Debating Hariri’s economic policy

And the question of Lebanese corruptive and monopoly practices

We’ve started a debate around political economy issues in a previous post. So please stop commenting in the previous post and start commenting here. I just copy-pasted the last entries in the comment section. I will be soon answering and I encourage everyone to contribute by commenting here.

As a summary:

We are assessing of the economic ‘policies’ or broad rationale followed by the various Hariri cabinets since the inception of his first term. through an assessment of:

1- Interest rate politics followed
2- Reconstruction of downtown and some infrastructure
3- General economic (or business) visions
4- Other economic and social practices

Hussein proposes what I would call the “security threat” argument, where Hariri had to hike interest rates because investment climate was bad supposedly due to the war in the south.
I will soon show that this argument is untenable.
Another argument dear to the Harirists are the “service economy” argument. Although Hussein says he is against I want to show how this argument is at the core of Hariri’s policies and political interests and ultimately (and among other things) serves to keep the confessional system well entrenched, and the constituencies pretty much dormant (in terms of social assertiveness) and divided.

Always a winner

No matter what happens, there is always one clear winner in Lebanon:

In its study titled “International Expansions Not Priced In,” Cairo-based EFG-Hermes stressed the buoyancy of Lebanese banks. The report, which was published in Banque Audi Saradar’s weekly bulletin on Monday, noted that customer deposits witnessed year-on-year growth of 4 percent in 2005 and 6 percent in 2006, while deposit outflows were short-lived and limited.

Funny, this was already the conclusion of economist Georges Corm in a latest interview. The Central Bank is still sinking in its FOREIGN exchange liquidity, and so there is no loss of confidence. But you know what is the price to pay for this liquidity? More debt: the accumulation of this foreign liquidity was done by substituting local currency debt to foreign. In sum, this raises the value of the debt. Who wins? The banks.

Oh and by the way, there is also the idea that ‘consumers’ put their money in banks because they are not spending. You mostly save because you are reluctant to spend. Not spending partly reduces economic activity. Then, Banks take this money and do not create economic activity with it either because they either buy debt from the State or put the money outside of the country. Nevermind.

Meanwhile, the banks create their own confidence. The nexus, banks-Central Bank-Ministry of Finance (Bks-CB-MoF) make sure ‘everybody’ is happy. See, the whole concept of “confidence” is a tricky issue in economics. But I don’t want to open the discussion here. Suffice it to say that it is a very dark world filled with IMF and other international institutions bureaucrats and political assurances here and there that “it’ll be fine, put your money folks and we’ll make sure it will multiply”.

I like how this flies against any hard-economic rationale. Normally the rule is simple. If there is political instability then you get your money out quick. but if ‘everybody’ (mm say, Hariri and co for example, seconded by Saudi investor’s assurance).

I say simply that those who ‘put money’ in the Lebanese economy, of course I mean those who really do make a change, have political guarantees and are part of the same network. It seems that with regards to the banking sector (and I stress only the banking sector), there is a solid system in place. A system that involves few actors but a lot of money, unconcerned by the rest of the Lebanese economy. Because at the end of the day, it is not the Lebanese economy per se that is at the heart of concerns, but some kind of fictive ‘confidence-based’ economy created by a bleeding public financial system being eaten away by lazy local banks who if they don’t put their money in fatly remunerated TBills go invest outside of Lebanon. Why would a war then destabilize this system?

The politics of naming

One of the first political phenomenon I am concerned with is the time (and resources etc.) dominant actors spend on finding suitable categories to define (or give meaning to) their various political actions. In addition to the fact that naming gives significance or the illusion of substance in perceiving the enemy, the symbolic act of naming Hizbullah a “terrorist” organization opens the door for so many different legal as well as diplomatic dispositions that has concrete material effect (in the same way the beefing up of an army has material significance):

United States lawmakers are stepping up pressure on the European Union to declare the Lebanese militant group Hezbollah a terrorist organization.

A House of Representatives’ panel is to highlight Wednesday the importance of Europe as a fundraising base for the group, long held responsible by the United States for anti-U.S. and anti-Israel attacks.

Some European countries have resisted an EU designation of Hezbollah as a terrorist organization, arguing that it is better to engage the group given its large role in Lebanese politics.

What is important here is to notice how, generally, legal appellations and social norms are all based on this categorization principle. In this case, the creation of significance is a political process embedded in institutions in place (governments, parliaments, courts, etc.) that serves to create disciplined subjects and the ‘other’.

