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No Rush to Aid Tunisia, Egypt

During his speech, President Obama promised, in the words of CNN, a “Reset 2.0” for the Middle East. Amid the Arab uprisings, the President announced aid for Tunisia and Egypt, which have overthrown their corrupt, dictatorial regimes. Specifically, he promised $1 billion in debt relief to help the post-Mubarak government off its feet.

This might be a good idea, but the timing is wrong. Egypt will have elections in September. In the aftermath of those elections, we will have very contentious negotiations and diplomacy with the new Egyptian government, especially if the fiercely anti-Western Muslim Brotherhood takes over. Why then give aid to Egypt right now?

Likewise, because Egyptians associated privatization with the ruling elites in the previous government selling off state-owned enterprises at bargain basement prices to their sons and family members, most Egyptians associate privatization and serious economic reform with corruption and so have swung the pendulum back full circle to the point where they advocate a state-centered economic model that would make East Germany proud.

What is clear is that the toughest diplomacy lies ahead. Only the Obama administration, however, would sacrifice all of America’s leverage before the negotiations even begin. It’s important to support democratic forces in the Middle East, but perhaps the administration ought to wait and make sure that democratic forces are really in control before billions of hard-earned tax dollars are transferred to the former dictatorships. Foreign aid should not be charity; it should be given only when it will support of American national security interests.


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