Why Egypt's Military Cares About Home Appliances

Lefteris Pitarakis/AP

The Egyptian military has been notably non-confrontational during the recent wave of protests, defending the right of people to protest and protecting the protesters from attacks by pro-regime forces.

One reason for the military's peaceful response: the unique role it plays in the Egyptian economy. The military owns "virtually every industry in the country," according to Robert Springborg.

Springborg, a professor at the U.S. Naval Postgraduate School, has written several books about Egypt, he's lived in Egypt, he's consulted with the Egyptian military, and he's an expert on the various businesses it runs. Here's a list he rattled off from the top of his head:

...car assembly, we're talking of clothing, we're talking of construction of roads, highways, bridges. We're talking of pots and pans, we're talking of kitchen appliances. You know, if you buy an appliance there's a good chance that it's manufactured by the military. If you ... don't have natural gas piped into your house and you have to have a gas bottle, the gas bottle will have been manufactured by the military. Some of the foodstuffs that you will be eating will have been grown and/or processed by the military.

The reasons for this arrangement go back to the '60s and '70s, when the Egyptian military was very large as a result of the wars with Israel. After the peace treaty with Israel was signed, the need for such a large fighting force disappeared. But leaders worried about all those young men released from military service suddenly flooding the job market.

So the military transformed itself from a fighting force to hiring force. And some of the businesses it got into were pretty far away from its traditional mission. For example, the military had all these forces stationed on the coast — a really pretty coast that lots of people would probably pay to visit. So, Springborg says, the question arose:

What are we gonna do with this military zone that is huge and in the most desirable part of the country and has extremely beautiful beaches, and some of the greatest … coral reefs in the world and was absolutely crying out for touristic development?

The answer: The military gave private developers access to the land, and the developers made military officers shareholders in big tourist developments.

No one knows for sure how many resort hotels or other businesses in Egypt are run by the military, which controls somewhere between 5 percent and 40 percent of the nation's economy, according to various estimates. Whatever the number, Springborg says, officers in the Egyptian military are making "billions and billions and billions" of dollars.

These billions would be threatened if the protests devolved into full-on civil conflict. People in the middle of violent political chaos don't buy dishwashers.

"The military wants stability above all," Springborg says. "It's not focused on war fighting; it's focused on consumption."

One of the few glimpses we have into the role of the Egyptian military in the economy comes via a 2008 diplomatic cable made public by WikiLeaks.

The cable discusses the various businesses the military is involved in, and considers how the military might react if Egypt's current president, Hosni Mubarak, were to lose power.

The military would almost certainly go along with a successor, the cable's author writes, if that successor didn't interfere in the military's business arrangements. But, the cable continues, "in a messier succession scenario, it becomes more difficult to predict the military's actions."