Introduction to American Government and Politics

   In this blog post, I want to discuss Lebanon’s economic crisis and go into Lebanon history and how it became a country, and how its development over time led to the financial struggles it is in during these times. Lebanon is a Middle Eastern country that faced a civil war back in 1975 that lasted till 1990. That civil war began because of some growing tensions that different political parties were experiencing. These political parties have religion mixed with their usual motives and work depending on making the religions they encourage to be more dominant in the country. These religious tensions grew whenever some parts of Syria that was predominantly Muslim were added to Lebanon that was originally Christian. The Clash of religions and the different religions forced to live in the same land and these tensions kept growing over time. None of the two religious sides were addressing the growing conflicts and were rejecting each other and wanted to have a singular religion dominating Lebanon. Whilst those tensions were growing, in 1975, a Christian group by the name of the Phalange Party (more generally known as Kataeb Party) following the leadership of Pierre Gemayel took matter into their own hands and attacked a bus that was taking Palestinians to a refugee camp. This action triggered the Muslim parties to respond to the Christian parties in Lebanon and a civil war escalated after that event. After the events of the civil war, Lebanon went through a phase of Syrian occupation which was taken care of by blaming the Syrian of the assassination of an important political figure Rafik al Hariri. On the other hand, Israel was still present on the southern side of Lebanon and a short-term war went out between Hezbollah and the Israeli forces and led the Israeli forces to leave. From that moment on till today the financial debt has been continuously growing, it has been growing exponentially. Lebanon received foreign aid to be paid later on, a sort of loan that foreign countries gave to Lebanon on very positive and stress-free conditions that allowed Lebanon to grow from the mess the civil war had caused. Lebanon relies a lot on its tourism factor and since the days it was first established one of the big ways of income was tourism. After the civil war and spending their budget to reconstruct a broken-down country and at that point started to add up the national debt. Lebanon’s economy relies on families living abroad to send money into the country to help out with receiving fresh dollars.

     The Dollar, the problem that caused this entire country to get to a point of no return. Remittances started to slow down and that was mostly caused by the influence of the Shiite group, Hezbollah which was growing in power and taking control of more things in the country. The Gulf countries that are mainly Sunni Muslims stopped being so generous with their money and worked on slowly getting rid of these financial funds which started pushing Lebanon into a bad economic state. Riad Salameh the president of the national bank tried to implement more tactics to fight off this increasing debt and tried to do that through offering companies low interest rates to new businesses that needed the money to start up. This strategy didn’t achieve what it was supposed to and Lebanon kept going in a bad spiral. Then Lebanon reached a point that a new tax on WhatsApp was going to be implemented. These talks of implementing a new tax on the free service that WhatsApp provides started a movement with the groups living in poverty in Lebanon and a big riot started happening. The youth in Lebanon took this opportunity to show that it was time for a change. On the political side it’s been the same leaders in the same positions stealing from the countries money under the circumstances of using the country’s funds to construct something new. Lebanon was drowning in debt and the people sitting in power only robbed it even more and blamed all the other sides of politics as being corrupt. This goes back to the civil war and the consequences of it, leaders in power started using all forms of excuses to steal the country’s money under the context of using it to found projects that will help rebuild Lebanon back. Rafik al Hariri achieved his status of billionaire through robbing the country’s money when he was in power serving as the Prime Minister in Lebanon. It was stated that his wealth grew exponentially when he was in office and his wealth went from 1$ billion dollars to around 16$ billion dollars.

