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Egypt’s problems stem from the weakness of the private sector and the "rent-seeking" of state officials. The solution is to open Egypt’s markets to the outside world, lift restrictions on investment in key sectors of the economy, liberalise ownership laws, end subsidies to the poor for food and other necessities and increase market competition.

The mechanisms of this conditionality are discussed further below, at this stage, it is simply important to note that there has been an unassailable link established between aid and the fulfillment of neoliberal reforms.

This policy shift, however, does not represent a turn away from the logic of neoliberalism. Rather, it actually serves to reinforce this logic, by tailoring institutions to the needs of the private sector and removing any ability of the state to intervene in the market.

In the case of Egypt, the discourse of institutional reform has allowed neoliberal structural adjustment to be presented not just as a technocratic necessity – but as the actual fulfillment of the demands innervating the uprisings.

his fundamental message has been repeatedly emphasised by US and European spokespeople over the last weeks: this was not a revolt against several decades of neoliberalism – but rather a movement against an intrusive state that had obstructed the pursuit of individual self-interest through the market.

The political demands heard on the streets of Egypt today – to reclaim wealth that was stolen from the people, offer state support and services to the poor, nationalise those industries that were privatised and place restrictions on foreign investment – can be either disregarded or portrayed as "anti-democratic".

Precisely because Egypt’s uprising was one in which the political and economic demands were inseparable and intertwined, this effort to recast the struggle as "pro-market" is, in a very real sense, directly aimed at undercutting and weakening the country’s ongoing mobilisations.

There are two common elements to all the financial support offered to Egypt to date – an extension of loans (i.e. an increase in Egypt’s external debt) and promised investment in so-called public-private partnerships (PPPs).

n other words, contrary to popular belief, more money actually flows from Egypt to Western lenders than vice versa. These figures demonstrate the striking reality of Egypt’s financial relationship with the global economy – Western loans act to extract wealth from Egypt’s poor and redistribute it to the richest banks in North America and Europe.

Of course, the decision to borrow this money and enter into this "debt trap" was not made by Egypt’s poor. The vast majority of this debt is public or publically guaranteed (around 85%), i.e. debt that was taken on by the Mubarak government with the open encouragement of the IFIs. Egypt’s ruling elite – centred around Mubarak and his closest coterie – profited handsomely from these transactions (estimated in the many billions).

It is actually a debt swap – a promise to reduce Egypt’s debt service by $1 billion, provided that money is used in a manner in which the US government approves. This debt swap confirms the relationship of power that is inherent to modern finance.

The US is able to use Egypt’s indebtedness as a means to compel the country to adopt the types of economic policies described above.

Unless these loans are refused and the existing debt repudiated, Egypt will find itself in a cul-de-sac from which there is little chance of escape. Foreign debt is not a neutral form of "aid" but an exploitative social relation established between financial institutions in the global North and countries in the global South.

OPIC’s mandate is to support US business investment in so-called emerging markets; it provides guarantees for loans (particularly in the case of large projects) or direct loans for projects that have a significant proportion of US business involvement and may face political risk.

In the case of Egypt, this is likely to take place primarily through the use of US government funds to establish public-private partnerships (PPPs). A PPP is a means of encouraging the outsourcing of previously state-run utilities and services to private companies. A private company provides a service through a contract with the government – typically, this may include activities such as running hospitals or schools, or building infrastructure such as highways or power plants.

OPIC’s intervention in Egypt has been explicitly tied to the promotion of PPPs. An OPIC press release, for example, that followed soon after Obama’s speech, noted that the $1 billion promised by the US government would be used “to identify Egyptian government owned enterprises investing in public-private partnerships in order to promote growth in mutually agreed-upon sectors of the Egyptian economy.”

Anyone who has any illusions about the goals of the EBRD’s investment in Egypt would do well to read carefully the EBRD 2010 Transition Report. The report presents a detailed assessment of the East European and ex-Soviet republics, measuring their progress on a detailed set of indicators. These indicators are highly revealing: (1) Private sector share of GDP; (2) Large-scale privatisation; (3) Small-scale privatisation; (4) Governance and enterprise restructuring; (5) Price liberalisation; (6) Trade and foreign exchange system; (7) Competition policy; (8) Banking reform and interest rate liberalisation; (9) Securities markets and non-bank financial institutions; (10) Overall infrastructure reform.[5] Only countries that score well on these indicators are eligible for EBRD loans. A research institute that tracks the activity of the EBRD, Bank Watch, noted in 2008 that a country cannot achieve top marks in the EBRD assessment without the implementation of PPPs in the water and road sectors.

