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Wednesday, February 23, 2011




The second wave is coming

It's time for a summary of the first wave of Arab revolutions. The first wave swept the region and left the regimes reeling while Tunisia was left without a functional government and in Libya the regime of Gaddafi looks like living through its last days. In Egypt the military managed to get hold of the situation but their grip on power is probably a rather tentative one.

A strange situation is developing in Bahrain which is threatening to put all our notions about the region on their head. Of course, Bahrain is one of the most developed countries in the region. Nevertheless, it still looks strange. Basically, the Shia in Bahrain seem getting their way despite the security apparatus being firmly under the Sunni control.

The Arab economic reform appears largely dead by now with the regimes reversing years of economic reforms. Everywhere food and fuel subsidies have been reinstituted or increased. Many regimes are rushing programs to boost employment in the public sector and putting on hold privatization programs. Budget and trade deficits are rising. On top of this a wave of labor unrest is sweeping the region driving up labor costs and putting more pressure on the budgets. Capital flight from the region is accelerating and this list of negative economic consequences can go on. The present defeat of the Arab economic reform at the hands of the revolution ensures another round of revolutionary turmoil in a few years from now, when the unemployment crisis escalates again amidst severe inflationary pressures and economic slowdown.

Meanwhile the second wave of revolutions appears about to hit the region soon. Maybe in a matter of days.

The second wave is coming


I would stick my head out and predict that Israel and Iran will be hit during the second wave. I elaborated a bit on this point here. I would only add that as far as Israel is concerned, if not this Friday, then the next one or at some point later, but the blockade of Gaza will crumble on the Egyptian side. As a matter of fact, the first march may well be launched not in the West Bank, but against Egyptian part of the border in Gaza. Though I am not sure about from which side. As a matter of fact, the wall may come under attack from both sides.

We should also have it very clear that once the genie is out of the bottle, means once the Arab Street is unleashed, it's probably impossible to bottle it back. The Arab Street is euphoric and intoxicated by the feeling of people power. Basically it looks like the Palestinians and Muslim Brothers across the border are about to take hostage the two peace treaties Israel has respectively with Egypt and Jordan. Large scale military operations in Gaza and the West Bank are probably no longer possible. Unless of course Israel is ready to risk seeing the weakened regimes in Egypt and Jordan swept away by another wave of popular unrest.

The first wave left Yemen thrown off balance and as the protests in Yemen are continuing, the country looks increasingly teetering on the bring of disintegration and civil war. For some reason the protests seem to be failing to take off in Algeria and Iran. Nevertheless, I am still cautiously betting on a revolution to break out in Tehran and other Iranian cities (Maybe because I want to see it so much).

I would also make two more observations. First of all, even in Tunisia the post revolution has disintegrated into a mess. As far as Libya and Yemen go, I can only see no longer a mess, but a disaster. The collapse of both countries can seriously cool down the enthusiasm for more revolutions. Neither Egypt is likely to have a very inspiring post revolution given the already mounting economic losses and labor unrest. In short, whatever revolutions the Arabs and Persians are planning there, they should be executed now before the post revolutionary mess in Libya and elsewhere hits TV screens.

Two, a year and a half ago, when the first signs of an approaching destabilization became apparent, I said that the regimes seemed to be missing quite a few of their once formidable teeth. Information coming from Libya is sketchy but it looks like the Libyan regime is an exception to the rule. Gaddafi apparently threw everything, from fighter jets to navy, into a battle against the protesters. Nevertheless, despite an old fashioned crackdown, the regime has already lost control over large chunks of the country. My understanding of the situation is that by now some revolutions are being fueled by the pure revolutionary contagion. This makes it difficult to know for certain where this thing is going to strike next. Basically any country in the region can find itself on the way of the next wave.

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