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3/8/11

The Revolution In Egypt & Neoliberalism

"Neoliberalism describes a market-driven approach to economic and social policy based on neoclassical theories of economics that stresses the efficiency of private enterprise, liberalized trade and relatively open markets, and therefore seeks to maximize the role of the private sector in determining the political and economic priorities of the state." More

The Egyptian public is curiously silent about the wealth amassed by army generals. Instead, the aim is to freeze the billions in public assets stolen by government officials, Hosni Mubarak included. What seems to go unnoticed is the role of neoliberalism in creating the division between haves and have-nots.

The generals, of course, are only too willing to have the blame deflected from them. There is a reason for this. They and their army are depended upon to oversee the engines of change. Scoundrels they may be, but they provide the only means to regime change. The means, in this case, are seen as justifying the end.

But theirs is only one part of the role in a corrupted Egyptian government. Not only that, "calling it corruption suggests that the problem is aberrations from a system that would otherwise function smoothly."

The real culprit, according to some, is neoliberalism. Mubarak and his cronies "were enriched through a conflation of politics and business under the guise of privatization. This was less a violation of the system than business as usual. Mubarak’s Egypt, in a nutshell, was a quintessential neoliberal state."

In his Brief History of Neoliberalism, David Harvey describes "a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterised by strong private property rights, free markets, and free trade."

If markets don't exist, then the state should create them. Often by privatizing public functions such as "water, education, health care, social security, or environmental pollution."

In neoliberal doctrine, markets are sanctified. "All human behavior, and not just the production of goods and services, can be reduced to market transactions."

So, against the Marxist utopia of communism, we have the neoliberal utopia of markets.


"Mubarak’s Egypt was considered to be at the forefront of instituting neoliberal policies in the Middle East (not un-coincidentally, so was Ben Ali’s Tunisia) . . ."

There is neoliberalism in theory and neoliberalism in practice. Utopia in theory and utopia in practice.

"The only people for whom Egyptian neoliberalism worked 'by the book' were the most vulnerable members of society, and their experience with neoliberalism was not a pretty picture. Organised labor was fiercely suppressed. The public education and the health care systems were gutted by a combination of neglect and privatization. Much of the population suffered stagnant or falling wages relative to inflation. . . ."

Neoliberalism in practice seeks to shrink the public sector in favor of privatization. That did not happen. "Privatization provided windfalls for politically well-connected individuals who could purchase state-owned assets for much less than their market value, or monopolise rents from such diverse sources as tourism and foreign aid. . . ."

This experience was not unique to Egypt. "Everywhere neoliberalism has been tried, the results are similar: living up to the utopian ideal is impossible; formal measures of economic activity mask huge disparities in the fortunes of the rich and poor; elites become 'masters of the universe,' using force to defend their prerogatives, and manipulating the economy to their advantage, but never living in anything resembling the heavily marketised worlds that are imposed on the poor."

Not unique to Egypt. "For example, the vast fortunes of Bush era cabinet members Donald Rumsfeld and Dick Cheney, through their involvement with companies like Halliburton and Gilead Sciences, are the product of a political system that allows them — more or less legally — to have one foot planted in 'business' and another in 'government' to the point that the distinction between them becomes blurred. Politicians move from the office to the boardroom to the lobbying organization and back again. . . ."

So what about the generals in Egypt? Their army is to preside over change for the people. " . . . it is almost unthinkable that the generals of the Supreme Military Council will willingly allow more than cosmetic changes in the political economy of Egypt. . . ." More
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David Harvey (born 1935) in A Brief History of Neoliberalism (2005) "provides a historical examination of the theory and divergent practices of neoliberalism since the mid-1970s. This work conceptualizes the neoliberalized global political economy as a system that benefits few at the expense of many, and which has resulted in the (re)creation of class distinction through what Harvey calls 'accumulation by dispossession'. More

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