Adonis Diaries

Posts Tagged ‘Saudi Arabia absolute Wahhabi monarchy

How Neoliberal expatriate Contractor Class is managing the contracted national debt in Lebanon?

How neoliberalism is applied in your country?

Neoliberalism is not a difficult concept to comprehand: Just observe its applications and consequences on your survival instinct.

The best way to understand neolibralism in the western developed nations is to witness how developing States are applying it.

Particularly, new small States recognized in the UN that were under direct mandated powers for many decades, and now are appeasing their former “masters” in order to enrich the oligarchy ruling class these under-developped “nations” are sustaining.

How neoliberalism is applied in Lebanon?

Together with the governor of the Central Bank and the Prime Minister, the minister of Finance is a crucial player in the management of government debt.

From 1992, late Rafik Hariri PM, and later the Hariri clan hoarded the control of these three institutions.

The policy adopted in 1993 pegged the Lebanese currency to the US dollar. What that means?

The State borrows on behalf of the government large sums of loans that are not needed to finance the deficit.

The borrowing mechanism is basically a political decision to get the State tightly linked to outside multinational financial institutions… Institutions that the ruling class has invested in and wants to generate quick profit in this globalization era… at the expense of the people they claim to work for their benefit…

This scheme drove up the demand for the Lebanese currency, raised the interest rates on government debt, and high interest returns for depositors (reaching 30% at determined periods as the Future Movement spread the words among its elite class to deposit) and the new expatriate Contractor wealthy class of billionnaires…

Leading the country into a dept trap.

A debt ever increasing ($60 bn) and absorbing a third of the government budget, every year since 1992.

Servicing the interest of the debt has one purpose: Keeping the new neoliberal Contractors class in control of the management of the financial and economic institutions.

The main benefiaciaries were commercial banks and their wealthy depositors: Lebanon financial and economic elite classes (new expatriate contractors, warlords, oligarchic politicians…) have the necessary savings to invest in government debt instruments.

The notion of neoliberalism is that, as long as the government maintains the confidence of the elite classes in the soundness of the financial policy, the situation can remain in control, precariously in control, and relying mainly on foreign support for the policy.

The IMF working paper from 2008 mentions that the continuous rollover of Lebanon debt depends on an “implicit guarantor” from donors and international financial institutions.

And who is the main donor guarantor? It is Saudi Arabia absolute wahhabi monarchy.

This Saudi Kingdom

1.  Bought up Lebanon government bonds when investors refused to buy the bonds

2. It provided the largest chunk of concessionary loans at Paris 2 donor conference in 2002, and Paris 3 in 2007

3. It transfered One $bn to the central bank during Israel preemptive war in June 2006.

Consequently, the governor of the central bank, PM and finance minister must satisfy Saudi Arabia confidence!

The Hariri clan main objective was to deepen neoliberal economic “reforms”.

Former Fouad Seniora PM reiterated the neoliberal program, including privatization of State-controlled entities, welfare “reforms“, politically aimed at curtailing patronage opportunities of political rivals to the Future Movement…

However, Seniora could not pull off his wishes of abolishing the Council of the South (a Box of money controlled by Parliament chairman and worlord Nabih Berri) or the Central Fund for the Displaced “sandouk al mouhajjareen” (controlled by the Druze warlord Walid Jumblatt)

For over two decades, the Hariri clan attached a dozen public institutions to the Prime Minister, controlled the municipality of Beirut, extendit building permits to its elites and the foreign investors and dropping any resistrictions when convenient, assigning public contracts to the “Future Elite contractors” and entrepreneurs at manyfold the proper cost, extending their hold on Solidere for 75 years, never accounting for the bids on Sukleen which collect waste in Beirut at $100 per ton while costing $30 in Zahle for example…

The current “national debt” has skyrocketed to reach $70 bn, even after 2 decades of paying high interest rates. In addition to funding the warlord “reconstruction chests”, part of the loans were used to paying the tribute to the Syrian oligarchy, since lebanon was under Syria mandated power till 2005.

Mind you that Syria, after 2001, began a neoliberal policy for its oligarchic elite class, and privatizing new public institutions such as the mobile telecommunication and oil extraction and grandiose Real Estates development in Aleppo, Homs and Damascus…

Note 1: The oil boom increased the number of Lebanese workers in the Arab Gulf Emirates and Saudi Arabia within a decade from just 50,000 in 1970 to well over 210,000 in 1980, or one third of Lebanon work force.

Note 2: Post inspired from two chapters written by Fabrice Balanche and Hannes Baumann in the book “Lebanon after the Cedar Revolution

Note 3: A wealthy international neoliberal club requires from its members to extract profit from their own country, as a proof of allegiance to global neoliberalism, in order to facilitate the infusion of unwarrented loans to their corresponding State.

