Saturday, July 7, 2018

The Plateau: Egypt’s Struggles with Development in the Modern Era


Introduction
According to the political scientist Walt Whitman Rostow, the scientific, industrial, and democratic revolutions in Western Europe paved the way for the rise of modernity, transforming the lives of billions of human beings across the globe over the last two centuries.[1]  There is strong evidence to support this conclusion: life expectancy, literacy rates, and GDP per capita have grown at an unprecedented rate. These general improvements in the human condition fall under a general umbrella called development. Egypt is no exception to this trend.  Its population has grown from approximately 4 million to 90 million since Napoleon’s invasion in 1798; literacy rates rose from less than five percent of the population to over seventy percent; and GDP per capita has risen from less than five hundred dollars to over three thousand.[2]  The importing of Western technology as well as institutional structures associated with the state are major reasons for these developments.  Almost every other human community on the globe was affected by this process as well.
However, as Samuel Huntington pointed out in Political Order and Changing Societies, development is neither an even process nor is it inevitable.[3]  Rostow’s simplistic and teleological conception of development is contradicted by modernity’s convoluted history.  The socio-economic changes created by the rise of the modern world have also caused a great deal of conflict and sporadic periods of economic stagnation that Huntington referred to as plateaus.  Despite the positive statistical trends noted above, Egypt has suffered from various periods of decline over the last two centuries, and the country has fallen further behind not only the West but many of its regional neighbors on many measures of development.  The 2011 revolution was Egypt’s fourth in the last 150 years, and each one failed to lead to the consolidation of democracy or levels of economic development associated with Western countries. 
There are a plethora of theories that could help explain Egypt’s uneven relationship with modernity, including Marxism, post-colonialism, dependency theory, rentierism, historical institutionalism, neo-liberalism, and precocious Keynesianism to name a few.  The problem with adhering to any one of these theories and ignoring the others is that none of them can explain the full complexity of Egypt’s uneven economic and political development.  It is instead more beneficial to analyze the country’s convoluted history, which shows that each of these theories only apply during specific periods of time and that many crucial aspects of Egypt’s development cannot be easily categorized under any particular theory at all.[4]

Mohamed Ali and Egypt’s Early Struggles with Development: 1805-1848
            When Mohamed Ali, an Ottoman Officer of Albanian descent, solidified his control of the Nile River valley at the beginning of the nineteenth century, he began a program of modernization with the intent of thwarting the political ambitions of European powers and solidifying his control over the country.[5]  Although Napoleon’s invasion of Egypt in 1798 ended in disaster for the French, it was a wakeup call to the leaders of the Ottoman Empire, who had previously failed to respond adequately to the emergence of modernity in Western Europe. 
            Mohamed Ali’s reform program focused on the following three areas: agriculture, industry, and the military.  In order to avoid losing his newly won prize to rapacious European powers and make these reforms, he needed access to capital, new technology, and Western expertise, and he had to convince Egypt’s landed elite, the Mamluk aristocracy, to sacrifice resources for the sake of long term development.  Over the following two decades, Mohamed Ali was able to successfully transform the country’s agriculture by importing new technology and European engineers, tripling Egypt’s agricultural production in the process.  The city of Alexandria, which had previously declined into a fishing village following the Arab invasion of the country in the seventh century, was revived as Mohamed Ali had a modern port constructed on the Mediterranean Sea.  Cash crops such as cotton and sugar were grown and exported to Western Europe, raising capital for industrial and military projects.  As a result, Egypt’s first factories, which mass produced textiles and weapons, were established in Bulaq, Cairo’s port on the Nile River.  In addition, many Egyptians were sent abroad to European universities, and Western teachers and military officers were imported to train bureaucrats and soldiers.  By the end of the 1820’s, Mohamed Ali was able to conscript tens of thousands of Egyptian villagers into a national army and challenge the Ottoman Empire for supremacy over the Middle East.
            However, from the very beginning, Mohamed Ali’s reform efforts faced a diversity of internal and external problems.   For one, most of the Mamluk aristocracy, the class of slave soldiers that owned most of Egypt’s land, were reluctant to sacrifice their wealth and power to engage in long term reforms.  Frustrated by his attempt to centralize control and reign in his conservative political opponents, Mohamed Ali had most of the landed elite hunted down and executed in 1811 in what was a very bloody battle for control of the country’s future.  Furthermore, to engage in his industrial and military reforms, he conscripted, by force, tens of thousands of villagers to work on irrigation projects and in factories.   While his agricultural reforms were very successful, leading to the beginning of the country’s population explosion, his industrial reforms suffered due to the shortage of capital and experienced workers.  Egypt’s fledgling industrial sector was highly dependent on tariffs to prevent cheaper Western goods from flooding the country’s markets.  Lastly, although Mohamed Ali was initially successful in defeating the Ottoman Empire’s military on the battlefield and taking territory in the Arabian Peninsula and Greater Syria, his rapid advances drew the ire of Great Britain, who feared that the collapse of the Ottoman Empire could create a political vacuum that would be filled by the Russians or the French.  To prevent the collapse of the empire, the British stepped in to assist them military.  By 1838, Great Britain forced Mohamed Ali to demilitarize and open up his economy to free trade with the West, thus ending his dream of turning Egypt into a regional powerhouse.  His successor Abbas Helmy led a conservative backlash against the Westernization of the Egyptian economy and society, reversing many of Mohamed Ali’s educational and industrial reforms during the early 1850’s.

