Egypt's activists face an impossible choice

Forced to choose between an Islamist and an ex-general, optimism is fading among Egypt's young.

I could see the tears in her eyes.

"We must go back to the streets. The revolution did not happen for this."

In a visit to Cairo earlier this month, I heard direct the frustration of those whose courage and commitment helped end Egypt's dictatorship last year. The choice for Egyptians in this week's Presidential run-off between Mohammed Morsi, representing the Islamist Freedom and Justice Party, and Ahmed Shafiq, a remnant of the Mubarak regime, was not one the young activist could stomach.

The veteran dissidents of the Mubarak years were more reflective. "It is not what I would have chosen, but it is progress. If you had told me five years ago that we would have had an election in Egypt where 90 per cent of the vote was divided between five candidates, I would not have believed you."

Later this week, the people of Egypt return to the polls for the second round in their presidential elections. Many have described the choice they face as impossible.

The first round eliminated, in a poll characterised by its closeness, the centrist candidates. In a febrile political environment, the last two weeks has seen the sentencing of former President Mubarak to a term of life imprisonment but the acquittal of his sons on corruption charges. The latter decision prompted a return of mass demonstrations to Tahrir Square. The frustrated youth who brought revolution to Egypt are deeply afraid that the revolution is in danger.

"Whatever happens, Shafiq will win," one voice warned me. Snatched conversations on the street with those in uniform, and there are many of them, testify to the continued importance of the army in Egyptian politics. They see their jobs, their status and their futures under threat. There is a profound, broadly-held scepticism that the military will ever allow their role to be subject to democratic scrutiny. Until they do, the capacity of Egypt to operate as a democratic society will be constrained to the point of impotence. Real power will stay with the army.

"My real fear is that the Brotherhood will cut a deal with the army," another experienced dissident voter told me. "The deal will be made before the election and the Brotherhood and the military, the two parties with organisation, will deliver it." The price will be limits to progress in the revolution - on military control, on women's rights, on real accountability.

There is little optimism in the air. The ambitions of Tahrir Square, so heady in the spring of 2011, seem distant now.  But In a nascent democracy, there is much to be done. New political parties, with distinct ideologies, need to develop and to learn to organise. Those I spoke to in the Freedom and Justice Party, which relies heavily on the organisation of the Muslim Brotherhood, are deeply suspicious of international co-operation of competitor parties.

What are they afraid of? Democracy requires different parties and new political activists are eager to learn from those with a democratic tradition. The sooner those with power learn this, the quicker confidence in Egyptian democracy will build.

A new generation has formed a new government in Egypt. But governmental power in Egypt still has limits: the army allows government to operate and government operates with the army's consent. This fundamental obstacle to full democracy in Egypt remains. It will not be overcome by this week's election. But, if full and stable democracy is to come to Egypt, the army, its budget and its power must be placed under democratic control.

That ambition is one which many Egyptians I spoke to share still. They know that is an ambition that will be difficult to realise and one that will not come quickly. But many who spent years in prison under President Mubarak see that steps forward have been taken. More steps are needed, but the political prisoners of the past are still political activists today. They are impressively determined that the journey to democracy will continue - beyond the election this week which gives them a choice they find difficult to bear.

An Egyptian protester holds a crossed out portrait of presidential candidate and former premier Ahmed Shafiq. Photograph: Getty Images.

Ian Lucas is the Labour MP for Wrexham.

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The Autumn Statement proved it – we need a real alternative to austerity, now

Theresa May’s Tories have missed their chance to rescue the British economy.

After six wasted years of failed Conservative austerity measures, Philip Hammond had the opportunity last month in the Autumn Statement to change course and put in place the economic policies that would deliver greater prosperity, and make sure it was fairly shared.

Instead, he chose to continue with cuts to public services and in-work benefits while failing to deliver the scale of investment needed to secure future prosperity. The sense of betrayal is palpable.

