Lebanon in the age of political economy
In the past 25 years, and arguably in the 75 years since Lebanon’s independence and (sometimes self-determined) statehood, economy was mostly private. Neither political economy, in the sense of the economic choices made by political groups and individual leaders, nor the nation’s economic policy as choices about taxation and the state’s economic direction for the country, was much of a topic in elections or even between elections.
Politics was made by leaders who personified identities and communities as defined by religious and secular belief systems. In the national policy discourse in Parliament and other halls of politics, these leaders did not need to offer much in terms of explanations for the economics they applied or choices of economic directions that they and their parties would stand for. Discussions of economic direction—anything not manageable under a laissez faire private enterprise paradigm—appeared almost as untoward, like mixing a prenuptial contingency plan for disagreements and divorce alongside preparations for a “Maronite marriage,” proverbial for its doctrinal and social indissolubility.
Politicians displayed obvious economic behavior but were not called out on it in elections while the idea of political parties having to come up with economic platforms or programs in election battles was considered by many (average voters, political strategists, and professional observers of Lebanese politics alike) as patently absurd.
This is the existential aspect of modern Lebanese reality for which the artificially long inter-election break between 2009 and this month of May 2018 can be argued to be a turning point, or more accurately a turning pe- riod. In the past nine years, scrutiny of the self-interested economic behaviors of politicians, or the political economy of Lebanon, has become a central focus of complaint and outrage. Under the buzz term of corruption and the combating of corruption, the political economy is perhaps the biggest topic in national society and across all the communities that compose it—even as the underlying reality of preference for politics that brings advantages to “my” community, clan, and family/ person is by all measures of human self-interest necessarily prevalent but hardly reflected upon or questioned.
MANY ARE THE BARRIERS
Economic policy setting and the design of a new path for the national economy is still not an easy quest in the Lebanese specificity, partly because the country is hyper-dependent on the external forces that have so often com-
peted to and often succeeded in lording over this area, which is located at the fault lines of not only civilizations but also of geopolitical interests.
On one hand this location atop geopolitical fault lines exacerbates the country’s exposure to global factors that unfold with no local causal component, such as interest rate decisions in the United States and European Union, but that have clear ramifications for the sensitive local economic and political landscape. On the other hand, Lebanon—because of its position at the intersection of cultures, continents, and economic spheres—was historically integrated by colonial and neocolonial interests in political defense lines and used as a bulwark against threats by foreign powers that occupied this territory ever since the first crusade at various times during the past 1000 years just as, some would argue, they are doing today.
It was a Roman poet, Virgil, who two millennia ago subsumed the sentiment of self-interested intentions and their risks through the line of Trojan seer Laocoön about the Trojan horse and the fear of such gifts, “Quidquididest, timeō Danaōset dōnaferentīs,” literally translated as, “Whatever it is, I fear the Danaans (Greeks), even when bringing gifts.” The line rings true with the political intentions of state donations even today. In the context of the so-called Conférence économique pour le développement par les réformes et avec les enterprises, or CEDRE conference, it could be interpreted as, “Whatever they pledge, I fear the multilateral agencies and European governments, even when offering concessional loans or grants.”
A second intrinsic barrier to formulation and debate of economic policy in the Lebanese consociational political landscape is arguably the need to forge electoral alliances on list level even before politicians of different ideological persuasions come to present their proposals in the con- test at the voting booth. Alliances and coalitions have to be formed preemptively, not after the group or individual has received a mandate to pursue his, her, or their policy platform.
It seems that this encourages or even necessitates, under the 2018 election law, the formation of lists that do not always reflect clearly the positions of the candidates or organizations that join forces in the contest for power. This appears to be on one hand a case for anti-establishment lists where groups close ranks with one another that, in words of their own exponents, do not agree on anything except on challenging the existing power distribution but also for lists where established parties team up with groups that differ in positions on environmental priorities or economic goals.
Executive has sought to track the formation of anti-establishment coalitions and platforms since the 2018 election date was confirmed in the middle of last year. In the camps that can broadly be subsumed under the anti-establishment label of expressed opposition and challenge to the entrenched power groups and political families, there has since been progress in reaching common positions on candidacies, with a mitigation of the personality competitions and ego issues that many quoted as the anti-establishment forces’ defining, albeit hidden, characteristic and weakness.
However, the groups are still in a pre-programmatic phase of their development, and their associations cannot at this point be tested on their economic platforms or even their preparedness to challenge and counterpropose or concur and co-implement the economic platform that the established government, with its various stakeholders from the traditional political camps, has produced over the course of the past eight to 12 months.
The novelty in the government plan, presented by advocate-cum-stakeholders such as the Hariri government’s senior economic adviser Nadim Munla with great frequency and high vigor in the few weeks after the plan was released in March, appears to be the admission that the diagnosis for the Lebanese economic health is indisputably “dismal” (which it had actually been for many years, but without acknowledgement by government leaders) in conjunction with the insight that the public sector in Lebanon “needs to assume the leadership role in jumpstarting the economy.”