Have you witnessed that almost all current prime ministers, finance ministers and governors of central banks in Europe, the USA and many other countries were “employees” at the IMF, the World Bank , World Commerce institutions and international financial corporations?

Note 4: Basically, the expatriate billionnaire contractors initially got the blessing of the former civil war warlords (Nabih Berri, Walid Jumblatt, Samir Jagea… supported by Syria, Saudi Arabia and the US neoliberal financial institutions) who were brought back to power, and then managed their financial porfolio and financed the election campaigns as political allies…

What’s going on in Lebanon? In the prison of Roumieh?

There is this prison in Lebanon, close to the town called Roumieh.  The prisoners set fire in the 4 buildings and closed accesses to the prison.  This prison is holding 4,000 incarcerated people, in all categories from minor citizens (under 17 of age), minor thefts and car accidents…, political prisoners, foreign maids not able to pay their flight back home, …

One prisoner (26 year-old) did not live because he was repeatedly refused treatment for his diabetes:  He was in prison for two months and was to stay 6 months for traffic incident as his family was unable to collect $10,000.

Every week, Lebanon witness a dozen of road kills (people) and the cases are settled out of court. This prison in Roumieh was designed to host one thousand inmates in the 70’s and no other prisons were planned to be constructed.

Every couple of months, the prisoners in Roumieh revolt in order to have better living conditions, and the State crack down and promises improvement… This time around, the families of the prisoners demonstrated on mass for 3 days in front of the prison and the Justice Palace.  The families closed main roads throughout Lebanon demanding information on the situation and conditions of their family members.

There are plenty of evidence that the prison officers have established a lucrative racket, selling cellular phones, cocaine, heroin, and all kinds of drugs…These facts were widely known and the supposed government promised to investigate and nothing was revealed or done or reformed.

Lebanon has never had a government worth calling a government:  Most of the time, the government is in “running affairs” condition because a designated Prime Minister takes his time forming another stupid government, say four months on average, and ending up with virtual governments that are too weak to govern, plan, and execute any kinds of reforms.

The real power in Lebanon is in the hand of the clerics of 18 recognized religious sects.

The current rioting that generated 3 deaths so far, and unknown number of injuries, is the consequence of two decades of negligence and malpractice in the field of correctional services.

Prisoners are held in cells with up to 15 fellow inmates with no medical treatment.  The justice system has been crippled for over 4 decades, since the civil war that started in 1975, and no new judges have been appointed for many years.

Many prisoners in the overcrowded jail have been waiting up to 5 years for their case to be heard over common law matters such as theft, faked signature…Many have died in prison before and during the riots.

The trouble stems from 3 main problems:

First, lack of funding from the Finance Ministry, which was under the control of the late Rafic Hariri PM, and who ruled from 1992 to 2005.  The Finance Ministry is still in the hand of Saad Hariri, son of Rafic:  an oligarchic Future Movement political party succession story.  In this period, Lebanon witnessed institutionalized corruption, and saw its public debt balloon to $60 billion. An estimated $11 billion is currently unaccounted for under his government.  Such funding could have been diverted to pay for the construction of jails in both North and South Lebanon as proposed by the Change and Reform Bloc in Lebanon’s parliament.

The second problem is the immersion of politics in all facets of the judiciary system:  For example he political appointment of Said Mirza (an ally of Hariri) as Lebanon’s Chief Prosecutor.  Mirza is deeply involved in the highly politicized Special Tribunal for Lebanon, investigating the assassination of Rafic Hariri.

This involvement has diverted attention away from reforming Lebanon’s legal system, which is struggling to deal with the backlog of court cases and the subversion of justice in the court and prison systems.

The third hurdle is the conduct of Lebanon Internal Security Forces (ISF) and its General Director, Brigadier Ashraf Rifi, another close ally of Lebanon’s “care taker” Prime Minister Saadedine Hariri.  The ISF was responsible for arbitrary arrests and human rights abuse during the Syrian occupation of Lebanon under Rafic Hariri, and continues to operate in the same manner today.

The treatment in Roumieh prison of Al Qaeda political prisoners,  inspired terrorist groups such as Fateh Islam (that waged a brutal war with the Lebanese Army in 2007), is deemed luxurious compared to other inmates as these groups are believed to have links to the Future Movement political figures and Saudi Arabia absolute Wahhabi monarchy.

The “care taker” Interior Minister Ziad Baroud, a young and dedicated lawyer, as well as a consensus appointment among Lebanon’s different factions and counted as the President of the Republic protegee, has been unable to implement any reforms or reign in the actions of his subordinate, Brigadier Ashraf Rifi.

For 75 days, Lebanon has no government, the parliament does not meet, and the wrath of the Arab masses are engulfing the regions with positive uncertainties, except in Lebanon, the bastion of conservatism in governance.




June 2023

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