The Obama administration is temporarily suspending aid to Egypt while continuing to deny that Morsi's removal last month constituted a coup. Were the Obama administration to declare the Egyptian military's actions last month a coup aid would have to be suspended until a democratic government was set up.
Two Obama administration officials told The Daily Beast that by temporarily suspending aid to Egypt without saying that Morsi's removal was a coup the administration can act as if a coup had taken place by restricting aid without being burdened by other conditions. While this approach may be convenient, it is not being welcomed by some on Capitol Hill.
From The Daily Beast:
On Capitol Hill, lawmakers and staffers complained that the administration is trying to skirt congressional intent by refusing to say whether it believes there was a coup in Egypt while implementing its own preliminary punitive measures outside the confines of the legislation.
"This approach seems to be too cute by half, leaving the U.S. with little leverage in Egypt and appearing to condone gross violations of human rights in the process," said one senior GOP Senate aide. "It is also unclear that Congress intended to give the executive branch this much leeway in implementing the coup provision in Section 7008" of the law.
While most of the military aid from the U.S. to Egypt may be suspended the Saudi government has said that it will ensure that the interim Egyptian government is compensated for whatever funds are withdrawn by Western governments.
From The Washington Post:
CAIRO — Saudi Arabia is emerging at the forefront of a forceful effort by Persian Gulf monarchies to back Egypt's new military leaders, exacerbating a fierce struggle for influence in the chaotic and increasingly leaderless Arab world and putting the Saudis at odds with the United States, a long-standing ally.
On Monday, Saudi Arabia promised to compensate Egypt for any aid that Western countries might withdraw in response to the harsh tactics employed by Egypt's leaders to quell protests by supporters of the country's deposed president, in which nearly 1,000 people and more than 100 police officers are reported to have been killed.
That the Saudi's are committed to supporting Egypt's military is the latest reason why the Obama administration should save taxpayers $1.3 billion a year and withdraw military aid from Egypt entirely. Perhaps unsurprisingly many in the American arms industry are against cutting off military aid to Egypt.