Monday, June 25, 2012


Mohamed Morsi of the Muslim Brotherhood is the winner of the first competitive presidential election in Egypt. Maybe he could be considered an italicized president. With 51.7% of the runoff votes, his victory over the former air force general Ahmed Shafik is a narrow one. The military leaders have also pre-emted a powerswap by shutting down the democratically elected and Islamist- led Parliament. They hijacked the presidential power to make laws and set budgets, and decreed an interim constitution stripping him of most of his powers.  Martial law was reimposed.
Mr. Morsi resigned from the Brotherhood and made a victory speech which was remarkable for its inclusive, conciliatory tone. He finds himself "sandwiched" between a base which still largely adheres to a theocratic mayhem and the military/secular opposition which showed  an astonishing staying power.  The outcome in the long-term remains a new riddle in the serial political saga of Egypt.  I think we should wish the president-elect well and hope that confidence-building signals be given from both sides so that we might see a Turkish rather than an Iranian scenario developing in the future.
Egypt needs an urgent transfusion of investment, capital, tourism and services to overcome what has been a prolonged cardiac arrest.  Morsi, an engineer who studied at the University of Southern California, looks like an ordinary, unremarkable man.  He will be under great pressure to reinstate unconditionally the Parliament, which could put him immediately on a collision course with the military.  The Brotherhood has been shunned for decades, which will make it hard to translate conciliatory rhetoric into action and to coax former ennemies to work with him.  It will require tact and savoir-faire to avoid a "coup," and to restore confidence, being his own man rather than becoming the hostage of the Brotherhood's Guidance Council.  Mubarak's regime also survives its former Rais and will have to be reckoned with.  The masses in Tahrir Square will not be satisfied with merely having a figurehead president.   They want more Islam, not less.  On the other hand, their social and economic demands are legitimate and they will, understandably, not tolerate that the former plutocrats might find a safe haven under the military's umbrella.  This revolution has not reached the finish line yet,  it is just beginning.  The new president needs to be supported by the West, until further notice. The military should be encouraged to stay in their barracks and to respect pluralism as much as Morsi pledged to do so.  Egypt is an impatient country which is not in a waiting mood. All sides need to understand that change cannot be reduced to cosmic arrangements. The United States can consider playing more the soft-power card and push for democracy with all actors involved. The EU has here a trump card to play as well, as it did years ago when the MENA (Middle East and North Africa) exercise looked like more than the empty promise it became.  Egypt needs a shot in the arm if we want to avoid the masses in Tahrir Square becoming too polarised and repeating the fate of so many revolutions or social upheavels in the past, which started with legitimate grievances, but ended up in indiscriminating bloodbaths. It would be wise to follow the events with an open mind, remaining circumspect but also ready to help if the change warrants a generous trust.

