Monthly Archives: August 2013

Remember the neocons? They were the powerful and controversial group of thinkers who argued that the promotion of democracy in the Middle East was the key to winning the “war on terror”. The influence of the neocons peaked during the Bush administration, when they became vocal advocates for the invasion of Iraq.

Many of the critics of the neocons always argued that all this talk of “democracy” was simply a hypocritical mask for the promotion of US or Israeli interests. So I was interested to see how leading neocon thinkers have reacted to the coup in Egypt and the assault on the Muslim Brotherhood. Have they kept the democratic faith, or have they gone along with the military? Read more

By Catherine Contiguglia

  • Trouble continues in emerging markets. The imminent tapering of the US Fed’s bond-buying programme against the backdrop of high levels of credit in Asia have some worried that the stage is set for another 1997-98 style financial crisis.
  • Speaking of the Fed, Larry Summers has had a lot of bad press in his run to succeed Ben Bernanke as governor of the Federal Reserve, and so “his friends from the White House years wanted to help him,” writes Zachary Goldfarb in the Washington Post, teaming up to ramp up his strategy for the “hottest political campaign in 2013.”
  • While the NSA/Snowden/Greenwald-Miranda/surveillance row rumbles on, the US department of homeland security is testing a crowd-scanning surveillance system that would automatically identify people by their faces, which has privacy advocates calling for the implementation of limitations before the technology outpaces existing legislation.
  • More EM pain: the Sapphire – the tallest addition to Istanbul’s skyline – was funded by cheap loans denominated in dollars that poured into emerging markets as major central banks engaged in quantitative easing. Now, as monetary policy tightening looms on the horizon, “Istanbul’s skyline could well be a harbinger of an emerging-market bust brought on by unpaid loans, weakening currencies, and, eventually, the possible failure of developers and banks.”

 Read more

Guardian Editor Alan Rusbridger’s revelation that his newspaper was forced by British spooks to destroy hard disks containing files provided by the contractor Edward Snowden included a fascinating detail on modern spy craft. The Guardian reported:

“In a subsequent meeting, an intelligence agency expert argued that the material was still vulnerable. He said by way of example that if there was a plastic cup in the room where the work was being carried out foreign agents could train a laser on it to pick up the vibrations of what was being said. Vibrations on windows could similarly be monitored remotely by laser.”

I’m sorry, come again?

You read that correctly. GCHQ, the British intelligence agency, feared that if Russian or Chinese agents were unsuccessful in penetrating the Guardian’s computer systems, they might try to listen to journalists discussing the Snowden files by using a laser beam.

That sounds like a far-fetched plot line from the US hit TV series Homeland…

True. But laser microphone surveillance has been going on ever since the Soviets and Americans went toe-to-toe during the Cold War.

Some experts argue that intelligence services take the risk of laser audio surveillance into account when constructing their own headquarters. Read more

Police arrest a supporter of ousted Islamist president Mohamed Morsi at a protest camp in Cairo last week. (Getty)

Saud al-Feisal, the veteran Saudi foreign minister, delivered a strident warning to Europe and the US this week as western nations consider suspending financial assistance to Egypt’s new military-backed government.

Slamming what he said was a refusal to recognise reality, in which Islamists alone were to blame for the violence and chaos spreading in Egypt, he warned that Cairo had friends in the region who would make up any reduction in aid.

He went further, hinting at potential consequences for western relations with Saudi Arabia itself. If the “strange” international policy on Egypt continued, he said, “we will not forget … and will consider it hostile attitude towards Arab and Muslim security and stability”.

Riyadh had already shown its commitment to Egypt’s new government, rushing in after the July coup with billions of dollars of assistance. Saudi officials argue that western reluctance to embrace the new government in Cairo runs against the demands of the popular majority and encourages the Islamists’ defiance, thereby provoking more violence.

Although often indecisive, and sometimes shy, Riyadh appears to be acting on Egypt in the same resolute way it handled Bahrain two years ago. Read more

By Catherine Contiguglia

Emerging market currencies are sliding as the beginning of the end looms for the US Federal Reserve’s ultra-loose monetary policy, and economic growth continues to stagnate while current account deficits grow. India’s rupee is leading the drop after a clumsy policy response spooked investors. Though policy makers are now focused on reducing the current account deficit and foreign currency reserves are much stronger than they were before the 1991 balance of payments crisis, the size of India’s economy means any downturn could have a significant impact on the global economy.

