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REFLECTIONS ON THE REVOLUTION IN EGYPT,

PART II

HEARING

BEFORE THE

SUBCOMMITTEE ON 

THE MIDDLE EAST AND SOUTH ASIA

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

SECOND SESSION

JUNE 20, 2012

Serial No. 112–155

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

ILEANA ROS-LEHTINEN, Florida, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

DAN BURTON, Indiana 

ELTON GALLEGLY, California 

DANA ROHRABACHER, California 

DONALD A. MANZULLO, Illinois 

EDWARD R. ROYCE, California 

STEVE CHABOT, Ohio 

RON PAUL, Texas 

MIKE PENCE, Indiana 

JOE WILSON, South Carolina 

CONNIE MACK, Florida 

JEFF FORTENBERRY, Nebraska 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

GUS M. BILIRAKIS, Florida 

JEAN SCHMIDT, Ohio 

BILL JOHNSON, Ohio 

DAVID RIVERA, Florida 

MIKE KELLY, Pennsylvania 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

ANN MARIE BUERKLE, New York 

RENEE ELLMERS, North Carolina 

ROBERT TURNER, New York 

HOWARD L. BERMAN, California 

GARY L. ACKERMAN, New York 

ENI F.H. FALEOMAVAEGA, American 

Samoa 

BRAD SHERMAN, California 

ELIOT L. ENGEL, New York 

GREGORY W. MEEKS, New York 

RUSS CARNAHAN, Missouri 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

DENNIS CARDOZA, California 

BEN CHANDLER, Kentucky 

BRIAN HIGGINS, New York 

ALLYSON SCHWARTZ, Pennsylvania 

CHRISTOPHER S. MURPHY, Connecticut 

FREDERICA WILSON, Florida 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

YLEEM D.S. POBLETE, Staff Director 

RICHARD J. KESSLER, Democratic Staff Director 

SUBCOMMITTEE ON THE MIDDLE EAST AND SOUTH ASIA

STEVE CHABOT, Ohio, Chairman 

MIKE PENCE, Indiana 

JOE WILSON, South Carolina 

JEFF FORTENBERRY, Nebraska 

ANN MARIE BUERKLE, New York 

RENEE ELLMERS, North Carolina 

DANA ROHRABACHER, California 

DONALD A. MANZULLO, Illinois 

CONNIE MACK, Florida 

MICHAEL T. MCCAUL, Texas 

GUS M. BILIRAKIS, Florida 

TOM MARINO, Pennsylvania 

ROBERT TURNER, New York 

GARY L. ACKERMAN, New York 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

DENNIS CARDOZA, California 

BEN CHANDLER, Kentucky 

BRIAN HIGGINS, New York 

ALLYSON SCHWARTZ, Pennsylvania 

CHRISTOPHER S. MURPHY, Connecticut 

WILLIAM KEATING, Massachusetts 

(III)

C O N T E N T S 

Page

WITNESSES 

Mr. David Schenker, director, Program on Arab Politics, Washington Institute 

for Near East Policy ............................................................................................. 6

Michele Dunne, Ph.D., director, Rafik Hariri Center for the Middle East, 

Atlantic Council .................................................................................................... 14

Jon B. Alterman, Ph.D., director, Middle East Program, Center for Strategic 

and International Studies ................................................................................... 19

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Mr. David Schenker: Prepared statement ............................................................. 8

Michele Dunne, Ph.D.: Prepared statement .......................................................... 16

Jon B. Alterman, Ph.D.: Prepared statement ........................................................ 21

APPENDIX 

Hearing notice .......................................................................................................... 42

Hearing minutes ...................................................................................................... 43

(1)

REFLECTIONS ON THE REVOLUTION IN 

EGYPT, PART II 

WEDNESDAY, JUNE 20, 2012

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON THE MIDDLE EAST

AND SOUTH ASIA, COMMITTEE ON FOREIGN AFFAIRS, Washington, DC. 

The committee met, pursuant to notice, at 1:30 p.m., in room 

2200 Rayburn House Office Building, Hon. Steve Chabot (chairman 

of the subcommittee) presiding. 

Mr. CHABOT. We’re going to come to order. I believe the ranking 

member, Mr. Ackerman, will be here very shortly. The folks that 

are at the back, if you’d like to make your ways in a little bit and 

over here, I’m fine with that because I’ve been told that we’re going 

to have to close the door at some point. I apologize for having a 

smaller meeting room. Two of the other subcommittees, yes, you 

can keep coming in. I know we’ve got some more folks out there. 

Normally, we’re in the larger room. This is, I think, the first time 

in the last 2 years we’ve been in the smaller room. Because two of 

the other Foreign Affairs subcommittees have a joint hearing going 

on. So they’re in the larger room. But feel free to come over this 

way, too, if there’s not sufficient room over there. 

I’m Steve Chabot. I’m the chairman of the Foreign Affairs Subcommittee on the Middle East and South Asia. As I said, I know 

the ranking member, Mr. Ackerman, will probably be here shortly. 

We believe we’re going to be interrupted by votes here within the 

next 10 minutes or so. I think there are three votes which will take 

about 1⁄2 hour. So we’re going to try to get through as much of this 

as we can before the votes happen. Even when the bells go off for 

the votes, we have about 5 to 10 minutes before we have to actually go, so we’ll try to get in as much as we can. Maybe the introduction of the witnesses as well. 

In any event, I want to thank everyone for being here this afternoon. I want to welcome my colleagues who will be arriving shortly, and all the folks that have shown interest in this particular 

hearing on Egypt this afternoon. 

Just over 11⁄2 years ago, Hosni Mubarak resigned as President 

of Egypt in response to massive and sustained protests by the 

Egyptian people. Unfortunately, as the last year has illustrated far 

too well, freedom rarely marches steadily forward in a straight line. 

A year and a half into the transition, Islamist groups have won a 

majority in the parliamentary elections. The Muslim Brotherhood 

candidate for President, Mohamed Morsi, appears to have won in 

2

the recent run-off election. The Egyptian economy is on the verge 

of collapse. The trial against civil society NGO workers is still ongoing and perhaps most disturbingly recently, measures implemented by the SCAF appear to have the effect of actually rolling 

back democratic progress. 

The events of the past week have been especially alarming. On 

June 13th, the Supreme Council of the Armed Forces, SCAF, reauthorized the use of military tribunals in cases involving Egyptian 

citizens. On June 14th, the Supreme Constitutional Court ruled 

that one third of the Egyptian Parliament was elected illegally. 

This prompted the SCAF to declare the entire Lower House of Parliament invalid. And on June 15th, the SCAF dissolved it and assumed full legislative authority. 

The Egyptian parliamentary leadership has refused to recognize 

the decision, prompting security forces to surround the Parliament 

building. The SCAF also has now invalidated the standing constituent assembly, the body which was charged with writing the 

new constitution, and has taken it upon itself to appoint the new 

panel. 

Finally, on June 17th, as the polls in the Presidential runoff election were closing, the SCAF issued an addendum to the March 

2011 transitional constitution which, among other provisions, gives 

the SCAF veto power over any provisions of the forthcoming constitution. 

We all knew Egypt’s path toward democracy was not going to be 

without its bumps. With the President and the nearly 47 percent 

of the elected seats in the Egyptian Parliament going to the Muslim Brotherhood, and nearly a quarter to other Islamist parties, it 

is clear that Islamists will dominate the Egyptian political landscape in the near future. 

And we all knew that the Egyptian military was to no small degree operating in uncharted territory in its efforts to oversee a 

democratic transition. But I don’t think anyone expected events to 

unfold quite as they have. 

While I continue to question the Islamist commitment to the 

principles of democracy, I believe the SCAF would have a positive 

and reinforcing effect, but unfortunately, far from calming the situation, I feel the recent decisions taken by the SCAF will only stoke 

already-inflamed tensions between the military and the public. And 

I also fear that the SCAF has lost a tremendous opportunity to be 

a force for good. Democratic transitions, even under the best of circumstances, are fraught with potential peril and a nascent Egyptian Government could have benefitted from a steady hand to help 

guide it forward. That opportunity appears to be departing and it 

is time for us all to face the fact that the genie, as they say, it out 

of the bottle. 

