Samir Radwan: The soft-spoken economist with sound policies

In the government formed right after the January 2011 revolution, the Keynesian economist Samir Radwan took over as finance minister from the neoliberal economist Youssef Boutros-Ghali; an appointment that pitted, as the Arabic idiom has it, night against fire. The difference between them was telling.

The two men belonged to different worlds. Radwan brought the experience of the International Labour Organization (ILO), which works to improve labor conditions and protect workers, and he believed in the state’s role in crafting policy that creates decent work. Ghali carried the ideas of the International Monetary Fund (IMF), which called for commodifying education and health and suppressing wages. We Egyptians have lived with those effects for a decade now, and still feel them every time the price of a good or service climbs.

Perhaps the fervor in the “square” during the 2011 revolution left little room, for those hungry for radical change, to register just how large that difference was. Both men, after all, had come up through the very party Egyptians had revolted against: the National Democratic Party.

But the years since January have taught us that grey areas come in a thousands of shades. Now, with the death of the prominent economist Samir Radwan, we owe it to ourselves to look again.

Not the loudest voice

Radwan, an ILO expert, returned to Egypt in the mid-2000s after years of international development work abroad, and his election as director of the Economic Research Forum, one of the region’s leading think tanks, gave public debate a real boost. He had just finished contributing to a critical ILO report titled “A Fair Globalization: Creating Opportunities for All.”

Before the January revolution, he wrote what became the most important study documenting the declining wage share of national income, laying the scientific groundwork for the demands for a minimum wage that were gaining momentum at the time. He also wrote a lesser-known study on productivity that dismantled a claim dominant among businessmen in the ruling party’s corridors at the time: that low wages were simply a function of low worker productivity.

In the same period he led a research team on the competitiveness of the Egyptian economy, which took aim at investment-promotion policies built around tax exemptions. These, he argued, were the wrong path to employment-generating growth: they effectively subsidized machinery purchases at the expense of job creation, leaving factories stacked with idle imported machines instead of workers hired to run them.

Step by small step, Radwan put employment and wage policy on the table, at an exceptional moment when the NDP was opening itself to thinkers and politicians who believed in change from within, a dynamic that helped crack open debate inside the ruling party over the future of development in Egypt.

What made those debates matter was the counter-discourse they created against the government and party line, which cared only about privatization, the private sector, and the entitlement of certain businessmen and companies to subsidies and tax breaks, never viewing fiscal and monetary policy through any lens but austerity and closing the budget deficit.

But for all their importance, Radwan’s efforts were never the loudest voice against Boutros-Ghali and his team.

The progressive years

Anyone who knew Radwan up close knew how he fought his battles: with diplomacy, humility, and a smile that was both charming and wry. It was easy to see how much he still relished the mischief he’d carried since his graduate years at the University of London in the 1970s, when he belonged to the SOAS students’ union, known for its progressive politics.

Radwan helped found an association for Arab students and was an eloquent advocate for the Palestinian cause in Britain, a stronghold of the occupation. His home, by multiple accounts from those who knew him then, stood open to any expatriate student who needed it.

He remembered those years with real fondness: hours spent wandering streets he knew by heart. It was there that he met another Egyptian student no less brilliant or quick-witted: the economist and Oxford energy expert Robert Mabro, a son of Alexandria, that city of diversity, who carried nothing “foreign” about him but his name and his blue eyes. Otherwise he was Egyptian to the core, a believer in the Arab peoples’ right to fair, independent development.

The two co-wrote a well-known study, “The Industrialisation of Egypt 1939–1973: Policy and Performance,” later expanded into a book on the same subject published by Oxford: Clarendon Press. Radwan then joined the International Labour Organization, where he continued his research with a focus on rural development policy and helped shape economic and social policy across a large number of countries.

Radwan represented a certain kind of economist: one who takes development as a compass and decent work as the means to that higher end, and who believes in labor itself. It was in this spirit that he took on the finance portfolio in 2011, facing, as he told me, blame from his own family for accepting the post while the revolutionaries were still in the Square.

He believed his presence in the ministry served the goals of change. I watched him speak, somewhere between reassurance and warning, at the Egyptian Center for Economic Studies shortly after Mubarak’s ouster. Standing beside a minister from that same NDP-born government, Ahmed El-Borai, he delivered his now-famous line, “This time, God spared us,” calling on the country’s leading financiers and businessmen to accept the reforms needed to redistribute income.

The ruling establishment soon turned on him. He resigned after roughly seven months, the fate of many officials who, closer to the Square's aims than most, took up government posts during that volatile stretch.

Boutros-Ghali, the market’s man

Despite his brief tenure as minister, Radwan managed to expose astonishing details of corruption. He told me about one case in particular, its full file handed to the oversight authorities, involving a relative of a senior former official who was close to Boutros-Ghali himself.

