Neopatrimonial Corruption and its Effect on the Egyptian Political System Isaac Freedman Colgate University Spring 2011 “Corruption has become a science and an art It has become a craft and a practice, to the point that we can now say that it has crystallized in the last few years into a ruling organization We no longer face miscellaneous incidents of corruption in a given regime, rather we face ‘a comprehensive system of corruption,’ which has its own encompassing principles, mechanisms, symbol.
Neopatrimonial Corruption and its Effect on the Egyptian Political System Isaac Freedman Colgate University Spring 2011 “Corruption has become a science and an art It has become a craft and a practice, to the point that we can now say that it has crystallized in the last few years into a ruling organization We no longer face miscellaneous incidents of corruption in a given regime, rather we face ‘a comprehensive system of corruption,’ which has its own encompassing principles, mechanisms, symbols, language and practice.” – Dr Sa’d al-Din Ibrahim (quoted in Sadowski, 1991: 138) How, if at all, did corruption contribute to the fall of former President Hosni Mubarak’s regime in Egypt? On February 11 2011 Mubarak resigned as the President of Egypt after nearly thirty years of uninterrupted rule His abdication came amidst an enormous swell of protests, demanding democracy and an end to corruption It certainly appeared as though the people had become fed up with the state Yet the question arises as to whether the pervasive corruption within the Egyptian state precipitated a sooner end to the regime, or whether it enabled the regime to survive for the thirty years that it did This paper will attempt to provide a conceptual framework for understanding not only the variant forms of corruption in Egypt but also the social and political impact of corruption on Mubarak’s regime and broader Egyptian society In addition, it seeks to approach the concept of corruption in Egypt as a unique phenomenon disconnected from Western notions of it Defining Corruption Corruption is not an easily definable term and it is first necessary to establish what type of corruption we are talking about and how it is applicable to Egyptian society In the West, corruption is most of the time thought of as bribery, and other times thought of as embezzlement, extortion, or perhaps, campaign contributions and political lobbying Thus, J.S Nye’s definition of corruption is one of the most widely used in the field of corruption and provides a useful launching point for this study Corruption is behavior which deviates from the normal duties of a public role because of private regarding (family close private clique), pecuniary or status gains; or violates rules against the exercise of certain types of privateregarding influence This includes such behavior as bribery; nepotism; and misappropriation (Nye quoted in Heidenheimer and Johnston, 2008) Yet this public office centered definition is only appropriate in a society where there are clearly established public roles That is, there must exist a clear distinction between the public sector, or the state, and the private sector The ruling National Democratic Party in Egypt, however, is mired in state of conflicting interests where individuals alternate from business to politics back to business, while many simply maintain positions in both A second important qualification premised on the first also exists What defines a normal duty? And, furthermore, what constitutes a deviation from a normal duty or violation of a rule in a society where there are no established standards of official behavior? As Gardiner points out, “the ‘normal duties’ of an official in one country may include accepting ‘gifts’ 2 or making a decision even if it involves a conflict of interest.” (Gardiner, 1993: 27) This definition also suffers from the fact that “normal duties” may actually be harmful to the public interest even when legal (Ibid., 32) These questions take on increasing importance when asked in the context of autocratic and/or authoritarian regimes like Egypt In such states, the public rarely has a say in politics not to mention legislation President Mubarak stood far above the legislature in the power he possessed Parliament – filled with a handpicked majority– merely laid a “rubber stamp” on Mubarak’s policy proposals Effectively Mubarak could determine what type of behavior constituted corruption, the level at which the state would pursue corrupt officials, and which officials it would choose to pursue An alternative definition of corruption focuses on the public interest but that is also fraught with significant problems: Who constitutes the public and where does the public interest lay? This question is ever more pertinent in Egyptian society, a conglomeration of sectors with distinct interests According to the CIA World Factbook, 32 percent of the labor force is employed in agriculture, 17 percent is employed in the industrial sector and 51 percent is employed in service industry Even more telling though of the different interests within society may be the fact the size