Greek Business File, January-February-March 2020, No 124


By Nick Papandreou


Let Lebanon Burn?

The political paralysis in Lebanon has led to an economic crisis. The banks have imposed capital controls to ensure deposits do not disappear. It is estimated that the country needs a $20-$25bn bailout including International Monetary Fund (IMF) support to emerge from its financial crisis. Lebanon’s credit ratings have hit junk status and unemployment continues to rise.

Yet the West and the USA in particular have not made any effort to save the country. Months of surprisingly peaceful street protests from all sectors of society and all religions have apparently not convinced any of the powers to come to Lebanon’s aid.

The reason is that US policy towards Lebanon is actually US policy towards Iran. Because Hezbollah is the single most influential political and military actor in the country and because Hezbollah was created by Iran, the US desire to defeat Iran – so present thinking goes – requires the collapse of Lebanon, bringing about the  end of Iran’s client, Hezbollah. By allowing for the total collapse of the existing government, after months of remarkably peaceful street protests, the US has refused to prop up the banks or provide any sort of serious financial support to a country on the verge of bankruptcy.

So let Lebanon burn so the fires will also incinerate Hezbollah?

Yet such an outcome, besides the human suffering, will lead to greater instability in the region. Can we afford to let one more country in the region go under?

There is of course much to criticize with the way things have operated in that country. The political class has been unable to change itself, so to speak. The protestors demand a government formed purely technocrats. In short, they demand a clean sweep and the ousting of anybody who is seen as part of the old political class. Although the new Hezbollah supported prime minister has promised just that, any such reforms have yet to materialize and the protests continue – now in their fourth month.

And Lebanon is not any country. For years it has been touted as that rare specimen in the Middle east, a semi-democracy. From the 1940s on the country had managed to create a system of governance that addressed the needs of its truly multi-religious population: where else in the Middle East do Christians share power with Muslims and vice versa? It is a country where religious plurality has flourished – its political system has been based on representation of religious communities and sects.

Many of the protestors claim that the existing mechanism has led to permanently entrenched divisions and permanent religious identity politics. The original well-founded desire for power sharing has led to an odd outcome where governments are formed based on religious preferences and not on the basis of competence. Critics point out that the existing power sharing agreement can lead to crazy outcomes: It can take 12 years for a budget to be approved. Elections may be postponed endlessly; the formation of a government can take years. Cabinet decisions, say critics and protestors, require putting aside sectarian differences and working for the good of the country.

So does that mean let the whole thing must go down in flames? Of course not. Similar arguments were made in the Greek case – whether to bail out the country or to punish the country for years of excess and let it go bankrupt. Greece survived the crisis with the help of foreign creditors and looks like it is doing a lot better.

Ultimately, the challenges in Lebanon are political, economic and religious. The issue is now how to create a legitimate political class that can address systemic challenges of economic equity and social justice, protect religious inclusion and avoid dominance by any one religion. This will prevent Lebanon’s disintegration. If Lebanon falls, this will create the very conditions that the US wants to avoid, namely, increased Iranian and Russian leverage, not to mention the birth of another failed state in the Mideast.

The collapse of Lebanon will also mean the inevitable end of its Christian presence. We have seen how the collapse of Iraq and Syria have produced massive emigration of Christians and have catalyzed Islamist activism, targeted especially at Christians and other vulnerable religious minorities. If the West and in particular the USA wish to preserve one of the last countries in the region where religious pluralism includes a moderating Christian presence, then the answer is obvious: don’t allow our friends and neighbors in Lebanon to implode.

What to do? First of all, provide a serious and generous IMF bailout -a bailout not premised on austerity models! Secondly, provide massive and immediate humanitarian assistance to address hunger and the impoverishment of the Lebanese citizens and the millions of refugees living there. Thirdly, encourage a summit with all the country’s religious leaders. And finally, the West and especially the USA must break with the current policy path that sees Lebanon only as a proxy of Hezbollah-Iran.  That means the fires must be put out and soon.