So, the constitutional referendum, as expected, has passed with flying colours. Official results cite a turn out that’s over 20 million people who voted Yes for the constitution by 98%. It is again worth noting that the supreme majority of those who voted for the constitution didn’t bother reading it or care what was in it, but rather, wanted the legitimacy issue of the MB to be over and done with and for us as a nation to move on to the next phase. As one of the people who actually did read the constitution, I must say that I voted Yes with face-wide smiles, not for those reasons per se, but because of the amount of landmines that this constitution entails. This constitution was so utterly stupid, that I simply had to vote for it just to watch the people dealing with the consequences of their choices. Make no mistake, this constitution is a minefield, and one that will blow up in the faces of everyone involved in it.
Take the military for instance. While the majority focused on whether or not military trials for civilians were included in the constitution, very few people noticed that it made the military judiciary the most powerful and autonomous judiciary body in all of Egypt, completely out of the control of the Minister of Defence, and completely capable of trying him or anyone in the military it pleases. Why do you think that is? It’s not for the sake of oppressing the public with more military trials, since the previous structure serves them well in that regard anyway. If we presume that it doesn’t affect civilians, then it must be done to affect the military, and whoever proposed that article from the military top brass did it after ensuring that they control the military judiciary anyway. So why? The only reasonable explanation left is to utilise this new order to settle scores inside the military against whatever rivals they have inside, no matter how high up in the food chain they might be, while seemingly looking as if they had nothing to do with anything. If we believe that, this leaves us with two deductions: (1) The military top brass are not all as homogenous and on the same page as they would like us to think; and (2) One group in it is preparing to take out the other. In short, we might be entering “the war of the generals” phase. Ponder that thought for a minute.
Away from the military, the constitution also has a very curious set of articles that set floor percentages for funding of social services in health and education. Those articles are curious because their percentages are not from the government’s earning or budget, but rather, from GDP. The new constitution states that the government is now constitutionally obligated to allocate funding 10% of the GDP for education, healthcare and scientific research. With a GDP of approximately $260bn, this amounts to $26bn, or EGP 180bn, for education and healthcare alone, just this year. And if we, God forbid, experience any growth in our GDP next year, this amount is set to increase accordingly. Needless to say that we don’t have this kind of money, and that whoever put it there is either a moron who can’t differentiate between the government’s budget and the GDP, or someone who truly longs for the days of the nationalisation of industries; because if we couple these articles with the article stating that Egypt’s tax system will have to be progressive, we find that the only way for the new budget to not be unconstitutional is if they increase taxes insanely on everything. We are talking Hollande levels of tax increases here, which in case anyone is following what’s happening in France… well, it’s not going very well for the economy.
Egypt needs an insane amount of growth to get out of its economic funk, which requires a huge amount of investments, both foreign and domestic. Those investments will not come if, coupled with all of Egypt’s problems of security, political instability and a corrupt inefficient government, they also have to contend with a huge increase in taxes. This leads to economic stagnation and flight of capital and brains, not to mention the fleecing of whatever capital our richest businessmen have managed to preserve during the past three years. The inevitable conclusion will be that either the businessmen will move their money elsewhere the moment those tax increases take place, or they will push back to have those articles removed and the constitution amended the first chance they get, which means yet another referendum after the presidential and parliamentary elections are over. It will be our umpteenth time to vote in less than four years. And people say Egyptians are not dedicated to democracy.
If one is conspiracy-minded, then one would presume that these articles are put in there by the military to destroy the last remaining power centre left outside of their control, which is the wealth of businessmen. While this may be a very Nasserite move fitting with the Nasserite mood we are in, Egypt is in no shape economically to replay those years again; the country needs its private sector vibrant and growing if it even hopes to meet the demands and needs of its ever-growing population in the future. Given that future planning is not our forte, this may be very well the government’s solution to its woes: just take the money from the rich people and plug the holes on the short term, and deal with the consequences later. Given that later will be exactly one year after it implements such a strategy, and that its consequences will be a recession the likes of which Egypt has never seen, this will not end well for anyone involved. Who knows, maybe the aftermath of what will happen will ensure that next time, they will allow a No vote campaign, but I highly doubt it. We are obviously not run by people who see farther than their noses.