of the rural population, an astonishing 56.6 percent (CIA World Factbook) The clash of interests was particularly pronounced in an ironic case in 2007 After the implementation of a number of pro-business reforms made Egypt the World Bank’s top reformer, the same week the World Bank report came out, 27,000 textile laborers went on strike A final definition of corruption – that of public opinion - proves the most useful for our analysis This definition primarily centers on what the people believe to be considered corrupt behavior Like that of public interest, the public opinion definition suffers from the question of who is the public? And, in the case of Egypt, 3 is it the politically engaged elites or the masses? Taking into account these possible variations in the levels of the toleration of corruption in different communities, Heidenheimer puts forward a framework that distinguishes between “black,” “grey,” and “white” corruption: The evaluation ‘black corruption’ indicates… that a particular action is one which a majority consensus of both elite and mass opinion would condemn and would want to see punished on ground of principle ‘Gray corruption’ indicates that some elements… may want to see the action punished, others not, and the majority well be ambiguous ‘White corruption’ signifies that the majority of both… probably would not vigorously support an attempt to punish a form of corruption that they regard as tolerable (2008: 152) It is important to note that this framework does not necessarily imply that corruption is condoned but rather that it is tolerated to the extent that combating it is more costly than living with it Such a scheme also enables us to assess the different manifestations of corrupt practices within Mubarak’s regime instead of using an approach that singularly defines the concept of corruption and its impact Drawbacks to this approach also exist, namely that such opinion is difficult to measure The public opinion approach, though, is helpful if and when it is measurable in non-democratic regimes because it sheds light on peoples’ tolerance of corrupt practices It also is significant, as we will see later, in that it can help explain the peoples’ tolerability of the political system and reveal systemic factors contributing to the perpetuation of corruption Egypt under Mubarak Egypt is the land of the Pharaohs, the popularized all-powerful autocratic rulers who governed Ancient Egypt with an iron fist The Pharaoh assumed full control of the people and the land of Egypt –resources to be used at his disposal 4 Today, while the term Pharaoh might have grown obsolete to describe a ruler, the tyrannous hard-fisted nature of rule the name conveys is uncannily similar to former Mubarak’s rule over Egypt Mubarak, after ascending to power in 1981 after the assassination of his predecessor Anwar Sadat, immediately reinstated Egypt’s notorious emergency law, which gives undue power to the state’s secret police, the mukhabarat, and military courts in order to purge society of dissent Despite his civilian credentials, Mubarak’s rise to power was largely due to military support (Freedom House, 2007) Throughout the 1980s and 1990s, Mubarak utilized this power for the most part without restraint to terrorize, suppress and disband opposition parties and to torture and jail political activists, more of which will be described later Mubarak allowed little room for dissent and continued to impose a ban instituted under Nasser of the Muslim Brotherhood, which to this day remains one of the most active and popular political groups in Egypt To a certain extent, President Mubarak’s political powers were constitutional He had the power to name and dismiss cabinet members, provincial governors and the heads of various state institutions He faced no term limit as President, the office to which the Parliament – filled with members of his ruling National Democratic Party – elected four times with virtually unanimous consent Although a common phenomenon, parliamentary elections in Egypt were manipulated, fraudulent and rarely contested to the extent that most Egyptians did not even bother to register to vote (Economist, Feb 25 2005) A constitutional amendment passed in 2005 that purported to permit multi-party presidential elections also banned religious parties like the Muslim Brotherhood, which has substantial support among the population, and imposed “near-impossible obstacles” for independent candidates (Ibid.) In addition, the constitution granted the President substantial power over the legislature, which, for the most part, was 5 comprised of Mubarak’s NDP pawns In 2007, society and human rights groups viewed constitutional reforms that ostensibly sought to reform the more undemocratic aspects of the constitution with serious suspicion The reforms, although democratic in appearance, were crafted in a manner largely designed to maintain Mubarak’s hold on power (Economist, March 26 2007) Constitutional manipulation, however, was not the only tool Mubarak used in order to solidify his rule The routine use of torture, mistreatment of political prisoners and