Like Moth to a Flame: On Money, Cigarettes, and Gas

BK: Did anyone's salary get raised or at least were you promised a raise? Just wondering. Good morning.


RR: Morning! Sorry for being MIA all, was on holiday. Came back to find 120 unread emails. Fun.

I want a raise. Was promised a raise mid-year. Now I better get two raises.


RS: I'd been given a raise a couple of months ago, but also nothing to do with the Mubarak decree.


BK: But I'm thinking Central Bank is still a governmental agency right (I mean I know they're privatizing and all, but they still are huh?) What about MT? He's MCIT (at least for now, congrats about Coke btw)


NF: No one ever gave me a raise

At which point, BK and K engage in their own form of witty banter

BK: Wanna get another post in today since our group is quiet and we've got time?

Proposed topic?

E: Easy. The current economic reforms

BK: I don't know what to think exactly. I have to admit something in me was made happy by the raise. A friend of mine's father in a professor of political science at Cairo University and he said that, jokingly, that this was a bad move cos know Mubarak's gonna make people think that if they voice their concerns they can get what they want---which I can't understand as being a bad thing (isn't this a measure of 'democratic' reform or something—I swear intellectuals are frustrating.) Anyways, that happiness was easily dissolved when they announced that gas prices were rising and then cigarettes yesterday went up as well. I didn't understand that.

Is the tagline here that, 'now that we've raised your salaries you sons-of-bitches, we expect that you, as a consumer, can afford the change in prices? What about the poor stratas that are not currently employed by the government and in the face of bread and cigarettes rising have no additional money to afford these new increases?

E: An example of the effects, from Sandmonkey:

"This guy I work with, while riding the Microbus with me, kept cursing Mubarak today. His government salary has increased by 37 pounds, but now the Microbus' fare has doubled, so now he has to pay extra 2 pounds a work day. If he works for 20 days a months, he is already worse off by 3 pounds. And what kills is that he raised the prices right after he announces the raise. This Mubarak guy, he has no tact!"
The Taxi Driver I rode with to work today. Oh, and by the way, the ride now costs 30 pounds, up from the standard 20. Increased Gas prices, baby!


BK: Yeah, I paid the taxi 25 pounds today from Dokki to Star Capital.

But it's like I said when Mubarak first announced the increase in salaries: "It's a promise because they get paid at the end of the month, so that's when we'll find out what a 30% increase really means—because then it'll be physically tangible."

Yes, the 'tact' thing is weird.

How do they think, in the newsletter you sent me that this will affect the purchasing power parity of the lower and lower-middle income groups but won't affect the PPP of the higher classes? I don't get that.

E: Because the rich already have enough to remained unaffected. By rich they mean those with millions of dollars. Not us mate lol. We're considered middle class.

TM: Okay so salaries are getting raised 30 percent but only public sector, you think I would be like damn woop woot woot but no. to me that means 100 pounds or something cause they'll raise the base salary not the real salary we get RS you'll probably have the same thing, when you get a mokafa2a that’s what will get raised, cause that’s the salary they report they are paying you. Private sector sets salaries itself government can't tell it what to do. But I'm guessing if you work for a nice cool caring company they'll do that for you since gas prices esp. went up.

BK: Do you really think they consider us middle class? And is it true what's TM's saying about base salaries cos that would indicate the lack of transparency or accountability in salaries. I know that happens a lot though, like officially you'll be receiving 1500 LE when in reality you're receiving near 7 or 8 grand cos the donors money helps fund your salary. Things are so strange. And the worst part is that the media doesn't really report on these incidents.

E: Nothing in this country is transparent. It's sad. And yes, I do think we'd be considered upper middle class, because these gas price changes, the car license increases, the property taxes, etc... would actually impact us. We'd feel them. The rich won't really be affected because they wouldn't be taking from one budget and putting it into taxes or whatever. They'd continue to enjoy the same luxuries by spending more. We would probably cut down on shopping or something to compensate the extra costs.

BK: Yeah that does make sense. It's just that I think our definition of what constitutes class remains ambigious to remain complicit with our disassociation with the "rich" although people in the street automatically think we are the rich, don't they? Don't want to sound much of a ranter but our visual representation mostly equal in people eye's the rich and affluent and our own self-image is that off the preserved upper-middle class (although I don't even know if a word for that exists in colloquial Arabic, which would mean we can't even start to propagate our own self-image if our language isn't helping us). Anyways, I feel there's too much ramble. I think I've exhausted where I can go with this. But totally agree with you the gas price changes, the cigarette prices, the costs of food slowly increasing, taxis, etc will weigh on us more considerably. I think it will start to be truly evaluated only when we receive our salaries at the end of the month though and that's going to create a whole new typology of people—those who have significant increases in their salaries, those whose salaries don't REALLY increase, people who aren't even government, people who work in the private sector but had increases (and those who didn't), etc.

If that typology is what the government had in mind, then I guess the increase in salaries, if it were to benefit anyone, it would benefit the lower-middle and working poor who are civil servants the most and it wouldn't really effect us too much since most of our salaries are paid "behind closed doors" so to speak (I'm speaking about those who are officially employed in the public sector of course.)

Anyways, that's it.

E: But BK the salary increase won't benefit anyone. It's only harming the middle and poor classes further.

All these increases in prices are a direct consequence of Mubarak's insistence to overstretch the national budget and give a 30% increase to preserve or boost his image and avoid another strike or similar revolt. As there is no room in the budget for such a dramatic increase, the increases were announced as a method to pay the new salaries. With the new increases in prices, the cost of living is now more expensive than it was before the salary and thus price increases were put in place. Even with raises, the individual's PPP has dropped.

Fuel price increase = more expensive transportation = less money for other necessities.
Cigarettes have gone up, so those who will continue to smoke will find even less money left over for other necessities.

Car registration has shot up exponentially, so anyone who has a car is suddenly paying 10-fold what they used to, and thus will have a LOT less money left over for necessities. Those who can't afford a car can probably barely afford public transportation, and since that has been affected by the gas prices, that'll become even less affordable, as seen in the taxi example I sent you earlier.
Food and other necessities have been impacted by our country's current state of super-inflation, so the 30% increase, combined with the other increases in prices, will not cover the rising inflation rates.

So no, no one is benefiting.

Had all these reforms come into play 10 years ago when life was more affordable, then we'd have had the opportunity for proper improvement. Now, with the way inflation has busted everyone's guts open, all these changes have done is make a frustrated populace ten steps closer to revolution.

BK: But according to the attachment you sent, the way the government is making room for this increase by increasing the taxes on cigarettes and reducing the subsidies on gas. And this is the hope in raising the revenue for the increase in prices right? I think we should attach the PDF you sent me onto the blog as well and keep updating that file.

E: According to Nazif, "we will take from the rich to give to the poor". President Robin Hood and Minister Friar Tuck. And the government is putting its people between a rock and a hard place. Fine, it believes it is making room for this increase by increasing the taxes on cigarettes and reducing the subsidies on gas. But essentially, it has increased the cost of living far more than it has increased the salaries. The increased salaries have been rendered a moot point.