Mubarak's credibility on the line. Egyptian leader is praised for handling of police riots, but observers wonder how much more he can withstand

Last week's rampage by mutinous security police has left Egyptians and foreign observers wondering how many more shocks President Hosni Mubarak's government can withstand. The question is of vital interest to the United States, because Egypt is a pillar of its policy in the Arab world and the second largest recipient of United States foreign aid. Mr. Mubarak has remained committed to the American-brokered peace treaty with Israel and to expanding the peace process under US auspices. A collapse of his regime would have serious implications for US policy throughout the region.

US diplomats were quick to praise Mubarak's handling of the crisis. They pointed to the Army's efficiency in taking control of the streets of Cairo and the unusually thorough, largely accurate coverage of the riots by the government news media.

But there has been concern for some time about Mubarak's ability to respond to the myriad problems he faces. That these problems extend into the security apparatus of the regime is hardly comforting.

Mubarak inherited a long list of economic, social, and political problems from President Anwar Sadat, who was assassinated in 1981. Egypt was isolated in the Arab world as a result of the peace treaty Sadat signed with Israel in 1979. Its exploding population (there is a net increase of 1 million people every nine months) frustrated any efforts to upgrade the infrastructure and expand the economy. Its vast bureaucracy (there are an estimated 12 million civil servants) seemed impervious to efforts at reform.

In addition to these problems, however, Mubarak's regime has been faced with a series of crises. The President's handling of them has not enhanced his image as a leader, either in the West or in the eyes of Egyptians.

Mubarak's credibility eroded steadily as he struggled through the Achille Lauro hijacking last fall, the hijacking to Malta of an Egyptair passenger plane, and the trial of Suleiman Khater, an Egyptian security policeman who shot to death seven Israeli tourists in the Sinai.

Khater became an Egyptian folk hero and then a martyr when he was found dead in his prison cell last January, shortly after he was convicted of murdering the Israelis. Many Egyptians are convinced that Khater was murdered by the government.

``Suleiman Khater was made a hero and then a martyr because the President is not a hero,'' said one Egyptian political analyst.

So when some 9,000 security police poured out of their squalid barracks in Cairo and other cities Tuesday night and began burning hotels and luxury cars, the nation waited to see how Mubarak would respond.

``There is a sense of impending disaster among the new-haves in this country anyway,'' said Muhammad Sid Ahmed, a leading opposition journalist. ``When the curfew was announced, everyone wanted to rush home and save what they have. All the opposition political faction leaders were expecting to be arrested.''

The riots began after security police conscripts were told their mandatory service was being extended from three years to four. The security police are conscripted from the rural villages, paid only about the equivalent of $4 a month, and harshly treated by their commanding officers.

``Egypt is a volcano. It had to explode sometime,'' said Nihad Safwat, a Cairo businessman whose family owns a home about 150 feet from the Jolly Ville, one of two hotels the rioters burned.

Mr. Safwat and his cousin sheltered six Swedish tourists who were robbed and roughed up by the security police the night the Jolly Ville was burned. Safwat said he believed the underlying cause of the riots was a widespread sense of frustration among the Egyptian poor with which the large middle class sympathizes.

``We are a passive people who must be pushed very far to rampage through the streets,'' Safwat said. ``But the whole country is falling apart. In Egypt now there is a lack of integrity, the government is corrupt. They are talking about reforms but they are only talking.''

Egyptians close to Mubarak argue, however, that this time the President did move quickly and decisively to restore order, and that he did it without mass arrests of opposition figures.

The Army moved into Cairo ``in one of the most efficient operations I've seen,'' said one Western diplomat. It clashed with the rioters and started making thousands of arrests among them.

By Wednesday afternoon, the curfew was imposed and normally chaotic, traffic-clogged Cairo streets were cleared and eerily silent. The omnipresent security police, who usually guard the embassies and other offices around the city disappeared from their posts, confined to their barracks while elite Army units replaced them at key locations.

And the government, in a reversal of the policy it applied during previous crises, took to the airwaves with hours of riot coverage. Mubarak spoke to the nation, condemning the mutineers and promising to restore order by Friday, Mubarak had fired Ahmed Rushdi, minister of the interior, and replaced him with Maj. Gen. Zaki Badr.

On Sunday, some security police appeared at their posts and the curfew was lifted for 12 hours. The streets of Cairo came alive again as offices reopened and people went back to work.

Mubarak announced that living and working conditions for the conscripts would be improved and that they would soon be at their duties again. But observers predicted that the forces, which have swelled from 24,000 men five years ago to 250,000 today, would be drastically cut back.

Government officials said they are still not convinced that the riots were spontaneous -- because they spread so quickly across the country and involved young men who are conditioned always to follow orders.

At least 36 people were killed, more than 360 injured, and some 3,000 arrested by the time the Army had quelled the rioters.

The government and the diplomatic community were caught completely off guard by the revolt.

``Would I have said two weeks ago that this was possible? Absolutely not,'' said one Western diplomat.

Some civilians joined the security police, but it did not appear that Islamic fundamentalists or other opposition groups joined the rioting.

``Handling the crisis was easy, because the public in Egypt is easy,'' said Tahsin Bashir, a former government spokesman. ``No one accepts burning and rioting in Egypt.''

Still, Mr. Bashir said, the government now should move quickly to institute reforms in the security apparatus and in other areas to restore public confidence.

``You need leadership that is not tough like crocodile skin. It must be sensitive to the people,'' Bashir said. ``We need a dexterous policy and a Cabinet that is alert. This crisis will make the government look at these problems that exist.''