ordinary citizens was a fact of life Arbitrary arrests and the detention of political activists from the Muslim Brotherhood also remained prevalent under Mubarak in order to ensure that the NDP was guaranteed a majority in Parliament (Freedom House, 2007) In 2005, for example, government security forces were accused of arresting thousands of Brotherhood members Furthermore, despite the constitution’s promise of freedom of assembly, the government frequently cracks down on protests with unrestrained brutality The state security forces, commonly referred to as the baltagiya, or thugs, harassed and intimidated Egyptians who decide to vote in Parliamentary elections Freedom House, an international human rights organization that assesses political rights and civil liberties in countries, has given Egypt a 2.06 out of a possible in respect to the guarantee of civil liberties, and a 1.14 for “protection from state terror, unjustified imprisonment and torture.” (Ibid.) Mubarak’s regime also underwent a near institutionalization of corruption Endemic corruption, such as a policeman accepting a bribe for a traffic ticket or a bureaucratic facilitative bribe, is perhaps the most widely experienced form of corruption in Egypt for ordinary citizens A sense of the necessity of bureaucratic bribery in everyday life can be gleaned from a remark a frequent traveler to Egypt has made: “It takes hours just to pay an electric or phone bill Getting a copy of a birth certificate will require a full day off of work, trekking to multiple offices, plus 6 the bribes And the bureaucracy can’t be avoided, because everything needs government pieces of paper.” (Khan, 2011: 2) Moreover, the public education system is so bad in Egypt that passing exams typically requires one to take a private course with the instructor to compensate poor state salaries Obtaining health services typically also requires a substantial bribe, as does requesting mandatory official documents and signatures from the state Corruption, as Waterbury remarked over forty years ago, is “the price of routine performance The alternative is not red-tape but non-performance.” (1976: 430) In mid-2009, for example, a nation-wide survey found that 47% of those trying to establish small or medium sized businesses were required to pay a cash bribe (JPOST, 2010) The international watchdog, Transparency International, assigns Egypt a lowly 3.1 out of 10 on its corruption perception index (TI, 2011) While ‘grand corruption’ – that which involves transactions of large sums of money typically at the higher levels of the government – is less often experienced by ordinary Egyptians, it is an important attribute of Mubarak’s regime It has been argued that Mubarak considered Egypt his “fiefdom” to be exploited and divided amongst his cronies and supporters (Ismail, 2011) Rents – natural resources with low production and extraction costs but high profit returns – were distributed to business elites for prices much lower than the value of the resource itself Under Mubarak, a tiny business elite composed of representatives from foreign companies with exclusive import rights and real estate developers secured control of all consumption driven production, generating great wealth through their contacts with the state State-controlled banks extended loans exclusively to families in support of Mubarak, but denied credit to credible businessmen without political connections The state also imposed laws that required foreign investors to form joint ventures with Egyptian nationals and ensured that its political cronies were among the owners (Fahim et al., 2011) 7 One prominent example will suffice to make light of the scale of corruption in Egypt Ahmed Ezz, a businessman converted politicians, was able to generate enormous wealth after he bought an publically owned steel production company and then became an active member of Parliament where he was able to defend his near monopoly on steel production (Ezz controlled about two-thirds of the industry.) Surely, his success could not have come without his close friendship with President Mubarak’s son, Gamal, head of the NDP’s policy-making committee For another perspective, take the Sawiris family, another family with close political ties to the regime, which more than 50% of a business empire worth over US $12 billion accounting for 40% of the value of Egypt’s stock market (Economist, March 10 2005) Mubarak also guaranteed military loyalists lucrative real-estate deals and the control of a number of highly profitable companies in the water, olive oil, cement, and construction hotel and gasoline industries (Barry, 2011) It was and still is the gap between these rich businessmen and the rest of society created by Mubarak’s crony tendencies that is so startling For starters, Egypt has become nearly two distinct worlds In the minority are the upper and upper middle classes who live in gated communities, drive expensive cars, and send their children to private schools Expensive consumer goods are advertised on prominent billboards, and these well-off Egyptians eat at western fast-food chains The majority