Cotton Dependency and the Debt Crisis, 1848-1881
            Without the option of developing the country’s industry or military, Mohamed Ali’s successors were forced to use other means to raise capital and engage in developmental reforms.[6]  His first three successors—Abbas Helmy, Mohamed Said, and Ismail Pasha—depended on the export of cotton to raise revenue.  At first, dependency on the cash crop proved fortuitous.  During the 1850’s and 1860’s, Egypt was able to dominate the international cotton market as exports from the American South dropped due to the country’s civil war.  Furthermore, Great Britain was in the middle of an economic boom, so demand for the cash crop in English textile factories was high.  Abbas Helmy used the revenue generated by the cash crop to build the country’s first rail ways, which connected Cairo with the Mediterranean and Red Seas, enabling the faster transport of natural resources to the coasts.  The increase in revenue encouraged his two successors to borrow money from Europe to pay for other developmental reforms.  Mohamed Said and his successor Ismail Pasha, with the help of European investments and bank loans, constructed the Suez Canal, a waterway that connected the Mediterranean Sea with the Red Sea.  To honor the inauguration of the project, Ismail Pasha borrowed extraordinary sums of money to build a Parisian style downtown for Cairo, which included posh cafes, restaurants, parks, palaces, and even an opera house.[7]  It was a new façade for a city whose medieval neighborhoods were beginning to crumble.  Ismail, who received his education in Paris, sought to turn Egypt into a European country by importing Western art, architecture, music, clothing, and customs.   By the 1870’s, both Cairo and Alexandria became cosmopolitan cities where various peoples from all over Europe mixed with Egyptians, creating a hybrid culture.
            However, dependency on a single crop has a very obvious drawback: if the price of the good suddenly declines, so does the entire economy.  The American civil war ended in 1865, which led to Southern cotton reentering the international market.  Furthermore, a depression began in Europe in 1873, leading to a significant decline in demand for textiles and thus the price of the cash crop.  Facing a shortage of capital, the Egyptian government was forced to borrow even more money, which made the government ever more dependent on Western banks.  The debt crisis came to a head in the late 1870’s, when Ismail Pasha was pressured to replace his cabinet with Western advisors, who decided to cut the salaries of Egyptian bureaucrats to pay back Egypt’s debt.   The country’s burgeoning middle class of white collar civil servants, engineers, doctors, lawyers, teachers, and military officers—who came into being during Mohamed Ali’s reign—objected to the European influence on the government and the pay cuts.  In 1879, massive protests by this new middle class forced Ismail to concede to their demands, disbanding the European cabinet and re-raising salaries.  In turn, this led the Europeans to replace Ismail by force with his son Mohamed Tawfiq, who became a puppet of the British.  What started as peaceful protests quickly turned into revolutionary activity when an Egyptian officer named Ahmed ‘Urabi led a revolt against the British backed government, briefly taking over the entire country.   ‘Urabi was in the process of creating a parliamentary political system when the British invaded in 1882 to protect their interests in the Suez Canal, the private property of British citizens, and the money owed to European banks. 

British Colonialism: 1882-1952                                                         
             Like most of the third world, Egypt became a victim of Western imperialism.  European powers, in their pursuit of natural resources, power, and the spread of their culture, dominated the world politically and economically throughout the late nineteenth and early twentieth century.  This is not say that colonialism did not bring its fair share of benefits.  Under direct British rule from 1882 to 1923, Egypt’s population growth rates increased significantly thanks to further improvements in agriculture and the importing of Western medicine.  Advances were made to the communication and transportation infrastructure in part due to the positive influence of the British civil service, which was known for its high levels of professionalism and low levels of corruption.  However, the British invested very little in education or industrial development.  Egypt’s literacy remained at approximately ten percent throughout this time period and the economy stayed dependent on cash crops.   Colonial powers were largely concerned with securing their territorial possessions and turning their colonies into primary resource exporters.  The end result was that Egypt’s population grew and urban areas began to swell as villages could no longer absorb the surplus agricultural labor.  Without an adequate industrial sector, the country’s cities struggled to manage the influx of people from the country side, creating enormous problems with urban development and a growing wealth gap between rich and poor.  In the process, foreigners flaunted their wealth in European style social clubs and in newly Westernized areas of Cairo such as Ma’adi, Heliopolis, and Zamalek.
             These demographic problems and the humiliation of colonialism created the foundations for Egypt’s nationalist movement, which was led by members of the upper-middle class.  A new generation of journalists, lawyers, civil servants, mid-level army officers, and academics in the late nineteenth and early twentieth century sought to bridge the gap between traditional aspects of Egyptian culture and modernity with the intent of pushing the country towards independence.  One of these intellectuals was a lawyer named Sa’ad Zaghlool, who founded one of Egypt’s first political parties.  It was a political movement based on liberal, democratic principles that began as a peaceful attempt to lead the nation towards independence.  However, the British declaration of emergency laws during World War I and their refusal to allow the Egyptians to send a delegation to the Versailles conference at the end of the conflict turned Zaghlool’s party into a revolutionary movement.  Renamed the Waqf, which means delegation in Arabic, this movement helped lead Egypt’s 1919 revolution.  The British responded to the protests with divide and conquer tactics, making concessions to the revolutionaries by giving the country formal independence but still maintaining control over foreign policy and the Suez Canal.  In 1923, Egypt’s first truly democratic constitution was drafted, creating a constitutional monarchy with a parliamentary system of government. 
However, continued British influence over the country over the next two decades and the poor performance of the new government delegitimized the democratization process, pushing many Egyptians away from liberalism.   The Wafd party gradually lost its popularity as it struggled to govern due to the obstruction of the British, the monarchy, and corrupt officials within their own party.  Attempts to redirect capital towards long term development, education, and industrialization were consistently thwarted.  When the Great Depression hit in 1929, the end result was a political crisis, and many Egyptians began turning towards anti-democratic ideologies.  One of these movements was Hasan al-Banna’s Muslim Brotherhood, an organization that rejected the Westernization of the country and saw Islam as the answer to Egypt’s political, social, and economic problems.  Through their charity networks that provided support for the unemployed and the poor, they were able to gain a substantial amount of supporters.   Others turned towards fascist movements such as the Young Egyptians, who drew much of their inspiration from Hitler’s Nazi Germany and Mussolini’s Italy.   On the other hand, many saw inspiration in communism and the Stalinist model.  Out of all of the anti-democratic fronts, the one that eventually became the most popular by the middle of the twentieth century was Arab-Nationalism, an ideology that saw socialism and Arab political unity as the answer to ending Western dominance and fostering economic development in the Middle East. 
These anti-democratic movements and the economic depression of the 1930’s led to a long period of political instability and violence.  Throughout the 1930’s and 1940’s, Egypt’s political system wavered back and forth between periods of martial law imposed by the king and his British backers, and ineffective coalition governments in parliament.  The final straw was the humiliating defeat suffered by the Egyptian military against Israel in the 1947-48 war, which created a groundswell of opposition against the British, the king, and the Wafd party.  In the summer of 1952, this tension exploded into another revolution, which was used as an excuse by a group of mid-level officers in the Egyptian military to stage a coup d’état, putting an end to Egypt’s first democratic experiment and ending the monarchy in the process.  The British, weakened significantly by World War II and facing a plethora of independence movements in their colonial possessions, were no longer able to maintain control of their empire.