Equally disturbing, however, is the state of the Egyptian economy. Since the revolution began, spending on public sector salaries 

and food and energy subsidies have skyrocketed, leading to a predicted budgetary deficit of $23 billion. Authorities have been financing this deficit by borrowing from domestic banks and using 

the country’s foreign exchange reserves which have fallen nearly 60 

percent from approximately $36 billion in early 2011 to $15.5 billion in June 2012. 

3

The situation is fundamentally unsustainable. If foreign exchange reserves continue to dwindle, officials may be forced to depreciate the value of the Egyptian pound, a move that could boost 

interest rates and reduce asset values, potentially stalling any economic recovery. Sooner or later, Egyptians are going to have to face 

the fact that serious structural reforms are needed and they’re 

going to need outside help. Although the International Monetary 

Fund and World Bank have offered assistance, some maligned officials, in particular, the Minister of International Cooperation, 

Fayza Abul Naga, have obstructed progress, citing the loan and its 

potential conditions as threats to Egypt’s sovereignty. This is absurd and I would caution the forthcoming Egyptian Government to 

reconsider this stance as well as Abul Naga’s role in any future 

government. Such a loan would offer Cairo the opportunity to make 

critical economic and governmental changes while continuing to 

provide for a Egyptian population in the meantime. 

Although Egypt’s exact path to democracy remains unclear, what 

is clear is that Egypt is an important country, a very important 

country, that is going through an extraordinary transition. I hope 

to see power handed over to a civilian government that is committed to a pluralistic Egypt that remains an ally of the United 

States and committed to peace with Israel. Decisions about U.S. assistance to Egypt must ultimately be shaped by the choices and 

policies made by whatever Egyptian Government that the Egyptian 

people choose to elect. 

We have an interest in strongly supporting a democratic government that respects the rights of its citizens and rule of law, fosters 

greater economic opportunity and observes international obligations. We would obviously react very differently to any government 

that does not respect the institutions of free government, discriminates against or represses its own citizens, or which pursues policies which are destabilizing in the region. That said, we should be 

careful about making judgments too quickly. I suspect that the 

transfer of power, the government formation, and the constitutional 

revision process are going to take some time. 

For decades, Egypt has been a critical ally to the United States 

and the global war on terror and in pursue to Arab-Israeli peace. 

Egypt has been, and I hope will remain, a leader in the Arab world 

and a force for peace in the region. I hope our witnesses here today 

can help us both understand the current state of affairs in Egypt 

and guide U.S. policy accordingly. 

And at this time I would like to yield to the distinguished ranking member of this committee, the gentleman from New York, Mr. 

Gary Ackerman. 

Mr. ACKERMAN. Thank you very much, Mr. Chairman. I want to 

start by thanking and commending all of our witnesses for appearing today and trying to help us to understand what’s happening in 

Egypt and what it means for the United States and our national 

security. 

If making predictions is a sucker’s game, then making predictions about Egypt must be a sort for mad men, degenerate gamblers, and otherwise distinguished, sane, and expert congressional 

witnesses. [Laughter.] 

4

Welcome. Every prediction about the Egyptian revolution, except 

for change, followed by uncertainty and capped off by the unexpected has failed. The path of the Egyptian revolution began not 

with Hosni Mubarak’s expected death, but with that of a frustrated 

fruit peddler in Tunisia. President Mubarak was removed from 

power not by the masses, but ultimately by his fellow generals. 

And the generals of the Supreme Council of the Armed Forces, the 

SCAF, having seized power, have shown themselves alternatively 

painfully hesitant and spastically aggressive in their rule. What 

could not happen, did. What one expected now seems—what no one 

expected, now seems obvious. And what will finally come to be is 

not much clearer today than it was a year ago. 

One of our nation’s greatest writers, William Faulkner, who 

chronicled the way of the American South, continued years later to 

be shaped and gripped by the drama of the Civil War and the failure of Reconstruction authored a brief, but compelling warning to 

all those who expected to move swiftly and cleanly from one period 

to another. ‘‘The path,’’ Faulkner wrote, ‘‘is never dead. It’s not 

even past.’’

The many twists and turns of Egypt’s post-Revolutionary transition accord with this idea because with the notable exception of 

Hosni Mubarak, the people contending for power in Egypt today 

are by and large the same people they were on January 24, 2011. 

Their outlook, goals, prejudices, and experiences did not disappear 

or transform when Hosni Mubarak ceased to be President. Even 

this revolution, as in every revolution, it is power, power, who will 

have it, what limits there will be upon it, and upon whom and for 

what ends it can be applied, power that is the object of the current 

struggle. 

There was only one prediction that I heard that has held up. I 

heard it from one of the key actors in the present drama. About 

a year ago at a private dinner party, this top shelf player was 

being questioned aggressively about the prospects for the then upcoming parliamentary elections and what it would mean if the 

Muslim Brotherhood won. The elections, again and again, with almost impossible politeness, he deflected the question. ‘‘Their victory,’’ he asserted, ‘‘was very unlikely. Really, almost inconceivable.’’ But the questions continued to be thrown at him without respite. 

‘‘What would happen if they did win the elections? How can you 

be sure they’re not going to win the elections? What if you’re 

wrong? What if they have more strength than you think?’’ After 

ducking and dodging throughout the meal and with dessert departing untouched and no relief in sight, he finally retreated with some 

tinge of anger and got to the bottom line. He actually answered a 

different question. ‘‘The Muslim Brotherhood will never rule 

Egypt,’’ he said. 

That statement wasn’t a prediction or a pledge for our benefit. 

It was an expression of a commitment that was much a part of this 

man as the marrow in his bones. Subsequently, I’ve gotten to know 

him better. He’s a man of his word. And like it or not, he promises 

and he delivers. 

It was in the wake of the Supreme Constitutional Court’s action 

against the Parliament and in favor of the candidacy of the former 

5

prime minister following the outcome of the Presidential election 

and vote in the shadow of the newly SCAF-issued amendments to 

the constitutional declaration. The question I wish had been 

pressed upon him once the Muslim Brotherhood is blocked from 

power, what then? 

I suspect his answer would be something along the lines of saying the Nile will continue to flow. I guess we’ll see. 

Mr. CHABOT. Thank you very much. And at this time I’m going 

to go ahead and introduce the panel. You’ve probably heard the 

buzzers going off which is us being called for a vote on the floor. 

If the second bell hasn’t gone off by the time I get through the introductions we may get in one of the testimonies here before we 

head over there, but I’ll go through these quickly. 

Our first witness will be David Schenker, who is the Aufzien Fellow and director of the program on Arab politics at the Washington 

Institute for Near East Policy. Previously, he served in the Office 

of the Secretary of Defense as Levant country director and was 

awarded the Office of the Secretary of Defense Medal for exceptional civilian service in 2005. Mr. Schenker holds an M.A. in Modern Middle Eastern History from the University of Michigan and 

a B.A. in Political Science and Middle East Studies from the University of Vermont. 

Next, we have Michele Dunne, who is director of the Rafik Hariri 

Center for the Middle East at the Atlantic Council of the United 

States. Prior to this, she was a senior associate at the Carnegie Endowment for International Peace, and editor of the Arab Reform 

Bulletin from 2006 until 2011. She was also previously a Middle 

East specialist with the U.S. State Department where her assignments included serving on the National Security Council staff, on 

the Security of States Policy Planning staff in the U.S. Embassy in 

Cairo, and U.S. Consulate General in Jerusalem in the Bureau of 

Intelligence and Research. She holds a PhD in Arabic Language 

and Linguistics from Georgetown University where she was a visiting professor for 2002 until 2006 and we welcome you here this 

afternoon, Doctor. 

And finally, we have Jon Alterman who holds the Zbigniew 

Brzezinski chair in global security and geostrategy and is director 

of the Middle East Program at CSIS. Prior to joining CSIS, he 

served as a member of the policy planning staff at the U.S. Department of State and is a special assistant to the Assistant Secretary 

of State for Near Eastern Affairs. Before entering government, he 

was a scholar at the U.S. Institute of Peace and at the Washington 

Institute for Near East Policy. 

The second bell went off, I didn’t quite make it. However, we’ve 

been joined by the former chair of the Full Foreign Affairs Committee, Mr. Berman from California, and as is the practice of this 

committee, if he’d like to take a minute for an opening statement? 