of Egyptians, though, struggle to merely subsist Rising bread prices, poor schools, and government neglect have marginalized an overwhelming majority of Egyptians 44 percent of the population is considered poor or extremely poor while nearly 2.6 million people are not even able to pay for basic food and services (Economist, September 11 2008) While Mubarak has made some effort to increase subsidies to the poor and increase government employment, inflation has taken a devastating toll on the economy and has driven food and basic service prices to levels that even increased government funding cannot meet 8 Theorizing Political Legitimacy in Egypt: Patrimonialism, Neopatrimonialism, or Predation? Autocrats not have the support of their people and thus must maintain authority through an alternative mechanism Some like Saddam Hussein in Iraq or Joseph Stalin in Soviet Russia, for example, have relied upon brute force and repression in order to instill fear into their people and cow them into obedience Authority derives from the use of force and does not carry legitimacy with the people Certainly, President Mubarak used the military and internal security forces extensively to suppress protests and to arrest dissidents throughout his years Yet it is clear that Mubarak’s rule also involved a certain degree of legitimate authority, a reality often neglected in debates over and analysis of Egypt’s political system The Egyptian ‘ruling bargain’ sheds a clear light on the system of political authority in Egypt when viewed in the context of patrimonialism as a form of governance and authority, and as a source of legitimacy The concept of patrimonialism derives from Weber’s (1978) work on particular types of sociological authority and origins of power in different cultures and societies The patrimonial system is based on a system of reciprocal obligations between the ruler, or state, and its subjects As Johnston et al point out, these “reciprocities – personal, densely interwoven, often lopsided, and based on intangible and symbolic dynamics of status loyalty and deference as much as on material exchange – became the means by which rulers sought obedience from the ruled.” (Johnston et al 2009: 127) Citizens expect a certain degree of assistance, of benefits and of protection from the state and in return offer their political and economic support to the state Effectively, a system of mutual reciprocation evolves in which the status quo lasts as long as both sides of the bargain hold up their end of the deal The nature of large societies that developed over time effectively meant that a ruler’s subjects were unable to access the ruler directly 9 Thus, a network of those individuals closely connected to the ruler, typically with familial, kinship, or marital ties, emerged that facilitated and coordinated the interaction of reciprocal obligations between ruler and ruled Informal social obligations are fundamentally important to patrimonial systems and provide the underlying structure of political governance This network of cadres with their close connections essentially forms a class of elite patrons Such patrons are endowed with the resources and means to ascertain the obedience of the subjects in a society and to ensure that those subjects hold up their end of the bargain Subjects in turn become clients dependent on their patron for state services and access to the political system The patron, on the other end of the scale, depends on the client for political support for his boss, the ruler, as well as the clients compliance in ensuring that the patron is able to meet requirements stipulated by the ruler to maintain his position The ruler permits the patron to act as required in order to sustain the ‘ruling bargain.’ Therefore, patrons within the administration are not tasked with professional responsibilities or delineated tasks but with “entirely discretionary” political power as long as as it accords to the boundaries set forth by the ruler (Weber, 1978: 1029) In a patrimonial system, there is no distinction between the “public” and the “private” especially regarding the behavior of the political administration Weber points out that “the office and the exercise of public authority serve the ruler and the official on which the office was bestowed; they not serve impersonal purposes.” (Ibid., 1028-1029) Institutions are designed and acted upon with the specific goal of regime survival – that is ensuring that reciprocities between the ruler and ruled are met Political officials, thus, are not bureaucrats in the sense that a bureaucrat is responsible to a legal order irrespective of the personal inclinations of the ruler 10 Instead, political officials consider their position to be personal 10 non-capitalists and can focus its resources on the most productive capitalists who are likely to generate the most private revenue and thus the largest bribes As such, the process of economic liberalization can lead to significant development It is certainly clear that that was the case in Egypt over the past twenty years or so GDP growth rates in Egypt have soared and have approached