 Abdel Nasser and Arab Nationalism: 1952-1970
            Although Egyptian’s ruling military junta initially consisted of a diversity of personalities with different visions for the country’s future, it was the Arab nationalist vision of the charismatic Colonel Gamal Abdel Nasser that would win out in the political and ideological struggle over control of the state.[8]  By 1954, most of Nasser’s opposition, including leaders of the Muslim Brotherhood, were in prison.  His decision to nationalize the Suez Canal two years later and the subsequent failure of the British, French, and Israelis to retake control of the Canal Zone due to the intervention of the Soviet Union and the United States increased his popularity throughout the country, enabling the Nasser regime to engage in a series of Arab Nationalist reforms. 
Many of these reforms were inspired by the policies of socialist governments in Eastern Europe.  In several phases, land was taken from wealthy Egyptians and redistributed to small landowners throughout the 1950’s.  Furthermore, the businesses and property of most foreigners were nationalized, and the capital gained from these seizures were invested into state owned factories producing cement, bricks, textiles, heavy machinery, and packaged food stuffs with the intent of making the country self-sufficient economically.   The size of the Egyptian bureaucracy was also greatly expanded to improve the infrastructure, centralize control the national economy, expand public education, and create a welfare state.  In the process, the Soviet Union helped the Egyptian government construct the Aswan Dam in the far south, which today produces approximately fifteen percent of the country’s electricity.  Also, new neighborhoods inspired by communist architecture were built in Cairo and Giza such as Muqqatam, Mohandiseen, and Doqi to deal with the country’s rapid population growth.  Lastly, Nasser attempted to create political unions between Syria and Yemen to foster Arab nationalism throughout the entire Middle East in opposition to the Israeli state and Western influence.
            However, Abdel Nasser’s reforms created numerous political, social, and economic problems that had negative repercussions for the Egyptian state over the following half century.  For one, his policies of confiscating the lands and businesses of the upper class, foreigners, and Jewish Egyptians created a brain drain, driving some of the most educated and talented bureaucrats and intellectuals out of the country.  The military regime’s extensive use of coercion to stifle opposition also contributed to this decline in cultural diversity and political pluralism.  To make matters worse, the new state industries that were created suffered from severe inefficiency as a result of overemployment, a lack of accountability, cronyism, and no market competition.   Nasser did solve the country’s problems with overdependence on cash crops by diversifying the economy, but the country’s industrial sector was inefficient and struggled to export goods.  Furthermore, land distribution created a new class of a small and medium sized land owners that lacked sufficient capital to invest in modern agricultural technology.  As Egypt’s population exploded in the 1950’s and 1960’s, the agricultural sector struggled to keep up.  Consequently, the country now imports approximately half of its food stuffs.   On top of this, continued population growth and disappointing levels of economic development strained Egypt’s welfare state.  This created a phenomenon that the political scientist Peter Evans called precocious Keynesianism, which is when a welfare state is created before a country has an adequate industrial sector to pay for it.[9]  Since the state promised universal employment, Nasser’s government politicized the employment of state officials, artificially creating new jobs with low wages.  As a result, Egypt’s bloated bureaucracies today suffer from high levels of corruption and inefficiency.  The state struggles to enforce laws; educate its citizens; and allocate capital towards long term development.  Furthermore, the government now spends over twenty percent of its budget on bread and fuel subsidies.  Lastly, the centralization of the economy and the political system around Cairo has led to the neglect of other areas of the country and the swelling of the capital’s population.
            To make matters worse, Nasser’s foreign policy initiatives also failed to materialize.  His attempted unions with Syria (1958-61) and Yemen (1962-76) ended in complete disasters.  Egypt’s occupation of Yemen for five years, which was resisted militarily by northern forces with ties to Saudi Arabia, has been referred to by several historians as Nasser’s Vietnam.  The state’s struggle against Israel also ended in humiliation with the defeat of the Egyptian state in the Six Day War of 1967, which led to Israel’s occupation of the Golan Heights, the West Bank, the Gaza Strip, and the Sinai Peninsula.  Several years of warfare in the 1960’s forced the government to borrow substantial amounts of loans from foreign banks, and the Egyptian government halted several development projects, including the building of desperately needed urban infrastructure.   Following the Six Day War, protests broke out in Egypt for the first time since 1952, and Nasser spent the last three years of his life struggling to deal with the country’s enormous political, social, and economic problems.

