypt they have now entered the mainstream. Neoliberal economic
policies were thoroughly tried under the Mubarak regime, and
In 2008 the World Bank named Egypt as its "top reformer".
Mubarak's adherence to the Washington Consensus strategies,
however, delivered prosperity only for the already affluent elite.
Meanwhile, the quality of life for the rest of the country
deteriorated. This has not been lost on Egyptians.
In a recent conversation, Ahmed Attiya, a journalist for the
Egyptian daily al-Shorouk – who describes his own politics as
centre-right – put it to me that "even the conservative liberals
nowadays support income taxes and minimum wages", adding that
"social justice measures are on the agenda of every Egyptian party
I have heard of".
Even the interim cabinet seems to get it. In March, as part his
first TV address as interim prime minister, Essam Sharaf affirmed
social justice, along with freedom and democracy, as one of the
main principles of the revolution. These words have been
accompanied by at least some action – one example being tentative
moves to reform Egypt's regressive income tax.
The old system (typical of tax policy in the region) was basically
flat, with a top rate of 20%. This put an unfair burden on
society's lower ranks and allowed those at the top to accumulate
massive fortunes. These fortunes in turn drove rampant inflation
which, combined with a 10% sales tax, put an ever-increasing
strain on the spending power of the poor. Meanwhile, the public
health and education systems fell apart.
The changes made so far are small – the tax-free threshold has
been lifted slightly and the top rate raised to 25% – but they are
an indication that Egypt's political class know which way they are
supposed to be moving.
Perhaps a more significant indicator than the small steps taken on
tax is the interim cabinet's decision to turn down a new round of
unpopular and potentially devastating loans from the IMF. This
decision will give the new government more freedom to chart its
own economic course.
Of course the fight is not won yet. Less high-profile deals with
western financial institutions such as the European Bank for
Reconstruction and Development are still on the cards and have
similar strings attached.
There are well-off enemies of social justice within Egypt, too,
and they seem to have an ally in the Supreme Council of the Armed
Forces, which has banned strikes and sit-ins along with protests.
Their objections, however, are generally based less on principle
than issues of practicality: that businesses, for example, can't
agree to new wage structures now, amid such political uncertainty.
Market fundamentalism has no traction here any more and no new
government will be able to hide behind experts that advocate it.
The government will have to be seen to be acting directly to ease
the population's suffering and re-levelling a very slanted playing
From the beginning, the class-based economic elements of this
revolution have been undeniable to those paying attention. The
"April 6" Facebook group which triggered the uprising in January
had itself been inspired by the textile workers of Mahalla whose
strike had been part of an ongoing rolling wave of industrial
action across the country involving more than a million workers –
a story the mainstream media has studiously ignored.
On the odd occasion that the unpopularity of Mubarak's neoliberal
programme is mentioned now, it is with a tone of tutting
condescension. Back in February, for instance, a Reuters business
commentary on Egypt and other North African countries noted the
"bitter irony" that:
"Citizens of the countries in question would be financially
better off if their governments don't stray too far from the
economic policies they have pursued in the past. But the toppling
of unpopular regimes will make it difficult for their successors
to adopt the same policies."
What the article did not consider was that it might be the other
way round – and that Mubarak's extreme capitalist policies could
have contributed to his unpopularity.
Such an analysis implies that the Egyptian people are so blinded
by their hatred of the dictator that they don't know what's good
for them. It relies on the assumption that the answer to such
questions has been settled in favour of the Friedmanite policies
that have been ascendant in the halls of power through the last
few decades. Events in Egypt – and indeed around the world –
should give those still indulging in such hubris pause for thought.
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