The new Frenchman in the East

Well, it turns out that there may well be interesting developments in French politics with the arrival of Nicholas Sarkozy as president. The French envoy Jean-Claude Cousseran who was roaming around the backdoors of Syrian government buidings around the time Mustaqbal deputy Walid Eido was killed, turns out to have a history of confrontation with French ex-president and Hariri long time friend Jacques Chirac. In this article dated from June 2002, Cousseran is said to have been fired by Chirac because he was trying to find proof of corruptive practices done by the latter. More than that, Cousseran was the head of the main French espionage agency, the Direction Generale de La Securité Exterieure (DGSE).

So please can somebody tell me why when this type of guy goes to Syria to investigate possibilities of change in French-Syrian political relations does a newly found Lebanese “anti-Syrian” politician get killed?

The Saga Continues …

Confrontations between Hamas and Fatah members erupted in at least two Palestinian refugee camps in Lebanon over the weekend, raising fears that the situation in the Palestinian Territories might spill over into Lebanon’s camps.

The Salafi Connection

“There’s a relationship between ourselves and Sheik Saad when it’s needed,” Shahal said. “The biggest Sunni political power is Hariri. The biggest Sunni religious power are the Salafis. So it’s natural.”

"Welcome to the Middle East"

And so today, we are supposed to talk to our faithful policeman, Mr Abbas, the “moderate” (as the BBC, CNN and Fox News refer to him) Palestinian leader, a man who wrote a 600-page book about Oslo without once mentioning the word “occupation”, who always referred to Israeli “redeployment” rather than “withdrawal”, a “leader” we can trust because he wears a tie and goes to the White House and says all the right things.

All over the Middle East, it is the same. We support Hamid Karzai in Afghanistan, even though he keeps warlords and drug barons in his government.

We love Hosni Mubarak of Egypt, whose torturers have not yet finished with the Muslim Brotherhood politicians recently arrested outside Cairo.

We adore Muammar Gaddafi, the crazed dictator of Libya whose werewolves have murdered his opponents abroad.

Yes, and we love King Abdullah’s unconstitutional monarchy in Jordan, and all the princes and emirs of the Gulf.

The Truth about Iraq

A 2003’s “Soldier’s Guide to the Republic of Iraq,” issued by the Army on the eve of the U.S. invasion, tells troops that Arabs see “little virtue in a frank exchange” and are “by American standards… reluctant to accept responsibility.”

There is a 1943 version as well, which can be accessed here.

(This article was stolen off Hassan’s facebook profile.)

"Skool’s Out"

The City International School in Beirut let preschoolers out one week early, at the request of parents who had made sudden travel arrangements for the summer or were leaving the country permanently due to the political uncertainty, said one administrator on condition of anonymity. The school is popular with expatriate families.

One 17-year-old boy rolled his eyes when asked why school was out early this summer. “Because of the weather,” he said, then added: “Why do you think? It’s the political situation.”


An illustration of colonialism internalized:

The Israel Prison Service on Friday separated Palestinian security prisoners affiliated with Fatah from those linked with Hamas, after receiving intelligence information indicating that factional violence could break out among the prisoners in the wake of the bloody clashes in the Gaza Strip that led to the Hamas takeover there.

Local motives, international triggers

I have this little theory that the latest political assassinations (starting with Rafic Hariri) in Lebanon are carried out by local actors (Lebanese mostly but may include regional players) are triggered by international political shifts and decisions in order to force a status-quo on Lebanese political alignments and decisions. Although I don’t have the time to do this with great historical investigative detail but I kind of recall that most of the assassinations followed or preceded either the voting of UN resolutions, or the issuing of the finding of UN commissions, the visits of political delegates from outside, or some regional political agreement or re-alignment.

For example, Walid Eido’s assassination was preceded by renewed French diplomatic activity with Syria. In the case of Pierre Gemayel there was a very similar circumstance: Syrian and Iraqi rapprochement. I’ll try to find similar patterns later on. It’s like every time something is opening up in the face of Syria, some ‘anti-Syrian’ guy in Lebanon is being blown up. Of course, not any sort of “anti-Syrian” guy, but someone who represents the lamb, the ideal scapegoat, the ‘weakest link’ (Eido and Gemayel are perfect examples). As I argued for Gemayel’s killing, Eido’s assassination obeys the same type of political logics. No material costs (the guy has no popularity for example), but high symbolic effect (represents Hariri’s staunchest supporter).

