Two years after the revolution that toppled a dictator, Egypt is already a failed state. According to the Failed States Index, in the year before the uprising we ranked No. 45. After Hosni Mubarak fell, we worsened to 31st. I haven't checked recently -- I don't want to get more depressed. But the evidence is all around us.
Today you see an erosion of state authority in Egypt. The state is supposed to provide security and justice; that's the most basic form of statehood. But law and order is disintegrating. In 2012, murders were up 130 percent, robberies 350 percent, and kidnappings 145 percent, according to the Interior Ministry. You see people being lynched in public, while others take pictures of the scene. Mind you, this is the 21st century -- not the French Revolution!
The feeling right now is that there is no state authority to enforce law and order, and therefore everybody thinks that everything is permissible. And that, of course, creates a lot of fear and anxiety.
You can't expect Egypt to have a normal economic life under such circumstances. People are very worried. People who have money are not investing -- neither Egyptians nor foreigners. In a situation where law and order is spotty and you don't see institutions performing their duties, when you don't know what will happen tomorrow, obviously you hold back. As a result, Egypt's foreign reserves have been depleted, the budget deficit will be 12 percent this year, and the pound is being devalued. Roughly a quarter of our youth wake up in the morning and have no jobs to go to. In every area, the economic fundamentals are not there.
Egypt could risk a default on its foreign debt over the next few months, and the government is desperately trying to get a credit line from here and there -- but that's not how to get the economy back to work. You need foreign investment, you need sound economic policies, you need functioning institutions, and you need skilled labor.
So far, however, the Egyptian government has only offered a patchwork vision and ad hoc economic policies, with no steady hand at the helm of the state. The government adopted some austerity measures in December to satisfy certain IMF requirements, only to repeal them by morning. Meanwhile, prices are soaring and the situation is becoming untenable, particularly for the nearly half of Egyptians who live on less than $2 a day.
The executive branch has no clue how to run Egypt. It's not a question of whether they are Muslim Brothers or liberals -- it's a question of people who have no vision or experience. They do not know how to diagnose the problem and then provide the solution. They are simply not qualified to govern.