Moreover, fully embracing the pro-market ideological discourse discussed above, the Egyptian government promised to relax control over foreign investments through committing “to overcoming the previous shortcomings of excessive government centralisation. In addition, we will build on existing initiatives to achieve a greater level of decentralisation, especially in terms of local planning and financial management”.

As the decades of the Egyptian experience of neoliberalism illustrate all too clearly, these measures will further deepen poverty, precarity and an erosion of living standards for the vast majority. Simultaneously, the financial inflows will help to strengthen and consolidate Egypt’s narrow business and military elites as the only layer of society that stands to gain from further liberalisation of the economy. The expansion of PPPs, for example, will provide enormous opportunities for the largest business groups in the country to take ownership stakes in major infrastructure projects and other privatised service provision. Alongside foreign investors, these groups will gain from the deregulation of labour markets, liberalisation of land and retail activities, and the potential access to export markets in the US and Europe.

These measures also have a regional impact. Their other main beneficiary will be the states of the Gulf Cooperation Council (Saudi Arabia, Kuwait, United Arab Emirates, Bahrain, Qatar and Oman), which are playing a highly visible and complementary role alongside the IFIs. Saudi Arabia has pledged $4 billion to Egypt – exceeding the amounts promised by the US and EBRD.

As with the investments from Western states, these financial flows from the GCC are dependent upon the further liberalisation of Egypt’s economy, most likely through the mechanisms of PPPs. Indeed, Essam Sharaf, Egypt’s interim prime minister, and Samir Radwan, finance minister, have both travelled frequently to the GCC states over recent months with the aim of marketing PPP projects, particularly in water and waste water, roads, education, health care and energy.

In essence, the financial initiatives announced over recent weeks represent an attempt to bind social layers such as these – Egypt’s military and business elites, the ruling families and large conglomerates of the GCC, and so forth – ever more tightly to the Western states. The revolutionary process in Egypt represented an attack against these elements of the Arab world.

Before it was ousted, the Muslim Brotherhood faced serious structural constraints in Egypt and it made many wrong decisions. Since its electoral victory there was an ongoing power struggle in Egypt and its Freedom and Justice Party clumsily attempted to consolidate its political control over Egypt. The Muslim Brotherhood’s attempts to consolidate power meant that it has had to live with and work with a vast array of state institutions and bodies filled with its opponents, corrupt figures, and old regime loyalists. The Freedom and Justice Party tried to slowly purge the Egyptian state of Mubarak loyalists and old regime figures, but Morsi was forced to also work with them simultaneously. This made the foundations of his government even weaker.

Just as Hamas was forced by the US and its allies to accept Fatah ministers in key positions in the Palestinian government that it formed, the Muslim Brotherhood was forced to do the same unless it wanted the state to collapse and to be internationally isolated. The main difference between the two situations is that the Muslim Brotherhood seemed all too eager to comply with the US and work with segments of the old regime that would not challenge it. Perhaps this happened because the Muslim Brotherhood feared a military takeover. Regardless of what the reasons were, the Muslim Brotherhood knowingly shared the table of governance with counter-revolutionaries and criminals.

As a result of the Muslim Brotherhood’s collaboration with the US and Israel, large components of the protests in Egypt against Morsi were resoundingly anti-American and anti-Israeli.

The Muslim Brotherhood has tried to use the Obama Administration to ascend to power whereas the Obama Administration has used the Muslim Brotherhood in America’s war against Syria and to slowly nudge the Hamas government in Gaza away from the orbit of Iran and its allies in the Resistance Bloc. Both wittingly and unwittingly, the Muslim Brotherhood in broader terms has, as an organization, helped the US, Israel, and the Arab petro-sheikhdoms try to regionally align the chessboard in a sectarian project that seeks to get Sunnis and Shias to fight one another.