Bear in mind that the US has not accused Syria for Eido’s assassination. This of course is not a signal that Syria is not behind the assassination but tells you more about specific political configurations, and possible re-alignments. Is it possible that something is cooking in the corridors of regional diplomacy and that some party (Lebanese most probably, but with possible regional help, even groups within Syria) is trying to force a specific status-quo on the Lebanese local political platform?

Hussain’s answer

Hussain answered me by email to what was written in a previous post. I will answer soon to his comment that I quoted below:

bech, apokraphyte, boumb and all,

In my article on Hariri, I gave numbers and evidence. Bech you should know better, you used to work with such numbers. So if you have evidence against his theft and monopoly, please point it out. Solidere is a private company with public shareholding. Other economic monopoly, please cite verifiable examples. Don’t tell me the Dalloul/cellphone deal. Dalloul has connections in Syria before Hariri was born.
Anyway, I cannot discuss the whole Hariri policy in this small post. My piece was a personal experience.
As for leftism ya Bech, you should know better. Any social welfare program can never pick up without prior accumulation of wealth, walaw… this is 101 leftism.
Hariri’s plan was not my favorite for Lebanon. I disagree with his no diversification of economy. But that’s too luxury of a debate in a country that has Assem Kanso and Nasser Qandil. Hariri had a plan, but he was never given a chance to implement it.
And ya boumb, for your own credibility and good image, drop the Najah Wakim style of how much Hariri paid me or others. Let’s be more civilized in our debate.

Blogger Goodbye …

Thanks for reading me and please keep checking here for the insights of my talented blogmates.

Best of luck and thanks again — dave

Notes in self-inflicted diary (1)

LBCI distances itself from LF: I don’t think this means (english version) anything but business talking. Meaning that at the ideological level, things will stay pretty much the same. But this is still an interesting development. It shows that media centers are not big monolithic structures speaking through one voice, and this could spill over and change some ideological directions. It reminds me of L’Orient le jour and the fact that they have this one journalist Scarlett Haddad who writes the most interesting articles, in the most horrible newspaper. Resistance can start everywhere.

An interesting article
on the relation between the Lebanese state and Palestinian camps, and social and economic conditions. It reviews the main political developments of the last years or so. This article is written in a direction I would take to understand political events taking place in this country: You can say whatever you want about political actors manipulating groups within camps (Syria, Hariri, etc.) at the end of the day, if the camps were not these marginal areas none of this would have happened.

I mean think of it this way: what are the most marginalized areas of Lebanon? South, Bekaa, North, and Camps. South, Bekaa, Hizbullah stepped in and has creating a de facto political order that may or may not integrate through state structures (you can fight it over in the comment section). After years of state neglect, the North has seen the rise of several conflicting Islamic movements emerge. Just look at Diniyeh where most of the so-called ‘extremist’ come from (the dudes who were in prison, and that Fatfat who is from Diniyeh had to co-opt), Diniyeh is probably one of the poorest region in Lebanon. Now the difference between north and south is that without strong backing or political domestication, none of these groups clearly emerged on top of the other. As for the camps, you know the story. It all starts from the absence of the State or a very poor functioning of the State in the areas concerned. Sometimes it is in the interest of the state (or groups within the state because of course there is no “state” in Lebanon) to keep these region in this state of neglect.

Read here Hussain defending the Hariri legacy. Hussain if you read me here, I seriously cannot believe how you deliberately fail to mention the economic exploitative structures Hariri put in place as a result of his economic policies, to the way downtown was rebuilt, to how he monopolized economic activity, to the fact that he was the biggest ally of the Syrians, and to the fact that his recent backstabbing of the Syrians had more to do with wanting to get rid of Lahoud with US and French help and not at all because he “tried to change” things for “us” “Lebanese” etc. (by the way, do you still call yourself a LEFTIST (name me one initiative Hariri took that is related in one way or another to social justice)? And on top of that you say that Lebanese are used to live in a world of lies (and in a good propagandist vein, that the ‘tribunal’ will set the record straight). Well, don’t you have just a tiny bit of conscience to see that you are clearly perpetuating this legacy?

Make Love, Not War …

The Pentagon considered a proposal to create a hormone bomb that could turn enemy soldiers into homosexuals and make them more interested in sex than fighting.