percent since 2005 Exports have grown at 20 percent annually, and a recent real-estate boom has enriched investors (Economist, 2007) The benefits of economic growth, though, have been largely directed toward the upper levels of society thereby marginalizing the other sectors who did not benefit from insider status to Mubarak’s regime Neopatrimonial Corruption: The Disintegration of the Political System and Patron-Client Connections The picture that emerges from the preceding discussion focuses on the strong patron-client ties that have connected business elites to the state which has provided highly profitable financial resources in return for the political support of the business community Yet set within that notion is the idea that it was the business community which benefited from Mubarak’s privatization process not ordinary citizens Neopatrimonialism and privatization cemented strong ties between the business community and the state but the question still remains as to whether the state was able to maintain patron-client ties to the rest of the population As we will see, the picture that emerges is not all that rosy and suggests that Mubarak’s patron-client ties were benefitting a smaller and smaller percentage of the population as economic liberalization became more and more beneficial to those with insider access Nasser’s ‘ruling bargain’ – the neopatrimonial agreement between the Egyptian labour and the middle class - had maintained political support for the one-party rule of the state This ‘ruling bargain,’ Fahmy points out, (2002: 103) took the form of a ‘social contract’ between the state and corporatized groups and 35 35 associations, “where economic benefits accrue to all members of these groups” and “are exchanged for support of the state and its policy.” The government promised and provided to these classes social and welfare services, government employment, guaranteed jobs for university graduates, free education and health care services and state subsidies for food, energy, housing, and transportation In the late 1980s and early 1990s, however, an economic crisis appeared imminent, and Egypt began to cut back its subsidies, free social services, free education and secured jobs for university graduates in order to reign in its enormous deficit Decreased public spending on education, healthcare, and transportation deteriorated the quality of public life “Factory workers, landless peasants, government employees, and those who produce goods for the local market… suffered most,” Shehata notes, since “they depended on government services and subsidies, as well as on market protections… many saw their fortunes fall as a result of the economic liberalization.” (Shehata, 2011) Mubarak’s economic reforms – initiated, it should be noted, at the behest of the IMF and World Bank - had effectively terminated the ‘ruling bargain’ Instead, the business elite and a new middle class emerged as the benefactors of Mubarak’s economic liberalization while the rest of the society was left to out on the street to suffer Fahmy (2002: 105) has identified what occurred in Egypt as “co-integrationism”: [The] system of state’s control over the various interest groups in society through a strategy of co-option of top group leaders into the system and integrating their interests with that of the state using special privileges, patronage networks and institutionalized corruption Indeed, Fahmy goes on to argue that instead of merely managing to distribute economic benefits to groups in society, the regime has taken on a new role of 36 36 continuous repression and intervention within corporatized groups of the labour and middle class Instead of permitting syndicates to operate freely, the government has restricted the freedom of nearly all syndicates and has permitted dictatorial leadership to mismanage and embezzles syndicate funds (Fahmy, 2002: 106-148) In labour organizations, top leaders are co-opted into the state’s realm and provided lucrative benefits in order to support the state’s coercive policies The state’s intervention in and manipulation of labour movements has created a lack of solidarity among their members As such, “conflict in interests between workers and other segments in the society… does not manifest itself within the context of class antagonism, but rather in antagonism towards the authoritarian state, and hence workers’ protests directed toward state symbols.” (Fahmy, 2002: 175) It is clear that a significant number of groups in society have begun to suffer Yet, as noted, the International Monetary Fund has estimated that economic liberalization and reform has caused Egypt’s real GDP growth to increase exponentially since 2002 Then, it was at a rate of 3.2%, and in 04/05 the rate jumped to 4.5 percent, hit 6.8 percent in 05/06 only to increase yet again to 7.3 percent in 07/08 The IMF also estimates that GDP per capita growth has increased since 2004 when it was about 1.5 percent to 4.5 percent in 2007 If anything, then, it appears that poor in Egypt were becoming richer and that Mubarak was playing his patron-saint role of guaranteeing wealth and