Furthermore, the Muslim Brotherhood had its own agenda and it seemed unlikely that it would continue to play a subordinate role to the United States and Washington was aware of this.

Mohammed Al-Baradei (El-Baradei / ElBaradei), a former Egyptian diplomat and the former director-general of the politically manipulated International Atomic Energy Agency (IAEA), has been offered the post of interim prime minister of Egypt by the military. He had returned to Egypt during the start of the so-called Arab Spring to run for office with the support of the International Crisis Group, which is an organization that is linked to US foreign policy interests and tied to the Carnegie Foundation, the Ford Foundation, and George Soros’ Open Society Institute.

Many of the Muslim Brotherhood’s supporters are emphasizing that an unfair media war was waged against them. The Qatari-owned Al Jazeera Mubasher Misr, Al Jazeera’s Egyptian branch which has worked as a mouth piece for the Muslim Brotherhood, has been taken off the air by the Egyptian military. This, along with the ouster of Morsi, is a sign that Qatar’s regional interests are being rolled back too. It seems Saudi Arabia, which quickly congratulated Adli Al-Mansour, is delighted, which explains why the Saudi-supported Nour Party in Egypt betray the Muslim Brotherhood.

Despite the media reports and commentaries, the Muslim Brotherhood was never fully in charge of Egypt or its government. It always had to share power with segments of the old regime or “Washington’s and Tel Aviv’s men.

The discussions on Sharia law were predominately manipulated by the Muslim Brotherhood’s opponents primarily for outside consumption by predominantly non-Muslim countries and to rally Egypt’s Christians and socialist currents against Morsi. As for the economic problems that Egypt faced, they were the mixed result of the legacy of the old regime, the greed of Egypt’s elites and military leaders, the global economic crisis, and the predatory capitalism that the United States and European Union have impaired Egypt with. Those that blamed Morsi for Egypt’s economic problems and unemployment did so wrongly or opportunistically. His administration’s incompetence did not help the situation, but they did not create them either. Morsi was manning a sinking ship that had been economically ravaged in 2011 by foreign states and local and foreign lenders, speculators, investors, and corporations.

Their hesitation at restoring ties with Iran and their antagonism towards Syria, Hezbollah, and their Palestinian allies only managed to reduce their list of friends and supporters.

The US, however, will be haunted by the coup against Morsi. Washington will dearly feel the repercussions of what has happened in Egypt. Morsi’s fall sends a negative message to all of America’s allies. Everyone in the Arab World, corrupt and just alike, is more aware than ever that an alliance with Washington or Tel Aviv will not protect them. Instead they are noticing that those that are aligned with the Iranians and the Russians are the ones that are standing.

An empire that cannot guarantee the security of its satraps is one that will eventually find many of its minions turning their backs on it or betraying it. Just as America’s regime change project in Syria is failing, its time in the Middle East is drawing to an end. Those who gambled on Washington’s success, like the Saudi royals, the Muslim Brotherhood, and Turkey’s Prime Minister Recep Erdogan, will find themselves on the losing side of the Middle East’s regional equation.

Many young women say they are puzzled at their mothers’ reactions—mothers who at their own age worked three jobs, came home late, or themselves decided not to wear the hijab. Some attribute this shift in perceptions of women’s role to successive waves of conservative religiosity: first inspired from Saudi Arabia for Egyptian families who either fled Sadat or migrated to the Gulf for work, and later by a post-Iraq war wave of opposition to the West.

Another patient of Nabil El Qutt is one such reason for hope. The daughter of very conservative parents, the young pharmacist joined a leftist party and stopped veiling. Her parents railed against everything she did, and even took her to a doctor for a virginity test. She sunk into severe depression and began self-harming. Nonetheless, she eventually managed to leave her family home and no longer felt the need for therapy. She even convinced her mother to leave her own emotionally-abusive husband.

It seems that Ghannouchi, good Muslim that he is, gets more of his ‘spiritual guidance’ these days in Washington  than in Mecca. As in the past, he was given a red carpet treatment by important American Middle-East think tanks. He spoke to audiences at both the Brookings Institute and the Council on Foreign Relations. At Brookings, Ghannouchi was introduced by Martin Indyk, an indication that whatever else is happening in Tunisia and throughout the Middle East, that Ghannouchi and Ennahda still enjoy the support of the Obama Administration.

