A U.N. vote on Palestinian statehood may be weeks or even months away, but the verdict of Egypt's public is already in - and it could mean trouble for Cairo's relations with Washington, its longtime key ally and major financial backer.
Even before the popular movement that overthrew President Hosni Mubarak turned its attention to the Israeli-Palestinian conflict next door, its authors believed they had taught the Palestinians an important lesson: that when negotiations and discreet lobbying fails to bring about change, it's time to take matters into your own hands. (See photos of protests in the West Bank.)
Many Egyptians have been surprised that Israel's Prime Minister Benjamin Netanyahu has failed to seize the opportunity of the Arab Spring to negotiate the creation of a Palestinian state while the region's attentions are consumed by other issues. If Israel's occupation of Palestinian territories is not ended soon, they warn, Israel could face far tougher responses from newly confident Arabs - even among those who quietly admire Israel's democratic values.
"Netanyahu is missing a golden chance to work with Palestinians and get this problem off our chest," says Naguib Sawiris, a wealthy tycoon who ran the Orascom telecommunications giant until May and recently founded the secular, liberal Free Egyptians political party. "He had an advantage in the past in that he had the only democratic state in the region," he says. "Tomorrow he will be facing three, four, five democratic states. And they will deal with [Israelis] differently." A more representative political system in Egypt and Tunisia could see resurgence of Islamist parties. Sawiris, a Coptic Christian with global business interests says Israel is the one country with which he can't do business, for a simple reason: "I would lose all my business in the Middle East."
And President Barack Obama's moves to block the Palestinian statehood bid at the U.N. could raise a similar risk for U.S. companies operating in the Arab world. Obama's interventions on Israel's behalf are creating a wave of hostility against the U.S. on the Arab street, stirring up feelings that have been on the back burner through much of the Arab Spring, and reversing some of the goodwill earned by U.S. statements and interventions in support of Arab freedom. (Watch how Palestinian fighters are rehabilitated in Israel.)
For months visitors landing at Cairo International Airport have been greeted by a billboard quoting Obama saying that Americans should raise their children "to be like young Egyptians." But a backlash against the U.S. is inevitable after Washington was perceived to be siding with Israel against the Palestinians, warns Hisham Fahmy, CEO of the American Chamber of Commerce in Egypt. "What form it is going to take is anybody's guess, but you know that it is going to happen."
One immediate form of protest likely to be adopted by the Egyptian public is a consumer boycott of U.S. products. Ziad Aly, CEO and founder of Alzwad, a mobile-application company in Cairo, remembered how Egyptians shunned American products during the Palestinian intifadeh in the early 2000s, foregoing items like Coca-Cola, which is a staple for many Cairenes in normal times.
"Whenever America takes a big stand toward what happens in Israel, immediately you get this kind of reaction," Aly said Friday, speaking by phone from an expo for start-up companies in Alexandria sponsored by the U.S. Agency for International Development. Ten years after the intifadeh, Cairo is now full of brand-name American products, from Guess jeans to Starbucks cappuccinos. Several Egyptians told TIME they would now avoid buying those items, particularly if there was a local alternative readily at hand. Starbucks, for example, has faced stiff competition from Egypt's local Cilantro coffee shops since the U.S. chain opened in Cairo two years, in part, says one local business owner, because of anti-Israeli feeling. (See photos of protesters settling in Tahrir Square.)
But there is more at stake for both Egyptians and Americans than Coke and Starbucks. Anti-American feeling over the Palestinian issue may well have an impact on the choices made by Egyptian voters in parliamentary elections later this year, and in presidential elections expected early in 2012 - to the benefit of those politicians and parties more willing to stand up to Israel and distance themselves from Washington, like those aligned with the Muslim Brotherhood. Despite Mubarak's close alliance with Washington, the revolution was almost entirely devoid of anti-American slogans. "We were really happy all through the revolution that there was never an anti-U.S. or anti-Western feeling," said Aly, adding that when he traveled to Silicon Valley earlier this month, top executives at Google, Twitter and venture-capital firms all wanted to meet him, eager to discuss the Egyptian revolution with a true-life activist. He believed that enthusiasm was possible partly because the revolution seemed so separated from the fraught issues of Israeli-Palestinian relations.
But the Middle East conflict is back in focus on Egypt's streets, where the mood is less celebratory and more confrontational over the pace and form of the political transition. In May demonstrators hung an effigy in the square with a Star of David on its chest to mark the anniversary of Israel's 1948 war of independence, and the military fought running battles with protesters who tried to swarm the Israeli embassy in downtown Cairo. On Sept. 11, tens of thousands of protesters stormed the embassy, prompting the evacuation of the Israeli ambassador and his staff. Three protesters were killed in the clashes with military and the police, and days later, Egypt's ruling Supreme Council of the Armed Forces reintroduced Mubarak's hated emergency laws.
Despite the darker mood toward the U.S. and Israel, no significant player in Egyptian politics - not even the Muslim Brotherhood - is ready to abandon the U.S.-brokered 1979 Camp David peace agreement between Israel and Egypt. Even if Israel manages to block the emergence of a Palestinian state, few Egyptians have any appetite for another conflict with Israel. "The cost of not honoring the Camp David agreement is so high that nobody would risk that," Fahmy says. "We cannot afford a conflict."
See TIME's special report "The Middle East in Revolt."
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