February 12, 2011

Military and Government Service Offers Lavish Lifestyle

A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship. - Justice Litle, Is America’s Economic Recovery on the Whole Based on a Rotten Sham?, Daily Markets, April 20, 2010

How Hosni Mubarak Got Filthy Rich

February 11, 2011

U.S. News & World Report - There are no Mubaraks on the Forbes list of the world's richest people, but there sure ought to be.

The mounting pressure from 18 days of historic protests finally drove Egyptian President Hosni Mubarak from office, after three decades as his nation's iron-fisted ruler. But over that time, Mubarak amassed a fortune that should finance a pretty comfortable retirement.

The British Guardian newspaper cites Middle Eastern sources placing the wealth of Mubarak and his family at somewhere between $40 billion and $70 billion. That's a pretty good pension for government work.

The world's richest man--Mexican business magnate Carlos Slim--is worth about $54 billion, by comparison. Bill Gates is close behind, with a net worth of about $53 billion.

Mubarak, of course, was a military man, not a businessman. But running a country with a suspended constitution for 30 years generates certain perks, and Mubarak was in a position to take a slice of virtually every significant business deal in the country, from development projects throughout the Nile basin to transit projects on the Suez Canal, which is a conduit for about 4 percent of the world's oil shipments.
"There was no accountability, no need for transparency," says Prof. Amaney Jamal of Princeton University. "He was able to reach into the economic sphere and benefit from monopolies, bribery fees, red-tape fees, and nepotism. It was guaranteed profit."
Had the typical Egyptian enjoyed a morsel of that, Mubarak might still be in power. But Egypt, despite a cadre of well-educated young people, has struggled as an economic backwater. The nation's GDP per capita is just $6,200, according to the CIA--one-seventh what it is in the United States. That output ranks 136th in the world, even though Egypt ranks 16th in population. Mubarak had been working on a set of economic reforms, but they stalled during the global recession. The chronic lack of jobs and upward mobility was perhaps the biggest factor driving millions of enraged Egyptian youths into the streets, demanding change.

Estimates of Mubarak's wealth will probably be hard to verify, if not impossible (one reason dictators tend not to make it onto Forbes's annual list). His money is certainly not sitting in an Egyptian vault, waiting to be counted. And his delayed exit may have allowed Mubarak time to move money around and hide significant parts of his fortune. The Swiss government has said it is temporarily freezing any assets in Swiss banks that could be linked to Mubarak, an uncharacteristically aggressive move for the secretive banking nation. But that doesn't mean the money will ever be returned to the Egyptian people, and it may even find its way to Mubarak eventually.

Other Mubarak funds are reportedly sitting in British banks, and Mubarak was no doubt wily enough to squire away some cash in unlikely places. Plus, an eventual exile deal could allow Mubarak to retain some of his wealth, no questions asked, as long as he and his family leave Egypt and make no further bids for power.
Epic skimming is a common privilege of Middle Eastern despots, and Mubarak and his two sons, Gamal and Alaa, were a bit less conspicuous than some of the Saudi princes and other Middle Eastern royals seen partying from time to time on the French Riviera or other hotspots. The family does reportedly own posh estates in London, New York, and Beverly Hills, plus a number of properties around the Egyptian resort town of Sharm El Sheikh, where Mubarak reportedly went after resigning the presidency.

Mubarak also spread the wealth far and wide in Egyptian power circles--another Middle Eastern tradition--one reason he incurred the kind of loyalty that allowed him to rule for a remarkable three decades. Top Army officials were almost certainly on his payroll, which might help explain why the Army eased him out in the end--allowing a kind of in-country exile--instead of hounding him out of Egypt or imprisoning him once it was clear the tide had turned against him for good.

That money trail, in fact, will help determine whether Egypt becomes a more prosperous, democratic country, or continues to muddle along as an economic basket case. Even though he's out of power, Mubarak may still be able to influence the Army officials running the country, through the financial connections that made them all wealthy.

And if not Mubarak, the next leader may be poised to start lining his pockets the same way Mubarak did. For Egypt to have a more effective, transparent economy, all of that will have to be cleaned up. There are probably a lot of people in Cairo who have been checking their bank balances lately.

Egypt: Hosni Mubarak used last 18 days in power to secure his fortune

Hosni Mubarak used the 18 days it took for protesters to topple him to shift his vast wealth into untraceable accounts overseas, Western intelligence sources have said.

Foreign Aid is taking money from the poor people of a rich country and giving it to the rich people of a poor country. - Ron Paul

Who is the Real Opposition in Egypt?

February 7, 2011

Global Research - The revolution in Egypt erupted like all revolutions do, from the bottom up. It was unemployment and high food prices that propelled working and poor people into action. Now, the media reports that the “opposition” in Egypt is a group of well-to-do folks who have very little in common with the poor of Egypt.

This top down takeover of the revolution is being engineered with the support of the U.S. and European nations, the same allies of the dictatorship that lasted three decades. If this elite group of Egyptians manages to gain power, they’ll soon find themselves confronted with the real opposition of Egypt, the overwhelming majority of working and poor people.