The Neoliberal Era: 1970-2011
            When Nasser’s presidential successor Anwar Sadat came to power in 1970, he sought to reverse the country’s domestic and foreign policy by realigning the country with the United States and liberalizing the economy in what he dubbed the corrective revolution.[10]  The failures of the Nasser regime combined with the gradual decline of the Soviet Union pushed Sadat towards neo-liberalism throughout the 1970’s.  However, due to his lack of social capital and Israel’s occupation of the Sinai, Sadat would not have been able to engineer this political shift legitimately without a strategic victory that he could promote to the public.  The opportunity was provided for him in 1973 during the Jewish holiday of Yom Kippur.  Having rebuilt the military over the previous three years with the help of Russian weapons, Sadat chose the Jewish holy day to attack Israeli forces in the Sinai as many Israeli soldiers were on a short leave.  Although the Egyptian military only gained a modest amount of territory over the course of a week before the Israeli state struck back with the help of American military aid, the intervention of the Soviet Union and the significant death toll among the Israeli soldiers forced both sides to sue for peace and begin a long period of negotiations that ended with the Camp David Accords in 1979 and the return of the Sinai.  The Egyptian government, rightfully or wrongfully, portrayed it as a great victory for their military in the state media outlets, and Sadat used his brief rise in popularity to engage in the corrective revolution.
            The neo-liberal reforms, as promoted by the International Monetary Fund, the World Bank, and other Western international institutions, were pursued by Sadat and his successor Hosni Mubarak (1981-2011) over the next three decades with mixed results.   The philosophy behind these reforms was to cut the size of the country’s bureaucracies and the welfare state to free up capital for long term development.  Furthermore, privatization of the economy would encourage competition and maximize the efficiency of production.  Lastly, opening up the political system to free elections and more tolerance for oppositional groups would increase political transparency and accountability.  During the 1970’s, Sadat released many political prisoners from jail; particularly Islamists, who served as a counterweight to decrease the power of the left wing, leading to the growing religious conservativism of the Egyptian population. 
However, the Egyptian state only partially engaged in the neo-liberal reforms.  Attempts to cut the welfare state and subsidies, fire bureaucrats, or downsize public companies were often met with bread riots, strikes, and protests, which the regime usually responded to with a mix of coercion and back peddling.   Although some parts of the economy were privatized, what rose in its place was a new class of crony capitalists, many of whom made their fortune off the oil boom in the Gulf and whose businesses survived because of their connections with the government.  Furthermore, although both Sadat and Mubarak held elections for the parliament, the results were always preordained as the ruling National Democratic Party won through a mix of media manipulation, electoral fraud, vote-buying, and intimidation of oppositional groups.  Some Islamist and liberal opposition groups participated in the fake elections in the hopes of gradually pushing the regime towards reforms; however, others chose protest and insurrection.  The Egyptian state fought a five year war with radical Islamist terror cells from 1992 to 1997, and they suppressed a serious of increasingly volatile protests by liberal groups such as Kifayya and the Sixth of April movement throughout the 2000’s.
            Part of the reason why the Egyptian state was able to delay the implementation of neo-liberal reforms was due to the state’s access to substantial amount of rents, which has been a peculiar aspect of Middle East politics in the last few decades.[11]  The oil boom of the 1970’s not only provided the state with extensive amounts of capital from the export of oil, which today consists of ten percent of the country’s GDP, they were also able to encourage individuals to migrate to the Gulf and the West for work.  Egyptian emigrants now send over sixteen billion dollars a year in remittances back to their home country, and many of their family members have been able to use this money to purchase property and consumer goods as well as gain access to satellite television, mobile phones, and eventually the internet by the 2000’s.  Furthermore, due to Egypt’s control of the Suez Canal and their shared border with Israel, both Western countries and the Gulf have provided the state with an extensive amount of foreign aid and foreign direct investment.  Egypt is the second largest recipient of American aid, which averaged approximately two billion dollars a year from 1981 to 2011.  The country has also received favorable treatment from the IMF and international banks, at one point having half its debt forgiven in the early nineties in exchange for supporting America in the Gulf War.  International aid agencies have also helped Egypt deal with many of its urban development programs, including building a metro line and modern sewage system in Cairo in the 1980’s.   Moreover, the emergence of international air travel and Egypt’s reconciliation with the West led to a dramatic increase in tourism to the country as visitors flocked to see the country’s ancient monuments and Red Sea beach resorts.  Tourism now accounts for ten percent of GDP and employs thirty percent of the work force in the formal economy.  
Although access to rents modestly improved the standard of living of the average Egyptian and kept the government from going bankrupt, it also discouraged the government from making long term reforms to improve the educational system, promote a competitive industrial sector, and open up the political system to competitive elections.  The government was able to use rents to secure their own power while buying off part of the opposition.  This reliance on rents was also problematic since Egypt’s population continued to grow over the last few decades while rents from oil shrunk due to dwindling reserves.  While oil made up thirty percent of Egypt’s GDP in 1980, by 2008 it only made up ten percent. In 2004, the Egyptian government, under the influence of Hosni Mubarak’s son Gamal, began making more serious neo-liberal reforms, which gradually increased opposition towards the regime due to the cutting of state services, growing unemployment, and the increase in the price of goods due to inflation.  Furthermore, greater access to satellite television and the internet increased the expectations for a better life among the average Egyptian, and the government’s bloated and poorly guided bureaucracies were unable to respond adequately to growing calls for reform.  Increasing tensions between the government and the opposition culminated in the 2011 revolution.[12] 