♦ Saudi Arabia is backing Egypt’s military rulers with oil money and diplomatic might and that could well undercut US and European efforts to apply pressure by cutting aid to Cairo following the bloody crackdown by Egyptian security forces on Islamist supporters of deposed president Mohamed Morsi.

“It may not be long before it will be impossible for journalists to have confidential sources,” writes the Guardian editor Alan Rusbridger, reflecting on the recent detainment of a reporter’s partner in connection with the paper’s publication of information from US National Security Agency whistleblower Edward Snowden.

A detail not often noted about Turkey’s Gezi protests is that many of the frontline protesters have been women, whose situation has lagged far behind international standards on almost every measure in the ten years Prime Minister Recep Tayppid Erdogan has been in office.

The economic gap between blacks and whites in the United States has not budged for 50 years, the Washington Post points out in a set of charts that show how “yawning” disparities have persisted since 1963.” Read more

By Gideon Rachman

If you are going to intervene in a foreign country, it helps to know what you want to happen. But on Egypt – and Syria, too – western policy is buffeted by a mass of conflicting instincts. The US and the EU are pro-democracy but anti-Islamist; pro-stability but anti-crackdown; opposed both to jihadists and to their enemies in the security state. No wonder that the Arab world is confused. The one thing that unites the Egyptian military and the Muslim Brotherhood is that they both claim to have been betrayed by the US. Read more

Supporters of ousted President Mohamed Morsi protest the killing of his supporters by the security forces. (Getty)

Egyptian Prime Minister Hazem el-Beblawi on Saturday proposed banning the Muslim Brotherhood group in a move apparently aimed at barring it from participating in politics in Egypt. Read more

By Catherine Contiguglia
♦ The public mood in Egypt is hardening against Islamists since President Mohamed Morsi was deposed – a result of fatigue with the turmoil caused by Brotherhood marches, and hostile local media that refrain from covering the bloody crackdown on Islamist protest camps.
♦ On the flip side, the crackdown on Islamist camps caused the most violent wave of Islamist violence against Christians in modern history, with attacks on 30 churches and at least four Christian deaths.
♦ In the hours before Egyptian security forces launched a crackdown on camps of pro-Morsi supporters, American diplomats were pushing for agreements between the two groups to avoid violence – all of which failed, as generals in Cairo ignored Americans “in a cold-eyed calculation that they would not pay a significant cost.”
♦ An event that brought together India’s prime minister with past, present and future bosses of the central bank yielded some insight into what the future might hold for the volatile economy, including bringing incoming RBI governor Raghuram Rajan on earlier, not adding new capital controls, and narrowing the trade deficit.
♦ Being an American among Brits sometimes “feels like being a guest who shows up at a memorial service wearing a Hawaiian shirt and traumatizes the mourners with intrusive personal questions,” writes Sarah Lyall of her 18 years as the New York Times’ UK correspondent.
♦ The partner of Glenn Greenwald, the Guardian journalist who revealed surveillance programs by the NSA using documents passed to him by whistleblower Edward Snowden, was detained for almost nine hours by UK authorities in Heathrow airport to be questioned under the Terrorism Act 2000.
♦ After almost 60 years, the US intelligence community has openly acknowledged that it was behind the controversial overthrow of Iran’s former prime minister Mohammed Mossadegh in 1953.
♦ Turkey’s greatest writer Orhan Pamuk converses with Simon Schama about recent developments in his country, including the “wonderful” uprising in Taksim square and the twilight of prime minister Tayyip Erdogan, and allows him to step into his home that has been transformed into a “Museum of Innocence.” Read more

In a rambling weekend statement, Egypt’s state information service complained of “severe bitterness” towards some western media coverage, which it deemed “biased” in favour of the Muslim Brotherhood. Forget that the Brothers had won legislative and presidential elections and are now facing one of the most brutal crackdowns in their more than 80-year history; they are, says the statement, terrorizing citizens, killing innocent people, and attacking the police. And they are being aided in their devious acts by al-Qaeda.