Tuesday, June 19, 2012


The Egyptian saga is not over, far from it.  Mubarak, clinically dead,  used to say "it is me or the bearded ones". We got the bearded ones but the situation remains volatile. Their majority is slim and the army is trying to pull the rug out from under their political agenda. The initiators of the Tahrir Square movement feel, rightly so, betrayed by two camps which stand for the status quo (the army) or for the stone age (the Brotherhood). The inglorious finale of Mubarak, whatever his faults might have been reminds me of the fall of the Shah. Those episodes do not show their former backers in a flattering light. They blundered, shifting froem the abrupt to the circumlocutory, loosing an ally ,while forgetting to have an understudy ready to step in.
Egypt is still the motor of the Arab world and any fundamental change there has repercussions from Turkey to Morocco. Hence a situation now wherein the instability and a murky future create a danger zone with multiple possible repercussions in geopolitics, military strategy and democracy (if such an outcome could still be envisaged in an Islamic context.) The Muslim Brotherhood has a long history which predates the coup of Nasser, who was basically more a pan-Arabist ideologue than a narrow-minded fanatic.  After the revolution, the Brotherhood became more an underground force than a player in the political arena.  Mubarak had his good side--in international affairs--and a less-pleasant side in his handling of internal affairs of a country which he considered as his private domain. His entourage reaped the benefits, while the masses survived on subventions for elementary needs and foodstuffs.  Here the Muslim Brotherhood found allies who were ignored in their own country or discouraged to go to the Red Sea resorts, which were reserved for Western tourists who could enjoy cocktails, sex, service and sunbathing without censure.  For those who risked leaving the classical tourist trails, there opened a vision of a country which was polluted, dirty, ignored by the gated communities reserved for the rich.  Poor Egyptians lived in de facto Bantoustans where the regime was considered an American creation.  Mubarak, who showed such cleverness in his analysis  of international affairs (in the first place the Palestinian question, Israel or Iran), showed little empathy with a population which was hidden from him by a screen of sycophants, who got richer by the day.
It is also difficult to predict what tomorrow will bring because you have three constituencies who are equally frustrated.  The military wants to cut its losses, the Islamists do not want to give up the added value of a (narrow) electoral victory, and the secular element which brought Mubarak to his downfall will do the impossible for the clock not be turned back.  All the elements for a vicious confrontation are ready for ignition and a Syrian repeat should not be excluded. Such a scenario would be difficult to contain.   Other countries not in the vicinity would certainly use "proxis" to steer an outcome which should not jeopardize specific interests. The Suez (Suicide) Canal is of vital importance and the risk of having Suez and Ormuz in unwelcome hands is too great to be ignored. .
The Russians are playing with fire in Syria. We should keep our matches dry and look into a diplomatic compromise.  The Turkish model might be acceptable to all if there is still enough value left in Egypt which can be considered an asset rather than a liability.  Unfortunately, the Arabs are often their own worst enemies, seemingly unable to confront diversity and modernity. Egypt risks loosing a historic opportunity.  This would be all the more tragic since there was, until World War II, a parliamentary tradition and a plurality of opinion. Like most things Egyptian, this also risks being covered by the sand, which in this fascinating country is the only dynasty with lasting power.

Monday, June 18, 2012


What a week-end!
What a future!
It would be redundant to elaborate on events which already fill papers and keep political analysts busy while leaving the spectators in the cold.
Nothing got solved. The Islamist victory in Egypt or the Greek vote in support (?) of the bailout are hostage to forces which they cannot control. This on top of numerous flash points spread all over which do not respond to available therapies.  Meanwhile, the G20 are currently meeting in Los Cabos in Mexico, an absurd tropical 007 setting, while the world is on fire.
I will not elaborate on situations that are out of control but as a European I wonder if our many cooks will ever be able to come forward with an agreed "entree" rather than with an assortment of little "canapes."  Paul Krugman argues that the origins of the European disaster lie north rather than south. The monetary system is fatally flawed, unwilling or unable to come up with ideas which could in turn rectify the recognized malfunctions in Greece, Spain & Co. If your house is on fire you do not moralize, you dial 911. The European Central Bank and Euro member states, in the first place Germany, have not come up with solid alternatives.  Spending more maybe or letting some inflation free are still tabou in the leading circles which hold firm on austerity rather than growth. Theology stands in the way of praxis.  Europe is in need of a far stronger central authority if it wants to avoid the fate of the Medusa raft where there were too many to be rescued, while being rudderless.  This crisis in the globalised world is toxic and could very well derail America's slow recovery and torpedo the advances of the BRICS.
I would contradict myself if I were to suggest that the euro zone or the EU as a whole are doomed. The adverse psychology which weakens Europe's attraction as a model should not remain unanswered.  Europe needs to review its existing structures and realize that new unforeseen conditions can no longer be monitored by outmoded dogmas. There is plenty of conceptual talent in the EU but the political will lies in tatters.  Most realize that, but too few are willing to accept the consequences of this new breed of power vacuum.
That the Greeks and Spanish are faulty is a fact.  Letting them become scapegoats for not doing enough does not help. The sick should not be allowed to become an alibi for the non-doers.  Athens before the elections equals Athens under Antonis Samaras. This pyrrhic victory might well prolong the stalemate rather than shorten it.  It should not stop the EU from reviewing its workings and ignoring the austerity showdown which looms around the corner.  I wonder how the stock market will react but I am afraid that in the short term the unconvinced will have the upper hand if nothing more drastic occurs.

