BEIRUT (Reuters) - Egypt has long served as the Arab world's centre of gravity -- or of inertia under President Hosni Mubarak. An explosion of street protests has changed all that, with untold consequences for the region and for Western policy.
Many Arabs were already entranced by Tunisia's popular rising, which with the army's help forced President Zine al-Abidine Ben Ali to flee on Jan. 14 after 23 years in power.
But the potential impact of the turmoil in Egypt is far greater than that in nearby Tunisia, a secular North African country often overlooked as peripheral to the Arab mainstream.
"Egypt has always been the leader of the Arab world," said Jihad al-Khazen, a columnist for al-Hayat, a London-based Arab newspaper. "Mubarak had no pan-Arab ambitions, but what happens in Egypt will definitely affect the Arab world."
Autocratic leaders in Algeria, Jordan, Libya, Kuwait, Morocco, Syria and Yemen have sought to stave off contagion by offering economic carrots on jobs, housing and prices.
Meanwhile the United States, caught between its loyalty to a key Middle Eastern ally, its fear that Islamists might gain power, and a desire to get on the right side of history, has gradually distanced itself from Mubarak and is now urging "an orderly transition".
The outcome of the struggle between Mubarak and his people is undecided, but if he is ousted any new government will be more hostile to the United States and Israel, Khazen said.
"As long as he has the support of the army, he is safe," he added. "The only alternative to Mubarak if there are democratic elections will be the Muslim Brothers, and they would definitely withdraw Egypt from the peace treaty with Israel."
Egypt was the first Arab country to make peace with Israel in 1978. Only Jordan followed suit in 1994, a year after the Palestinians signed the Oslo accords with the Israelis.
Israeli Prime Minister Benjamin Netanyahu said on Sunday his country must exercise "responsibility and restraint", voicing hope that stability and peaceful ties with Cairo would last.
But some Israeli commentators fear President Barack Obama's administration is adopting a policy that will dislodge Mubarak.
"The situation could not be more dangerous and might be the biggest disaster for the region and Western interests since the Iranian revolution three decades ago," wrote Barry Rubin, director of the Global Research in International Affairs Center in Herzliya. He urged Washington to focus on the survival of the pro-Western ruling system in Egypt, with or without Mubarak.
The Brotherhood, officially banned but somewhat tolerated, has long co-existed with Mubarak's 30-year rule and has never challenged the state as Ayatollah Ruhollah Khomeini did before the 1979 revolution on which he rode to power in Iran.
While many Western and Israeli strategists fret that radical Islamists might take over Egypt, the Brotherhood only belatedly joined the street protests, which run counter to its declared non-violent strategy of working for long-term change.
Tunisia's long-suppressed Islamists also played only a minor role in an uprising driven by young protesters angered by political repression, corruption and unemployment.
"The argument of keeping political systems closed out of fear of the Islamists coming has been undermined," Marwan Muasher, a former Jordanian foreign minister, told Reuters.
NOT JUST THE ECONOMY
"Once again, it is about governance and fighting corruption, not about Islamists," he said, arguing that tackling economic grievances alone would not douse popular fury in the Arab world.
"The reaction cannot simply be reducing prices or increasing salaries. Without addressing governance and embarking on a long-term, sustained process of opening up political systems in the Arab world, what happened in Tunisia won't stay in Tunisia."
Mubarak, deaf to such ideas, has replaced his cabinet, named a vice-president for the first time and pledged economic reform, ignoring the protesters' main demand -- his own departure.
Washington's dilemma over the crisis buffeting a man who has maintained the peace treaty with Israel, nurtured U.S. military ties and supported U.S. policies against al Qaeda and Iran, is understandable, said Iraqi sociologist Faleh Abdul-Jabbar.
"But it is not well received in the region," he said. "Egyptians want Obama to tell Mubarak in person to leave."
Repressing popular unrest is much harder in today's restless urban societies where mobile phones, the Internet, Facebook and Twitter offer powerful tools for mobilisation, he said.
Explaining the popular wrath evident in many countries, Abdul-Jabbar argued Arab leaders had enacted a "mockery" of liberalisation of socialist-style command economies.
"The ruling elite bought out these assets, creating a bizarre alliance of military rule or dictatorship plus a new business class created from that self-same elite, which led to a concentration of wealth in the hands of the old nomenklatura."
The Beirut-based academic said the protests in Tunisia and Egypt had echoes of those that shook Iran after its disputed presidential election in 2009 and he suggested that change in the Arab world would in turn ripple back to Tehran.
"This will again push the Iranian resistance to autocracy to the forefront," he said. "If these two tributaries converge, we will have a new Middle East within 10 years or less."
(Editing by Mark Trevelyan)