Okay, unfortunately, we have to head over to vote and we may not 

make it, especially as we get older, we get a little slower getting 

over there. So—and we don’t want to miss a vote, so at this time, 

we will recess and as I understand we have about three votes, so 

we should be back ballpark around 1⁄2 hour. So we are in recess 

at this time. 

[Recess.] 

6

Mr. CHABOT. Okay, we’re back in session and unless Mr. Berman 

has changed his mind about making an opening statement we’ll go 

right to the witnesses and I’m assuming by his grin, that he is not. 

So we’ve introduced the panel, so Mr. Schenker, you’re recognized for 5 minutes. We again apologize for the temperature. I 

don’t want to say it may be slightly cooler, because you’ve been 

here longer than I have. It doesn’t feel quite as hot as it did, but 

we’ve got a lot of people in a relatively small room. We have a 5-

minute rule. You have 5 minutes. The yellow light will come on. 

You’ll have 30 seconds, excuse me, 60 seconds to wrap up and we 

ask you to stay within that if at all possible. So you’re recognized 

for 5 minutes, Mr. Schenker. 

STATEMENT OF MR. DAVID SCHENKER, DIRECTOR, PROGRAM 

ON ARAB POLITICS, WASHINGTON INSTITUTE FOR NEAR 

EAST POLICY 

Mr. SCHENKER. Chairman Chabot, Ranking Member Ackerman, 

it’s an honor to participate in this important hearing on the subject 

of vital national interest. I thank you for the opportunity to present 

my views to this committee today. 

Today’s hearing could not be more timely, well, actually, given 

the dynamic nature of post-revolt politics in Egypt, tomorrow might 

have been somewhat better. Earlier this week, it seemed the Muslim Brotherhood’s Mohammed Morsi had won Egypt’s hotly contested Presidential election. Tomorrow, however, it would not be 

surprising if we had learned that erstwhile Mubarak Prime Minister Afhmed Shafiq is Egypt’s new chief executive. At this very 

moment, we just don’t know. What we do know is that regardless 

who Egypt’s next President is, barring an unexpected retreat of political power, Egypt will continue to reside with the military. And 

in order to maintain this power, Egypt’s military will likely have 

to take increasingly repressive measures. 

Meanwhile, this military, and whatever government emerges in 

Egypt, are together going to have to contend with a series of increasingly complex challenges that have in the last 16 months 

reached the crisis point. Foremost among these difficulties is the 

economy which has deteriorated precipitously since last year’s revolt. Foreign reserves plummeted, capital has fled, foreign direct 

investment has dried up, inflation is taking hold, and tourism has 

dropped to a fraction of its pre-2011 levels. 

In May, Minister of Finance Mumtaz Saad predicted that elections would ‘‘be the beginning of the national economic recovery.’’ 

His assessment was overly optimistic. The effort to revitalize the 

economy will be hampered not only by continued political uncertainty and unrest, but also by the worsening security situation. The 

immediate aftermath of the revolt saw a rash of prison escapes and 

a surge in violent crime in Egypt, including car jackings, armed 

robberies, and kidnapings, a situation that drove much of the appeal for ‘‘law and order President candidate, Ahmed Shafiq.’’ The 

security deficit is most conspicuous in the Sinai where armed 

groups are claiming allegiance to the ideology and agenda of alQaeda are becoming increasing active and Bedouin tribesmen have 

been kidnaping tourists and harassing the multi-national force and 

7

observes. Operations by Gaza-based terrorists against Israel are 

emanating from the Sinai are also on the rise. 

It’s difficult to discern whether the Egyptian military is incapable or just unwilling to secure the Sinai. Both scenarios are troubling. Not only is insecurity in the Sinai unlikely to be contained 

indefinitely to the peninsula, should Israeli-Egyptian ties further 

deteriorate, border incidents will become more subject to populist 

politics and difficult to manage. 

The bleak economic and security picture is accompanied by 

equally grim prospects for return to political normalcy. For the 

foreseeable future it seems, the Muslim Brotherhood and the SCAF 

will be locked in an ongoing and destabilizing struggle for power. 

At the same time, the Muslim Brotherhood will be challenged from 

the right by the Salafists, their chief political and ideological rivals, 

pushing the Brothers to take an even military line. 

Regardless who prevails in the Presidential contest, Egypt seems 

destined for a combination of populist, Islamist, and authoritarian 

politics. While this may not imply an end to the peace agreement 

with Israel or strategic ties to the United States, changes in policies that impact women, political pluralism and religious tolerance 

could complicate bilateral relations with Washington. At the same 

time, the absence of a Parliament and a President with limited 

powers will diffuse authority, making it difficult for Washington to 

work with civilian leaders in Cairo on issues of mutual interest. 

Continued military preeminence in Cairo may in the short term 

guarantee some long-standing U.S. strategic interests in Egypt: 

Priority access to the Canal, over slights, counterterrorism cooperation, and the maintenance of the peace treaty with Israel. But it 

is an inherently volatile situation. The opposition, Islamists and 

liberal alike, are sure to employ anti-U.S. populist politics as a 

cudgel against the military and should the military crack down and 

reinstitute draconian measures, it will further stress U.S.-Egyptian 

relations. 

Sixteen months on the transition in Egypt is not over. Indeed, it 

is just beginning. And with limited leverage, Washington is going 

to have to pick its spots with both the military and civilian leadership. Populism, along with the social justice imperative of the revolution, will make it more difficult to sustain a critical political commitment to economic reform in Egypt. Washington must encourage 

Egypt to remain dedicated to economic reform and continue to remind Cairo of the inverse relationship between radicalism and foreign direct investment. 

At the most basic level, however, Egypt is going to have to help 

itself. Already, the Salifists and the Muslim Brotherhood have opposed a Japanese loan to expand the Metro system in Cairo which 

Islamists consider is interest and prohibited by Islam. The Salifists 

are also opposed to the $3 billion IMF loan. It’s not clear whether 

the Muslim Brotherhood and the SCAF will come down on this critical funding. At the end of the day, the sine qua non for maintaining the substantial U.S. aid package to Egypt is a continuity of the 

core elements of the strategic partnership. While the instinct may 

be to lower the standard for other less pressing issues, Washington 

should, in fact, take the opposite tact. If democracy in Egypt is ever 

to take root, regardless of who is at the helm, Cairo should be held 

8

to a high standard in this coming period in terms of human rights, 

religious freedoms, political pluralism, and women’s rights. Revoking or reconfiguring the U.S. aid package right now would likely be 

more provocative than productive. Lest these issues fall by the 

wayside, a periodic congressional report requirement for the administration could keep this issues on the front burner. 

Egypt with 83 million people is too big and too important to fail. 

But a return to authoritarianism, either religious or secular, would 

also be a failure, dashing Egypt’s aspirations, undermine U.S. interests in the region and ensuring continued instability in this critical state. Thank you. 

[The prepared statement of Mr. Schenker follows:]


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Mr. CHABOT. Thank you very much. I appreciate your testimony 

this afternoon. 

Dr. Dunne, you’re recognized for 5 minutes. 

STATEMENT OF MICHELE DUNNE, PH.D., DIRECTOR, RAFIK 

HARIRI CENTER FOR THE MIDDLE EAST, ATLANTIC COUNCIL 

Ms. DUNNE. Thank you, Mr. Chairman, for the honor of testifying before the subcommittee. I’ll summarize the written statement that I’ve submitted. 

With the conclusion of their first post-revolution Presidential 

election, Egyptians should have been celebrating this week, the 

transition from inter-military rule to government by elected civilians. Instead, they’re back demonstrating in Tahrir Square. The 

question, Mr. Chairman, is whether the democratic transition in 

Egypt has gone irretrievably off the rails or whether it can get back 

on track. 

We’re awaiting the final results of the Presidential election. 

Today, a coalition of judges who set out to do a parallel count of 

the vote announced that they agreed with the Muslim Brotherhood, 

that Freedom and Justice Party candidate Mohamed Morsi won by 

about 900,000 votes out of a total of about 25 million votes cast. 

But the Presidential Election Commission, whose decisions are 

final and cannot be appealed in court, is now reviewing complaints 

of irregularities by both campaigns and will announce the final results soon, perhaps tomorrow. 