Monday, June 11, 2012


The Jubilee of the British Monarch was remarkable. The pomp and splendor from bygone times did fit the person of the Queen, while they might have looked rather pathetic and vulgar almost with any other. Elisabeth II appropriated the pageant, with nonchalance and almost aloof irony. She waved and smiled with parsimony, remaining a distant idol, as she has decided to be since acceding to the throne. Belonging to the generation which had the privilege to mingle with the likes of the Sitwells, Noel Coward, P.G.Wodehouse or Allan Bennett, she is known for a sense of humor but also for a steel faculty of reckoning.

She witnessed how the Royal family was almost swept away by soap opera events which spanned an arc which covered both the sordid/comic (The Duchess of York) and the tragic (Princess Diana). The latter, who had enlivened the Royal family, was the only one who, after her death, was able to crack the walls of royal self-control.  It is ironic by the way that Prince Charles married Camilla Parker Bowles, direct descendant of Edward VII‘s favorite mistress, Alice Keppel. The Windsors like continuity!

The Queen remains a cipher. One would love to see her at times exchange distance in favor of proximity, to receive proof of the realty of her supposedly mordant humor, which she keeps safe in some personal vault.  Her passion for horses and dogs, the concern shown in 1992 after the fire in Windsor Castle, and her political stand regarding the Commonwealth leave us with some glimpses, but the overall picture remains blurred. One would have liked to witness what was said during her rare meetings with Edward VII or her encounter with Wallis Simpson at the funeral of the former. The motto of absolute discretion continues to prevail. Countless prime ministers, from Winston Churchill on, have respected the mutually accepted code of privacy. Hence this queen, who is still able to mobilize millions, looks familiar to all while simultaneously keeping her distance, creating a mystique which no other royal has been able to achieve.

There is also a cynical element in all this. The carriages, the uniforms, the gossip have become a touristic attraction and feed the tabloids. In the Royal family only the queen has the knack to control her narrative.  The successors will have to be attentive to keep this savoir-faire, in order not to become hostages of a mothballed pageant. Fortunately the sons of Princess Diana seem to have inherited from their mother a healthy, ironical gene which will protect them from becoming mere pawns in some mediocre “matinee”.  Until then, the Queen will continue to rule, without equal in the world, setting her own rules. It is an act which would leave even Lady Bracknell speechless.

The British are unique indeed. This former infinite empire, now reduced to having to attend EU meetings in Brussels remains a “power” and projects an irrational indispensability, unlike any other EU member.  Sometimes I think that the British sense of humor and morgue are weapons that no other country, with the possible exception of the United States, possesses. We do not go to Moscow or Beijing to laugh. The French only indulge in negative humor:  to attempt to humiliate is their “forte”. The British are too insular, probably, to indulge in “minimizing,” more out of lack of interest than out of respect. Elisabeth II has a worldview, seen from balconies and carriages, which are part of the “job”. I am sure that her analytical mind rests on a more solid foundation. The person who is almost hidden from view by a cloud of honors is the last to be fooled by a “production” which she alone, unlike her father King George VI or King George V, is able to master.  Queen Victoria has found her match, finally.  Both queens share class. There is no room for fussiness in either.