The police and army, meanwhile, are the heroes who have rushed to protect the people and their revolution and are now standing in the face of “terrorist” attempts to “fling the country into violence.”

Expressing dismay that several western media have been focusing on the outraged reaction of some western governments, the statement recommends that they pay closer attention to the support in Egypt’s war against terrorism delivered by the likes of Saudi Arabia and the United Arab Emirates (the autocratic supporters of the anti-Brotherhood campaign.) Read more

Co-workers and relatives of miners shot at Marikana gather there to mark the first anniversary of their deaths (Getty)

The shooting and killing of 34 striking miners in Marikana a year ago has become a symbol for the growing inequality and civil strife boiling beneath the surface of post-apartheid South Africa.

The massacre at the Marikana platinum mine complex operated by the London-listed company Lonmin occurred six days into a strike in which 10 others had already been killed in clashes, including two policemen. The striking miners, armed with sticks, stones and machetes, were demanding monthly wages of R12,500, a little more than £900, in a country where the average wage is R27,239. Strikers said that they had been warned to leave the area and then were surrounded by coils of razor wire laid down by police. “That’s when they started shooting,” the FT’s Andrew England was told at the time. “It was terrible.” Read more

By Catherine Contiguglia
Egypt

♦ The Obama administration’s initial approach of staying mostly neutral following the ouster of Morsi is now moot, writes the FT’s Geoff Dyer. Though the United States currently has lost much influence, they must distance themselves from the military to have a voice in the longer-term political debate.
♦ It is “striking” how many people expected the recent violence in Egypt, writes Peter Hessler in the New Yorker in his analysis of why it happened now. Many Egyptians feel there was growing popular pressure to contain the Muslim Brotherhood movement following the removal of Morsi.
♦ The United States has lost all influence and soft power in Egypt by prioritising regional security interests over the interests of potential Egyptian voters in a fledgling democracy, writes Cynthia Schneider in Foreign Policy.
♦ The United States must cut off aid to Egypt, writes James Traub in Foreign Policy, because it is necessary for the United States to “look at themselves in the mirror, and to accept, if not like, what they see.”
♦ As the international community condemns the violence in Egypt that left hundreds of Brotherhood supporters dead, in the streets of a working class neighbourhood in Cairo, opinions are more nuanced. Many regret the blood shed but feel that the crackdown by the liberal government on Morsi supporters was necessary for the security of the country.
Elsewhere
♦ Following elections that kept Robert Mugabe in power, businessmen are holding their breath to see if, and to what extent, he will actually pursue his “indigenisation” policy where all enterprises must be 51 percent owned by black Zimbabweans.
♦ The virtual currency that started out as a nerd experiment has allowed drug dealers to “win the war on drugs.” Online black markets hidden behind sophisticated anonymity software are revolutionizing the drug trade, selling a range of illegal drugs in exchange for Bitcoin, and then shipping sales right to customers’ doorsteps. Read more

What comes after the crackdown in Egypt?
The Egyptian army’s efforts to clear supporters of the Muslim Brotherhood from camps around Cairo has led to hundreds of deaths and a deepening political crisis. So what is the future for Egypt, and how is the rest of the world likely to react? Heba Saleh, Cairo correspondent, and David Gardner, senior international affairs commentator, join Gideon Rachman.

Army chief Gen Abdel Fattah al-Sisi on an anti-Islamist protester's placard. US president Obama is depicted as a supporter of the Muslim Brotherhood. Getty

When the army and security forces ignored pleas for restraint from Egypt’s allies in the US and Europe, moving to crush the Muslim Brotherhood protest camps that spread across Cairo after the July 3 coup d’etat that toppled President Mohamed Morsi, they had reason to feel supremely confident.

What General Abdel Fattah al-Sisi and his colleagues have done is to restore the security state – an action that should not be confused with re-establishing security.

