The timing of Mr Morsi's decrees has put the White House in an awkward position, and appears to some analysts to have exploited the administration's praise for Egypt's role as a pragmatic peacemaker in Gaza.
Honeymoon between US and Morsi is over
NEW YORK //Amid the first major flareup of violence between Hamas and Israel since the Egyptian revolution, president Mohammed Morsi last week emerged as a key US ally in helping broker a ceasefire.
In the eyes of the US administration, Mr Morsi's Islamist government had passed an important first test of commitment to peace in the Middle East. But with the Egyptian president's startling decrees days later, which removed the final checks on his power, the honeymoon between Washington and Cairo ended.
"The more the crowds gather in Tahrir…the harder it is for president Obama to publicly embrace Morsi," said Tarek Masoud, associate professor at Harvard's Kennedy School of Government. "Even though the administration probably still feels that he was a very useful partner on the Gaza conflict."
With options limited, however, Barack Obama, the US president, has little choice but to cautiously continue to support his Egyptian counterpart.
On Tuesday, a State Department spokeswoman said: "When confronted with concerns about the decree that he issued, president Morsi entered into discussions with the judiciary…That's a far cry from an autocrat just saying: 'My way or the highway.'"
For the time being, the Obama administration is expressing some worry over the situation without denouncing Mr Morsi, taking a "wait and see" approach, said Isobel Coleman, a senior fellow for US foreign policy at the Council on Foreign Relations, based in New York.
"Transitions are messy, they take a long time, there are ups and downs - there's an appreciation of that in Washington," Ms Coleman said.
The timing of Mr Morsi's decrees has put the White House in an awkward position, and appeared to some analysts to have exploited the administration's praise for Egypt's role as a pragmatic peacemaker in Gaza.
"That is a very American-centric view of what goes on in Egypt, but this drastic move was coming regardless," said Mr Masoud. He added that the package of laws took time to draft and, with the judiciary allegedly gunning for Mr Morsi's government, the decrees were imminent with or without the Gaza eruption.
There is a growing concern in Washington, especially among Republican legislators, that Mr Morsi's power grab reflects the true intentions of the Muslim Brotherhood-dominated government. During the weekend, Senator John McCain called on Mr Obama to condemn the Egyptian president's move and threaten to withhold aid.
"There's a deep suspicion in Washington about the Muslim Brotherhood, that it will use the democratic process to amass power and never let it go," Ms Coleman said. "This plays in to those fears."
In the face of continuing protests by opposition groups over the decrees, Mr Morsi moved back from exemptions on judicial oversight, but he has kept the freedom from legal challenge for the Islamist-dominated council writing the new constitution. Curtailing of freedoms for minorities in the new constitution would make it difficult for the US to maintain its current tightrope walking, analysts said.
"There are little signals that make people nervous," said Graeme Bannerman, a former Middle East analyst at the US State Department. "He didn't go to the Coptic pope's installation - if he's going to be the representative of all Egyptians why didn't he go?", he said, referring to the November 18 ceremony in Cairo that enthroned Pope Tawadros II, the new head of Egypt's Coptic Church.
Whatever the concerns about the trajectory of the democratic transition, there is little the US can do to shape it.
"It's not possible for the US to have anything more than a marginal influence on how Egypt ends up," said Mr Masoud. "We really need to manage expectations and understand that the US can pressure Morsi on Israel or this or on that limited policy, but there's not a whole lot we can do about the big process of becoming a democracy."
While unilateral leverage is limited, the US can exert some pressure through the International Monetary Fund, which was close to finalising a US$4.8 billion (Dh17.6bn) loan that is crucial for Egypt's fraying economy, Ms Coleman said.
The unrest after the decrees might imperil the funds, with an IMF spokeswoman saying on Tuesday that the agreement is "based on the economic and social policies the government plans to implement", Reuters reported.
The White House's "wait and see" approach is also based on a lack of clarity about what exactly it wants from Egypt, Mr Masoud said. Members of the Obama administration talk about wanting Egypt to become a liberal democracy, but then why "turn a blind eye to all sorts of undemocratic practises over the past two years?"
On the other hand, he added, if all it wants from Egypt is maintaining good relations with Israel, then it could be happy with a range of constitutional arrangements.
"I think the administration has this sense that Egypt is this big, important country in the Arab world and that we have to have good relations with it," Mr Masoud said. "The aim that those relations is supposed to achieve are not necessarily clear."