Boutros-Ghali, scion of a political family whose roots reach back to the monarchy and the British occupation, earned his PhD from MIT, one of the American universities where The Chicago School of economics was born. He belonged intellectually to that school, which worked across countries to spread neoliberal ideas within the Washington Consensus, a consensus that would later collapse under the 2008 global financial crisis. He promoted the state’s withdrawal from the economy, made peace with rising inequality and the billions in profits reaped by tax-avoiding megacorporations, and defended the encroachment of finance and the dominance of financial elites in banks and stock markets over economic decision-making worldwide.

His convictions and academic record earned him a stint at the IMF. He returned to Egypt to serve in a series of Mubarak-era government posts, the last of them finance minister, where the neoliberal imprint on his policies became unmistakable, above all in tax cuts for the wealthy and lower import tariffs. He did, on the other hand, push to increase budget transparency, expanding public oversight of state finances, and he succeeded in imposing a tax on real estate wealth: fair in principle, but riddled with enough exemptions to gut it of both fairness and revenue.

For years, Boutros-Ghali held his ministerial post alongside parliamentary immunity, until he left the country during the revolution and took up a senior post at the IMF. Soon after, he was charged in more than one corruption case while living in London, where there is no extradition treaty with Egypt.

Over the following years he was convicted in absentia in final rulings; when those cases were retried, new verdicts acquitted him. He returned to Egypt and re-emerged in public life, telling interviewers that policymakers had been consulting him throughout the past decade.

That was the sum of Youssef Boutros-Ghali's long career at the finance ministry. So what did Samir Radwan's brief run through that same ministry look like?

In the time of SCAF

Radwan met with the leaders of the Supreme Council of the Armed Forces (SCAF), which governed the transitional period before the first post-revolution presidential election. Field Marshal Tantawi, he recalled, gave him a single instruction: “Your main job is to make sure bread and cooking gas never run out in this country.” He opened his brief months in office with the line that would follow him ever after: “I’m only a fifth of a finance minister,” a nod to how little room there was to restructure government spending, when the only real lever for maneuver lay in public investment.

Still, he refused to accept that as his lot. The first and most important thing he did was reach into Pandora's box: the wages chapter, the budget line recording the salaries of every state employee, junior and senior alike. There he found a string of problems.

Radwan was the only official who spoke openly about the imbalance in the government's own wage structure: bonuses, some booked in the budget and some off it, revealing that the gap between the lowest and highest salaries in government reached a thousandfold. He drew international comparisons to show the gap was unprecedented, and proposed fixing it through progressive taxation. But he didn't stay long enough to finish that file, and reform efforts have yet to succeed to this day.

He also had a plan to hire into government by competitive examination, modeled on the foreign ministry, which draws the best of the young educated elite. He pointed to India’s civil service, with its distinguished corps of public servants, as a model to replace the nepotism and patronage that dominate hiring across the Egyptian state.

Radwan told me at the time that he’d gone back, with real enthusiasm, to a treasure he’d rediscovered: the memoirs of John Maynard Keynes, from his years as an economic adviser to the British Treasury, who helped save England and the world from the Great Depression by applying his theory, the inverse of classical economics, known as “The General Theory of Employment, Interest and Money.”

Following in Keynes's footsteps, Radwan designed the revolution's first budget, one that included a minimum wage and an ambitious employment plan. He managed, in effect, to persuade the IMF, desperate at the time for Egypt to sign an agreement with it, to accept a larger deficit in exchange for higher employment and social spending.

He published the agreement before it was signed, a precedent for transparency never repeated before or since. He also put unemployment on the table of public debate, along with the case for an unemployment insurance policy, so that no family whose breadwinner lost a job would fall into poverty.

Of course, Radwan’s few months in office weren’t without turmoil. His announcement that the ministry would accept letters from job seekers drew thousands of young people, who gathered around the ministry building as though it were the shrine of Sayeda Zeinab, “patron of the destitute.” He later left the government, replaced by another disciple of the IMF school, the economist Hazem El-Beblawi.

Radwan, a lover of culture and the arts and a man of progressive convictions, opposed Muslim Brotherhood rule and supported their removal from power. After their ouster, though, he warned businessmen against ignoring negotiations with workers, or they would meet the same fate as the Brotherhood.

The years passed. Economic and social policy shifted, and the disciples of the IMF and World Bank schools once again took the reins, while Radwan drifted away from Egypt's policymaking circles, not only as an actor, but even as an advisor. When the presidency called for a national dialogue to chart a roadmap for political, social, and economic reform, he wasn't invited, reinforcing, for some, the impression that the distance was deliberate.

When the sharp-minded economist died, the pieces of the composite picture finally came together. He was mourned across the full spectrum of Egypt’s elite: from the finance ministry itself, to Ziad Bahaa-Eldin and Mahmoud Mohieldin, to former classmates from his London student days. Economists around the world who believe in social justice mourned him too, for that goal’s road is a hard one, winding and full of turns: the very road Samir Radwan walked, and one that still needs more people willing to walk it.