Hosni Mubarak's announcement sparked immediate outrage from the Egyptian protestors, who have stated repeatedly over the last several days that they seek nothing less than his ouster.
President Obama made the right call in urging Mubarak not to seek reelection, but he may have inadvertently made the situation more dangerous. If Mubarak serves out his term and elections take place in September - seven months from now - it will be almost a surefire recipe for the rise of the Muslim Brotherhood.
The Brotherhood is the only party that has the financing, infrastructure and ability to mobilize. Egypt's other opposition parties are in shambles, having been suffocated by the Mubarak regime for decades. Seven months is not enough time for them to prepare to compete in elections.
But things don't have to go that way. The president can still ask Mubarak to step aside and allow for the creation of a transitional caretaker government, backed by the military, which can maintain order on the streets, create a safe political space, and then guide the nation to democracy. The caretaker government would preside over a period during which the Egyptian people can draft a new constitution - not just amend it, as Mubarak suggested in his speech - and prepare for genuinely fair elections.
The longer this transition period lasts - within reason - the stronger the opposition parties can become. This would mitigate the power of the Muslim Brotherhood and other groups that reject democratic principles, without completely excluding them from the political process.
Former International Atomic Energy Agency chief Mohammed El Baradei backs this plan, and so does the constellation of reform factions that tapped him to speak in its name. But ElBaradei himself would not need to lead the cabinet. Newly-installed vice president Omar Suleiman (or another known quantity) could also do so.
But the key to this is the Egyptian military. It has earned the trust of the people. Indeed, it has not fired a shot on the protestors. If it can preside over this process, it can guarantee that the power of the transitional leader is kept in check, so a peaceful democratic process can unfold.
Yes, this plan carries risks. But so does inaction. If Mr. Obama accepts Mubarak's plan and allows elections to take place in September, the Muslim Brotherhood will be poised to fill the vacuum. This could result in two equally miserable scenarios: the rise of a Muslim Brotherhood government, or new strong man tapped by the West to bring it down.