Friday, June 8, 2012


The financial mess in Europe and, to a lesser degree, in the United States seems to be impervious to any therapy. The EU crisis is the more serious of the two because it is of a structural nature. The “institutions” are not working out as was expected and the fragility of a continent which was supposed to have found “closure” after the Bosnian conflict, looks as if it were tempted to reopen old wounds and prejudices. The American financial crisis looks more manageable in the long-term because the Americans are not mortgaged by ulterior motives.  The United States finds itself in a difficult situation but its future is not at stake. The EU is on life-support, almost.  However, I do not share in the fashionable pessimistic outlook, while at the same time recognizing the armada of icebergs which are threatening the EU Titanic. Obviously the ECB needs to be reformed and this can only be achieved by more Europe rather than less. Political wounds will need to be addressed, otherwise we risk finding ourselves with clusters rather than union. The United States has more technical problems and does suffer from denial with regard to a chronic overspending and a polarized political landscape. I doubt that the next president, be it Obama or Romney, will make that big of a difference. Too much is said in the campaigns which is dead on arrival once the candidate becomes the president. It is clear that the globalization which was cheered years ago and given a free ride needs some form of regulation both in the private and public sectors. Personal assets are hostage to hedging while public finances look dangerously exposed to the topsy-turviness of a banking sector often running amok. Notwithstanding, the Europeans seem to be making some progress toward the creation of Euro-bonds, a banking and fiscal union, allowing for a streamlined fiscal policy erga omnes. Spain and, above all, Greece might still be tempted to derail policies which are felt imposed rather than negotiated. Such an attitude would be unacceptable and lead to Athens’ inglorious exit.  Strangely, the Dutch do not support the President of the Council Herman Van Rompuy in his institutional “brainstorming.”  The finger should not solely be pointed at the Greeks.
Chancellor Angela Merkel has shown patience and creativity. She deserves credit for being forthcoming while others spend their energy trying to escape from underwritten responsibilities with regard to debt ratio or fiscal transparency.  Germany, rightly so, will not assume the role of European ambulance.  On the other hand, Berlin knows too well that the European “project” must be continued if there is still an ambition left to remain a political player in world affairs.  The immature Greek attitude could become a real danger if it were to mutate into similar situations in other countries. We should abstain from adding unpleasantness to difficulty.  Another problem is that within the EU there are too many cooks and bruised egos, which too often come up with half-baked solutions which only kick the cans down the road. The new French president seems convinced that the Franco-German partnership is essential for maintaining European relevance worldwide. He has not come up with the more old-fashioned ideas of the socialist textbook and seems to be eager to work with Germany. This can only benefit the therapy which must be imposed upon the mostly southern flank of the EU and which will certainly be a bitter pill to swallow.  Meanwhile, Wall Street struggles with bad bonds from, inter alia, Italy, Spain and Greece, besides living on borrowed (Chinese) time. The EU should send confidence-building signals to the American consumer. The latter is already penalized by the housing crisis and unemployment and needs to see the European crisis in a less “doomsday perspective.” Europe must no longer be seen as a virus, which could also affect the outcome of the presidential elections in the US.   In times like these, psychology plays a major role.  We need not be even more traumatized by events which can easily light a financial brushfire, such as a rush to the banks or a standstill in lending and consumer spending. The Fed for its part must not play the guessing-game. The Europeans should also realize that antiquated populism is no answer to a contemporary malfunction. Nobody wants some Tea Party player in this sophisticated bridge game, wherein familiarity with   “honors, rubbers and tricks” is not for the amateurs.

The euro should not be endangered. The EU has to reconnect with the citizen. The ECB is in need of a larger mandate. Paths to recovery there can only lead to improvements elsewhere. The same goes for the United States which finds itself hostage to political bickering from another age.  Obama is too philosophical to be as convincing as he should. Romney overstates his business savoir-faire in Staples or Bain as a model for finding a way out of the current crisis. Walt Disney was a genial businessman as well, but that did not make him necessarily fit to be the White House occupant.  Obama and Romney tend to exaggerate their exceptionalism (a chronic American ailment.)  Both are reasonable, intelligent individuals but are under pressure to play to the crowds and talk banalities at a time which requires a more visionary leadership. By the way, the same goes for Europe, which seems too often like an orphan looking for inspiration. The Brussels night meetings do not always seem to bring the best out of the participants. Angela Merkel, Herman Van Rompuy and Mario Draghi still stand out and deserve respect for their political clairvoyance.

We are still not in the land of the blind!