Josh Rogin, reporting for Daily Beast, says the path is now clear to restore US aid to Egypt to its full level. Here's a quote from Michele Dunne that pretty much sums it up:

“I think there’s a sense of giving up on Egypt [inside of the Obama administration], on the Hill as well,” said Dunne. “There’s a sense that ‘Oh well they tried a democratic transition, it didn’t work, but we don’t want to cut ourselves off from Egypt as a security ally, so let’s just forget about the whole democracy and human rights thing except for giving it some lip service from time to time.’”

Also see this report from Ali Gharib on the crucial role Israel and its US lobby played in mustering Congressional support for this.

Last summer, the language on draft bills from the House and Senate on Egypt suggested a substantial reduction in aid and/or the linking of the aid to various requirements, and also threatened to drop the usual waiver the administration could exercise. Now, the administration is only required to certify that Egypt is maintaining good relations with Israel. The path is clear to restore the aid, and the bilateral relationship, to its Mubarak-era level.

Egypt's new patrons? A poster in Cairo thanks the rulers of Saudi Arabia, Kuwait, the UAE -- and Russia.  

Why does Egypt receive between $1.3 and $1.5 billion of US aid annually?

"Because of Israel" is the most common answer to that question. Certainly, that is driving much of the American political wrangling over whether aid should be suspended. The New York Times reports that during the back-and-forth among the US and its allies leading up to Morsi's ouster, Israeli officials argued against cuts, and told the military not to put stock in US threats to cut off aid. The Israelis, like the US, greatly prefer the Egyptian security forces to be in charge of the country. Whatever, the depredations of Mubarak, the Brotherhood, or the counterrevolution, Egypt is too valuable for any American leader to risk "losing."

But though the Muslim Brotherhood signaled it might be less hostile to Hamas or Iran than Mubarak was, in practice the former president did little to change existing policies. Under Morsi's short presidency, the Egyptians even stepped up the destruction of smuggling tunnels into the coastal strip (moreover, the Egyptians were reportedly instrumental in negotiating an end to Operation Pillar of Cloud last winter).

Both Israel and Egypt have many shared interests in the Sinai, especially as the security situation deteriorates. Though Egyptian pressure on Gaza is massively increasing now, it was never seriously in jeopardy under the Brotherhood given that the terrorists and criminal gangs in the Sinai were going after both the SCAF- and Brotherhood-led Egyptian state, and it served Morsi little to champion the Palestinian cause while in office.

The massive corporate investment in Egyptian or Saudi defense expenditures certainly contributes to Congressional deliberations against aid cuts. And while one might examine the head of President Obama, and whether his reluctance to "take sides" really suggests a desire to reduce a US commitment to Egypt, the fact that the aid has not yet been publicly cut off suggests that Washington has tacitly taken a side: that of the military's, guarantor of the status quo.

It was, in fact, not just the Israelis telling General Sisi et al. to pay no mind to the US law that requires all aid to be suspended to a country if a coup takes place there. It was King Abdullah telling the Egyptian generals that the Kingdom would make up for any cutoffs in economic or military aid - the latter, almost assuredly in the form of American-made weapons in Riyadh's possession.

Riyadh's role is extremely important in all of this, especially with respect to Iran's containment. As the CNAS think tank noted in February 2011, Egypt's strategic importance in the wider region has nothing to do with the current deployment of US forces in the country, where the only fully staffed America military station is a US Navy medical center. It instead has to do with the nightmare scenario that would threaten the US's interests in the Persian Gulf: the sudden collapse of any one of the Gulf monarchies that host the radar sites, listening posts, airfields, and weapon emplacements pointing at Iran:

"The United States has no military bases of its own in Egypt. Its headquarters for directing air and ground troops in the Middle East, Afghanistan and Iraq, are in Qatar. Stockpiles of tanks, ammunition, fuel, spare parts and other war materiel are warehoused in Kuwait, Qatar and Oman. U.S. missile batteries are deployed along the Persian Gulf's west coast. The U.S. Navy's regional headquarters is in Bahrain.

But in contingencies or crises, American forces have depended heavily on Egyptian facilities built with U.S. aid to U.S. specifications to accommodate U.S. forces as they move from the United States and Europe to Africa or westward across Jordan and Saudi Arabia to the Persian Gulf. American nuclear powered aircraft carriers, whose jets are playing a major role in Afghanistan, rely critically on their expedited use of the Suez Canal, giving them easy access to the Red Sea and Persian Gulf."

