Democratic Palestine : 27 (ص 38)
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- Democratic Palestine : 27 (ص 38)
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Lebanon
Political Deadlock Fuels Economic Crisis
The crash of the Lebanese pound, a series of strikes, and the mass
revolt against hunger in Beirut in late August, have brought the
economic and class aspect of the Lebanese crisis to the fore.
In August alone, prices rose 43.6%,
setting a new record in crisis-torn
Lebanon. The prices of many basic
consumer items were estimated to have
risen by 300% since the first of the
year. In the same space of time, the in-
flation rate reached 245%, also a
record high, leading Lebanon’s General
Labor confederation to predict an an-
nual inflation rate of 600-800%. The
Lebanese pound, once the most stable
currency in the Middle East, lost over
70% of its value, plunging as low as
£290 to the dollar, as of August 27th.
There were other more graphic
symptoms of the all-sided economic
crisis. Prompted by the fuel shortage,
lines began at bakeries and petrol sta-
tions before dawn, swelling into crowds
and fistfights as people scuffled to ob-
tain their daily needs. Even in villages,
merchants wouldn’t open their shops
until afternoon when the closing price
of the Lebanese pound was posted. In-
creasingly, children were seen picking
for food in piles of garbage.
With their buying power drastically
eroded, Lebanese citizens began
signalling their discontent. In July,
there was a three-day general strike to
protest the declining standard of living.
In mid-August, both the state radio and
television stopped broadcasting as
employees went on strike. There were
strikes by municipal workers in Tripoli,
Mina and Ghbeiri, and in _ several
private concerns. Then, on August 27th
and 28th, people poured into the streets
amid reports of pending abolishment of
state subsidies on gasoline. In West
Beirut, drivers stopped their services
(collective taxis, the most common
form of public transport in the city),
fearing their means of making a living
jn jeopardy. Stalled services blocked
main roads, as people marched on
Hamra, the affluent business and
shopping district. Hundreds tried to
storm the Central Bank, targeting its
failure to protect the Lebanese pound.
The Lebanese Army fired in the air, at-
38
tempting to disperse the crowds. Pro-
tests spread all over the city, including
the eastern sector, and continued
through the next day. Burning tires
blocked the road to the airport. Foreign
exchange booths, supermarkets and
luxury shops were overrun. While
establishment figures decried the
‘aimless violence’, the targets singled
out by the masses attest to their
awareness of the sources of their
economic woes - state policy (or lack of
same), uncontrolled private enterprise
and speculation - three elements which
are closely interwoven in the Lebanese
system.
HUMAN COSTS
Prices have continued to rise, pro-
pelled upward by the lifting of state
subsidies on two vital commodities,
gasoline and bread, in September and
October respectively. Meanwhile, the
pound continued its downward plunge,
hitting 500 to the dollar on October
30th. The human costs of the collapse
and concurrent dollarization of the
Lebanese economy are almost in-
calculable. According to the
Consumer’s Protection Department
(affiliated to the Economy Ministry),
the value of Lebanon’s minimum mon-
thly wage of £4,300 has dropped from
$50 in January to $16 in August. On
October Sth the acting finance minister,
Joseph Hashem (also Phalangist Party
member), announced a decision to
double the minimum wage, the first
such raise in Over a year. From that day
to the next, the pound’s value fell by
over $10, hitting a new record low
($306). As one Beiruti commented,
«Yesterday, the government announced
salary increases, today speculators
snatch it all back by devaluating the
pound.» Little over a week later, the
same ‘generous’ minister lifted sub-
sidies on bread, upping the price 47%
overnight.
While the poor have always suffered
from Lebanon’s §finance-oriented,
dependent capitalist system, the current
crisis 1s hitting well into the middle
class. A study published by the Na-
tional Union Federation on October
3rd, showed that the minimum monthly
expenses of an average family of five,
excluding clothes, rent and school fees,
had risen from £14,179 in October
1976, to £32,718. The report registered
the average salary as £10,000, raising
the simple question as to how a bread-
vinner feeds the family, even after the
subsequent wage hike. There is
moreover the severe problems of the
unemployed whose ranks are swelling.
As of two years ago, it was estimated
that 40% of the population had no
work. This number is constantly grow-
ing with company closures due to the
economic crisis.
The answer is simply that not all
families can feed their children.
UNICEF has estimated that about
1,000 children die of infection and
malnutrition every year in Lebanon.
According to Richard Reid, UNICEF
director for the Middle East and North
Africa, indications of rising infant
mortality and malnutrition surfaced in
Lebanon early this year. He estimates
that in the recent period, more children
may have died from lack of food than
from violence. In July, Lebanon’s
Islamic Orphanage reported that it had
received a record number of abandoned
infants (17) in the three preceding
months, some of them found in piles of
garbage, on roadsides or vacant lots.
Naturally, some are profitting from
the decline in the working masses’
standard of living. According to the
Chamber of Commerce and Industry,
Lebanon’s exports may rise more than
50% in dollar terms this year, following
the collapse of the pound. Since pro-
duction has decreased rather than in-
creased, this can only mean _ that
manufacturers and exporters are pro-
fitting from cheaper local labor due to
the pound’s reduced dollar value.
(Arab countries are now the main im-
porters of Lebanese goods, but the US
has recently emerged as a new market.)
VICIOUS CIRCLE OR
STRUCTURAL CRISIS?
The Lebanese economic crisis ap-
pears as an irresolvable vicious circle,
for each of its indices is interlocked
with a cluster of other factors. The fuel
crisis provides one example of how a - هو جزء من
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