It's downright funny watching the Obama administration flounder around trying to decide what to do about the revolution in Egypt. The obvious answer is to announce publicly that this is something for the Egyptian people themselves to decide, and our part is simply to stand back and watch; I don't see Obama or his staff doing that, though.
For the past 30 years the US has dealt with Mubarek simply because he was there. He was the president of Egypt; therefore we had to deal with him. Who else should we have dealt with? Ali the cab-driver? Yes, we knew that Mubarek was a shabby little tyrant, but we gave him trade, alliance, military goods and foreign-aid money anyway. After all, he swore he wanted to be our "friend": that he was, first, a good anti-communist and, after the fall of the USSR, a good anti-terrorist. What else should we have done with Egypt? Besides, there was always the hope that he'd grow used to getting money from us, and we could use that to pressure him into keeping the peace with Israel and suppressing the Jihadists. To some extent, that worked. Egypt has not attacked Israel in a very long time, and just before the revolt broke out, Muslim congregations in Egypt made a point of guarding Coptic-Christian churches against attack by the Jihadists.
Nonetheless, Mubarek did in fact tyrannize and abuse his own people until they'd had entirely enough. So out they went into the streets, performing a marvel of Civil Disobedience -- with as little bloodshed as possible, given that the police and the army have served as Mubarek's bully-boys for decades. The police had the sense to run away and hide. The army has had the sense not to attack the demonstrators. Mubarek has had the sense to promise that he "won't run for re-election" -- which means that he's seen the handwriting on the wall and is stalling for time; I think we can be sure that he's moving his money and family out of Egypt, to some safe haven for rich ex-tyrants, as quickly as possible. If he keeps moving out, and if the protesters keep up the pressure, this will end in a successful and remarkably peaceful revolution.
Of course the Muslim Brotherhood, which is the grandfather of all the Arab terrorist organizations in the middle-east, is scrabbling about trying to grab the new reins of power. If the rebels continue to show solidarity between the Muslims and the Coptic Christians, the Muslim Brotherhood will gain a few headlines and nothing more; the US will transfer its agreements to the new Egyptian government, and all will be well. If the Muslim Brotherhood does succeed in grabbing power in Egypt, the US will have to end all such agreements and boycott the whole country. I suspect that most of the educated people in Egypt, of whom there are a remarkable number, are aware of this fact.
Alas, the US government says nothing out loud about all this. Obama mouths pretty platitudes, the various Intelligence groups blame each other for not predicting the revolt, and the State Department whaffles about What We Should Do -- all of which makes our government look like a pack of idiots.
Of course, that may not be very far from the truth.