Unfortunately, demonstrations and violence might well ensue, 

particularly if the Commission disqualifies enough votes to name 

former Prime Minister Afhmed Shafiq the winner. Sixteen months 

after promising to oversee a democratic transition, the Supreme 

Council of the Armed Forces, the SCAF, was as of last week on the 

verge of finally surrendering executive powers. But at the eleventh 

hour, as you know, the Supreme Constitutional Court invalidated 

the law under which the Parliament was elected and the SCAF 

acted quickly to reclaim legislative powers from what Egyptians 

call the Parliament of the revolution in which Islamists held a majority, as well as to limit the new President’s power. 

So among the most troubling elements of this supplementary 

constitutional declaration issued by the SCAF on June 17th is that 

it gives the SCAF the power basically to control the writing of the 

new constitution, to control who will be on the assembly that 

writes that constitution, to set the timetable and to object to any 

article in the constitution. It also will allow the SCAF to retain legislative powers and budgetary authority for months, perhaps even 

through the end of this year, until—because now, parliamentary 

elections cannot take place until there is a—until the new constitution is already in place. And then, of course, there will need to be 

a revision of the electoral law and so forth based on the court decision. So this is going to draw out for quite a while. And the SCAF 

will, according to this decree, be able to remain free from control 

by the new President who will be unable to appoint any senior defense ministers or make decisions on any military matters. 

In sum, this constitutional declaration removed the Parliament 

as a counterweight, the SCAF, and it positions the military as a 

power separate from and above civilian authorities, and it forces 

15

the writing of a new constitution in haste and under the pressure 

of military rule. 

Now Egyptians are now asking whether this court ruling invalidating the Parliament was an impartial ruling, particularly after 

a series of indications from senior members of the judiciary that 

some of them now feel they need to take aside in this power struggle between the SCAF and the Brotherhood, which is truly unfortunate because the judiciary was among the most respected institutions in Egypt. But even if it was—let’s say it was an impartial 

court decision to invalidate the law under which the Parliament 

was elected. It really doesn’t justify the SCAF’s declaration after 

that. The SCAF could have simply called for new parliamentary 

elections. It did not have to see some of the powers that the existing constitutional declaration would have given the President. And 

it certainly did not have to cease control of the writing of a constitution. 

This disruption and manipulation of the political transition—I 

have to say as I was thinking about this, the phrase Etch-a-Sketch 

transition came to mind. Every once in a while when the SCAF 

sees that it doesn’t like the way things are going with the transition, they just sort of shake it up and start drawing it all over 

again. You know, it does come at the expense of Egypt’s economy, 

as Mr. Schenker was just saying, as well as national security, because both of these things are going to suffer as a result of the ongoing struggle between the military and the Brotherhood. 

Now the United States might not be able to control or change the 

behavior of Egypt’s SCAF. They appear to be willing to pay any 

price to avoid bowing to the choices of the voters. But the United 

States can and should decline to use its taxpayers’ funds to support 

such leaders. The United States should withhold assistance until 

the situation in Egypt clarifies, withhold at a minimum military 

assistance, while articulating a desire to build a new partnership 

with Egypt once it’s on the road to becoming truly democratic, to 

respecting the rights of all its citizens, and to playing a responsible 

and peaceful regional role. Thank you very much. 

[The prepared statement of Ms. Dunne follows:]

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Mr. CHABOT. Thank you very much. 

Dr. Alterman, you’re recognized for 5 minutes. 

STATEMENT OF JON B. ALTERMAN, PH.D., DIRECTOR, MIDDLE 

EAST PROGRAM, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES 

Mr. ALTERMAN. Thank you, Mr. Chairman, Ranking Member. It’s 

a great honor and a pleasure to appear again before you this afternoon to discuss developments in Egypt. Watching Egypt for the last 

18 months has been a humbling experience. I’ve been constantly 

surprised. And although conspiracy theories abound, I’m convinced 

that everybody is completely making this up as they’re going along 

and they’ve been doing so for some time now. 

Each of status quo is deeply troubling to us as Americans and 

its allies, but it seems to me it’s not sustainable. Our strategic goal 

has to be to try to influence Egyptian politics so they become more 

inclusive and ultimately more resilient. While I’m discouraged of 

what’s happened in Egypt in recent months, I’m not yet ready to 

despair, nor should you be. 

Events in Egypt are disturbing, in part, because hopes were so 

high in February 2011. Egypt’s protests then seemed to promise 

the rise of a more pluralistic and inclusive country. The image of 

Egypt that emerged from the revolution was a country that embraced young and old, rich and poor, Christian and Muslim, religious and secular, urban and rural. 

Through the Mubarak years, where I lived off and on in Egypt, 

there was often a sort of dour xenophobia that lurked under the 

surface. It seemed to me to reflect a certain insecurity and lack of 

self confidence among Egyptians, a manifestation of their awareness that they were once a world leading civilization, more recently 

that led the Third World, but they have fallen far behind former 

peers such as South Korea and ceded influence in the Arab world 

to the wealthier countries in the Gulf. All of that evaporated with 

the advent of the protests that brought down Hosni Mubarak. The 

world’s eyes were on Egypt for the first time in a half century. Ordinary Egyptians were lionized and Egypt once again seemed to be 

in the vanguard of a movement that led hundreds of millions of 

people. 

With the military’s reassertion of power, that hope has evaporated. The question of what U.S. policy should be in the midst of 

all this is both important and subtle. Long before the fall of Hosni 

Mubarak, there were pathologies in the U.S.-Egyptian relationship 

that needed addressing, but weren’t being addressed. We have to 

address those pathologies and define a relationship going forward 

that serves both our interests and our values. 

As I’ve told this committee before and as I’ve written other 

places, I’ve long thought it would be helpful to right size our aid 

relationship with Egypt. The steady provision of $1.3 billion a year 

in annual military assistance over more than 30 years has led to 

an environment in which each side feels deeply taken for granted. 

I can’t tell you what the level of U.S. assistance to Egypt should 

be, nor is it my role to. Instead, the U.S. Government needs to sit 

down with the Egyptians, have a serious discussion about what we 

need, about what they need, and what each is willing to do for the 

20

other. The relationship has lost the intimacy of the 1970s and the 

eight figures should reflect that. In my judgment, reshaping the aid 

package will actually improve our relationship with Egypt in the 

longer term. 

I don’t think—I do not think it’s advisable to condition U.S. aid 

on political milestones in Egypt for two reasons. First, conditionality works best when it’s quantitative, triggered by discrete and 

concrete metrics. Qualitative conditionality tends to invite endless 

debate and argumentation, not compliance. 

Additionally, conditioning the aid on political outcomes creates a 

powerful impulse on the part of the target state to demonstrate resistance and bravado and it’s often counterproductive. We also have 

to be careful to take the long view. We’re only in the middle of 

what will be a long and drawn out process of political change in 

Egypt. The Muslim Brotherhood and young revolutionaries aren’t 

going to go away and the military is going to have to work hard 

in the coming months to preserve its legitimacy. Here, I think, we 

need to think about two relationships which I am sure members of 

this committee know better than I do, the U.S. relationship with 

Turkey, the U.S. relationship with Pakistan. We’ve had an uninterrupted relationship with Turkey and they have gone through military coups and had a more democratic evolution. We cut our military relationship with Pakistan in the 1990s. There are people who 

talk about the lost generation in the Pakistani military. It did 

nothing to heal the civil military tensions in Pakistan. 

Egypt has a growing economic problem and I think that will likely guide the leadership toward political compromise and more inclusive politics because if there’s political turmoil, they simply 

won’t be able to access international capital. They won’t be able to 

get IMF loans and a whole range of things, I think, will be much 

more difficult and the Egyptian leadership needs it to be to have 

success on any terms. 

For Israelis who looked at events in Egypt with great alarm, I 

think the army’s actions must come as a great relief. The Egyptian 

military has sophisticated understandings with the Israeli counterparts and the Egyptian military now remains in control. Overall, 

I think, Egypt’s political evolution and that of the broader Arab 

world hasn’t stopped. And in my judgment, this is another sign 

that Israel needs to build out its relations with Arab republics. 