Conclusion
            This analysis of Egypt’s history shows that each theory on development only tells part of the story. The state’s modern history is a complicated mix of periods of growth and decline, and the country has been influenced by a plethora of political, social, economic, and environmental factors along the way. Many events that would have been considered trivial or minor paved the way unexpectedly for massive political, economic, and social changes later in history.  While Egypt’s trajectory of development shares a lot in common with many other developing countries, its differences are equally striking. Furthermore, this history also shows that development is not inevitable. The collapse of Egypt's democratic experiment following the 2011 revolution, the return of the military to power, and the country's endemic problems with poor economic growth rates and weak state institutions indicate that nation is currently stuck in a developmental plateau and may not escape from it in the near future.



Work Cited Page
1. Almond, Gabriel and James Coleman.  The Politics of Developing Areas.  Princeton University Press: Princeton, 1960.

2. Apter, David.  The Politics of Modernization.  The University of Chicago Press: Chicago, 1965.

3. Burns, E. Bradford.  "The Modernization of Underdevelopment: El Salvador, 1858-1931,” The Journal of Developing Areas, 18(2), 1984: 293-316.

4. Cook, Steven.  The Struggle for Egypt: From Nasser to Tahrir Square.  Oxford University Press:  Oxford, 2012.

5. Frank, Andre Gunder.  "The Development of Underdevelopment,” Monthly Review Press, 18(4), 1966:  99-108.

6. Huntington, Samuel.  Political Order in Changing Societies.  Yale University Press: New Haven, 1968.

7. Korany, Bahgat, ed.  Arab Human Development in the Twenty-First Century: The Primacy of Empowerment.  The American University in Cairo Press: Egypt, 2014.

8. Mansfield, Peter.  A History of the Middle East, 4th edition.  Penguin Books: New York, 2013.

9. Raymond, Andre.  Cairo: City of History.  The American University in Cairo Press: Cairo, 2000.

10. Ross, Michael. "Does oil hinder democracy?" World Politics, 53(3), 2001: 325-361.

11. Rostow, W. W.  The Stages of Economic Growth: A Non-Communist Manifesto.  Cambridge University Press: Cambridge, 1967.

12. Tschirgi, Dan, ed.  Development in the Age of Liberalization: Egypt and Mexico.  The American University in Cairo Press: Egypt, 1996.

13. Waldner, David.  State Building and Late Development.  Cornell University Press: New York, 1999.

14. Waterbury, John.  The Egypt of Nasser and Sadat: The Political Economy of Two Regimes.  Princeton University Press:  New Jersey, 1983. 

15. Wilber, Charles and Kenneth P. Jameson.  Political Economy of Development and Underdevelopment, Sixth Edition.  McGraw-Hill Publications: New York, 1996.

16. Woo-Cumings, Meredith, ed.  The Developmental State.  Cornell University Press: Ithaca, 1999.



[1] Rostow, W. W.  The Stages of Economic Growth: A Non-Communist Manifesto.  Cambridge University Press: Cambridge, 1967.
[2] For information on statistics for Egypt in the last decade, see the United Nation’s Developmental Report at http://hdr.undp.org/en/content/egypt-human-development-report-0.  For information on statistics on Egypt at the end of the eighteenth century, see Raymond, Andre.  Cairo: City of History.  The American University in Cairo Press: Cairo, 2000. 
[3] Huntington, Samuel.  Political Order in Changing Societies.  Yale University Press: New Haven, 1968.
[4] For information on convoluted history, see Wilber, Charles and Kenneth P. Jameson.  Political Economy of Development and Underdevelopment, Sixth Edition.  McGraw-Hill Publications: New York, 1996.
[5] Mansfield, Peter.  A History of the Middle East, 4th edition.  Penguin Books: New York, 2013.  For information on Egyptian history in the nineteenth and twentieth century, see Peter Mansfield. 
[6] For information on dependency theory, see Almond, Gabriel and James Coleman.  The Politics of Developing Areas.  Princeton University Press: Princeton, 1960; and Burns, E. Bradford.  "The Modernization of Underdevelopment: El Salvador, 1858-1931,” The Journal of Developing Areas, 18(2), 1984: 293-316.
[7] For information on Greater Cairo’s history, see Raymond, Andre.  Cairo: City of History.  The American University in Cairo Press: Cairo, 2000.
[8] For information on problems with Egypt’s political development since the 1952 revolution, see Cook, Steven.  The Struggle for Egypt: From Nasser to Tahrir Square.  Oxford University Press:  Oxford, 2012.
[9] Waldner, David.  State Building and Late Development.  Cornell University Press: New York, 1999.
[10] For information on problems with Egypt’s development during the neo-liberal age, see Tschirgi, Dan, ed.  Development in the Age of Liberalization: Egypt and Mexico.  The American University in Cairo Press: Egypt, 1996.
[11] For information on rentierism and rentier theory, see Ross, Michael. "Does oil hinder democracy?" World Politics, 53(3), 2001: 325-361.
[12] For information on problems with development in the Middle East in the last decade, see Korany, Bahgat, ed.  Arab Human Development in the Twenty-First Century: The Primacy of Empowerment.  The American University in Cairo Press: Egypt, 2014.

