Masrzilla

January 25, 2011 may well go down in history as the zero-hour of a new geopolitical entity in the Middle East, the first true developmental state of the Arabic-speaking region: Masrzilla.

In many ways, Egypt's postcolonial history is a combination of post-WW II Latin America and postcolonial Southeastern Asia: a period of decolonization carried out by nationalist military officers, followed by the era of Nasser's firebrand pan-Arabism and the construction of an import-substitution economy -- a blend of Indonesia's Sukarno and Peron's Argentina, as it were.

However, while the Nasser regime did bring about limited social reforms, it was unable to industrialize the country, resolve the glaring social inequities of Egyptian society, or create a democratic national polity. The result was political crisis and economic stagnation. Egypt sank into Sadat's neocolonial
authoritarianism, and finally into Mubarak's kleptocratic neoliberalism.


Beginning in the late 1990s, neoliberal regimes through the industrializing world began to implode under the accumulated weight of their own internal contradictions. Venezuela led the way in 1998, quickly followed by Russia, Argentina, Turkey and Brazil. For their part, China and India never fully embraced neoliberal policies, and pragmatically steered towards regulated mixed economies 2004.

Two factors prevented the Egyptian regime from imploding until now. First, Egyptian workers flocked to Middle Eastern oil-producing states during the post-1979 oil shocks and also began to emigrate in significant numbers to the European Community, forerunner of the European Union. The remittances these workers sent home stabilized Egypt's economy, very much as remittances stabilized the Philippines during the dictatorship of Ferdinand Marcos. Second, the US pumped tens of billions of dollars into Egypt as a reward for signing a peace treaty with Israel.

By 2011, however, the game was up. The world economic crisis crimped remittances, and US military aid was no longer large enough to finance the investment needs of a population of 80 million citizens. The result was not just one of the great democratic revolutions of the 21st century, but the first openly anti-neoliberal revolution of our time.

Ironically, this delay is why Egypt may well become a developmental state and an economic motor for the entire region in record time. It took Brazil twenty years to manage the transition from the democratic revolution of the early 1980s to the economic democratization of the Lula-Dilma era; it took Russia ten years to translate the political freedoms of 1991 into the genuine economic development of the Putin-Medvedev era. But Egypt can achieve the same feat within a couple of years, assuming it can make the transition to a full-fledged democracy (and all the signs are promising).

The key is not, as neoliberal observers chatter, the attitude of the military. The key is the extensive industrial networks of Egypt's military-owned industries. These are the crucial engine for Egypt's economic revival. The first step will be to seize the ill-gotten assets of the Mubarak family and selected oligarchs. Next, transform the military enterprises into state champions, and use their surplus-profits to finance education and social services. Finally, pursue a UNASUR-style foreign policy of regional democratization and economic integration, and help free Palestine from Israeli colonization (and encourage Israel to free itself from the monstrous Israelo-apartheid which so terribly disfigures and warps its society).