The administration's immediate challenge was to prevent an Islamist
government in Cairo.
The report urged Washington to offer free trade as an
incentive meant to discourage the election of the Muslim Brotherhood in
presidential and parliamentary elections expected in late 2011.
"The United States has virtually no economic leverage over the Egyptian
government," the report, titled "Needed: High-Level U.S. Attention to the
Dire Situation in Egypt," said.
Author Robert Satloff, the institute's executive director, cited annual
U.S. military assistance to Egypt of $1.3 billion per year. The report said
the aid has failed to persuade the new Egyptian military regime, which
controls the Suez Canal, to maintain relations with neighboring Israel.
"Furthermore, military aid is a hollow lever, given that the Pentagon
wants to sustain the U.S. relationship with the Egyptian armed forces at
least as much — if not more — than the Egyptians themselves," the report,
released on Sept. 13, said. "In this environment, U.S. threats have limited
The administration of President Barack Obama has appointed William
Taylor as the State Department's special coordinator for Middle East
transitions. The report said Taylor's biggest challenge would be to maintain
the U.S.-sponsored Egyptian-Israeli peace treaty amid rising opposition from
the Muslim Brotherhood. On Sept. 10, Egyptians attacked and ransacked the
Israeli embassy in Cairo.
The report said Egypt was moving toward a "no war, no peace"
relationship with Israel. Satloff, a leading analyst on the Middle East, said
this would be "almost impossible to sustain" and endanger U.S.
interests in the region.
"As Egypt's elections approach, the likely results range between bad and
worse," the report said. "Liberal, reformist forces will not have a
majority. The question is how large a plurality will be achieved by
illiberal Islamist groups."