Sunday, July 1, 2018

Explaining Attitudes Towards Obamacare: An Analysis of Factors that Impact the Formation of Public Opinion


            In March of 2010, President Barack Obama signed the Affordable Care Act (ACA), more popularly known as Obamacare, into law. The main aim of the legislation was to curb the growing costs of healthcare by forcing young people to purchase health insurance, to expand the public healthcare program Medicaid, and to create a more competitive marketplace for consumers (Wear, 2011). The act also banned insurance companies from denying coverage based on preexisting conditions. Proponents of the law claim that millions of people now have health insurance because of the ACA. According to the New York Times, “In 2016, there were 28.6 million Americans without health insurance, down from 48 million in 2010.”[1] However, opponents of the ACA argue that the law expanded the size of government and raised the cost of healthcare for millions of people who already had health insurance. According to Forbes, “…across the board, for all ages and family sizes, for HMO, PPO, and PSO plans, premium increases averaged 60 percent from 2013, the last year before ACA reforms took effect, to 2017.”[2] The enactment of the legislation has faced intense political opposition. Since the ACA was signed into law, various parts of the legislation have been struck down by the courts, and many states have refused to participate in the federal government’s expansion of Medicaid. It is even possible that the popular backlash against the ACA negatively affected Democrats in the run up to the 2016.[3] In light of these developments, what factors explain public opinion on Obamacare? Analyzing this research question will help us understand attitudes towards a controversial public policy and allow us to explore how public opinions are formed. Are citizens generally knowledgeable on public policy issues or are they largely apathetic and ignorant? Furthermore, what heuristic devises do citizens use when forming opinions on public policy?
            There are several theories that can help us answer these questions. First, past research has shown that public opinions and political behavior are affected by identity politics (Iyengar, Sood, and Lelkes, 2012). Since the 1970’s, America has witnessed the growth of a partisan divide between Republicans and Democrats. Politicians, media outlets, and citizens have increasingly become more divided by party (Druckman, Peterson, and Slothus, 2013). Politicians are more prone to voting along partisan lines with their respective party in Congress, and media outlets are more apt to frame the news to satisfy political partisans. Rank and file Democrats and Republicans are also more likely to favor a policy if it is supported by their own party regardless of personal socioeconomic status or ideology. According to the academic Stephen Wear, Obamacare was inspired by a health policy implemented by former Republican Governor of Massachusetts Mitt Romney, and Republicans are now only opposing the ACA so strongly because Democrats were responsible for enacting the law at the federal level. Past research has shown that many citizens will use their party identity as a heuristic device to make quick decisions in terms of voting and forming opinions on public policy. From this perspective, the great majority of citizens have neither the time nor the educational background to understand the complexity of public policy issues, but many will rely on political parties and other linkage institutions to make decisions for them.
            Furthermore, opinions on the ACA may also be effected by political ideology. Some citizens evaluate policy based not only on their party affiliation but a set of general beliefs about how the government should function (Jessee, 2009). Conservatives generally believe in small government, low taxes, and a minimal amount of regulation, and liberals generally believe in the necessity of a strong welfare state and higher taxes on the wealthy to pay for it. The enactment of the ACA included an expansion of Medicare and an increase of government regulation of the medical industry, so knowledgeable liberals and conservatives may have supported or opposed the law on this basis. While most citizens may have not understood the precise details of the law and how precisely it would impact individuals, partisans may have understood enough of the basics to form an opinion based on the ideological prism in which they view the world. Conservative and liberal media outlets have use simplified ideological arguments to criticize or defend the law. While past studies have shown that most citizens have very little knowledge of public policy, the opinions of political partisans who keep up with the news are influenced by their political ideology (Zaller, 1992). It should be noted that there is a significant amount of multicollinearity between party identification and ideological beliefs as Republicans tend to be conservative and Democrats tend to be liberal, although party partisans who follow the news less often and have lower levels of education are more like to have a political ideology that contradicts their party identification.  
            Opposition to Obamacare might also be a result of symbolic racism; in other words, conservative whites may oppose the enactment of welfare programs like the ACA because of its association with welfare for African Americans. While old fashioned or biological racism has declined sharply since the signing of the Civil Rights Act in 1965, a more subtle more of racial resentment called symbolic racism has become prevalent among white conservatives (Kinder and Sears, 1981; Nail, Helen, and Decker, 2003). Even though the great majority of whites no longer believe blacks are biologically inferior, a majority of conservative whites believe that socioeconomic problems in the black community are the result of cultural deficiencies. From this perspective, blacks only need to work harder and stop using the history of slavery and segregation as an excuse for their problems. For many conservative whites, poverty has become associated with race. Therefore, whites who hold this form of racial resentment will be less likely to support public programs intended to help the poor such as Obamacare. In addition, many conservatives negatively associate the ACA with Barack Obama, the country’s first African American president (Wear, 2011). In fact, the ACA’s nickname, Obamacare, was originally used by conservative pundits as a means to mock the law. Opinions on the law may be tied to the race of the former president. Past studies have shown that America has a weaker welfare state than Western Europe partially because of the existence of salient social cleavages (Alesina and Glaeser, 2004). Americans are less likely than Europeans to empathize with the poor because the lower classes in the United States are associated with minorities, and political entrepreneurs on the right use these social cleavages to their advantage. For these same reasons, blacks are more likely to support Obamacare than whites.
            In addition, opinions on Obamacare may also be influenced by the socioeconomic status of citizens; specifically, people suffering from economic or health problems may harbor negative attitudes towards the law. Obamacare was supposed to improve the cost of healthcare and increase access to it, but if individuals don’t see personal financial or health improvements, they may blame the ACA for their problems. Given the complexity of the law and its impact on the healthcare system, it is reasonable to assume that the average American would not understand the precise impact the law had on the price of health insurance or the quality of medical services while controlling for other factors. Instead, we would assume that people would associate their personal economic and health status with the efficacy of the law regardless of the existence of causation between the independent and dependent variables. According to the political scientist Achen Bartels, citizens tend to engage in what is called irrational retrospection (Bartels, 2016). If they perceive themselves to be worse off economically or if they read negative news stories prior to an election, they become more likely to vote against the incumbent or oppose the status quo even if it is irrational to blame the government for their problems. For example, Bartels found that citizens were likely to punish politicians for uncontrollable acts of nature like shark attacks and famines. We might assume the same would be true of how citizens evaluate Obamacare.
            Finally, ignorance of politics may explain why some people are more likely to have a neutral attitude on the ACA. The political scientist John Zaller has shown that independents are comprised mainly of people who are apathetic about politics and rarely follow the news (Zaller, 2012). Contrary to popular opinion, partisans tend to be more highly educated on politics and follow the news more frequently. When asked questions on public opinion polls, people who are ignorant of politics will either not give an answer or will be easily influenced by the wording of the question itself when stating their opinion. It is possible that people who don’t follow the news, regardless of demographics and party identification, are more likely to have a neutral opinion on the ACA. It is also possible that many respondents on a survey will give a random answer. Too embarrassed to admit that they know nothing about Obamacare, survey respondents might state they are for or against the law anyway. However, due to the salient nature of the healthcare debate in the news, it is possible that the majority of respondents have formed a basic opinion of the issue prior to being surveyed. Past studies have also shown that a majority of Americans have been able to form consistent and strong opinions on salient issues like abortion and gun rights.
            To test these theories, I will analyze data from the 2016 American National Election Survey. Since this survey was conducted two years after the law came into effect, it gives ample time for the enforcement of the law to directly affect peoples’ lives. To measure the dependent variable, which is attitudes toward Obamacare, the following survey question is used: “Do you favor or oppose the 2010 health care law?”[4] The wording of this question is neutral as it avoids using loaded terms like Obamacare or the Affordable Care Act. Zero is coded as being in favor, one as being neutral, and two as being against the law. Opinions on Obamacare are as follows:
Table 1: Opinion on Obamacare
Frequency
Percentage
Favor
1,578
36.98
Neutral
881
20.63
Oppose
1,808
42.33