There’s already a sort of grudging acceptance of Israel and I think 

this is a sign the future is coming and Israel needs to reach broader. 

For the United States, this isn’t where we thought we’d find ourselves 18 months ago. Our allies in the Egyptian military promised 

something different and we expected something different. Yet, it’s 

important to remember that we’re only in the middle of what will 

surely be a long transition to an unknown new status quo. We 

should hold fast to our interests and to our values in Egypt and 

in the long run, I’m confident that change is coming and the U.S. 

can play a constructive role influencing it in a positive direction. 

Going forward, one idea should guide us. We should aim to enlarge our partnerships in Egypt, not limit them, and build on that 

fertile ground that encompasses a shared interest between our two 

countries. Thank you. 

21

[The prepared statement of Mr. Alterman follows:]


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Mr. CHABOT. Thank you very much and members now will have 

5 minutes to ask questions of the panel and I’ll begin with myself. 

One element of both the NGO raids and Egypt’s declining IMF 

financing which has gotten considerable attention has been the 

central role of Egypt’s Minister of International Cooperation, Fayza 

Abul Naga. In an editorial, the Washington Post recently noted 

that—and this is kind of a long quote:

‘‘The campaign against the International Republican Institute, 

National Democratic Institute, and Freedom House, along with 

a half dozen Egyptian and European groups, is being led by 

the Minister of International Cooperation, Fayza Abul Naga, a 

civilian hold over from the Mubarak regime. Abul Naga, an 

ambitious demagogue is pursuing a well-worn path in Egyptian politics whipping up national cinema against the United 

States as a way of attacking liberal opponents at home.’’

Referring to the U.S. funding of NGOs like IRI and NDI, she has 

reported to have said,

‘‘Evidence shows the existence of a clear and determined wish 

to abort any chance for Egypt to rise as a modern and democratic state with a strong economy since that will pose the biggest threat to American and Israeli interests, not only in 

Egypt, but in the whole region.’’

That’s her quote. 

It is also reported that financing from the IMF and World Bank 

were declined because according to Ms. Abul Naga, the terms of the 

loan were incompatible with the national interest, again, her 

words. She is reported to have added that ‘‘the government would 

not accept conditions dictating by the World Bank or the International Monetary Fund.’’

It’s my belief that—let’s face it, the chief agent provocateur, since 

the revolution, this person has shown very clearly that she cannot 

be trusted as the custodian of American taxpayer dollars or even 

as an advocate for Egypt’s own self interest. Do you believe Ms. 

Abul Naga’s—that she’ll continue to have a place in the forthcoming additional government? And if so, how should the United 

States react? And I would leave that up to anyone. 

Mr. Schenker? 

Mr. SCHENKER. Ms. Abul Naga has remarkable staying power. 

She is, for lack of a better term, Fahlul. She survived the Mubarak 

administration in fine shape and has the ears of the SCAF very 

clearly. Her star has risen and she’s doing very well. I would say 

certainly that she, in my eyes, very clearly she was responsible for 

the NGO crisis. I think a lot of people see it as this was something 

that was engineered by her. I think she has been subsequently 

PNGed by the U.S. Government which I think was warranted. 

We’ve had a long history of problems with Ms. Abul Naga. If you 

go back and look back at these Wikileaks documents, you’ll see a 

stack about this thick of complaints from the U.S. Embassy about 

how Ms. Abul Naga is undermining our efforts to improve the aid 

process or to really implement what we think was necessary for 

Egyptian development. 

29

Ms. Abul Naga has also had a very interesting response to the 

accepting of foreign funding, the IMF money. She has actually 

taken a leading role so far on this Japan issue where the Muslim 

Brotherhood and the Salifists say that they can’t accept the money 

from Japan, some $450 million for the Metro system because it’s 

interest. Ms. Abul Naga, we will call her Sheikha Abul Naga for 

her religious credentials, has come forward and issued an edict saying that no, no, it’s not interest and we can take this because the 

Government of Japan is not a money-making endeavor. So it’s a 

very odd role she’s had, but it’s persistent. 

Mr. CHABOT. Does anybody else want to add anything? Yes, Dr. 

Alterman and Dr. Dunne. 

Mr. ALTERMAN. I think she’s not in as secure a position as she 

appears from Washington, partly because of her history. She was 

a close, personal friend of Suzanne Mubarak. A lot of her friends 

have been discredited. I think she is desperate in many ways. She 

has been trying to control the money and her objection to U.S. aid 

was that it bypassed her. She is about controlling the money and 

controlling all the international money that goes to Egypt. 

I think she sees Egypt slipping through her fingers. I think she 

sees the role slipping through her fingers. I think rather than seeing her as a powerful woman who is standing up to the United 

States, she is trying to build herself up as a powerful person who 

is standing against the United States to shore up what is ultimately a very, very weak position both in the broader Egyptian 

public and also in the current Egyptian Government. 

Mr. CHABOT. Thank you. Dr. Dunne? 

Ms. DUNNE. Yes, you know, in addition to the role that Ms. Abul 

Naga played in the whole NGO issue and I certainly agree, she 

drove the whole thing. I hope that Egyptians see the damage that 

she did to Egypt’s relations and the foreign assistance that Egypt 

could have and frankly should have received in the last 16 months 

because she was so insistent basically on wanting cash budget support and was sure that that would come if Egypt held out and so 

they didn’t take other kinds of assistance, for example, an IMF 

loan on very soft terms and so forth that they should have taken. 

I hope this is recognized within Egypt, but that’s not for certain. 

And she has a very strong relationship with senior members of the 

SCAF and if they continue to hold sway, then we can’t exclude the 

possibility that she would appear once again in a prominent position in the new cabinet that will be named in the coming weeks. 

So that is something the United States might want to raise privately. 

Mr. CHABOT. Thank you very much. My time has expired. The 

gentleman from New York is recognized for 5 minutes. 

Mr. ACKERMAN. Well, now that we’ve burnished her street credentials, there was a play on Broadway in which right before the 

last act the audience every night got to vote on what the third act 

was going to be, how it was going to turn out or who done it or 

whatever it was. Of course, there were a limited number of possibilities and presumably whatever score they announced, that’s 

what they did. 

We don’t really get to vote in the last act anywhere, specifically 

Egypt. There’s a well-known adage that countries don’t have 

30

friends, they have interests. What would the outcome of this final 

act of this particular part of the play be in the interests of the 

United States? Would our interests be long term in democracy 

should always prevail and the will of the people should be adhered 

to? Not analogous in any way, but back in the ’30s, the National 

Socialist Party seemed to have a slam dunk in the election. Nobody 

thought what Nazis did was a good thing. The world didn’t approve, but certainly they didn’t steal an election. 

What was in our interests to do business with them? To not do 

business with them? 

In Egypt, if the SCAF comes up short in votes, and I guess it depends on who’s counting, but they really came up short in votes, 

is it in the U.S. interest that an organization that says things 

about adhering to national obligations and treaties, et cetera, remain in power? Or if the bad guys are promising terrible things, 

I mean I guess it’s more analogous of what happened once upon a 

time, not too long ago in Algeria where the election yielded enough 

results for them to change to a new constitution that the majority 

party that was coming in agreed that they wanted to do and have 

an Islamic republic rather than a democratic country. And the 

President just voided out the election. 

Sometimes you root for the bad guy. I remember once as a much 

younger congressman trying to explain my vote before a newspaper 

editorial board and they wanted to know why I voted that way. 

And I just looked them in the eye and said sometimes you have to 

stand up and do the wrong thing. 

What’s in our interests doing what we know? We don’t want the 

outcome in most elections to go through and just ignore them or 

what? 

Dr. Alterman? 

Mr. ALTERMAN. Mr. Ackerman, I think our interest is having 

some sort of hopeful stalemate which brings in——

Mr. ACKERMAN. So group prayer. 

Mr. ALTERMAN. Group prayer. Everybody hold hands, which 

brings in a wide variety of parties who come to believe that they 

can win in the future. It seems to me that the mark of a democracy 

is not people’s willingness to win, but their willingness to lose because they feel if they lose one round, they can win a future round. 

And I think the great danger right now in Egypt, the reason why 

people fear tremendous violence over the coming weeks is a sense 

that if you don’t lock in a victory now, you will never live to fight 

another day. That’s what happened in Algeria and more than 

100,000 deaths as a consequence. 