Jane's Defence Weekly presented an analysis of commercial satellite imagery compiled between 2011 and 2012 to illustrate the expansion of US, UK, and GCC "conventional combat capabilities" in the Persian Gulf. The analysis highlighted the most salient points of this cooperation, which all ultimately leads back over that waterway and the Saudi desert to Egypt's own airspace and port facilities.

Meanwhile, the suggestion that the failure of the Brotherhood's political experiment in Egypt may be necessary for the House of Saud's survival is not farfetched. Though security concerns largely determine American actions, for the Saudis, there is also the matter of not wanting competition from the transnational Brotherhood as a mass Islamist movement.

While in years past, the Saudis supported the Brotherhood in Egypt - against Nasser, primarily, whose pan-Arabism and meddling in Yemen during the Cold War threatened the House of Saud's shaky legitimacy. But then the Brothers' messaging and aspirations began to appeal to dissidents within the Kingdom, as did other rival Islamist precepts, threatening absolute monarchy with the prospect of replacement. In recent years, top Saudi officials have made extremely negative remarks about the Brotherhood, most notably the late Crown Prince Nayef. Last month, Prince Alwaleed Bin Talal fired a Kuwaiti preacher from his Al Resalah channel for having pro-Brotherhood leanings. As a Foreign Policy article recently noted about Saudi efforts to arm anti-Assad Syrian militias, "Saudi Arabia does not only despise the Muslim Brothers, but political Islamic movements and mass politics in general, which it sees as a threat to its model of absolute patrimonial monarchy."

↪ Egypt's opposition calls for new protests on | tagesschau.de

From a German press report, machine-translated below :

German Development Minister Dirk Niebel feared in his own words that Egypt slips under President Mohammed Mursi and the Muslim Brotherhood in a dictatorship. There was a risk that the dictatorial Mubarak system auflebe with other people, he said, the "Berliner Zeitung". Given the uncertain conditions in Syria, Lebanon and Jordan, an unstable Egypt is a huge security risk beyond the region.

According to Niebel, the German government restricted until further notice, the government contacts with Egypt. So, he wrote about the government canceled negotiations on development co-operation that should take place in mid-December. The planned partial debt relief of up to 240 million euros would be postponed, announced the Minister. "It is in the hands of the Egyptian government," said the FDP politician.

Meanwhile, complete silence from the EU, Catherine Ashton and most member states.

I took this photo on January 29, 2011 in Tahrir Square. Back to the same issue.

Readers of this blog know that I am against US military aid to Egypt. I was against it under Mubarak and am against it under SCAF. I am partly against aid because I'm not a big fan of any of the big Middle Eastern aid packages, because of the specifics of the Egyptian situation, although I am not against it under any circumstances. The national security waiver exercised by the Obama administration in March was premature and unwarranted, and now they have egg on their face. Washington can buy itself a few days to figure out what's going to happen in Egypt this week — this is what the recent statements frm the State Dept. being "troubled" by the recent developments amount to but the clock is ticking: they will either have to suspend the aid or be openly in favor of SCAF's constitutional coup if they continue it.

It's a situation as black-and-white as the one we see in Egypt today, despite all attempts to fudge the issue. Sara Khorshid puts it well in this NYT op-ed, The Betrayal of Egypt's Revolution:

Given the military’s consistent disregard for basic democratic norms over the past 16 months, Secretary of State Hillary Rodham Clinton’s comment last week that “There can be no going back on the democratic transition called for by the Egyptian people” sounded ridiculous.

Despite the army’s blatant power grabs, the Obama administration has had no qualms about restoring American military aid, waiving a Congressional requirement that links military assistance to the protection of basic freedoms, so as to preserve the United States’ longtime alliance with Egypt’s rulers.

America could have sided with the Egyptian people if it had wanted to. But the question is whether the American government really has the will to see Egypt become a democracy.

If the Obama administration genuinely supports the Egyptian people in their pursuit of freedom, then it should realize that democracy will take root only through the revolutionary path that started on the streets in January 2011 — not through the dubious ways of the Mubarak-appointed military council.

Shadi Hamid (with whom I cordially disagree on many issues) also put it well yesterday on Twitter:

If Obama wants to be on "right side of history," then next step is clear -- suspend aid to #Egypt until SCAF commits to handing over power.