As shown above, there are a significant number of responses for and against the law, which means there is sufficient variation on the dependent variable. Only four respondents declined to give an answer, so they were removed from the analysis.
            Numerous questions are utilized to operationalize the independent variables. For party identification, a dummy variable for Republican and Democrat is included with independent being the constant. To operationalize the independent variable political ideology, a question on the ANES is utilized that asked respondents to rank their ideology on a scale of one to seven with seven being the most conservative. To measure the independent variable symbolic racism, the following ANES survey question is used: “on a scale of one to seven, how much should the government help blacks?” One is labeled as “the government should help blacks,” and seven is labeled as “blacks should help themselves.” This is a common question that is found in past studies on symbolic racism, and answers to this question are highly correlated with other survey questions commonly used to measure the concept (Taber and Sears, 2005). Furthermore, dummy variables on race and ethnicity are included with separate coefficients for Blacks, Hispanics, and Asians, and whites are treated as the constant. To measure the variable economic status, a question from the ANES is used that asks respondents to state whether their economic status is better or worse from a year ago on a scale of one to five with five being much worse. Additionally, a question from the ANES is utilized that asks respondents to evaluate their health status on a scale of one to five with five being poor, and a dummy variable on whether or not people have health insurance is included. Finally, to measure political ignorance, a question is used that asks respondents to state how often they pay attention to politics, the news, and elections on a scale of one to five with five being never. Moreover, a dummy variable indicating whether or not a respondent has a bachelor’s degree or higher is included. The normal demographic control variables are also used in the model, which includes age, ethnicity, marital status, income, and gender.
            To conduct the analysis, I first used the ordered logit model, but after conducting the brant test, there was a problem with parallel regression. This was expected. The reason for this complication is that there are significant differences between people who were neutral on Obamacare and those who are either for or against the law as will be shown in the model below. The dependent variable cannot be treated as ordinal. As a result, I used the multinomial logit model with the baseline being those who oppose Obamacare. The baseline will be compared with people who favor Obamacare and respondents who are neutral on the public policy.  Using the multinomial logit model is a better choice since we can compare people who are neutral with those who have strong opinions on the ACA.
            It is my hypothesis that political party identification, political ideology, symbolic racism, and socioeconomic variables for health and economic status will be powerful explanatory variables to explain people who support and oppose Obamacare. In contrast, people who are ignorant of politics are far more likely to be neutral. Furthermore, weak partisans and independents are less likely to know anything about Obamacare and more likely to give random answers to a pollster’s question. Since the majority of Americans lack basic knowledge of important policy issues, we can expect a relatively weak pseudo R-Squared value for the model and weaker coefficients when comparing those who are neutral with those who oppose the law. The results of the analysis are below:
Opinions on Obamacare (Baseline: Opposes Obamacare)
Favors Obamacare



Odds Ratio
Republican
-0.75
-0.2
***
0.47
Democrat
1.21
-0.2
***
3.35
Ideology
-0.44
-0.1
***
0.64
Financial Status
-0.28
-0.1
***
0.75
Female
-0.21
-0.1

