Deal­ing with a self-ab­sorbed sys­tem

Executive Magazine - - Front Page -

* To our es­teemed read­ers: 1. We fully re­spect the dig­nity of all do­mes­ti­cated an­i­mals, in­clud­ing the Equus Africanus As­i­nus, also known as the ass or don­key. 2. This cover does not make ref­er­ence to any vile Amer­i­can col­lo­qui­al­ism. 3. In no way do we wish to im­ply that the Lebanese sys­tem of pub­lic gov­er­nance is hes­i­tant, stub­born, in­de­ci­sive or in­ac­tive. Any sim­i­lar­ity of rider or an­i­mal with a real ex­ist­ing pop­u­lace or in­sti­tu­tion is in your mind only.

Don­keys de­serve more re­spect than they get. For some 5,000 years, hu­mans have been us­ing them as strong, re­li­able beasts of bur­den. We’ve made progress on the backs of these no­ble crea­tures, yet de­nounce them for a strength of will we praise in our­selves. In­tran­si­gence is in the eye of the taskmas­ter, it seems. Don­keys aren’t stub­born be­cause they’re lazy. A don­key’s stub­born­ness ac­tu­ally be­lies its in­tel­li­gence. While hu­mans can poke and prod horses to do nearly any­thing, if a don­key senses it is be­ing pushed to act against its self­in­ter­est, it won’t budge. Hardly ideal for a work an­i­mal, but a re­spectable trait none­the­less. That said, a don­key will never win the Triple Crown. For both strength and speed, the more mal­leable horse is a far bet­ter bet. Le­banon’s econ­omy needs a horse. The don­key we’ve been rid­ing is old, tired and clearly not up to meet­ing new chal­lenges with any­thing that re­sem­bles swift­ness.

Our sys­tem is our don­key. Not par­lia­ment, cab­i­net or the pres­i­dency as such, but the whole con­fes­sional, con­sen­sual sys­tem. The so-called 1 per­cent have a dis­pro­por­tion­ate amount of power the world over, but Le­banon’s elite have their sta­tus fur­ther pro­tected be­cause each is a guardian of a self-ab­sorbed com­mu­nity wor­ried about its own in­ter­ests and pro­tec­tion rather than the cre­ation of a strong and func­tion­ing state that could ben­e­fit all cit­i­zens. Our don­key is at once the peo­ple in power, but also, the un­writ­ten com­pro­mise that keeps them there and par­a­lyzes de­ci­sion mak­ing in this coun­try.

While the don­key has over­seen some de­cent eco­nomic times in the past 25 years, re­cent times have proven just how useless our don­key has be­come. While the Great Re­ces­sion did lit­tle dam­age to the Lebanese econ­omy, fall­out from the civil war in Syria has been dev­as­tat­ing. As growth fell from 8 per­cent in 2010 to 2 per­cent in 2011, as per World Bank fig­ures, the don­key didn’t budge. And it has only barely moved since. This stands in stark con­trast to Banque du Liban, Le­banon’s cen­tral bank, which has proven to be a thor­ough­bred, al­beit one still con­fined to the pad­dock. Boost­ing growth is not BDL’s job, yet the in­sti­tu­tion has been do­ing all it can in this re­gard as the don­key munches grass, nei­ther in­spired to fol­low suit, nor will­ing to lend a hoof. In the past five years, BDL used sub­si­dies and cir­cu­lars in an ef­fort to prop up the so-called pil­lars of Le­banon’s econ­omy, real es­tate, tourism and bank­ing. The hard­est hit – real es­tate – has re­ceived the most help, and BDL still claims re­spon­si­bil­ity for 50 per­cent of growth since 2012, which Ex­ec­u­tive is un­able to ver­ify. The don­key makes no such boasts.

This is in­fu­ri­at­ing. In the pages that fol­low, the don­key’s dere­lic­tion of duty is well doc­u­mented. Seven years af­ter a plan for fix­ing the elec­tric­ity sec­tor won the don­key’s sup­port, noth­ing has changed. In fact, the don­key is still munch­ing on the same plan it ap­proved but never im­ple­mented (see story page 30). Two elec­tric­ity bills drain house­holds of dis­pos­able in­come and re­strict the re­gional com­pet­i­tive­ness of lo­cal in­dus­try. Twenty-four hours of state-

Our sys­tem is our don­key. Not par­lia­ment, cab­i­net or the pres­i­dency as such, but the whole con­fes­sional, con­sen­sual sys­tem

sup­plied elec­tric­ity by 2015, as the don­key promised in 2010, would have had a cu­mu­la­tive im­pact by now.

For its han­dling of telecom­mu­ni­ca­tions – par­tic­u­larly the qual­ity of in­ter­net ser­vice in the coun­try – the don­key de­serves a beat­ing. Down­load speeds in Le­banon have been kept very slow on pur­pose in re­cent years (see story page 34). While blame for this is of­ten laid at the feet of one man, the don­key kept that man in place. A World Bank study from 2009 found that a 10 per­cent in­crease in ac­cess to fast in­ter­net gives GDP growth a re­cur­ring 1.3 per­cent boost in de­vel­op­ing coun­tries. Again, wide­spread, faster in­ter­net was pos­si­ble years ago and our econ­omy would be stronger to­day had the don­key but moved.

The don­key also de­layed the launch of Le­banon’s oil and gas sec­tor, and could yet stand in the way once again (see spe­cial re­port page 12). To ex­plore the coun­try’s off­shore po­ten­tial, wells must be drilled. That won’t hap­pen with­out con­tracts be­tween the gov­ern­ment and com­pa­nies qual­i­fied to do that drilling. Con­tracts were sup­posed to be signed back in 2013, but the don­key failed to pass two needed de- crees. While the don­key passed the de­crees in Jan­uary, we need a don­key to sign con­tracts in Novem­ber, but might not have one, as the don­key’s plans for long-over­due par­lia­men­tary elec­tions are any­thing but clear. The don­key’s re­fusal to choose an elec­toral law adds an un­nec­es­sary and un­wel­come el­e­ment of un­cer­tainty onto an al­ready dis­as­trous eco­nomic sit­u­a­tion.

The don­key is a los­ing bet. We’ve done all we can to push it into ac­tion over the years, with lit­tle to show for our ef­forts. It’s time to ditch the don­key and start bet­ting on a horse.

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