Both admissions, made by Munla in discussions, such as an April 19 forum organized by business magazine Lebanon Opportunities at the Le Grey Hotel, constitute the backdrop of new economic policy pursued by the Lebanese government. This economic policy is subsumed in the CEDRE concept with its four pillars of (1) fiscal consolidation and the reduction of the deficit by 5 percentage points of GDP, (2) sweeping reforms, (3) large infrastructure investments, and (4) a partially outsourced economic vision and strategy that is under development by global consulting firm McKinsey (for more on the CEDRE plan components as known today, see page 18).
The other focus of the 2018 elections is, of course, the rebalancing of political representation, where Executive has followed the issue of female participation and is dedicated to monitoring the change on this front. However, the economic policy theme is the magazine’s primary concern. On this front, the first observance of 2018 when compared to the previous elections is that political positions are
Anti-establishment groups are still in the pre-grammatic phase of their development.
more articulated when comparing the party positions of now and then. Previously, clear views on foreign trade policies, promotion of industry, redistribution via direct and indirect taxation, and others simply did not seem to exist in a fully developed program in any established party, never mind whom Executive asked about these issues.
In an investigation that Executive conducted during the 2005 election preparations, on one end of the spectrum stood the answer of Hezbollah, which responded that it did not have to exert positions on the economy. There appears to be no shift from Hezbollah’s position as far as the organization’s election program of seeking to act as “voice for the honorable resistance and protector of the sacrifices of its people and mujahedeen” for the next four years as the organization’s Secretary General Hassan Nasrallah said when he announced the election program of the Loyalty and Resistance bloc this spring. He focused his economic policy remarks on calls for the reduction of “waste and corruption” and on the creation of a “ministry of planning,” without going into specific details on an economic policy program points per se. According to statements which Nasrallah made in late April during the 2018 race, the party is still not aspiring to involvement in economic policymaking.
On the other end of the scale, many parties historically have offered partisan views on single line items in the economic context, but nothing that deserved to be called an economic policy platform or program. The best any party offered was some brochure-length excuse for an economic policy. Compared to that, the governing “coalition’s” CEDRE lineup of economic policy innovations is a big step forward. However, this is not enough for a real debate on economic policy in the public square.
POLICY THROUGH DEBATE
This CEDRE scenario of a single plan without any well-developed coun- terproposals is at the very least counterintuitive to the idea, under which a parliament is the “deliberative assembly of one nation,” to quote Edmund Burke as a historic pioneer of democratic practice. It is not an idea whose certainty has been established that in the Lebanese National Chamber government and legislation have ever been, as Burke postulated, “matters of reason and judgment” as opposed to the type where “the determination precedes the discussion.” This notwithstanding, if one believes that deliberation is integral to representative democracy, one is likely to think that the best policy is the outcome of debate between competing policies or solutions.
There is no simple answer to the deficiency of alternative economic policy platforms for Lebanon, though, given that such platforms of the anti-establishment in 2018, as mentioned before, appear yet to be in pre-formation stage, and that the CEDRE platform has coalesced into what can be called the government stakeholders’ united economic survival strategy. Despite the concept’s many aspects that have yet to see the light of day such as the Economic Vision, and the many that appear worthy of much careful scrutiny, buy-in of government parties into CEDRE seems far-flung, even to the point that exponents of establishment politics in Lebanon have even resorted, in the intense month of campaigning between the CEDRE meet in April and the presumed elections on May 6, to the same specter of gloom, doom, and bankruptcy in their rhetoric about the Lebanese economy. It is ironic that these are the same orators who should have previously assumed responsibility for improving the economy and its political environment.
That does not mean, however, that there cannot be hope for contrasting the government’s platform with antiestablishment platforms or even positions voiced by stakeholders in the political establishment in the course of the coming Parliament. One sign for such a possibility—however contrarian to the group’s past political identities it may appear to some skeptical Lebanese—is that the Kataeb Party has produced a diverse 131-point program, which entails over 30 economic policy points. While it presented the program this spring with targets that may not in themselves spell out radically new economics, the effort invested in the program has enough revolutionary feel in the context of Lebanese establishment politics.
It certainly is curious that one of the most entrenched political organizations in Lebanon, which had been represented in every Parliament between 1951 and the last pre-war elections in 1972, that was the party of assassinated President-elect Bachir Gemayel and President Amine Gemayel, and that regained parliamentary seats in 2000, 2005, and 2009, is offering a platform of economic policy positions from an opposition angle. However, as the political debate of economic policies appears to be a dire need—a consensus across party lines and internal community borders that the country is in a state of abject economic and financial despondency and threatened by economic default is perhaps able to provide people with a certain perverse satisfaction of assured depression—it appears as a ray of hope that members of the political establishment in the country are ready to pick up the gauntlet of serious economic policy discourse.
The best any party offered was some brochure-length excuse for an economic policy.
The tentative makings of an economic vision