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The third chapter traces the decline of Nasserist hegemony and the rise of a new ruling class and its project of infitah (literally translated to ‘opening’). Marking Egypt’s opening to global capital and the failure of state-led capitalist development, these years see the dominance of neoliberal restructuring and Westernization. I argue that while this ruling class did attempt to create hegemony, its project was weaker than the Nasserist project. Engaging in debates on the effects of neoliberalism in the Middle East, the chapter argues that it was this bloc that laid the foundations for Egypt’s neoliberal trajectory but failed to create a hegemonic project strong enough to maintain the same level of hegemony as the Nasser-led bloc and thus had to rely on transnational social and ideological forces in order to rule. The question of transnational capitalist development and its effects across postcolonial contexts frames this chapter, as I argue that there is a correlation between weakening hegemony and neoliberal restructuring. This era is thus understood through Fanon’s notion of a dependent bourgeoisie, as well as Gramsci’s notion of an interregnum, a period of transition.
Chapter two presents an overview of the evolution of Egypt’s political economy under Nasser and Sadat. Central to this history are the struggles over property rights. Under Nasser, nationalist attempts to modernize the economy eventually gave way to an experiment in Arab socialism within the geopolitical context of the Cold War. During this period, an ‘authoritarian bargain’ was established in which broadly redistributive social and economic policies sought to provide welfare for, and redistribute land to, the popular classes in return for their political subordination. In the 1970s, Sadat began to dismantle Arab socialism and establish a more liberal political economy through his infitah policy. In doing so, Sadat presided over the beginning of the disintegration of the authoritarian bargain. To contain social conflict, Sadat emboldened the right-wing forces of political Islam in the hope that they would combat the left and provide an Islamic alternative to the social protection offered by the Nasserists.
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