Along those lines, US contractors may want to rethink the wisdom of sending former SLA and LF guys into Iraq as security guards. Lebanon’s gentler sex might, perhaps, serve as a more effective deterrent against evil-doers.

Irony on Downing Street …

“The fear of missing out means today’s media, more than ever before, hunts in a pack,” Mr. Blair declared. “In these modes it is like a feral beast, just tearing people and reputations to bits. But no one dares miss out.”

Indeed, St. Antony, indeed. Tell us more about the “fear of missing out.” This isn’t quite what I had in mind when I heard about his “lurching,” but I do have a thing for feral beasts, even poodles who busy themselves chasing their own tail.

In His Own Words …

I draw your attention and that of your readers to the fact that, for the first time in history — and I want to emphasize this — there are elements of the U.S. nuclear capability on the European continent. It simply changes the whole configuration of international security.

This press conference is impressive. I have no illusions about Putin, but intelligence-wise, he would have to be at the top of the class among heads of state. Combine this with having to listen to GWB and it makes me wonder how exactly the US “won” the Cold War.

Why Aren’t We All Like That Old Bird …

A wise old owl lived in an oak
The more he saw the less he spoke,
The less he spoke, the more he heard,
Why aren’t we all like that old bird?

Damning the Dead …

Four policemen were wounded when a coffin bomb went off in the district of al-Sayediya, western Baghdad, an Iraqi police source said on Saturday.

Populist words from a Lebanese mafioso? Or a sign of things to come?

Lebanese Christians, wary of the rise of militant Islam in their country, will have to retaliate if they are targeted, a leading politician warned yesterday.

“These extremists must be finished, we cannot allow them to grow. Addressing this imported phenomena is the responsibility of our Muslim compatriots,” he said, warning that “Lebanese Christians, who are the basis on which this country was built, will not sit idle if their existence and dignity are threatened.”

Addressing the Al Qaida-inspired Fatah Al Islam and other militant groups, which recently threatened to target Christians, Gemayel said: “Don’t play with fire,” to the cheer of the crowd.

Trish Schuh reporting

An intersting article that proves nothing, doesn’t clearly point fingers at anyone but has some relevant information on the alledged attempts to “politicize” the International Tribunal.

Jawad Nasrallah

My joy was tremendous this morning when I picked up from the floor an envelope with Lebanese stamps on addressed to me, and that I guessed came from my fellow blogger, and friend Moussa. I knew what was in it: the collection of poems by Jawad Nasrallah son of the secretary general of Hizbullah Sayyed Hassan Nasrallah.

As I said before my joy was tremendous, so I hurried to open the envelope after sitting on my prison table (where I spend most of my time), and I read the title: 7urufon muqawima (resisting letters, to translate literally). Nice. So I started reading the dedication for his family and all those who encouraged him to write this book, and then I went to the first poem: a special thanks (it is titled ‘thank you’) to his father. “Thanks to the heart of the most beautiful dad”.

But the more I read the more my disappointment grew. I think my dilettante bourgeois background and shaper of taste has made me seek for the contradictory states of mind, personal confessions/reflexions on the life of the poet. There was none of that, every line was subordinated to ‘the greatest good’ of the resistance. Poems are to the ‘martyrs’, to the ‘prisoners’, to those who are still fighting, to the SG of Hizbullah (the first poem addressed him as a dad but others as a political figure), then towards the end, there is a return to the family where the author writes for his mom and his brother (for the latter he writes on him as a brother but also as the one who died in the battle).

Sublimated poems, disciplined verses, chants for the songs of the resistance, Nasrallah has played by the rules. So he may still be called the poet of the resistance. The poet of this new party/movement. And I’m not judging his verses that are very often enough a bit too pompous to my taste, and poor in the richness of the images they convey. But indeed, his style mirrors what he is writing for: A constituency the party wishes to win over. To create grand ideological frames that are thought to stick effectively to people’s mind, that is the task Nasrallah seems to has set to himself.

But first, it does not mean he has consciously done that, as he may write for so many other personal reasons (as i am not his psychoanalyst I’m just speculating here: like winning over his dad’s pride in him, as it’s the elder son Hadi who took most of the respect through his sanctified martyrdom). Despite this fact, as a social outcome Nasrallah plays the role trying to create a general discursive field that would group the constituency. And so second, it does not mean that people automatically incorporate these frames, there is a much more complex process at stake at the reception level, but that is another story.