This restoration is edging towards the status quo ante the Tahrir revolution that overthrew Hosni Mubarak in 2011. It started before the coup, with the constitution Morsi and the Brothers railroaded through last December. Most of the controversy excited by this Islamist-tinged charter was caused by the way it ignored liberal, Christian and women’s concerns over fundamental rights and freedoms. Alarmingly little attention was paid to the way the Brotherhood sought to co-opt the military by embedding the army’s privileges and prerogatives even beyond the powers it enjoyed under Mubarak. Read more

By Catherine Contiguglia
♦ The violence in Egypt has put Western diplomacy in a quandary that goes beyond a face-off between principles and interests, says Gideon Rachman. The United States and Europe must condemn the violent crackdown and cannot back a violent anti-democratic group, but by withdrawing all support from the current military government, they may find themselves powerless to influence events.
♦ International efforts to bring the warring camps in Egypt to the negotiating table have failed, but in order to end the violence, more diplomacy will be needed the FT writes in an editorial. Washington must suspend aid to Egypt’s military until parties agree to talks, the release of Mohamed Morsi must be on the table, and pressure needs to be exerted on the Muslim Brotherhood with the help of Turkey and Qatar.
♦ In choosing to not respond strongly to the violence in Egypt, the United States seems to be missing how grave this development is for Egypt and the region, writes Michael Hirsh in the National Journal. Hopes for a moderate Muslim participation in democracy are dashed, and extremism will likely replace it, while Egypt could end up reverting to a military junta regime.
♦ Amidst the horror, blood and mud within the camps of Morsi supporters, the work from an improvised gallery of comic artists from Brotherhood-affiliated papers continues to paper the walls.
♦ The idea of democracy for any potential Muslim voter was destroyed in the violence in Egypt, writes Robert Fisk in the Independent, and though what the future holds is unclear, what is certain is the initial feeling of unity that came with the Arab Spring no longer exists in Egypt.
♦ The most disturbing question raised by the violence in Egypt, writes Issandr El Amrani on the Arabist blog, is whether the escalation of violence is part of the desired goal, rather than a consequence. Some liberals who came out in favour of the coup of Mohamed Morsi may have thought it would lead to a better transition to democracy, but they were in the minority – most “appear to have relished the opportunity to crush the Muslim Brothers.”
♦ The US under-the-radar approach to the leadership in Egypt following the coup of Mohamed Morsi may have been appropriate to facilitate negotiations, but that time has passed, writes Marc Lynch in Foreign Policy. After the bloody crackdown on Morsi supporters, the United States must step away from the current regime.
♦The failure of the United States to follow their own laws and suspend aid to Egypt following the coup of Mohamed Morsi in which the army played a “decisive role” makes them complicit in the bloody crackdown on Morsi supporters, the Washington Post writes in an editorial. Their continued resistance to calling Morsi’s ouster a coup even after the crackdown is self defeating as continued support of the military will lead to a dictatorship rather than restore democracy.
♦ It is still the Egypt of Hosni Mubarak, writes Steven Cook in Foreign Policy. Political leaders on all sides have promoted narrow interests at the expense of what is best for Egypt, including the Muslim Brotherhood that carried on in Mubarak’s tradition of “whoever ruled could do so without regard to anyone who might disagree.”  Read more

Supporters of ousted president Mohamed Morsi are detained by security forces at the Rabaa al-Adawiyya protest camp. Getty

Egypt’s security forces on Wednesday launched a much-anticipated operation to clear supporters of ousted president Mohamed Morsi from two protest camps in the capital, leaving scores dead and prompting protests around the country from Mr Morsi’s Islamist sympathizers, who clashed with police and attacked churches in southern Egypt.

Polarisation between opponents and supporters of the president increased dramatically in the wake of the popularly-backed coup that removed Mr Morsi, Egypt’s first democratically elected president, from office on July 3. He has languished in detention since, prompting his supporters to accuse the security forces of undermining democracy. Opponents of the former president accuse him of trying to impose an Islamist vision on Egypt and say the military coup was needed to ‘save’ the country. International efforts to mediate between Mr Morsi’s Muslim Brotherhood group and the interim government, backed by the powerful defence minister Gen Abdel Fattah Sisi, failed as neither side showed willingness to compromise.

As the Islamist protest camps became increasingly disruptive in the traffic-choked capital and leaks of an imminent operation to clear them grew, the protesters vowed they would remain until Mr Morsi was restored to power, with some claiming they would rather die as martyrs than give up their protest. Warnings by activists, rights groups and some politicians that their forcible removal could ignite a cycle of violence were ignored and the Arab world’s most populous nation is once again riven by unrest.

