Democracy doesn’t make miracles for Greece or Egypt

By Ian Bremmer
June 27, 2012

For months now, the world has been waiting for the results of the momentous elections in Greece and in Egypt. In Greece, it was hoped that citizens would reject candidates who called for the breakup of the euro zone, or a Greek exit. In Egypt, the stakes were simpler, but larger: It was hoped that the election itself wouldn’t be a sham and that the country’s people would get their first true taste of the power of democracy.

It felt like everyone was holding their breath for the results in these two troubled countries, but it turns out neither country had the “disaster election” that some pundits feared. No, what both countries had was a “kick the can” election: For very different reasons, neither Greece nor Egypt is going to transform into a flourishing, liberal, fiscally sound nation overnight. And the task of governing in either country, therefore, is no big prize to either Greek Prime Minister Antonis Samaras or Egyptian President Mohammed Mursi. A lot of chips have to fall in their favor before they can even begin to get beyond the basic duties of simply showing up to work in the morning and keeping the lights on in government. But again, each country’s situation is different and bears a different explanation of the reality on the ground. Let’s take Egypt, with its internal threats to stability, first.

While the election of Mursi, the incoming Egyptian president, is a signal achievement that goes a long way toward instituting a tradition of civil rather than military rule, he alone will not get the economy to stand on its feet. The Egyptian tourism industry, its most important, has been absolutely crushed. The economy is in a shambles as the thread that was holding it together – Mubarak’s dictatorship – has been pulled from the fabric of Egypt, and the country is a long way from convincing anyone that it has recovered. While Mursi was the better choice for Egypt, he comes from the Muslim Brotherhood, basically a civic organization with no experience or expertise in macroeconomic management. The brotherhood is an important social organization: It’s a lot of things to a lot of people in Egypt, but it’s not an incubator of technocratic economic thinking or governance. That’s what the country will need to get back on its fiscal feet.

And as long as Egypt’s economy is struggling, the civilian leadership will face a threat from the country’s military leaders, the Supreme Council of the Armed Forces. The SCAF supported Mursi’s opponent, Mubarak’s former prime minister, Ahmed Shafiq. Mursi will have to go a long way to get out from under the SCAF’s thumb, and it’s unclear what resources he’ll have to do that, with his narrow win. One thing is for sure: A “kick the can” strategy will look enticing in this environment. Mursi will most likely postpone fixes for long-term problems to brighten the nearer-term outlook. Take subsidy reform. Right now Egypt spends almost 10 percent of GDP on subsidies, mostly for food and fuel – a situation widely recognized as inefficient and unsustainable – but 51.5 percent of the popular vote is no mandate for Mursi to take on the unpopular task.

In Greece, the general problems of its debt crisis and need for austerity measures to persuade the Germans to bail it out, have been discussed to death in the media. Samaras has taken over from a caretaker government, and he’s got his work cut out for him. But things did not get off to the best start, as his technocratic finance minister, Vassilis Rapanos, has already bowed out of the job due to health problems. With Samaras himself also in the hospital recently for emergency eye surgery, Greece is quite literally laid up right now, hoping it has more time to figure out its next economic move.

Don’t expect much, in other words, from the governments of Mursi and Samaras. While the elections went as well as they could go, nothing fundamental has changed about the pickle both nations find themselves in. Both leaders need fixes that appear to be far outside of their control. Mursi needs to figure out how and whether he can work with the Egyptian military to begin turning his country around. Samaras may have had a say in appointing the new finance minister, Yannis Stournaras, but the real issue is out of his hands: He needs Germany and the euro zone to accept a renegotiation of the existing loan package for Greece, which, over the long run, it cannot afford. The best thing that can come out of both of their tenures is some stability, which would, one hopes, beget even more stability, shoring up the democratic sovereignty of both countries.

But even with that good outcome, which is far from assured, each country will still firmly be in kicking-the-can territory. It will take years before affairs in Greece and Egypt get back to anything like normal. Just as in Germany’s takedown of the scrappy but overmatched Greeks in Euro Cup play this weekend, there will be no miracles this time around.

This essay is based on a transcribed interview with Bremmer.

4 comments

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the necessity for reforms in the greek economy and governance over-shadow the stale meme of austerity

for greece to reform or not reform, that is the question

“kicking the can” – more on this meme later

suffice to say there is a difference between procrastinating with needed reforms in greece and the slow process of fiscal discipline between 16.5 sovereign countries sharing the same currency

Posted by scythe | Report as abusive

People need to understand and be educated on the fact that their silent assent to a lot of things has been the reason why they need austerity to survive. If their parents had done a better job of raising their voices when required, this would not have occurred. If we do not raise our voices now in favor of healthy debates, we will leave nothing but misery for our children.

Many of the old order of society is neither useful nor appropriate. Organised religion of has been given undue prominence in all countries round the world and created a new order of magnitude for tensions never seen before.

Leaders and Governments will do well to convey some harsh truths and educate people. People will do well and participate in Governance beyond voting. All dramatics and theater that is politics now should be severely protested against.

Education is the key. Get more and more people educated at all costs

Greece and Egypt are just tips of the iceberg

Posted by DNP | Report as abusive

Baby steps Ian. Baby steps. We’re talking a generation or two before average Egyptians understand democracy, capitalism, freedom, and accountability. Unfortunately, even average US citizens are unlearning how it all works as the world folds in on our sanctuary of freedom.

Posted by SeaWa | Report as abusive

A complete out-of-depth analysis of the Greek situation.

Repetition of the same irrelevant, incoherent and injurious positions of Merkel’s propaganda.

Under the banner of austerity Merkel has destroyed perfectly healthy economies like Spain and others.

And all of this so that (a) euro currency lowers in value (thus benefiting Germany as an export nation), (b) Germany gets zero financing cost (aka free money) and (c) all investment capital flees Europe to sit on German Bunds earning ridiculously low (aka negative) rates of return.

And the commentator here has the nerve to suggest that this unjust enrichment German game is somehow Greece’s lack of direction.

Let the author then be reminded that this article is an utter manifestation of his disturbing ignorance and that he is a true enemy of democracy.

Shame on you Bremmer!

Dean Plassaras

Posted by DeanPlassaras | Report as abusive