A tale of two Lebanons

(This article was originally published in An-Nahar on June 2, 2019)

I heard that one of my favorite restaurants is closing. I love that place, not because you can glimpse the who’s who in the country, but the food and service are great, and the charming manager reminds me of a bygone era.

I dress like I don’t belong there, so one waiter, Fouad, with whom I established familiarity, told me that when he saw me the first time, with my T-shirt, shorts, and backpack, whispered to his buddy, “This guy will end up doing dishes today.” Frankly, when I got the bill, I contemplated offering them my dishwashing services.

The manager, always dressed impeccably, and sporting trendy, quadrilateral-shaped glasses, like they were from the 1960’s, would always receive me with enthusiasm, despite my hopeless failure to meet her dress code standards.

One time, I was having lunch with my uncle Nasser, and we struck up a conversation with her.

“I’m a fan of your restaurant because your customers represent all the socioeconomic classes in Lebanon.”

She looked at me quizzingly.

“I mean it is frequented by the rich, the very rich, and the super rich.”

She burst out laughing and whispered, “That’s right, those two over there are super rich, ‘mitl afdalkon.’”

That’s when I corrected her, “No, ma’am. We’re the just the ‘mere’ rich.”

Another time I was having lunch with a friend of mine, Naaman, one of the most prominent Lebanese bankers. I ordered my usual gigantic côte de bœuf for two … for just me. Normally, the Chef cuts it up, making it look a civilized, but I always ask them to keep it intact — a huge, thick piece of meat, wrapped around a humongous bone, like a giant chicken drumstick. He, being vegetarian, ordered some lettuce with a couple of unidentified leaves, the contrast embarrassingly exposing my barbarous choice. So I fell to counterattack:

“Hey Naaman, do you realize that my order is an aphrodisiac?”

“What do you mean?”

“Well, when women see me eating something like this, it attracts them, because it brings out the old raw instincts from the stone-age days, when a powerful man would kill a mammoth or Ursus Spelaeus, and drag it back to the cave, eat a raw piece of meat, while grunting and holding it by the giant bone.”

“Don’t be ridiculous. You look like a caveman.”

And just as he said that, two stunning girls sitting next to us interrupt and ask me:

“Excuse me Monsieur, what kind of meat is that?”

“Côte de bœuf for two.”

“Wow. Will you eat that all alone?”

I turn to Naaman and wink with that ‘I rest my case’ look.” But despite the experiential sales pitch, he’s still vegetarian.

————————————————

So who is the clientele who frequent all the different expensive downtown restaurants? Let’s examine that market segment.

According to one of the most respected Swiss private banks (banks that specialize in high net-worth individuals), 3 per 1000 of Lebanon’s population are millionaires. That would be 13,500 millionaires. Unlike the stereotypical Lebanese definition, professionals define a millionaire as someone whose net worth is $1 million excluding their primary home. So if you live in a $10 million mansion and have $10,000 in cash, you’re not a millionaire. This may seem strange to the typical Lebanese, but from an economic perspective, if you haven’t sold your mansion and bought a smaller one, and upgraded your lifestyle, your effect on the economy is negligible (and you won’t be seen at the typical downtown restaurant). Thus, a large chunk of these 13,500 are the same group who alternates between the different expensive restaurants. Generally, you’ll recognize them because they’re always running into each other and you’ll see them exchange kisses and “Weinak mich mbayyan?” even though they just ran into each other in the restaurant next door the week before.

You could also validate this estimate by analyzing deposits in banks. According to BDL data, less than 1% of depositors own more than 52% of deposits; and 8% of depositors own 85% of deposits.

Based on MoF data, 60% of Lebanese makes less than $1000 per month and 82% make less than $3,333. That makes the middle class around 13%. You will sometimes run into these guys at the fancy restaurants, trying to play “keeping up with the Joneses.” You can’t really tell the difference from just looking, which one is the 0.3% and which one is the 13%. Both groups will wear the Rolex, Chanel bag, and Hermès belt. Texans call the latter “Big Hat, No Cattle.” There’s a subtle hint, though — they will recognize and kiss each other less often, because they don’t frequent the places as much as the 0.3%.

If you hang out exclusively in this world, watching sunsets at Iris or enjoying a show at Music Hall, you’ll be forgiven for believing the country is doing fine, because your economic analysis is derived from that personal experience. “What are you talking about? There’s a recession? Yesterday I couldn’t get a reservation at Latest Rooftop a week in advance.” The truth is that there are two Lebanons, Marie-Antoinette’s “They have no bread, let them eat brioche” Lebanon and Nadine Labaki’s Capernaum Lebanon. They both exist, simultaneously, but in parallel universes, and rarely shall the two interact meaningfully. Maybe when you’re valet parking or get to know your waiter better or stuck at a traffic light, full of panhandlers … or watching the movie Capernaum, nominated for a prize at the Cannes Film Festival. That nomination generated ambivalent feelings among most Lebanese — pride in Nadine’s (or our) nomination, but shame in not wanting to display our dirty underwear to the rest of the world.

If you make $6,666 per month, that puts you in the top 1.4% in the country; however, after school tuition of $20,000 per year, mortgage payments, car payments, two electricity bills, and a water bill, this is not sufficient for you to go to a fancy restaurant with a $200 bill, more than once or twice a month. Thus even if your income is at the edge of the top 1%, you’d barely be able to eek out a middle class existence.

In the old days, the 0.3% were fairly immune to downturns, because their income was generated from stable sources, like the Gulf, monopolies, and existing, inherited safe wealth; safe, but for the stupidity of the next generation blowing it on conspicuous consumption or dumb investments they got talked into by a smooth operator, lower on the pyramid — the economic Piranha of Lebanese society.

Today, only a third of the 0.3% fall into the category of stable wealth. The rest made their money through the bubbles, get rich quick schemes, artificially high interest rates, and other temporary phenomena, that today are unwinding, with much of their wealth tied up in illiquid real estate and very ominous and regular debt payments.

Maybe that’s why my favorite restaurant, which survived seemingly darker days, could be closing now.