Quotes of the Day

The hundreds of thousands of Egyptians who took to the streets on Thursday night to celebrate the victory of their democratic revolution were infuriated by what they had hoped would be a valedictory speech by President Hosni Mubarak. The leader defiantly reiterated his vow to remain in office until elections in September, offering only minor concessions and largely restating the regime's positions of recent days. And he warned that he would not be "dictated to by the orders of outside forces" and that the youth on the streets "would be the first victims" if the "intolerable" situation there continued. If the Obama Administration was expecting good news from Egypt, as it appeared to, it will have been bitterly disappointed.

Mubarak's meandering and legalistic speech was so unfocused that it was not immediately clear what he meant when he indicated that he was delegating powers or responsibilities to his Vice President, Omar Suleiman. Some observers said it was merely a delegation of chairmanship over constitutional committees and negotiations with the opposition. Others interpreted that he had given over all his powers to Suleiman. To add to the confusion, Egypt's ambassador to the U.S. appeared on CNN to say that Mubarak was now President in name only and that Suleiman was the de facto President of Egypt. The only clear thing Mubarak said was that he will stay in office — de jure or de facto — until a new President is elected in September. And the crowd in Tahrir Square took that to be a denial of their No. 1 demand.

Rumors had swirled all day — fueled by speculation in Washington and Cairo — that Mubarak would finally bow to the prime demand of the 17-day democratic uprising and resign, handing over his powers to Suleiman or to the Supreme Council of the Armed Forces, which has moved to center stage in the drama. Contradictory statements from different officials suggested some disarray within the regime, but Mubarak emerged with a hard-hitting vow that the regime would maintain control over any political transition. Delivered just hours before Friday prayers, the speech is likely to provoke a furious response from the democracy protesters. A night filled with expectations of an epic victory for people power instead left Egyptians with a chilling picture of the challenge that remains in pressing the regime to concede a democratic transition.

Mubarak said the regime would continue to seek dialogue with its opponents and amend the constitution to allow for greater participation in the September elections. In response to the opposition's demand, echoed by the U.S., that Egypt's state of emergency — which allows the state to arbitrarily arrest opponents and curb political activity — be revoked, Mubarak said it would be done when "stability" had been restored and conditions allowed it, a position the regime has maintained for years. Suleiman, who has made no secret of his aversion for democracy, has been delegated to oversee dialogue with opposition groups and reforms. Earlier in the day, the Supreme Council of the Armed Forces had signaled that the military would take a leading role in national affairs.

As rumors peaked that Mubarak would give way to the military or Suleiman, the reaction among the demonstrators was mixed. Abubakr Makhlouf, a 33-year-old entrepreneur, was thrilled. "We trust the military, and we think there will be a fair transition, so that the rest of the world does not have to worry about crazy things happening," he said as he headed for the square to share in the excitement of Mubarak's expected announcement. "We thought it would take a lot more time. And we never thought it would be as smooth as this." But his enthusiasm, like that of millions of others, was premature.

Even if Mubarak had made the expected transfer of power to Suleiman or the generals, 34-year-old activist Ahmed Shahawi said there was deep anxiety over the prospect of the military taking charge. "I am between being afraid and being happy," Shahawi said. "This is not what we wanted. We want a democratic, civilian government. We don't want another military ruler ... We are not fighting because we hate Mubarak. We are fighting because we hate the regime itself."

The power structure within the regime appeared to be in flux on Thursday. The Supreme Council of the Armed Forces, meeting for just the third time in Egypt's history, announced that it would remain permanently in session and issued what it called "Communiqué No. 1" on the crisis. The statement vowed to "safeguard the people and protect their interests, security and safety," approving of the "legitimate demands of the people." The Communiqué No. 1 rubric is commonplace in military coups, when armed forces take charge of matters of state and begin communicating directly with the citizenry, independently of any civilian leadership. A senior government source had told TIME that Mubarak would hand power over to the military.

The military's statement was ambiguous, never defining the interests of the people that it was vowing to safeguard. Clearly, Mubarak hopes that the combination of minor concessions and threats will be enough to get people to leave the streets. And the military is not going to be comfortable with continuing chaos. Having raised expectations that he would bring the crisis to a close by stepping aside, Mubarak has instead thrown more fuel on fires that are likely to rage in the days ahead.

— With reporting by Abigail Hauslohner / Cairo and Vivienne Walt

• Tony Karon
• Egyptian President Hosni Mubarak announced on state TV that he will not step down. Now what?