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NightWatch 20120524

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NightWatch

For the night of 24 May 2012

Sri Lanka: General Sareth Fonseka, the Army chief who planned and executed the destruction of the Tamil Tigers, was freed from jail on Monday, after spending two years in jail for corruption and for engaging in politics while still on active duty.

Comment: Ironically, both President Rajapaksa and General Fonseka are national heroes among the Sinhalese for having destroyed the 25-year long insurgency by the Tamil Tiger in 2009. He barely survived a suicide assassination attempt in 2006. After his recovery he executed the methodical destruction of the Tamil insurgency, one of only two successful counterinsurgency operations this century. The other is the Indian effort in Kashmir.

Fonseka ran for the presidency against Rajapaksa in 2010, lost and found himself imprisoned on charges that should have warranted a fine. But President Rajapaksa's clan insisted on criminal charges against Fonseka to undermine his run for office, even though his presidential campaign posed no serious challenge to President Rajapaksa.

International pressure contributed to Fonseka's early release from a 30 month sentence, but he remains banned from running for office for seven years. He has not been pardoned or his sentence annulled, but he remains a gadfly in the side of the Rajapaksas. This is a study in Sri Lankan democracy.


Egypt: Politics. Mohamed el Baradei, politician and former head of the International Atomic Energy Agency, told the press that this week's elections are "the first ever in the Arab world I can recall," in which the outcome is not pre-determined.

An election official estimated that the turnout was about 50% of the 50 million registered voters, or about 25 million voters. If that figure is accurate, it is roughly the same as the turnout for the parliamentary elections and roughly equal to the number of Egyptians who have full time jobs.

The correlation to the employment numbers means that an Islamist will be elected, hands down, because most of the Egyptian work force is semi-literate and devout Muslims.

No news services reported acts of coercion or significant voter irregularities. The military exercised no overt manipulation. However, the results which are to be announced on 29,, vice 27 May, will provide additional evidence about the openness and fairness of the election.

The bottom line is that for the first time in 7,000 years, Egyptians voted for their head of state and will not know who it is until the votes are counted. This was a genuine choice and the first time that the identity of the country's leader will have been determined by a popular vote, hopefully, and not by not heredity, accidental death,military coup d'etat or military manipulation.

This does not mean that Egypt has experienced a revolution because political and coercive power resides primarily in the armed forces and the constitution is that which Mubarak used for governance. It empowers the president to govern almost as he sees fit.

Finally, no candidate is expected to obtain 50% of the votes so a run-off election will be necessary and is already planned. The candidates in the run-off will be important in persuading the electorate that the vote was fair or manipulated. The demographic data and the pattern of voting in the parliamentary elections indicated two Islamists should contest the run-off election. Any other outcome has to be investigated for manipulation.

Economics. Tonight's good news is that the Egyptian planning minister announced that stocks are up and Gross Domestic Product rose at an annualized rate of 5.2 percent in the first quarter, after falling or showing no growth last year.

The new figures are suspect because they match Egypt's growth rate before the Arab spring, even though Egyptian tourism is disastrous and Europe, a main export market, is experiencing a recession. Still, this week most Egyptians are feeling good about themselves.

Tunisia: Standard and Poors downgraded Tunisian sovereign credit to junk on Wednesday.

"We anticipate that recovery will be slow, particularly given the weak economic environment in the European Union--by far Tunisia's largest export market and source of foreign direct investment (FDI) and tourists. Unemployment has also risen sharply to be now estimated at more than 18%, since the January 2011 revolution."

Comment: Increased political freedom does not of itself bring more jobs, lower prices or greater availability of daily necessities. That is the significance of the downgrade. The demonstrators wanted bread and got diverted by elections, while the economy continued to contract. This is one of the many ripple effects of the recession in much of Europe and the results of improvident economic integration. When a single point of failure fails, it brings down the system and anything linked to it.

End of NightWatch for 24 May.

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