Who are these upper-crust oppositionists? Middle East journalist Robert Fisk explains:
“[the oppositionists] include Amr Moussa, the secretary general of the Arab League, … the Nobel prize-winner Ahmed Zuwail, an Egyptian-American who has advised President Barack Obama; Mohamed Selim Al-Awa, a professor and author of Islamic studies, … and the president of the Wafd party [a tiny political party], Said al-Badawi…Other nominees for the committee…are Nagib Suez, a prominent [super-wealthy] Cairo businessman… Nabil al-Arabi, an Egyptian UN delegate; and even the heart surgeon Magdi Yacoub, who now lives in Cairo.” (February 4, 2011).
http://www.independent.co.uk/opinion/commentators/fisk/robert-fisk-exhausted-scared-and-trapped-protesters-put-forward-plan-for-future-2205079.html

What is the task of this committee? Al-Jazeera reports:
“The committee — which was formed last night… proposed that vice president Omar Suleiman [the head of the brutal secret police] preside over a transitional government, and that he pledge to dissolve parliament (whose lower house was elected just last year) and call early elections.” (February 4, 2011).

http://english.aljazeera.net/news/middleeast/2011/02/20112420435766522.html
Are these oppositionists so naive to believe that a “pledge” from a snake like Suleiman is worth anything? Is this a man that any respectable person should be negotiating with?

And herein lies the problem. There can be no smooth “peaceful transition,” as Obama and other politicians would like to see, unless nothing in Egypt changes. This is because the ruling political power in the country, the National Democratic Party (NDP), has extremely deep ties to the rich and powerful in Egypt, backed up by both senior military officials and the U.S. government foreign aid program, which enriches various sections of the NDP.

The New York Times explains:
“Since the revolt, the military has surged to the forefront, emerging as the pivotal player in politics it long sought to manage behind the scenes. The beneficiary of nearly $40 billion in American aid during Mr. Mubarak’s rule, its interests span the gamut of economic life — from the military industry to businesses like road and housing construction, consumer goods and resort management. Even leading opposition leaders, like Mohamed ElBaradei, have acknowledged that the military will have a key role in a transition.”
http://www.nytimes.com/2011/02/05/world/middleeast/05cairo.html?hp
To summarize, U.S. aid to Egypt has been the lifeblood of the dictatorship and the ruling party associated with it, while leading opposition figures have no interests in confronting these powerful interests, only removing their current figurehead. The opposition group that plans to negotiate with the NDP must know that any agreed to middle ground will be unacceptable to the majority of Egyptians, since the NDP will work to maintain their own privileges and wealth.

If the ruling party stays intact, then so will the ruling security apparatus, which will eventually steer the wheel of history backwards again. The party of the dictatorship must be crushed and dismembered, so that real democracy can have room to grow. The official “opposition” has no interest in doing this, because they have no interest in real change.

What would real change look like? It would require a drastic departure from the free-market policies that have been implemented for years, including privatizations of state run industries, lowering taxes for the rich and corporations, eliminating regulations, subsidies, and tariffs, etc. These policies were required by the IMF and World Bank, U.S.-led institutions that created in Egypt what exists in the U.S. — an incredible gap between rich and poor.

None of Egypt’s “respectable” opposition are mentioning these policies, because many benefit from them.

If an anti-Mubarak, pro-free-market opposition gains power, they will collide immediately with the majority of working and poor Egyptians, who want a change in the above policies that brought about their misery.

The only opposition group that is expressing the economic demands of the people seems to be the newly-formed Egyptian Federation for Independent Unions, which broke away from the government dominated unions to demand that a
“… a minimum wage no less than 1200 LE, with a yearly raise proportionate to inflation; guarantee workers rights to bonuses and benefits according to work value, especially work compensation for those facing work hazards.”
and:
“The right for all Egyptian citizens to fair social security including the right to health care, housing, education ‘ensuring free education and syllabus development to cope with science and technology evolution,’ the right for all retired to decent pensions and benefits.”
It is demands like these that will decide Egypt’s future the day after Mubarak is gone. This will require a complete transformation of Egypt’s political system, including its economic policies that are intimately connected to the billions of U.S. foreign aid. It will also require that Egypt’s poor and working class develop a clear vision of what they want in order to avoid being led astray by enemies acting as friends.

Egypt President Hosni Mubarak's Net Worth Estimated at $40 Billion to $70 Billion

We live in a world where the public servants are the 'haves' and the private citizens are the 'have nots.'

February 4, 2011

The Economic Times - Egypt's embattled President Hosni Mubarak's and his family's net worth is estimated to be between US dollars 40 and 70 billion, a media report said.

The wealth of the Egypt's first family was built largely from military contracts during his days as an air force officer; Mubarak eventually diversified his investments through his family when he became President in 1981, the 'ABC News' quoted experts as saying.

The family's net worth now ranges from US dollars 40 to 70 billion, by some estimates, the report said.

Amaney Jamal, a political science professor at Princeton, said those estimates are comparable with the vast wealth of leaders in other Gulf countries.
"The business ventures from his military and government service accumulated to his personal wealth. There was a lot of corruption in this regime and stifling of public resources for personal gain," Jamal was quoted as saying.
Jamal said that Mubarak's assets are most likely in banks outside of Egypt, possibly in the UK and Switzerland.
"This is the pattern of other Middle Eastern dictators so their wealth will not be taken during a transition. These leaders plan on this," she said.
Mubarak, his wife and two sons were able to also accumulate wealth through a number of business partnerships with foreigners, according to Christopher Davidson, professor of Middle East Politics at Durham University in the UK.

The Mubarak family owns properties in London, Paris, Madrid, Dubai, Washington, New York and Frankfurt, according to a report from IHS Global Insight.

Aladdin Elaasar, author of 'The Last Pharaoh: Mubarak and the Uncertain Future of Egypt in the Obama Age', said the Mubaraks own several residences in Egypt, some inherited from previous presidents and the monarchy, and others he has built.
"He had a very lavish lifestyle with many homes around the country," said Elaasar, who estimates the family's wealth is between US dollars 50 and 70 billion.
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