Here is our pick of background reads on the latest episode in Egypt’s turbulent transition. Read more

Rabaa al-Adawiya square in Cairo (Getty)

The bloodshed on the streets of Egypt is a disaster for the country. It also creates a desperate dilemma for the West.

Nobody yet knows how many people have been killed. But the random nature of some of the victims – a British television cameraman, a 17-year-old-girl – suggests that the death toll will be very high. Beyond the immediate tragedy, the killings in Cairo end the prospect of any reconciliation between the military and the Muslim Brotherhood. They also end any hopes for a democratic Egypt, at least in the immediate future. That vision – which seemed almost irresistible after the overthrow of Hosni Mubarak in early 2011 – is now over. Read more

By Catherine Contiguglia
♦ Internet billionaires are putting their money into futuristic, even outlandish, ventures that could herald the new era of scientific innovation or just be exercises in hubris.
♦ German politicians may be saying that they have no intention of joining a coalition now, but all the party “colour combinations” will become viable once the election comes round, says the FT’s Quentin Peel.
♦ For those who have never been inside a gulag, New Republic takes a tour of a Russian penal colony through photographs to give an idea of what sort of conditions prisoners like Mikhail Khodorkovsky and the members of the punk bank Pussy Riots face.
♦ New calculations that show that jumping into a black hole would cause one to be flash-fried by a firewall of energy – rather than smote to particles smaller than dust – have ignited a tense debate among the world’s physicists.
♦ The New York Times profiles documentary film maker Laura Poitras, looking at her investigations into growing surveillance in the United States and how her involvement with releasing information from Edward Snowden changed her life.  Read more

By Catherine Contiguglia
♦ The signing of a contract between the Somali government and UK oil and gas exploration company Soma to collect data on onshore and offshore oil has been called non-transparent, and raised concerns about whether oil politics could destabilise the country’s fragile recovery.
♦ Prague’s CorruptTour agency is selling out bookings for their Crony Safari that brings tourists to a sites connected with the most famous corruption scandals – from an address registered by 600 companies to a school where cash can buy a degree.
♦ The monetary tightening by India’s central bank could close credit arteries and make it difficult for the country’s banks to cover a mass of rapidly souring loans, writes Reuters’ Andy Mukherjee, as short term funding costs have increased during a time where the economy has slowed and the stock market is slumping.
♦ The drive by policy makers to put Fannie Mae and Freddie Mac out of business doesn’t make any sense, writes Joe Nocera, as they are no longer bullies, are making the government money, and are necessary to uphold the core of American housing finance.
♦ The sit-ins being held around Egypt by those in favour of reinstating President Mohamed Morsi will likely not work, according to an analysis by Foreign Policy’s Erica Chenoweth, as studies show that nonviolent campaigns must follow a strategy of carefully sequenced moves, or they can end in catastrophe. Read more

By Gideon Rachman
Japan’s public diplomacy hovers between the ludicrous and the sinister. In recent months, the country has specialised in foreign policy gaffes that seem designed to give maximum offence to its Asian neighbours while causing maximum embarrassment to its western allies.

By Catherine Contiguglia
♦ Germany gets a lot of advice – good and bad – about how it should be handling the situation in Europe, the FT’s Tony Barber writes, when its greatest contribution would be to reform and modernise its own economy.
♦ Indonesia has enjoyed remarkable economic and political transformation, but the first regime change in the country’s democratic era will be the true test of the country’s resilience.
♦ Russia’s awkwardly worded ban on “propaganda of nontraditional sexual relations among minors” has sparked international condemnation, as well as crackdown within Russia on those who question it – even in jest.
♦ With Larry Summers as a top pick to replace Ben Bernanke as chairman of the US Federal Reserve, there are a lot of questions about whether his connections with Wall Street make him better informed for the position, or whether they present a conflict of interest, especially as the Fed works to complete regulatory legislation.
♦ The mother of Neil Heywood, the British businessman whose murder led to the downfall of Chinese Communist official Bo Xilai and the conviction of his wife, has broken her silence in a statement saying that Chinese officials have still given her neither a full account of the murder nor compensation, leaving Heywood’s two children without financial provision. Read more