In any case, even perceived through this narrow function, I could not find parts of what he wrote that really resonated in my mind. Again, this is because I am the personification of the hiqd that al haqid theorizes about. I could recognize in some of the poems the texts of some of Hizbullah’s songs but am not sure. Maybe it’s just the same vocabulary and expressions used. Suffice it to say, that these symbolic discursive efforts deployed by the party are crucial to understand the making of the history of a social movement and the political organizations that emerges from it. With time, discursive practices get more and more complex as more and more people are involved in it, and as different social structures emerge from the initial movement. Just watch the history of nationalism and its progressive discursive internalization in Europe during the past centuries and you will be able to draw interesting parallels.

Hamas doomed dreams

So Fatah asks for permission to Israel to get arms from other Arab states to neutralize Hamas, and the latter’s leader Ismael Haniyeh wants to integrate its militia to the Palestinian security forces. Do you get it? Hamas lives in Alice’s wonderland… Can somebody tell Haniyeh despite all the efforts deployed, purely ‘Palestinian’ decisions will never be possible?

Fatah is not Palestinian anymore, people should wake up and scrap the last decades of history of Palestinian resistance.

Has the Race Begun …?

I cannot help but think that the very public beating Bandar Bush is taking may be a sign that the race for the Saudi throne has begun. While much of the fighting will take place behind the scenes, it will be interesting to see how changes in the role of the Saudi regime in international affairs will require some of the grandsons to duke this out very publicly. Stay tuned.

Le toupet des Kurdes

If you were a Turk in an executive political position what would you do with a statement like this one:

The president of Iraq’s Kurdish region on Thursday rejected Ankara’s declaration that it was ready for dialogue with Iraqi Kurds provided they took measures against Turkish Kurd rebels holed up in the autonomous enclave.
“We do not accept the conditions laid down to deal with the PKK. We have always said that we would help Turkey if it chooses the path of dialogue and we confirm this,” Massoud Barzani told a news conference alongside Iraqi President Jalal Talabani, also a Kurd.

You know I wonder what Israelis were thinking when they started training Kurds and giving them military aid. Maybe they thought that selling weapons to Turkey on one side and to Kurds who just found themselves with the presidency of Iraq on the other, is something that could pay off eventually. Maybe they thought this would help the Americans… I mean what is the logic behind all these moves?
See, this is why I don’t believe much in grand conspiracy theories. People conspire don’t get me wrong, but people cannot accommodate for the desires/interests (depending on which terminology you want to use) of every ally.

Colonization continues

Do you know why there are constant Jewish settlements being built in the West Bank? Because these dudes find much more security and material comfort to live surrounded by ‘angry arabs’ then in the US:

Settlements near Jerusalem and Tel Aviv have become a suburban paradise for North American religious Jews. They offer large homes with yards, lawns and swimming pools, and prices are low compared with those of the cramped apartments not only of Israel’s main population centers but also of such smaller cities as Beit Shemesh and Modi’in.

In short, that’s how you buy ‘religious extremism’. And that’s how you provide a market for ‘religious extremism’. Just to echo with the discussion on ‘capitalism’ in the earlier comment section.

Security-wise, we can thank Abbas and co. who make sure these settlers get everything they need. No capitalistic structures without the provision of the number one public good: Monopoly over the means of coercion (By protecting the structures you create the market). No wonder how perceptions of the West Bank and Gaza are more and more ‘growing apart’. I remember this conversation I had with a colonel from Ramallah who told me that people in Gaza are from ‘another creed’: “they don’t think like us” he used to tell me.

And to add insult to injury, Fatah is busy asking from Israel the permission to get arms from other Arab states in order to neutralize Hamas.

So on the one hand, you have a mini-civil war in Palestine between those who have been won over by the colonizers cause and those who still try to resist, and on the other, you have a colonizer that makes sure that colonies are expanding and that constituencies of ‘colonizees’ are much better off living here than in their home town.

Colonization succeeds when it is effectively internalized. When West Bank and Gaza will be perceived as two different ‘countries’, then Israelis would have succeeded in their deepest ambitions. When people will think of themselves mostly through their projected differences, then exploitative structures are well entrenched.

“Like they massacred the army, I want to see the army massacre them,” added his friend, 21-year-old Moussa Youssef, sitting across from him. As for the thousands of civilians still in the camp, he added, “The innocent have already left.”