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Obama’s Middle East Balancing Act Tested by Egypt Protests

President Barack Obama’s bet that he can use the Arab spring to reshape the U.S. relationship with the Muslim world, and his standing with American voters as an international leader, will be tested today as a major march is called in Cairo that may erupt into anti-U.S. violence.

With U.S. diplomatic outposts having come under attack in Egypt, Libya and Yemen, Obama is balancing his need to be viewed as a forceful protector of U.S. interests against a risk of inciting more violence by adopting a harder line with leaders such as Egypt’s President Mohamed Mursi.

The turmoil has tossed an uncontrollable element into the U.S. presidential campaign and given Obama’s Republican rival, Mitt Romney, an opening to escalate his criticism of the president’s foreign and security policy.

“If we get anti-American protesters numbering in the tens or hundreds of thousands in Cairo, it’s not exactly the image you want on television in the remaining two months of the campaign,” said Thomas Mann, a senior fellow at the Brookings Institution in Washington.

The unsettled situation has implications for the U.S. economy, as well. Concern that protests in the Middle East and North Africa may lead to supply disruptions has helped drive up oil prices. Crude oil for October delivery advanced $1.18, or 1.2 percent, to $99.49 a barrel at 10:43 a.m. on the New York Mercantile Exchange. Futures breached $100 for the first time since May 4 and touched $100.42.

Prices are up 12 percent from this time a year ago, and higher prices may crimp consumer spending, which represents about 70 percent of the U.S. economy.

Egypt Stakes

While it was in Libya where an attack on a consulate left the U.S. ambassador and three colleagues dead, the highest stakes for the Obama administration may be in Egypt, the Arab world’s most populous nation.

Obama’s response is complicated by his focus on Egypt since taking office. After choosing Cairo as the site for a 2009 speech on outreach to the Muslim world, Obama took a public role in helping push Egyptian leader Hosni Mubarak from power in 2011 during the civilian uprisings the swept the region. Since then, Obama has sought to bring post-Arab Spring leaders into the U.S. orbit, including Mursi.

Mursi, who began his political career with the Muslim Brotherhood, has been charting a different course than Mubarak, one he has said relies on mutual respect between nations, according to his spokesman Yasser Ali. That’s been read in Cairo as an indication that, while he doesn’t want relations with the U.S. to deteriorate, he won’t be seen as bowing to Western nations.

Harder Line

After Mursi’s slow reaction to contain and condemn the embassy siege in Cairo, Obama, in an interview with the Spanish language broadcaster Telemundo, said of Egypt: “I don’t think that we would consider them an ally, but we don’t consider them an enemy.”

Obama, who spoke with Mursi by telephone on Sept. 12, also said that the U.S. expected the Egyptian government to be “responsive” to protecting U.S. embassy and personnel and that if that doesn’t happen, “that’s going to be a real big problem.”

Mursi yesterday gave a speech in Brussels in which he called the attacks on embassies “unacceptable” and said Muslims reject attacks against people and embassies. The Obama administration then adopted a more conciliatory tone.

Honoring Obligations

“We appreciate the public statements that President Mursi has made condemning acts of violence and emphasizing that Egypt will honor its obligation to ensure the safety of American personnel,” White House press secretary Jay Carney told reporters traveling with Obama as he campaigned in Colorado yesterday.

Carney and National Security Council spokesman Tommy Vietor dismissed Obama’s remarks on whether Egypt is a U.S. ally as a technicality.

“‘Ally’ is a legal term of art,” Carney said. He added that the U.S. doesn’t have a mutual defense agreement with Egypt as it does, for example, with other members of the North Atlantic Treaty Organization.

However, Egypt has been designated as a “major non-NATO ally” by the U.S. since the 1980s.

In the presidential campaign, polls show foreign policy and national security are among Obama’s strengths. He has used the killing of Osama bin Laden by U.S. forces and missteps by Romney to boost his public approval on those issues.

Romney Criticism

Romney has sought to use the attacks in Egypt and Libya to change the dynamic. Campaigning in northern Virginia yesterday, he said the U.S. is at the “mercy of events” in the Middle East instead of shaping them.

“The world needs American leadership,” he said. “The Middle East needs American leadership.”

His running mate, Wisconsin Representative Paul Ryan, is using a speech today in Washington to give a broader critique of Obama administration policy.

He cited the killings of dissidents in Syria, “mobs storming American embassies and consulates,” deteriorating relations with Israel and Iran progressing on its nuclear program.

“Amid all these threats and dangers, what we do not see is steady, consistent American leadership,” Ryan will say, according to excerpts of remarks he’s delivering to the Family Research Council’s voter summit.

Congressional Reaction

That line of attack was echoed by Republicans in Congress.

“We are seeing everything fall apart,” said Senator John McCain, an Arizona Republican and ranking Republican on the Armed Services Committee. McCain, who lost the 2008 presidential election to Obama, said he’s “very worried” about regional violence escalating in the coming days. He blamed “a lack of leadership on the part of the president.”

Still, the events have peril for Romney. He drew bipartisan criticism for his early reaction to the attack on the Cairo embassy and the consulate in Benghazi. Romney criticized the administration because the embassy in Cairo had issued a statement condemning the anti-Muslim video that sparked protests and any intentional efforts to offend Muslims. The embassy statement had been issued before the attacks as an effort to calm Muslims angry about the film.

Political Impact

Mann said the protests in Cairo are unlikely to hurt Obama’s re-election prospects so long as they are controlled.

“Now, obviously, if things deteriorate, that can change,” Mann said. “Then it sort of gets a little trickier and it depends how the president handles it.”

The U.S. has leverage in Egypt through its aid. Carney said yesterday the president isn’t planning to cut assistance to Egypt, which amounts to more than $1.5 billion annually, most of that for the military.

Mursi also is seeking a $4.8 billion International Monetary Fund loan to revive an economy stalled since last year’s uprising. The U.S. is the IMF’s biggest shareholder.

There has been support in the U.S. House and Senate this year to maintain current levels of aid to Egypt amid the broad political changes there -- with strings attached. Republican Senator Rand Paul of Kentucky and some other lawmakers have called for cutting off U.S. aid to Egypt and Libya in response to the violence.

Egypt Aid

The appropriations panels in the Senate and House have approved measures that would provide $250 million in economic assistance and $1.3 billion in military aid to Egypt in the new fiscal year that begins Oct. 1. That’s the same amount as this year and consistent with what Obama has requested.

In both chambers, strings are attached to the Egypt aid. The House committee’s bill includes provisions requiring more detailed reporting from the Secretary of State about how foreign aid to Egypt is being used and the status of human rights in Egypt.

Senator Bob Casey of Pennsylvania, a top Democrat on the Senate Foreign Relations Committee, said the attacks in Egypt suggest additional benchmarks may be needed.

“I think we’ve got to make sure that Egypt, even in the early stages of a new government, has to demonstrate to us and the region that they’re going to adhere to values that folks in that region and the American people who are paying the bills expect them to adhere to,” said Casey, who heads the panel’s subcommittee dealing with the Middle East and north Africa.

McCain and Senate Armed Services Committee Chairman Carl Levin, a Michigan Democrat, said cutting off aid to Egypt would damage U.S. interests and may endanger Egypt’s peace treaty with Israel.

It would “stir things up even more than they’re already stirred up,” Levin said.

To contact the reporters on this story: Margaret Talev in Washington at mtalev@bloomberg.net; Tarek El-Tablawy in Cairo at teltablawy@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net

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