     These riots led to a faster economic crisis, that was going to happen later on. This economic crisis saw a lot of people losing their jobs, unable to provide for their families anymore and alongside this economic crisis Covid hit and made things much worse for the entire population of Lebanon. The effects of this economic crisis led the American Dollar to go from a value of 1507 Lebanese pounds to a peak value of 33000 Lebanese pounds in two years of time. The dollar’s value was multiplied by 22 times. This made everything extremely expensive for the middle and lower class. A big comparison between different social groups can be seen on how this dollar situation impacted them. The rich seemed to gather even more riches off of the increasing dollar value whether it was through working on the trading system between the LBP and the USD. They carried on the same habits they experienced previously before any of the problems started happening, still having more than the resources needed to live the luxurious life they were casually having. On the other hand, the poor were facing all the difficulties of this crisis. An average worker was previously making just enough to feed himself and keep them safe in a shelter but with this crisis lower class workers started experiencing a lot of difficulty making enough money to feed their families. With the value of the dollar increasing, bills started to cost a lot more, my parents had to pay around 2,000,000 LBP for electricity this past month and when I was back at high school senior year the electricity bill would peak at 150,000 to 200,00 LBP. There is a shortage in dollar in Lebanon because of the absence of it in the Lebanese economic market and the demand on it increases during different periods of times caused by global events such as a recent example being Russia invading Ukraine and as I’m writing this the dollar’s value is at around 22650 LBP (Lebanese pounds). This shortage of dollar is stopping mass importation of all forms of resources or items and causing everything to become expensive. There is a petrol crisis happening right now and the value of a gallon costs around 300,000 LBP which amounts to 13$. The economic crisis isn’t going anywhere and its crushing the middle class and slowly making it disappear. The minimum wage in Lebanon is around 600,000 LBP that used to be around 400$, but in current times taking the current value of the dollar it would be around 26.5$. What can 26.5$ do in an increasing economy that isn’t looking like it's stopping anytime soon. It doesn’t stop there, a lot of Lebanese citizens have lost their jobs because of the influx of millions of foreign workers competing with them and replacing them at a scary rate and sadly the Lebanese system as a whole doesn’t seem to create more opportunities to cover up or fix the unemployment rates.

     To begin the change that can possibly start helping everyone out is getting rid of the same political mindset and the people in power and getting some people able to take responsibility for the errors they have made and know how to fix them. It’s time for a change a better political team to take control of the country and lead it in the right direction. Political stability as well as functioning democracy always seem to impact a country in a positive light and make the people of that country more encouraged to develop their own nation, especially in rough times. Stopping all sorts of plans that don’t necessarily help and are simply exploits for these politicians to make more money. Stop the incredible amount of imports that don’t really help out most of the population in Lebanon and only is a luxurious way of living for the rich. Stop wasting money on new ideas for development and focus on enhancing what already is present in Lebanon and work on the different industries it has. Lebanon has a great agricultural industry, it has amazing soil and the population as a whole can benefit from the development of that sector and stopping any form of imports related to it. Set up systems that help out local businesses into branching so the population can buy things for cheaper then what they usually pay for and that money being spent go back into the economic system in Lebanon. This sort of system has been seen through Greece’s slow economic recovery and the results of that was higher costumer confidence that led to more money being spent internally. This same money being spent internally led to more creations of jobs which is something Lebanon is currently facing in a very high rate. Another approach Greece is taking to help their economy from the crash they experienced a few years back is having more demand on the labor side of things so they can enhance their productivity. Lebanon has a lot of resources they can benefit from but nobody in power wants to take advantage of it. Setting up news systems such as these labor-enhanced opportunities would create more jobs help productivity as a whole and help out the Lebanese production of becoming much more competitive with its foreign commercial relations. Lebanon has a lot of gas, petrol, agriculture, metals. There is a potential 25 trillion cubic feet of natural gas reserves. Works have been developing and something has been happening to improve on that side of things but Israel seems to be always opposing any form of search. In 2019, Lebanon spent 16.1 billion dollars on imports and exported ¼ of the number of imports, a value of 4.07 billion dollars. We’re talking about a country that’s 4,036 mi² with a population of 6.825 million and comparing to Alabama with an area of 52,419 mi² and a population of 4.903 million. Lebanon as a whole has an area 13 times smaller than Alabama, has 1.922 million more people in it, and has accumulated a national debt of 98.2 billion dollars.

     A failing economic system paired with corruption and controlling political groups have led Lebanon to a debt of 98.2 billion dollars in 2021. It requires a lot of things to be fixed, renewed, and adjusted but there is a generation striving to better Lebanon and get rid of its old and bad habits. It’s difficult having to experience these things especially when I’m in the US looking at how bad things are in the country I grew up in and the country that I call my home. The reason I had to move back to the US was because of the economic crisis and funny enough the dollar crisis made colleges in Lebanon more expensive than private colleges in the US. I feel like this should put into perspective how bad things are and how badly the country is doing. But hey being optimistic is the best thing to do and believing that a positive change will end up happening sooner or later.