While world attention has focused on the protracted confrontation between the Islamists and the Algerian regime, observers have ignored a more momentous clash, that of the Egyptian government and the Islamist opposition. Since the early 1990s, Egypt has witnessed a low-level war of attrition between the regime and Islamists, costing more than a thousand casualties and billions of dollars in damage to the tourist industry. In the early 1990s, American officials became worried about the deteriorating security situation in Egypt and the polarization between state and society. According to an unconfirmed report in The Sunday Times of London, as early as 1993, a National Intelligence Estimate – which represented the collective input of all American agencies – suggested that “Islamic fundamentalist terrorists will continue to make gains across Egypt, leading to the eventual collapse of the Mubarak government.”

Although several U.S. officials denied such an estimate, the fact remains that the United States is terribly concerned about the turn of events in Cairo. In few other countries of the Middle East are American interests as involved as they are in Egypt. Egypt serves as the gate to the Arab world and the anchor of American Middle East policy because of its proximity to the oil-producing Gulf region and its active involvement in the Arab-Israeli peace process. The United States has invested heavily in Egypt, providing it with more than $2 billion in economic and military aid each year. Since 1979 Cairo has been a close ally of Washington – initiating the peace process, facilitating Arab-Israeli negotiations, and legitimizing the U.S.-led coalition against Iraq.