But the loan will mean entrenching the deeply unpopular economic polices of the Mubarak era. The IMF is urging Egypt to pursue what it calls “fiscal reforms,” which is understood to mean slashing government spending, including cuts in subsidies for commodities like natural gas and a hike in taxes on basic goods. In other words, the immediate solution to Egypt’s economic problems will only result in more economic pain for ordinary Egyptians.
Anticipating the difficulty Morsi faces in persuading the public to accept the loan program, IMF chief Christine Lagarde told journalists during a visit to the Ivory Coast on Jan. 8, “The IMF needs to have the commitment of the political authorities that can actually endorse the program, own it and propose it to the population as theirs.”
How the public will feel is uncertain. “The question is going to be how people are going to react to what is going to be prolonged disaster,” says Michael Hanna, a Middle East analyst with the New York City–based Century Foundation. “Egypt is not getting better. There are no glimmers of hope.”
The anticipated cuts have raised the specter of January 1977, when President Anwar Sadat stopped bread subsidies after seeking loans from the World Bank. The cuts sparked two days of violent demonstrations in which some 800 people were killed when security forces moved in. University of Michigan history professor Juan Cole, who was in Cairo at the time of those riots, once recalled demonstrators chanting, “You’re wearing the latest fashions while we sit seven in a room!” (The slogan rhymes in Arabic: “Inta labis ahkir moda; ihna aidin saba fil oda!”)
The neoliberal slimming of the state’s economic profile continued to provoke instability under Mubarak. Plans to sell off state-owned factories beginning in 2004 were followed by a wave of labor unrest that culminated in an attempted April 2008 general strike and street fighting in the factory town of Mahalla al-Kubra, a skirmish that is now seen as a precursor to the 2011 uprising.
But travel today to one of Cairo’s many poor neighborhoods, and you’ll hear plenty of complaints about price hikes, but not necessarily talk of another revolution. One of those places is the far end of the Giza subway line, yet another point where Cairo’s muscular grid of trains and elevated highways meets a cacophonous world of microbuses and precarious-looking brick housing with rebar protruding from their roofs.
There, on the side of the road, tea seller Abu Ahmad, 56, said he no longer puts sugar in his tea because the price in his neighborhood shop rose from about 50 cents a kilo to about 90 cents a kilo. “Everyone is angry here,” he said. But he stopped short of calling for a renewal of street protests, arguing that people should vote the Muslim Brotherhood out of power in the upcoming parliamentary election. Down the street, butcher Abdul Rahman Muhammad, 52, also doubted there would be a poor people’s revolt. “People are tired,” he said.
But rising prices are not the only source of public frustration. The country’s creaking national infrastructure, too, remains a cause of political outrage. On Jan. 15, a train crashed south of Cairo, killing 19 young, poor riot-police conscripts, and the next day an unlicensed building collapsed in Alexandria, killing 28. Pictures of the train’s shredded carriage appeared on the front page of the nation’s newspapers on Jan. 16, the banner headline in the independent newspaper al-Shorouk reading, “And still the blood falls on the tracks.” The crash was the latest in a string of transport disasters, including a November collision between a train and a bus that killed 51 people, most of them children. So in addition to “owning” the expected austerity measures, Morsi’s government will also face heat for a whole range of social and economic problems inherited from the Mubarak regime.
The question going forward, analyst Hanna says, is how the public reacts to economic shocks and dysfunctional government when it comes not from a secular autocrat but from the religious Muslim Brotherhood, a large and diverse movement whose ranks include both wealthy businessmen happy to work with the IMF and ordinary Egyptians who benefit from the group’s social services. Hanna predicts the group will use the pull of religion to soften the blow of austerity. “The Salafis and [Muslim Brotherhood] will turn to culture and social issues, and I think they will become more demagogic, more sectarian. Economic deprivation is not a time on which to build a sort of liberal, open, pluralistic outlook,” he says.
Even Ramadan Amin, the young bus driver who participated in the initial uprising, said he agreed that people were living in harsh conditions but doubted there’d be another full-scale revolt against the Brotherhood. “The first thing is that poor people are very religious,” he said. “I don’t know about activism,” he said, shaking his head.