There is some talk, that in gratitude for continued Obama Administration support, Tunisia might offer AFRICOM its African headquarters in Tunis. Whatever, Washington’s support did not come without some kind of major offer in return.

Although both Qatar and Saudi Arabia have carefully supported US security and economic interests in the Middle East – enough so that for Washington it matters little on a political level which one dominates – the growing Qatari growing political influence at Saudi Arabia’s expense was creating a dangerous rift between allies.

Ghannouchi’s fear – not without merit – was that as Washington had abandoned Morsi in Egypt that it could likewise cease its support for Ennahda in Tunisia, given Ennahda’s intimate relationship to the Brotherhood and Qatar.

Ghannouchi’s party is engaging in two forms of damage control to hold on to power. Internally, they are eliminating all the potentially pragmatic opposition leaders, be they secular or religiously inclined towards the Saudis externally. Caught in this web, it is likely that externally Ennahda would accommodate any demand that the IMF makes and any string that US attaches to its support –  from military bases to mega embassy to whom Washington would like to bring into the Ennahda-led government.

The initial demand was for the end of the Mubarak dictatorship and the creation of a democratic system that respected democratic rights -- the essential component of an authentic national democratic revolutionary process. However, the maturation of this process was arrested due to three factors: (i) the seizure of power by the Supreme Council of Armed Forces (SCAF) on 11 February, (ii) the channeling of mass dissent primarily into the electoral process, and (iii) the failure of the oppositional forces to organize sustainable mass structures to safeguard and consolidate the developing revolutionary situation.

This is important because the liberal appropriation of the term ‘revolution’ to describe everything from the events in Libya and Syria to the Green movement in Iran not only distorts social reality but also advances a dangerous narrative. That narrative suggests that revolutionary change takes place as a result of spectacle. It devalues organizing and building structures from the bottom up as unnecessary because it is the theater that is important; the episodic show; the display that refutes Gil Scott Heron’s admonition that ‘the revolution will not be televised!’

In fact, under President Morsi, the military never really went away. It maintained an independent space in the Egyptian state and economy.

For US policy-makers, the Muslim Brotherhood and the Morsi government were never seen as an alternative to Hosni Mubarak. Despite the repression meted out to members of the Muslim Brotherhood by the Mubarak regime, it was well understood that the Brotherhood was part of the Egyptian economic elite and open to doing business with the West. Therefore, Morsi was seen as an acceptable and safe civilian face to replace Mubarak while the US continued its influence behind the scenes through the military.

The class-based, social and economic interests of the military mean that it will oppose any fundamental transformation of the Egyptian economy and society, the ostensible aim of the ‘revolution.’ Significantly, this means that the power of the military is going to have to be broken if there is to be any prospect of revolutionary change in Egypt.

The demand for the end of the dictatorship was an awesome demonstration of people-power that created the potential for revolutionary change. The problem was that the dictatorship had severely undermined the ability of alternative popular forces to develop and acquire the political experience and institutional foundations that would have positioned them to better push for progressive change and curtail the power of the military. Unfortunately for Egypt, the force that had the longest experience in political opposition and organizational development was the Muslim Brotherhood.

when the Egyptian military -- a military that has not demonstrated any propensity for supporting democratic reforms -- intimated that it would step in, the mass position should have been ‘no to military intervention, change only by democratic means’ -- a position that a more mature and authentically independent movement might have assumed if it was not being manipulated by powerful elite forces internally and externally. It was wishful thinking that bordered on the psychotic for liberal and radical forces in the country and their allies outside to believe that a democratic process could be developed that reflected the interests of the broad sectors of Egyptian society while disenfranchising the Muslim Brotherhood, a social force that many conservatively suggest still commands the support of at least a third of the Egyptian population, and is the largest political organization in the country.

The powerful national elites that bankrolled the anti-Morsi campaign and their external allies, including Saudi Arabia and the US, have successfully set in motion a counter-revolutionary process that will fragment the opposition and marginalize any radical elements.