jobs In fact, between 2004 and 2007, 2.4 million jobs and unemployment dropped from 10.5 percent to percent (Enders, 2008) The World Bank, however, in a report released in 2011 reveals that economic growth in Egypt despite reducing poverty had unevenly pro-poor effects: The welfare of an average person who was poor in 2005 increased by almost 10 percent per year between 2005 and 2008; this was sufficient to move this household out of poverty But growth also exposed some non-poor to 37 37 negative dynamics, making them poor… In the period 2005-2008, only 45 percent of the population in Egypt remained out of poverty and near-poverty This means that 55 percent of Egyptians experienced poverty or nearpoverty between 2005 and 2008, even though the poverty and near-poverty rates at a given point of time within his period fell from 46 percent to 36 percent (WB, 2011: 20) The potentially destabilizing effect of this can be seen in light of the classical J-curve argument A number of non-poor Egyptians had become poorer even with the growth in real GDP, and thus had their expectations and hopes of upward economic mobility sundered When groups believe that their living standards should rise, but those standards actually fall, as was the case for a significant segment of the population in Egypt, “there is a significant discrepancy between what they think they deserve and what they think they will get… there is a likelihood of rebellion.” (Dugan, 2004) The distribution of state subsidies – basic food and service related subsidies given to the poor – has also declined dramatically while the outflow of a number of other components of the state budget including military spending and state salaries and pensions remained relatively constant throughout the 1990s and early 2000s (Richter, 2007a: 191) Nonetheless, even when the government has attempted to increase its subsidy allocation, the effects of corruption and inefficiency essentially negates any tangible benefits for Egyptians of which they are well aware (Economist, April 10 2008) This has only increased the inequality gap and sparked further tensions between different sectors of society In 2001, the World Bank estimated that the poorest 10 percent of the population had access to 3.7 percent of national income 38 38 while the richest twenty percent had access to 29.5 percent of the national income Ten years earlier, the poorest ten percent of the population received 3.9 percent while the richest received 26.7 percent (Marfleet, 2009: 17) The Fund for Peace Index gives Egypt a 8.6 on the “criminalization/delegitimazation” indicator placing on the same level as the Democratic Republic of the Congo This suggests “massive and endemic corruption or profiteering by ruling elites, resistance of ruling elites to transparency, accountability and political representation,” and finally, “widespread loss of popular confidence in state institutions and processes” among the populace (FFP, 2008) Egypt also receives an exceptionally high score for uneven economic development, which in addition to income inequality, can be attributed to the fact that whereas the industrial sector employs 17% of the labour force and contributes 41 percent to GDP, the agriculture sector employs 32 percent of the labor force and contributes only 13 percent to the GDP (FFP, 2008) Finally, the official unemployment rate continues to hover above percent while the youth unemployment rate grew to a massive 25 percent in 2011 (Economist, February 2011) For those lucky enough to have jobs, the average salary is less than US $100 per month – an amount that is barely enough to provide basic provisions (Economist, September 11 2008) Exponentially rising food prices have only exacerbated tension In Egyptian society, it is the wide disparity between the rich and the poor and the sense on the part of ordinary Egyptians of being unjustly exploited while the rich live lavishly that creates what Fraser and Rimas characterize as “morale outrage” – a public feeling that can lead to protest (Fraser and Rimas, 2011) Conclusion There was an immediate impression garnered after scores of protests led to Mubarak’s abdication of an Egyptian population fed up with its ailing dictatorial President, endemic corruption, and authoritarian practices Structurally high 39 39 unemployment, particularly among the youth, rising inflation and food prices, and increasing political repression all appeared to have increased the probability Mubarak’s regime collapsing It seemed as though the revolution was fueled by the anger of an increasingly literate, young population demanding a voice in the political process Social media had facilitated communication between activists, enabling the mass demonstrations that took place The revolution in Tunisia and abdication of its President seemed to convey to protestors that change was possible On the part of the military, hesitancy and then refusal to crush the protestors only led to increasingly insistent demands on the part of protestors This is not to say that that impression was incorrect in that it was immature On the contrary, these factors were