I think to my way of thinking the best possible outcome is one 

where the military feels they have a stake in making it work. The 

Muslim Brotherhood feels they have a stake in making it work. 

The young revolutionaries who had so much hope of where this 

would all go, so you know, well, we don’t like Morsi or Shafiq, but 

we could live to fight another day. We could have a better set of 

candidates in the future, and ultimately bringing all these groups 

to feel if they hold their nose and it’s good enough because they 

will be able to compete again I think is the best we can hope for 

right now. And it’s not certain we’re going to get there. 

31

Mr. ACKERMAN. Does Egypt have a long enough tradition of free 

and fair elections to be able to base the hopes that you live to fight 

another day, but that day may be fought for by your great, great, 

great grandchildren? 

Mr. ALTERMAN. I think they have enough tradition of good 

enough. And Egypt has been getting by on good enough for a long 

time and I think good enough is politically the best outcome we can 

hope for right now. 

Mr. CHABOT. The gentleman’s time has expired. The gentleman 

from Florida, Mr. Bilirakis, is recognized for 5 minutes. 

Mr. BILIRAKIS. Thank you, Mr. Chairman. I appreciate it very 

much. I have a couple of questions. Since the fall of Mubarak, we 

may have seen the end of authoritarian regime, but we have yet 

to see the rise of a new democratic leadership. Late last year, a few 

of my colleagues and I called for an end to the unconditional aid, 

U.S. aid to Egypt as long as the persecution and attacks on Coptic 

Christians and other religious minorities continue. For a brief time, 

we thought we had a victory. We thought we were successful. The 

House released its Fiscal Year 2012 funding bill and placed conditions on the U.S. aid. 

As we know, things continue to get worse in Egypt. There was 

a crackdown on—you mentioned the program of democracy NGOs 

and their staffs including the U.S. citizens. Before moving forward, 

I want to remind the committee that the Egyptian Government has 

yet to drop the charges on the U.S. citizens and I want to hear an 

update on that. 

But Secretary Clinton, and of course, the Obama administration, 

decided to waive the new restrictions and continue to provide U.S. 

taxpayer dollars and military aid to a country that disregards the 

basic principles of human rights and religious freedom. Now 

months later, it is clear that their decision to waive was not only 

untimely in my opinion, but wholly without merit. 

The trial, I understand, is scheduled to convene on July 4th and 

our U.S. citizens will be tried in absentia. With all that said, I’d 

like to ask a couple of questions. How do we engage Egypt to ensure that human rights and religious freedom for Christians and 

all religious minorities are respected? Can we expect the new Egyptian Government to drop charges against the U.S. citizens? What’s 

the status there? 

Also, how do we ensure that whoever comes to power in Egypt 

can protect Israel, of course, our important ally from any threats 

or attacks? And of course, to keep the peace agreement between 

Israel and Egypt? 

For the panel. 

Mr. CHABOT. Whoever would like to answer. 

Mr. BILIRAKIS. Whoever would like to take the question. 

Mr. CHABOT. Dr. Dunne? 

Ms. DUNNE. Congressman, you’ve raised some extremely important issues here. And I think in a way it links back to Congressman Ackerman’s question because you know what we really need 

to be in favor of in Egypt is the development of a strong democratic 

system. And this is, I think, what Dr. Alterman was saying in 

somewhat more picturesque terms, but a system in which people 

believe that there will be accountability through the ballot box and 

32

so forth and also that there’s a—they can work out these issues 

such as how the rights of all citizens will be protected. And that’s 

certainly something the United States has to stand up for. 

But I think it’s only going to happen in a system where Egyptians can work out their differences in a peaceable way. 

I really worry that if we take a narrow view of this and say well, 

we’d rather see the military than the Brotherhood in power and 

therefore, you know, forget about this whole democracy thing, that 

it will lead to a situation of ongoing conflict and violence. We really 

can’t turn the clock back 5 years or something like that. Egyptian 

society, it isn’t where it was. And I don’t think people will accept 

it. So it will lead to a situation of ongoing conflict and a lot of that 

will be taken out against Christians and other minorities inside of 

Egypt, I’m convinced. 

Mr. BILIRAKIS. How do we engage? Excuse me for—what is your 

suggestion? 

Ms. DUNNE. I think that we do need to continue to provide support to NGOs and stand up for them. Now before this Parliament 

was just dismissed, there was a draft new law on NGOs that would 

have allowed much better conditions. Maybe not absolutely perfect, 

but much better operating conditions for both Egyptian and foreign 

NGOs. And that—and although it’s not directly related to the case 

against the Americans which will resume in court on July 4th, people felt that if a new NGO law was passed, that somehow it would 

make the case easier to resolve against the people who are on trial. 

Now, you know, all of that has been absolutely thrown up into 

the air, since there now won’t be a Parliament for many months 

in Egypt. They won’t be able to pass a new law. And so the current 

conditions will continue to go forward. And that’s going to make it 

very difficult to have the sort of engagement that we really would 

like to have with the Egyptian Government on these issues. 

Mr. CHABOT. The gentleman’s time has expired. 

Mr. BILIRAKIS. That’s fine. Can someone comment on the peace 

treaty with Israel? 

Mr. CHABOT. If somebody would like to briefly comment. 

Mr. BILIRAKIS. Thank you. 

Mr. ACKERMAN. That’s a brief subject. [Laughter.] 

Mr. SCHENKER. It’s quite alarming, a lot of what we’re hearing, 

but we do have certainly the military being the leading supporter 

of the peace treaty in Egypt and we also have statements from senior officials in the Muslim Brotherhood saying that while they find 

that certain provisions of Camp David to be abhorrent or inappropriate, that they’re not calling for war. I think that you’re going to 

have a very deteriorating bilateral relationship between Egypt and 

Israel. I think you can see very clearly a trajectory where the 

Israeli Ambassador and the highest level of representation of the 

two countries no longer exists, that there’s no longer an ambassador, et cetera. But whether the bilateral relations are broken or 

peace treaty, I don’t think that’s on the table any time in the immediate future. And that will be the case as long as the military 

has a say and the constitution that the military is busy writing, 

they have a provision that they will have to be consulted by the 

President in terms of declaration of war. We’ll see if that sticks. 

33

I’m more concerned about how these states are going to get along 

as security deteriorates in the Sinai. I think that there are—just 

the number of land mines that are out there with these al-Qaeda 

affiliates or wannabes that are taking hold, with the lawlessness, 

with—even the MFO, the Multinational Force Observers, are being 

limited in their operations now, that are meant to oversee and ensure the ongoing commitments of the peace treaty. And I think this 

is very problematic. The question is in terms of the next crisis 

whether there will be somebody for the Israelis to call and get a 

response. 

It came very close, perilously close, to having six Israeli diplomats lynched last year after one of these incidents. In the future, 

if there’s this type of populist politics, you may not have a mechanism that works efficiently to prevent a tragedy. 

Mr. CHABOT. The gentleman’s time has expired. The gentleman 

from Connecticut, Mr. Murphy, is recognized for 5 minutes. 

Mr. MURPHY. Thank you, Mr. Chairman. I wanted to ask Mr. 

Ackerman’s question maybe a different way. He asked about what 

our interests were and Dr. Alderman gave, I think, a very good 

summary what the best case scenario might be. So let me ask it 

maybe the opposite way. 

You know, sometimes you engage in policies designed to encourage something you want and other times you engage in policies to 

discourage something you don’t want. And so the opposite or the 

flip side of Mr. Ackerman’s question is what’s the worst case scenario for the United States of all of the various things that could 

play out between the existing parties or parties to come, the 

Salifists, for instance, what do we want to guard against happening 

here? 

Mr. SCHENKER. I think the worst case scenarios are imaginable 

here, an Islamist President, an Islamist Parliament, that is authoritarian in nature in its own right. This is democracy unfulfilled. 

You have the process. You have the institutions and yet it goes the 

wrong direction. I think if you look even worse than that, you’re 

going to have the Brotherhood sitting in a Parliament eventually, 

depending on what happens in the best case scenario. A freely 

elected Parliament looks somewhat like it looks right now and 

you’re going to have the Salifists on the far right, basically pressing 

the Brotherhood to take even more militant positions and they’re 

going to give in and go to this more populist, more Islamist route. 