0.81
Health Insurance
1.02
-0.2
***
2.76
Poor Health
-0.13
-0.1
***
0.88
Age
0.02
0
***
1.02
Married
-0.11
-0.1

0.90
Education
0.11
-0.1

1.11
Income
-0.02
-0

0.98
Black
0.89
-0.3
***
2.43
Hispanic
0.29
-0.2

1.34
Asian
0.97
-0.3
**
2.64
Other race
-0.06
-0.3

0.94
Black Welfare
-0.27
-0
***
0.77
Economic Status
-0.43
-0.1
***
0.65
Political Ignorance
0.08
-0.1

1.09
Constant
3.32
-0.5

27.53





Neutral on Obamacare



Republican
-0.78
-0.2
***
0.46
Democrat
0.37
-0.2

1.45
Ideology
-0.24
-0.1
***
0.79
Financial Status
-0.07
-0.1

0.93
Female
-0.03
-0.1

0.97
Health Insurance
0.37
-0.2

1.45
Poor Health
0.01
-0.1

1.01
Age
0.01
0

1.01
Married
0.01
-0.1

1.01
Education
0.03
-0.1

1.03
Income
-0.04
-0
***
0.96
Black
0.85
-0.3
**
2.33
Hispanic
0.16
-0.2

1.18
Asian
0.57
-0.3

1.78
Other race
0.1
-0.3

1.11
Black Welfare
-0.09
-0
**
0.91
Economic Status
-0.28
-0.1
***
0.75
Political Ignorance
0.19
-0.1
***
1.21
Constant
1.39
-0.5

4.00
Pseudo R-Squared
0.285



Respondents
2807



*P<.05




**P<.01




***p<.001





            As predicted, the results show that partisanship, political ideology, symbolic racism, health status, and economic status are all statistically significant. Democrats are three times more likely than independents to favor Obamacare. Furthermore, moving up one point on the seven point ideological scale from liberal to conservative makes someone 1.56 times less likely to support Obamacare. Also, holding symbolically racist views makes someone .77 times less likely to support Obamacare, and being black makes someone 2.43 times more likely to support it. In addition, having health insurance makes someone 2.76 times more likely to support the ACA, and having poor health conditions and a self-reported decline in economic status is correlated with negative views of the law. Finally, political knowledge and education are not statistically significant when comparing respondents who favor Obamacare with those who oppose it. However, as expected, a lack of political knowledge is correlated with being neutral. Moving up one point in the scale of political ignorance makes someone 1.21 times more likely to be neutral. Moreover, almost all of the other coefficients in the neutral column are much smaller, and many of the independent variables are no longer statistically significant. The reason for this result is that people who are neutral are less likely to follow the news, and they have weaker partisan leanings regardless of their socioeconomic background and other factors. Being neutral on Obamacare is negatively correlated with being Republican, but it is not positively associated with being a Democrat. This indicates, as expected, that people who are neutral on Obamacare tend to be independents who do not follow the news often. Lastly, the weak r-squared of .28 indicates that over seventy percent of the variation in the dependent variable cannot be explained by the variables above. There is a high degree of randomness in people’s responses to the survey question. This may be the result of a majority of people not understanding the question. This is not surprising as past media reports have indicated that the majority of Americans are ignorant of health care policy in general.[5] The low pseudo r-squared could also partially be the result of independent variables that were not taken into account.
            The low pseudo r-squared could be a result of problems with the internal validity of this study. It would have been better to have included questions that asked respondents to state the economic and health impacts of the ACA on their lives, but there is no such question on the 2016 ANES. Self-reported health and economic status questions served as an imperfect substitute. It would have also been better to include questions that test the respondents’ knowledge of basic healthcare concepts and the ACA, but once again these questions are not found on the 2016 ANES. The questions on self-reported political knowledge and levels of education served as imperfect substitutes. Furthermore, it may have been better to have used a question that asked respondents to state their opinion on Obamacare on a scale of one to seven or to use a feeling thermometer, but given the large differences between people who are neutral and those who have strong opinions on the ACA, an ordered logit or ordinary least squares model would have not been appropriate. Finally, there are issues with external validity. Would we find similar results with public policy issues that are more or less salient than Obamacare?   
            In spite of these problems, the comprehensive number of independent variables in the model and the relatively low r-squared indicate that we can be sure of the finding that a large majority of people answering the ANES survey are ignorant of the details of the healthcare law and its impact on their lives. Furthermore, people who do follow the news regularly are more likely to use simplistic heuristic devices such as partisan political identity, political ideology, and symbolic racism to form their opinions on public policy issues. Only a small minority of people are judging Obamacare based on their personal economic and health status.

Work Cited
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[1] “Nearly 20 million have gained health insurance since 2010,” https://www.nytimes.com/2017/05/22/health/obamacare-health-insurance-numbers-nchs.html, May 22nd, 2017.
[2] Book, Robert. “Yes, it was the affordable care act that increased premiums,” https://www.forbes.com/sites/theapothecary/2017/03/22/yes-it-was-the-affordable-care-act-that-increased-premiums/#72c512b811d2, March 22, 2017.
[3] Gerson, Michael. “Obamacare’s effect on the 2016 election,” http://www.sandiegouniontribune.com/opinion/commentary/sd-oe-gerson-obamacare-20160919-story.html, September 20, 2016.
[4] “User’s Guide and Codebook for the ANES 2016 Time Series Study,” http://www.electionstudies.org/studypages/anes_timeseries_2016/anes_timeseries_2016_userguidecodebook.pdf, 2016.
[5] Japsen, Bruche. “Americans don’t understand basic health terms, let alone Obamacare,” https://www.forbes.com/sites/brucejapsen/2016/03/13/americans-dont-understand-basic-health-terms-let-alone-obamacare-costs/#340ffcf37e62, March 13, 2016.