— Shadi Hamid (@shadihamid) June 18, 2012

If US isn't willing to suspend military aid to #Egypt now, then under what circumstances would it? SCAF has done its worst.

— Shadi Hamid (@shadihamid) June 18, 2012

These two are Egyptians (Shadi is Egyptian-American), which is important — I think more Egyptians are willing to publicly take this stance. More Americans need to care about this, too. I'm not Egyptian, and care mostly about this for American reasons. It's not just that I don't want my tax dollars to subsidize the US defense industry and pampered generals in Cairo. It's also that I don't want the blowback when Egyptians turn to Americans and say, "you supported our dictators".  The time has come: the US may not be able to influence developments in Egypt, but at least it can stop underwriting them.

A must-read column by DNE's Rania al-Malky on the stupid scheme to raise "Egyptian aid" to replace the foreign kind:

If one year after Egypt's downtrodden and destitute people toppled Mubarak with thunderous, unrelenting calls for bread, freedom and social justice, those very Egyptians are being coerced into donating part of their paltry salaries to support a government they did not choose, then it's safe to say that the 'revolution' has failed.

Love for one's country is one thing but bailing out a decrepit failed economy that has been systematically mismanaged for 30 decades, and especially so in a year of crisis, by appealing to the nationalist sentiments of people who can barely feed their families, borders on the criminal.

. . .

There have been mixed reports on whether the ‘donations’ by government employees will be voluntary. A leaked circular from the Tax Authority, incidentally headed by the wife of SCAF’s number two General Sami Anan, implied that those who refuse to abide by the ‘voluntary donation’ will end up with their name on some blacklist. Although the said Tax Authority chief Munira Al-Qady had denied in an Al-Ahram interview that the signature on the letter was not hers, and that in fact, she had identified the employee who both drafted the letter and forged her signature, she initiated no disciplinary or legal action against him, sufficing with moving him to a different department. She then drafted a second letter emphasizing that donations will only be deducted from salaries following the consent of employees.

The story just doesn’t gel.

Similar complaints by government employees in various fields have also been reported, with one school teacher from Mansoura telling Daily News Egypt that she was told that the salary cut will be made anyway and that those who did not wish to donate will have to present a written request for reimbursement. Another from Kafr El-Sheikh province said that not only will she be forced to make the donation, she will also not be compensated for supervising the Shoura Council elections for which she was promised LE 500.

To add insult to injury, and in violation of the law, there have been no announcements on where that money will be spent and who will be overseeing that spending, only some vague reference to the fact that it will not go into the state treasury, as if to assure the public that it will not be misappropriated.

It reminds me of when, in the late 1980s, King Hassan II on Morocco decided he would build the world's largest mosque in Casablanca. To finance the project  — he didn't want to pay for it himself despite being a billionaire — there was a fundraising scheme that called on all Moroccans to pay "a symbolic Dirham". In practice, civil servants were coerced into giving up sometimes over a month's wages and many businessmen were forced to give tens of thousands. The mosque is still there, but of course East Asian and Gulf countries have since built bigger ones, and have experienced either economic takeoffs in the meantime or were rich to start with. Morocco is still a struggling, poor country with a fragile economic fabric.

On another point: much of the fabric of Egypt's civil society, especially when it comes to human rights associations, was foreign-funded. That kind of political work scared off the business moguls who wanted to do little outside of things like poverty relief.

And finally: the idea that Egypt is dependent on US aid is a red herring. At about $250m a year from USAID, civilian aid to Egypt from Washington is small. It used to be more important, and to be honest Egyptians are pretty ungrateful about the work that was done by Americans in the 1980s and 1990s: without it, you might have had cholera epidemics in a Cairo that could no longer handle its sewage and treat its water, or today you might still wait years for a new phone line, a situation that stopped after a massive, partly US-funded, overhaul of Egypt's telecom infrastructure that paved the way to make Egypt a success story for internet penetration. The Egyptian government ruined itself in the wars with Israel, and seems to have never quite recovered from them (stupid policies and runaway population growth did not help either).

I've always felt that Egypt's problem is not money — it's much richer than Morocco, for instance, with a more cohesive population (one reason that infant mortality rates are much lower in Egypt and Morocco, for instance). It's governance. And for the current, temporary government to be calling for donations at the same time as it grants more exemptions on real estate taxes is pretty criminal — especially when most of the aid goes to the military and is completely unnacountable.