That’s not going to be good for minorities in Egypt. It’s not going 

to be good for U.S.-Egypt relations. 

You’ve got basically two Turkey models competing right now in 

Egypt. One is the old Turkey model where the military maintains 

control and shores the national security issues. And you’ve got the 

new Turkey model where the Islamists may, in fact, be looking to 

have civilian control, are looking for civilian control and bringing 

the military to heel and then do whatever they want with the civilian system. And I can see many bad things emanating from that. 

Ms. DUNNE. Congressman, if I might briefly give another worst 

case scenario, it is that the military that was once in power behind 

the scenes is in power explicitly and you know is tampering with 

the democratic process and violating human rights, putting civilians to military trials, cracking down on civil society, meanwhile, 

34

enjoying a great deal of American assistance and therefore, the 

United States is incurring the hatred of many, many people in 

Egypt because the United States is seen as supporting all of that. 

And that is the current situation. It’s the current worst case scenario. 

Mr. MURPHY. So we’ve got one is the Islamist President. One is 

the status quo. 

Mr. ALTERMAN. The third is if you combine these two scenarios 

that you have a military crackdown which creates a violent and increasingly radicalized opposition, increasing amounts of violence, 

tens or hundreds of thousands of deaths, populist politics that ultimately push the military from power and what you have is not 

some sort of restrained, deal-seeking Islamist political party that’s 

trying to work within an Egyptian context, but instead a 

radicalized, anti-American, anti-Israeli, populist force which is as 

totalitarian as anything the world has seen and which not only affects Egypt and its immediate neighborhood, but also begins to 

spread some of those ideas and ideology more broadly through the 

Middle East affecting a whole range of American interest. I don’t 

think it’s likely, but I think if you’re talking about that’s the worst 

case, I think you combine those two, you get that, and then you 

project it out to the rest of the Middle East and that’s what you 

could be looking at. 

Mr. MURPHY. So does that mean as scared as we may be of what 

the Muslim Brotherhood brings to the presidency or to the Parliament, the best U.S. policy in the short term is to get the SCAF 

out of the way or get the military out of the way as quickly as possible? 

Mr. ALTERMAN. My argument would be—it’s unclear the extent 

to which they’ve been willing or could be made willing to work with 

each other. There are constant rumors of deals involving the SCAF 

and the Muslim Brotherhood. I think our best case scenario, my 

judgment, is finding ways for them and others to work out some 

sort of comity to go forward and preserving struggles for the future. 

Mr. CHABOT. The gentleman’s time has expired. We’ll go to a second round now and I’ll recognize myself for 5 minutes. 

I know all of you have mentioned some of the economic implications and the problems that exist right now and in fact, I guess the 

bottom line is Egypt stands on the threshold of a potential economic disaster. With cash reserves dwindling, budget deficits skyrocketing, and little sign of the political will to execute requisite 

economic reforms, a true crisis may be just around the corner. 

What measures does Egypt need to take to ensure its near-term 

and long-term economic viability? And how can the U.S. best encourage Cairo to institute these measures? And what happens if 

the Egyptian economy does collapse? I’ll perhaps go down the line 

unless somebody wants to take it. 

Doctor, do you want to take it? 

Ms. DUNNE. The Egyptian Government, who is ever in power, 

needs to be careful about their budgetary situation and they have 

started to do this. They have started to roll back fuel subsidies. 

Fuel subsidies, in particular, are the thing that have been devouring the Egyptian budget and so forth. But to be honest with you, 

I mean beyond that the economic conditions in the political transiVerDate 0ct 09 2002 13:40 Aug 07, 2012 Jkt 000000 PO 00000 Frm 00038 Fmt 6633 Sfmt 6633 Y:\WORK\MESA\062012\74639 HFA PsN: SHIRL
35

tion are closely linked. The reason that there’s no IMF deal right 

now is because of the political chaos in Egypt and the fact that this 

transition keeps being interrupted and prolonged and changed and 

so forth. 

Whether it is international financial institutions or other donors, 

they want to give money to a government that they believe is going 

to be there long enough to live out the terms of the agreements and 

also that the money is going to be used wisely and not going to be 

just gobbled up immediately. This is really a problem. They need 

to get the political transition moving forward as it should have 

been this week moving forward and then they will be able to get 

the economy back on its feet. 

The security situation is also extremely important. They’re not 

going to get tourists returning until they get the security situation 

in Sinai and elsewhere under control. And that’s going to require 

police reform which is something that—reform of the police and internal security and getting them back operating normally, that still 

hasn’t happened 16 months into this transition. 

Mr. MURPHY. Thank you. Mr. Schenker. 

Mr. SCHENKER. We’re facing, I think, potentially, and I think the 

SCAF pointed this out about a year ago that if things don’t improve 

that you will have a second revolution being a revolution of the 

hungry, that the traditional World Bank numbers say that 40 percent of the people in Egypt live on less than $2 a day. I think a 

year after the revolution, it’s probably closer to 50 percent of the 

people in Egypt. 

If you talk to people and there’s polling immediately after the 

revolution, people said that 80 percent of the people expected that 

their standard of living would increase after the revolution. I think 

just the opposite has happened. Meanwhile, you have a heavy pressure notwithstanding this great step that was taken toward the 

fuel subsidies. I think there’s going to be a heavy pressure to keep 

and even increase some subsidies and government salaries and a 

pressure to hire more people with the high unemployment rates. 

The Government of Egypt needs some 7 percent growth per year 

to create the 600,000 or 700,000 jobs a year that are just needed 

to remain at an even unemployment. And to get the kind of 

growth, you need security. You need stability. You need a political 

process and confidence in the Government of Egypt and that’s not 

going to happen any time soon. 

Mr. CHABOT. Before I run out of time, let me just get one more 

question in. And Dr. Alterman, if you’d like to take this one. Analysts disagree to some degree over how the Muslim Brotherhood 

will ultimately react depending on how much it’s in power and how 

this all plays out, but whether it will moderate its traditionally religiously inspired hard line traditions or not. What do you expect 

to occur? What is reasonable to expect? I know we’re speculating 

to a considerable degree here. And how do Islamists or anybody 

who is in power there expect to revive the heavily European dependent tourist industry, for example, if they’re legislating restrictions on women’s dress or ban alcohol or other things which may 

well be on the horizon? 

Mr. ALTERMAN. First, I think nobody knows and they don’t know. 

I mean this is a movement which has been going through a treVerDate 0ct 09 2002 13:40 Aug 07, 2012 Jkt 000000 PO 00000 Frm 00039 Fmt 6633 Sfmt 6633 Y:\WORK\MESA\062012\74639 HFA PsN: SHIRL
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mendous change as it has come into the public, as it’s engaging in 

politics. So I think there’s a part about the future of the Muslim 

Brotherhood, its future unity, the extent to which hard liners and 

old line guys versus the young generation versus more political 

people versus more religious people, how that whole battle turns 

out, I think, remains uncertain. 

My guess is if they want to legislate different regulations for 

tourists, that’s very easy to do. There are a number of countries in 

the Gulf, for example, where tourists can drink, tourists can gamble, nationals cannot, and I could certainly see that happening in 

Egypt. 

But I think that part of this also depends on what the political 

evolution over the coming year or so is. I mean if the Brotherhood 

is competing for votes and is looking for the center of Egyptian politics, there are a lot of people in the center of Egyptian politics, 

Christians, secular Egyptians, even religious Egyptians who are 

skeptical about the Brotherhood, who say you have to convince me. 

And I think there are ways that that can turn into moderation of 

some of the more extreme forms. If you radicalize the Brotherhood, 

the radicals will come to the fore. 

I was just in Moscow yesterday and I was talking to a Turk who 

said, you know, the Brotherhood is more democratic in Turkey, but 

we were moderating them for 20 years. And I think there are some 

people who have had the experience of Islamist politics in Turkey 

who will tell you that there’s nothing wrong with Islamists in government, just don’t give them everything up front. Make them compete for the middle. Persuade people that their intentions are good 

and then you can live with them. 

Mr. CHABOT. Thank you very much. My time has expired. The 

gentleman from New York, Ranking Member Mr. Ackerman is recognized for 5 minutes. 

