How The Mubarak Family Made Its Billions ~ Marcus Baram (via PLANETIZEN POST)

Frankly, I was curious about this myself. Amassing 5 to 10 billion dollars or more (there are estimates of up to 70 billion) while working on a government salary, be it in the United States or Egypt,  requires considerable energy.

How did they do it? My figured it was the usual means such as corruption in state-owned enterprises and government-run banks giving out loans without the expectation of being paid back. However, they did it more slowly with the appearance of legality.

This scheme appears to be based on the 51% rule. That rule says that no foreign business can be set up in Egypt without a majority stake being owned by an Egyptian. Obviously, the Mubarak family is more “Egyptian” than anyone else.

There is a warning in this. Nations requiring such partnerships may not in reality be all that friendly to business, not in the long-term. Certainly foreign interests are going to take a hit when they are in such an incestuous relationship with a corrupt government, first by shakedown and then by the inevitable revolution.

Such economic rules exist in many parts of the globe. The most prominent being China. For those businesses investing overseas I would recommend caution in these kinds of partnerships. Such an investment may pay off for the next quarter or the next year. But in theory, corporations are eternal. Having your immortal organization seized by an enraged population is an ignominious end. The situation in Egypt is a textbook example of how such investment can go wrong.

Whether the investment is shared with a corrupt Middle Eastern nation run by a single family or by a single political party (Chinese Communist), the future is hardly serene.

James Pilant

How The Mubarak Family Made Its Billions ~ Marcus Baram A tourist in Cairo spots three photographs on the wall of a restaurant: one of Nasser, another of Sadat, and the third of Hosni Mubarak. He asks the owner who the first man is, and the owner tells him it’s the man who overthrew the Egyptian monarchy and served as the country’s president. “Who’s the second man?” the tourist wants to know. “That’s Anwar Sadat, our next president,” comes the reply. “He made peace with Israel but was assassinated in … Read More

via PLANETIZEN POST

Popular Revolt in the Arab World (via Grand Strategy: The View from Oregon)

These events are hardcore business ethics matters. It is the economic theories of the Chicago School of Economics that propels the austerity measures all over the world. It is the intense privatization movements again pushed by American philosophies and business interests that is a factor in these conflicts. I will cover the IMF and its part in these uprisings in more detail in my next posting.

There are few commentators I trust as much as J. N. Nielsen. Certainly very few are as well read.

I strongly recommend his writings.

James Pilant

Popular Revolt in the Arab World Thursday Tunisia’s authoritarian government of several decades duration has fallen to a popular uprising. This was not a perfectly bloodless revolution, but bloodshed was definitely kept to a minimum, largely because security forces took the side of protest … Read More

via Grand Strategy: The View from Oregon

A Spectre is Haunting Ireland – the Spectre of Fascism (via homophilosophicus) [8]

This is Homophilosophicus take on the Authoritarian in Irish History and the last in today’s series. I hope you’ve enjoyed reading this as much as I have.

He has a thoughtful mind in a difficult place in a terrible time. The combination is painful but often results in very fine writing.

James Pilant

A Spectre is Haunting Ireland - the Spectre of Fascism One cannot help but be wryly amused by the accusation that the government and police authorities are fascists during this time of social discontent and upheaval. It sounds vaguely reminiscent of the language of the European student revolutionary movements of the 1970s à la John Sullivan’s Citizen Smith. No matter how often the term is used to describe the present régime it creates an involuntary smile across so many faces. No sensible person wish … Read More

via homophilosophicus