The headline figures are grim. An analysis by the Institute for Fiscal Studies shows that real wages will not recover their 2008 levels even after 2020. The Tories are overseeing a lost decade in earnings that is, in the words Paul Johnson, the director of the IFS, “dreadful” and unprecedented in modern British history.

Meanwhile, the Treasury’s own analysis shows the cuts falling hardest on the poorest 30 per cent of the population. The Office for Budget Responsibility has reported that it expects a £122bn worsening in the public finances over the next five years. Of this, less than half – £59bn – is due to the Tories’ shambolic handling of Brexit. Most of the rest is thanks to their mishandling of the domestic economy.

 

Time to invest

The Tories may think that those people who are “just about managing” are an electoral demographic, but for Labour they are our friends, neighbours and the people we represent. People in all walks of life needed something better from this government, but the Autumn Statement was a betrayal of the hopes that they tried to raise beforehand.

Because the Tories cut when they should have invested, we now have a fundamentally weak economy that is unprepared for the challenges of Brexit. Low investment has meant that instead of installing new machinery, or building the new infrastructure that would support productive high-wage jobs, we have an economy that is more and more dependent on low-productivity, low-paid work. Every hour worked in the US, Germany or France produces on average a third more than an hour of work here.

Labour has different priorities. We will deliver the necessary investment in infrastructure and research funding, and back it up with an industrial strategy that can sustain well-paid, secure jobs in the industries of the future such as renewables. We will fight for Britain’s continued tariff-free access to the single market. We will reverse the tax giveaways to the mega-rich and the giant companies, instead using the money to make sure the NHS and our education system are properly funded. In 2020 we will introduce a real living wage, expected to be £10 an hour, to make sure every job pays a wage you can actually live on. And we will rebuild and transform our economy so no one and no community is left behind.

 

May’s missing alternative

This week, the Bank of England governor, Mark Carney, gave an important speech in which he hit the proverbial nail on the head. He was completely right to point out that societies need to redistribute the gains from trade and technology, and to educate and empower their citizens. We are going through a lost decade of earnings growth, as Carney highlights, and the crisis of productivity will not be solved without major government investment, backed up by an industrial strategy that can deliver growth.

Labour in government is committed to tackling the challenges of rising inequality, low wage growth, and driving up Britain’s productivity growth. But it is becoming clearer each day since Theresa May became Prime Minister that she, like her predecessor, has no credible solutions to the challenges our economy faces.

 

Crisis in Italy

The Italian people have decisively rejected the changes to their constitution proposed by Prime Minister Matteo Renzi, with nearly 60 per cent voting No. The Italian economy has not grown for close to two decades. A succession of governments has attempted to introduce free-market policies, including slashing pensions and undermining rights at work, but these have had little impact.

Renzi wanted extra powers to push through more free-market reforms, but he has now resigned after encountering opposition from across the Italian political spectrum. The absence of growth has left Italian banks with €360bn of loans that are not being repaid. Usually, these debts would be written off, but Italian banks lack the reserves to be able to absorb the losses. They need outside assistance to survive.

 

Bail in or bail out

The oldest bank in the world, Monte dei Paschi di Siena, needs €5bn before the end of the year if it is to avoid collapse. Renzi had arranged a financing deal but this is now under threat. Under new EU rules, governments are not allowed to bail out banks, like in the 2008 crisis. This is intended to protect taxpayers. Instead, bank investors are supposed to take a loss through a “bail-in”.

Unusually, however, Italian bank investors are not only big financial institutions such as insurance companies, but ordinary households. One-third of all Italian bank bonds are held by households, so a bail-in would hit them hard. And should Italy’s banks fail, the danger is that investors will pull money out of banks across Europe, causing further failures. British banks have been reducing their investments in Italy, but concerned UK regulators have asked recently for details of their exposure.

John McDonnell is the shadow chancellor


John McDonnell is Labour MP for Hayes and Harlington and has been shadow chancellor since September 2015. 

This article first appeared in the 08 December 2016 issue of the New Statesman, Brexit to Trump