Mr. ACKERMAN. So who is going to tell the Egyptians we figured 

out what they should do? [Laughter.] 

We’re kind of playing at the margins right here of all sorts of 

theoreticals and in some scenarios we may be able to actually have 

a little bit of influence and in some absolutely none and in others 

whatever we do to influence, will have the complete opposite effect. 

I think I heard that one of the better outcomes would be if everybody had some kind of a compromise. I think we’ve got a pretty 

clear indication that the SCAF is able to compromise. They’re very 

pragmatic. They know what their needs are. They know what their 

creature comforts are. They seem to know how much that would 

cost and that there’s a price tag on it and they know where to send 

the bill. 

Can the street or better yet, the brotherhood, or can the people 

to their right, Salifists, and whoever else that might be out there, 

can they compromise? Can the ideologues compromise? The generals, it appears to me, are not ideologues at all, ever. And anybody, I think, who has ever met with them, going there or coming 

here, they have needs and wants and what they’re willing to do. 

It’s not pie in the sky. It’s not religion. It’s all practical. 

Can you compromise—can the other side compromise? 

Mr. ALTERMAN. Sir, I think in many ways, the Brotherhood since 

1928 has been finding ways to compromise on and off. They have 

37

been playing a long game. They have agreed not to be an official 

political party for decades until they just became a political party 

for this election. They have agreed to play a long game to try to 

win social support and Islamize the society, rather than control the 

government. 

I think in point of fact, the Brotherhood has some people who 

would not feel uncomfortable making the kinds of deals that you 

make in Congress. There are ideologues to be sure, but I think 

there are a lot of people who are political pragmatists, who are 

very good at getting out the vote, who are very good at doing things 

for the constituents and who would be at home in any political 

body anywhere in the world. And I think it’s people like that who 

are the promise for making a deal both with the military and with 

the U.S. Government and with the Israelis. 

Mr. ACKERMAN. These are the people who initially pledged that 

they weren’t going to contest for the presidency and they compromised by going back on what they said they weren’t going to do. 

Mr. ALTERMAN. One explanation for that is that they believed 

that the army was going to shut them out and the only way to 

guarantee that they had a role was to compete for the presidency. 

We don’t have insight into their decision making, but that’s an explanation that’s been offered. 

Mr. ACKERMAN. I don’t mind betting $10 million with somebody 

because I don’t have it. I’ll get into the ring with Jersey Joe 

Walcott or Killer Kowalski or something because I know that’s not 

going to happen. And if I think I could beat them, then it happens. 

I’m older than you. [Laughter.] 

That was when wrestling was real. [Laughter.] 

It’s a matter of they’re not going to do it. They’re not going to 

put up a candidate for President until they think they can win the 

presidency. That’s the practicality of it. But I think it’s also an indication not that they’re practical, but it’s an indication of it’s a 

way of getting to what they want. Do they want an Islamist state? 

There’s a question. I know the military answer. It’s a hell no. 

Where are the Salifists on this? Where is the Brotherhood? Where 

is the street? Where are all the people who didn’t vote? We don’t 

know these big answers. It makes it pretty dangerous. 

Mr. CHABOT. The gentleman’s time has expired. The gentleman 

from the Commonwealth of Virginia, Mr. Connolly, is recognized if 

he would like to ask questions. 

Mr. CONNOLLY. I thank the chair. Before I do, I just want the 

record to show emphatically, in large print, Mr. Ackerman admitted he’s much older than I am. [Laughter.] 

Mr. ACKERMAN. I’m a politician. Just disregard anything I say. 

[Laughter.] 

Mr. CONNOLLY. He’s also retiring, so he——

Mr. ACKERMAN. It costs him nothing. 

Mr. CHABOT. He’s open to say pretty much anything he wants. 

Mr. CONNOLLY. Let me ask our panelists, and welcome to all of 

you and forgive me for being late. I’m in a markup at the Oversight 

and Government Reform Committee that is bound and determined, 

God knoweth why, to issue a contempt citation against an honorable man. That’s a different subject. 

38

I am concerned about the status of the NGO personnel. I know 

our colleague from Florida talked about the Americans, but what 

about the Egyptians? I met them when I was last there a few 

months ago and these are terribly dedicated patriots trying to effectuate change in civil society and they are being put in the dock, 

in the cage, particularly for the women among them. It’s very 

humiliating and very hard to explain back home to their families 

and so forth. 

I want the United States to stand with those brave Egyptians 

and we don’t want the word to spread that somehow we only care 

about your nationality if you’re an American. We actually, I hope, 

are sort of blind with that respect. We care about all of the people 

who work at these NGOs who are trying to make theirs a better 

society. 

So I’d be interested in your take on their status and what more 

the United States can and should be doing or not to try to assist 

it. 

Dr. Dunne, do you want to begin—whoever. 

Mr. SCHENKER. Congressman, fortunately, the NGOs, IRI, and 

NDI, et cetera, are actually continuing to pay the Egyptian nationals who remain in Egypt and are on trial. They’re also paying their 

legal fees. This makes sense, obviously. There’s also one American 

who has remained in Egypt to fight the charges on his own volition. 

I think that this is going to go on for some time and it’s helpful 

that the United States Government or these NGOs have stepped 

forward to support this personnel, but this is going to be an issue 

that is ongoing for some time and there’s—we can make statements 

and if the judicial process works and Egypt has had a history of 

judicial independence for some time, although that’s come into 

question of late, this ridiculous political trial should be thrown out 

in which case these NGO workers may have difficulty finding work 

going forward, although it may also be a badge of honor to have 

done this for them. 

Ms. DUNNE. Congressman, the Egyptian employees and the 

Americans are all still on trial. The next hearing is to be July 4th 

and there was to be a new draft NGO law that might have made 

it easier for NGOs, both foreign and Egyptian, to operate. It was 

in the Parliament. It was in the committee and would have been 

voted on, but now the Parliament, of course, is dissolved. And there 

probably isn’t going to be another Parliament for months. So this 

unfortunate situation is going to continue. 

I think the United States has to be discussing with the Egyptian 

Government, with the new President and the new government that 

will be appointed, how civil society is going to be treated in the future and make it clear that this is going to determine not only to 

some extent how the U.S.-Egyptian relationship is going to go, but 

also Egypt’s relations with Europe and so forth. This whole struggle has caused a lot of programs to be suspended, even though as 

Mr. Schenker noted, maybe some of the employees are still being 

paid, but all of the activities that those NGOs were supposed to 

carry out are all just suspended. Nothing is happening. No new 

money is moving. 

39

Meanwhile, Egypt is going to have lots of elections and so forth 

and things where those NGOs could have been making an important contribution. And it’s a real shame. We were discussing a little 

bit earlier, Minister of International Cooperation, Fayza Abul 

Naga, and whether she would be appearing in the new government 

or not. So this is clearly one of the issues that the United States 

needs to take up behind the scenes with the Egyptian Government. 

Mr. CONNOLLY. Thank you. Mr. Alterman. 

Mr. ALTERMAN. Congressman, if I could just say, I was an election observer in the second round of Egyptian elections in December, and I just want to echo what you said about not only the patriotism, but the dedication and the true qualities of the Egyptian 

NGO workers I came across. It was inspiring, not because they 

were serving American interests, but because of how passionately 

they believed they were serving Egyptian interests. It’s a credit to 

us and we should stand by them. 

Mr. CONNOLLY. I thank you. My time is up. Thank you, Mr. 

Chairman. 

Mr. CHABOT. Thank you. The gentleman’s time has expired and 

I want to say that I agree with the comments the gentleman made 

relative to the NGO folks. And the only thing I disagree with was 

his non-germane comment relative to the attorney general and the 

case that’s going on in another committee which we shall not debate in this committee. So in any event, that concludes the business that we have before this committee. And I want to thank the 

witnesses this afternoon for testifying. I think this was very helpful 

to the members. We will convey this to our colleagues who were not 

able to be here today. Procedurally, the members have 5 days to 

revise and extend any statements or submit any additional questions. And if there’s no further business to come before the committee, we’re adjourned. Thank you. 

[Whereupon, at 3:32 p.m., the subcommittee was adjourned.] 

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