UPDATE 3: In this New York Times article from yesterday, we get an insight into the class conflict in Bahrain:

The days of protest and repression have mostly been about the Shiites speaking up and the Sunnis cracking down. But on Monday night, in the wealthy neighborhood of Juffair, tens of thousands of pro-government demonstrators poured into Al Fateh Grand Mosque to express their support for the embattled king.

The pro-government crowd borrowed some of the opposition’s slogans, including no Sunni, no Shia, only Bahraini. But that was where the call for unity started and ended.

This was an affluent crowd, far different from the mostly low-income Shiites who took to the streets to demand a constitutional monarchy, an elected government and a representative Parliament. The air was scented with perfume, and people drove expensive cars. In a visceral demonstration of the distance between Sunni and Shiite, the crowd cheered a police helicopter that swooped low, a symbol of the heavy-handed tactics that have been used to intimidate the Shiites.

We love King Hamad and we hate chaos, said Hannan al-Abdallah, 22, as she joined the pro-government rally. This is our country and we’re looking after it.

Ali al-Yaffi, 29, drove to the pro-government demonstration with friends in his shiny white sport utility vehicle. He was angry and distrustful. The democracy they have been asking for is already here, he said. But the Shias, they have their ayatollahs, and whatever they say, they will run and do it. If they tell them to burn a house, they will. I think they have a clear intention to disrupt this country.

In their hostility towards the poorer Shia, the Bahraini Sunnis remind me of the hatred that the people of the wealthier neighborhoods of Caracas have for the poorer, suburbio supporters of Hugo Chavez.

UPDATE 2: There was a strike of 3,000 construction workers in Saudi Arabia last week:

The police force couldn’t control the workers. When a police officer told the workers that they need to return to their accommodation and their issue will be solved later, the workers replied by throwing stones at him, and they managed to frighten all the police officers around him. The stones missed the police officer, but unfortunately it did not miss his car! It was the first time in my life I saw a police car smashed in Saudi Arabia.

Hat tip to t at Pink Scare.

UPDATE 1: Starting with Pinochet in Chile in the 1970s, neoliberalism has always flourished in countries with dictatorial regimes, as most recently demonstrated in North Africa and the Middle East:

Less than two weeks ago, the International Monetary Fund’s executive board, its highest authority, assessed a North African country’s economy and commended its government for its ambitious reform agenda. The I.M.F. also welcomed its strong macroeconomic performance and the progress on enhancing the role of the private sector, and encouraged the authorities to continue on that promising path.

By unfortunate timing, that country was Libya. The fund’s mission to Tripoli had somehow omitted to check whether the ambitious reform agenda was based on any kind of popular support.

Libya is not an isolated case. And the I.M.F. doesn’t look good after it gave glowing reviews to many of the countries shaken by popular revolts in recent weeks. Tunisia was hailed last September for its wide-ranging structural reforms and prudent macroeconomic management.

Bahrain was credited in December with a favorable near-term outlook after the economy managed the global crisis well. Algeria’s prudent macroeconomic policies helped it to build a sound financial position with a very low level of debt. And in Cairo, the I.M.F. directors last April praised the authorities’ response to the crisis as well as their sound macroeconomic management.

Of course, only reporters with the New York Times, in this instance Pierre Briancon and John Foley, could present this information with the requisite credulity. According to them, the IMF somehow failed to determine if Libya's reform agenda was based on any kind of popular support. They fail to acknowledge the obvious, that IMF policies of privatization and structural adjustment have never been based upon popular support, they have always been proposed by transnational economic elites for their benefit, so why should it be any different in Libya? If there had been popular support for these policies, the IMF might well have considered such support as a negative indication that they were not being implemented with sufficient rigor.

INITIAL POST: An excerpt from an excellent article by Walter Armbrust about the neoliberal structure of Egyptian society that remains in place despite the departure of Mubarak:

Two observations about Egypt’s history as a neoliberal state are in order. First, Mubarak’s Egypt was considered to be at the forefront of instituting neoliberal policies in the Middle East (not un-coincidentally, so was Ben Ali’s Tunisia). Secondly, the reality of Egypt’s political economy during the Mubarak era was very different than the rhetoric, as was the case in every other neoliberal state from Chile to Indonesia. Political scientist Timothy Mitchell published a revealing essay about Egypt’s brand of neoliberalism in Rule of Experts (the chapter titled Dreamland — named after a housing development built by Ahmad Bahgat, one of the Mubarak cronies now discredited by the fall of the regime; a version of this was also published in Merip). The gist of Mitchell’s portrait of Egyptian neoliberalism was that while Egypt was lauded by institutions such as the International Monetary Fund as a beacon of free-market success, the standard tools for measuring economies gave a grossly inadequate picture of the Egyptian economy. In reality the unfettering of markets and agenda of privatization were applied unevenly at best. The only people for whom Egyptian neoliberalism worked by the book were the most vulnerable members of society, and their experience with neoliberalism was not a pretty picture. Organized labor was fiercely suppressed. The public education and the health care systems were gutted by a combination of neglect and privatization. Much of the population suffered stagnant or falling wages relative to inflation. Official unemployment was estimated at approximately 9.4% last year (and much higher for the youth who spearheaded the January 25th Revolution), and about 20% of the population is said to live below a poverty line defined as $2 per day per person.

For the wealthy, the rules were very different. Egypt did not so much shrink its public sector, as neoliberal doctrine would have it, as it reallocated public resources for the benefit of a small and already affluent elite. Privatization provided windfalls for politically well-connected individuals who could purchase state-owned assets for much less than their market value, or monopolize rents from such diverse sources as tourism and foreign aid. Huge proportions of the profits made by companies that supplied basic construction materials like steel and cement came from government contracts, a proportion of which in turn were related to aid from foreign governments. Most importantly, the very limited function for the state recommended by neoliberal doctrine in the abstract was turned on its head in reality. In Mubarak’s Egypt business and government were so tightly intertwined that it was often difficult for an outside observer to tease them apart. Since political connections were the surest route to astronomical profits, businessmen had powerful incentives to buy political office in the phony elections run by the ruling National Democratic Party. Whatever competition there was for seats in the Peoples’ Assembly and Consultative Council took place mainly within the NDP. Non-NDP representation in parliament by opposition parties was strictly a matter of the political calculations made for a given elections: let in a few independent candidates known to be affiliated with the Muslim Brotherhood in 2005 (and set off tremors of fear in Washington); dictate total NDP domination in 2010 (and clear the path for an expected new round of distributing public assets to private investors).

No wonder the Egyptian military is threatening to suppress strikes that disrupt the economy.

Hat tip to the Angry Arab.

Labels: Activism, American Empire, Egypt, IMF, Neoliberalism, Poverty