Lebanese ‘Lollars’ – How American Currency Has Become The Face Of A Country’s Downfall

Lebanon, a country that once boasted its unmatched cuisine and elegance amongst other middle eastern nations, has become a scene of desperation and despair as their economy has entered a seemingly irreparable collapse. With COVID-19 concerns taking a back seat, the nation is seeing their standard of living dropping to a new, unbearable low and many of their freedoms disappearing daily. The worst of these, is losing power in the middle of a blistering summer, as the government rolls out power cuts nationwide to save scarce resources. What started as a small, occasional tactic for saving money and fuel has become a daily sufferance for the people, including hospitals that have experienced days of going without power for hours on end. Samira Hanna, a small grandmother in her 70’s, told Reuters that her apartment gets less than 2 hours of electricity a day as she, like many, cannot afford a generator to power her home. There is little she can do, saying, “I wait for the electricity to come on so I can wash clothes… and there’s nothing in the fridge, believe me.”

Though these restrictions were starting to happen even before the pandemic, the spread of the virus has only made conditions worse, and everyday essentials even harder to come by. It is not unusual these days to see the people bartering their nicer possessions for necessities, like giving up a new dress in exchange for laundry detergent and diapers. Less commonly, is the exchange of Lebanese liras for American dollars, which have become a nearly untouchable asset in their society. Dollars have been used interchangeably with the Lira for decades in the streets of Lebanon, with citizens being able to withdraw the foreign currency from the bank with little to no restrictions. Now, the exchange rate within these financial institutions has become shockingly steep and there are new withdrawal limits on the dollar that make the currency much more difficult to acquire. The lira, or pound, has lost nearly 90% of its value in the last few months compared to the dollar, though the price of everything around them has skyrocketed. Chef Antoine El Hajj, a celebrity television chef in Lebanon has seen the effects of this seep into his cooking shows, as he alters his recipes to include less meat ingredients and more substitutions that his audience can afford. Explaining the circumstances of their environment, he was quoted from NY Times revealing, “There used to be a middle class in Lebanon, but now the rich are the rich, the middle class has become poor and the poor have become destitute.” The people work as hard as they ever have, but with less and less compensation.

Some people have begun to trade their dollars and liras in secret, turning to risky back-alley meetups as a dire last resort. Many people are too afraid to participate in these illegal interactions for fear of the repercussions, and thus find themselves separated from the American dollar for the time being, hopefully not forever. These bills now sit in the banks unmoved and unused, and are being referred to as ‘Lollars’ (Lebanese Dollars) like a mythical object existing only behind bank walls. Outside those walls, CNN cited the World Bank as projecting that at least half of the country will become impoverished because of this tailspin.

In response, the people are beginning to grow restless in the street, protesters riling up against their government for their lack of action and mismanagement. Their anger spurs from the fact that their current position was initiated from an ill-conceived scheme amongst the country’s central banking system, luring investor banks in to bring deposits of dollars with high interest rates that could only ever be covered by the deposits of other investors. When the investors stopped coming, Lebanon found themselves unable to manage the costs, ensuring their spot as the third-most indebted country in the world. Recently, a local resident killed himself on one of the capital city Beirut’s most well-known boulevards, with a handwritten sign clearly blaming the crisis for his decision, leaving the people reeling.

In light of all this, the country’s finance ministry director Alain Bifani, who has served his government for 20 years, has stepped down from his chair. He appeared overcome with remorse and dissatisfaction with the state of things in a conference given last week from Beirut, quoted by Al Jazeera as confirming, “I decided to resign because I refuse to be a partner or a witness to what is happening.” As a member of his nation’s International Monetary Relief negotiation team, it is unclear where their government can go from here.

What is clear, is that Lebanon must stop trying to find a fix by ciphering off the top of what very little their people have left. What is done is done, and the seedy bank deals that tipped their economy over the edge cannot be taken back, but they can be erased and move forward with the help of the IMF or other national relief. Though an emergency loan from the IMF may not be enough to redeem the state now, and could likely also be misused, which could be part of the reason their discussions with Lebanon have currently been tabled.

Given that the American dollar is at the center of this catastrophe, the one thing these people want most, it only seems right that the US makes this a priority to get involved in, but not for this sole reason alone. We would all do well to remember that Lebanon is surrounded by dangerous forces, with Syria, Saudi Arabia, Iraq, and Iran all being close neighbors. If this country is not pulled from their brink of destruction, it could easily be overtaken by any of these nations and become a center of malcontent with the U.S. Any positive relationship we have built in the middle east is one we must foster and not let slip from under us.

Obviously, it would not make sense or be fair to our state to simply swoop in and save a country that condemned itself with thoughtless management. Therefore, though relief should soon be offered, it must come at a cost to their nation. Lebanon needs their government to be analyzed and restructured or possibly even turned into a dependent colony under another’s control. They would be losing most of their autonomy, until they are back on sound footing, but regaining peace of mind and financial security. There may be many other valid options a powerful country like ours or the UN could together consider, so long as the topic is no longer ignored.

Heidi Moura