Thursday, February 03, 2011

How outcome in Egypt could affect the United States

By Yahoo! News yahoo! News Wed Feb 2, 2:29 pm ET

By Steve Clemons

The turmoil in Egypt is intensifying and the outcome of the increasingly bloody demonstrations remains unclear. Anti-government protesters and pro-government supporters are clashing in the streets of Cairo, and the Egyptian military is ordering everybody to go home. Meanwhile, the United States is condemning the violence and urging President Hosni Mubarak to move faster in loosening his 30-year grip on the country. (Latest developments)

The strife in Egypt inevitably will have an impact on the United States. Here is a look at what Americans might expect:

Could the turmoil in Egypt affect the U.S. economy?

It already has, mainly because of what happens to oil prices when global tensions rise. Oil prices have been increasing in the past two weeks, and have topped $100. This will raise some prices and retard a portion of our economic growth. The ongoing uncertainty in Egypt has increased risk premiums on shipping insurance, and that drives up the cost of oil and gas imports as well as other cargo. And it's not just Egypt in turmoil but much of the Middle East. A zone of instability that Washington thought was fairly stable has erupted — all near some of the world's most important oil and gas reserves.

Secondly, unrest in Egypt has elevated anxiety about the continued operation of the Suez Canal and the Sumed Pipeline, which connect the Red Sea to the Mediterranean. The Suez Canal is a critical transit "choke point" between the Mediterranean and the Middle East and Asia for petroleum products and other types of cargo. Although there have not been indications that either of these choke points have been targeted, it remains a possibility.

Could the US military get sucked in?

That's unlikely. There is no direct threat to the United States from the current protests and the U.S. military is stretched thin in Afghanistan and Iraq.

Moreover, the United States does not want to appear to be interfering with the democratic aspirations of protestors in Egypt, especially at such a critical time. Any serious foreign military intervention would be catastrophic and generate significant blowback.

An important role that U.S. military has played, however, has been urging restraint for its counterparts in Egypt. The Egyptian and American militaries closely coordinate and have strong working relations. American advice to show restraint seems largely to have been accepted by the Egyptian military so far.

How will it affect the U.S. role and influence in the Middle East?

The ultimate impact will depend largely on how the situation in Egypt plays out, but if there is significant political transition in Egypt, the steps Obama takes now behind the scenes will be known and remembered by the next regime and the Egyptian people. America can easily get on the wrong side of change and needs to be cautious.

The United States relies on Egypt to cooperate on a huge range of issues — from assisting with American military logistical and supply operations in Middle East, to counterterrorism, to freedom of navigation and the seas, to Arab-Israeli peace. All of these interests of the United States could be affected positively or negatively by what comes next in Egypt.

Mubarak's close relationship with the United States at the expense of Egyptian popular sentiments on a host of foreign policy issues means that Egypt could go the way of Turkey — still a U.S. ally but with a much more independent foreign policy..

The United States will likely have to deal with a significant realignment of its military, political, and economic influence in the Middle East. American influence in the region and its social contract with key stakeholders in the Middle East may need to be "re-visioned" with a new strategy replacing the many decades-old one the United States has followed.

How will it affect our policy on Iran? Iraq?

A democratic Egypt could enhance U.S. efforts to minimize Iran's influence in the region in the same way that Turkey's popularity has come at Iran's expense. A democratic Egypt and a democratic Iraq would mean that the two most powerful Arab countries will now have representative governments. The impact on the region could be profound.

But there are risks as well. A new political order in Egypt also may contain significant elements of the Muslim Brotherhood, a banned political party that has received significant support from Iran and has related networks operating in many states throughout the region. The United States has been regrettably slow in engaging and interacting with the responsible factions of the Muslim Brotherhood.

How might developments in Egypt affect Israel and the Middle East peace process?

Mubarak has sided with U.S. policy in the Arab-Israeli conflict, including in supporting the status quo in Gaza, promotion of anti-Hamas policies, and emphasis on peace talks (even when they haven't worked). A democratic Egypt will likely still support the Camp David Peace Accords but not the status quo in Gaza or Palestinian disunity.

This may complicate the situation in Israel but open new opportunities to break the deadlock between Israel and the Palestinians. Only Egypt and Jordan (among Middle East and Muslim states) have peace with Israel. Since signing the Camp David Peace Accords in 1978, Egypt has received $35 billion in U.S. military and economic aid, second only to Israel. Egypt has played the role of America's Arab interlocutor in the peace process. Egypt also helps represent U.S. interests in negotiations between Fatah and Hamas.

What about possible political fallout in Washington, D.C.?

Depending on the outcome, the question can be posed, "Who Lost Egypt?" by some who try to paint the Obama administration as without a strategy to deal with the trends now erupting.

If the political outcome in Egypt turns out to be highly negative for Israel, there will be serious political echo effects in American politics.

Given that we are seeing a pattern of protest in many vulnerable nations throughout the Arab world, the Obama administration will be expected to roll out a new strategy of engagement that protects America's interests — particularly its energy sector interests — while at the same time standing behind the universal rights of people around the world to assemble and call for political reform. This will be tough for an administration that has many economic and political constraints at the moment. New visions and new engagement cost money and that is in short supply given the rising American debt.

Steve Clemons is founder and senior fellow of the American Strategy Program at the New America Foundation. He also is publisher of The Washington Note.

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