essential to aiding the success of the revolution Yet, it is only within the context of state-society relations that a fuller picture can be grasped of Egypt that encompasses these factors not as causative but instead as facilitative The neopatrimonial approach has enabled us to systematically analyze the political authority of Mubarak’s regime and the patron-client ties that have maintained its support It is clear that in order to sustain its rule, the regime has relied on the distribution of material resources to particular segments of society in order to buy off political support and thereby stave off political liberalization The ‘ruling bargain’ – the distribution of material benefits to all of society in exchange for support – dates back to Nasser and is premised on a neopatrimonial system of authority Patron-client exchanges, informal social connections and networks, and political favoritism were the rule rather than the exception in Egypt Yet the surveys repeatedly show that this type of behavior was not radically condemned in any sense Instead, it was largely seen as a fact of life Endemic corruption had been occurring for decades under Mubarak and his predecessors and it is consequently rather difficult to argue that Egyptians had suddenly become fed up with that system of corruption 40 40 Instead, I argue that the collapse of Mubarak’s regime was slated to occur since the beginning of the process of liberalization This process, although fundamental to the success of development, connected only a small class of business elites to the regime in the form of patron-client relationships Those who had been reliant on the regime, prior to liberalization, now became increasingly excluded from the material resources distributed by the state Food and basic service subsidies, free education and health care, and guaranteed employment – all staples of the ‘ruling bargain’ with the lower classes – became less and less provided for The bonds of reciprocity withered away Without promised benefits flowing from the state, ordinary Egyptians effectively retracted their side of the bargain and rescinded support It is within this context that the regime became considered corrupt in the eyes of the people as it lost legitimacy and then authority Literate youths promised a job by the regime were unable to secure it Inflation meant that without corresponding increased bread subsidies from the state subsistence became more difficult for most of the population Only those with close political ties to Mubarak and his cronies were able to secure material resources – a circle that became increasingly smaller yet involved higher stakes as time wore on The population became ever more marginalized and alienated from the upper echelons of society – some of whom had experienced significant improvement in their standard of living but then fell victim to Mubarak’s uneven pro-poor policies The process of development in more traditional societies is fraught with potential problems and complications Without a rational-legal bureaucratic culture, a clear distinction between public and private, widespread public regarding norms, a strong civil society and high standards of accountability and transparency it is ever easier for regimes to become involved in corrupt behavior throughout the process of economic liberalization In neopatrimonial societies, the process of 41 41 economic liberalization can merely be a tool to restructure and reorganize patronclient ties and cement the foundation of a ruling coalition of supporters In addition, in neopatrimonial societies economic liberalization can be a means to adapt to societal shifts and changes through the co-optation of potentially powerful groups The case of Egypt suggests not that the regime was predatory and unable to adapt to changes Rather, it shows that neopatrimonial systems of authority can disintegrate when there is a breakdown of the ‘ruling bargain’ and patron-client exchanges with important sectors of society If a neopatrimonial system is to adapt to modernization, however, it must continue to extend its hand in delivering material benefits to the majority of the population 42 42 Works Cited Alarming corruption 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Story_ID=E1_TNNDNPNT Youth unemployment: Young, jobless and looking for trouble | The Economist (Feb 2011) The Economist – World News, Politics, Economics, Business & Finance Retrieved April 28, 2011, from http://www.economist.com/blogs/schumpeter/2011/02/youth_unemployment 49 49 ... meet requirements stipulated by the ruler to maintain his position The ruler permits the patron to act as required in order to sustain the ‘ruling bargain.’ Therefore, patrons within the administration... political power Incumbency was maintained by the Mubarak regime not by its embrace of political pluralism and norms of accountability On the contrary, it was maintained through the allocation of... ‘ruling bargain’ – the neopatrimonial agreement between the Egyptian labour and the middle class - had maintained political support for the one-party rule of the state This ‘ruling bargain,’ Fahmy