One of Marx’s more interesting thoughts on capitalism concerns its ability to overcome its internal contradictions by engulfing them. One such contradiction can be simplified as such: the desire to hoard is contradicted by the need to recirculate, for to only hoard would otherwise lead to stagnation. That is why capital is constantly looking for new ways for recirculating itself: by creating new market niches, investing in infrastructure, expanding into new geographical areas, etc. By constantly expanding and increasing its productivity in these ways, capitalist incentives generate more capital which, in turn, searches for more release – thus creating a vicious dynamic of which capitalism is both prisoner and generator.
What does this have to do with anything? Apparently, the Ministry of Telecommunications auctioned “platinum” mobile phone numbers in order to fund itself. 13 of the 110 richest people in Lebanon paid a total of $2.5 million for 32 numbers. 70707070 sold for $450 thousand. Next were 70777777 and 70700000 which sold for $400 thousand each. Ridiculous sums by ridiculous people. Or are they?
Doubtless, to some of the buyers, like Wadih Kassab, a few hundred thousand dollars is peanuts. Money is made elsewhere. It is spent elsewhere. Lebanon is just for “recreation”, including throwing money around for show. But it seems to others, this is actually an investment. To sell to the Gulfites, according to Bilal Bundaqji, owner of Petit Café.
A handful of people in Lebanon are making (too much) money that needs to be recirculated and Lebanon is as good a place to do it as any. Given the instability, however, investments generating work for people and producing more capital that can then be reinvested in the country — a sound basis for some economies — are a risk. The real estate market, a classical area where capital recirculates itself, has reached stagnation point — too much to sell and not enough buying power. The Lebanese themselves can barely cough up enough cash to lead a decent life, let alone spend it on Zein al-Atat ($42 thousand for two numbers) products and Ramadan nights at Petit Café. There are Gulfites, on the other hand, with even more capital in need of recirculation and we have already offered them all the vacation apartments we can build, all the women we can sell, and all the intoxicants we can ferment. So, what to do? Why of course, buy ridiculously expensive mobile phone numbers and sell them for even more!
Thus a new market is created. Ingenious. And when you feel like venting, you know the numbers to call.
October 8, 2008 at 3:03 pm
Excellent post, but things are not much better in dar al-shaytan. I once got a 212 cell in NYC (you have better odds winning the lottery) and it was all my friends could talk about for six months and somehow evidence of my employment by the CIA.
I would also be interested in hearing what you think should be done about the cellular networks from a policy perspective rather than a ‘what a bunch of crooks’ pov. Ditto on electricity, and yes, I have some funny anecdotes on both to share.
Happy blogging … d
October 9, 2008 at 7:45 pm
If I were into policy perspectives, I would not be in academia, now would I?
Let me clarify something: this post is not about crooks (not all of them, at least). But I would be interested to hear what you have in mind concerning policy. And the anecdotes, of course.
October 10, 2008 at 7:17 pm
I was just talking about this last night with some friends. I know very little about electrical infrastructure or the business of telecommunications — except, of course, that I don’t like electrical cuts or exorbitant phone bills. As a result, it’s difficult for me to get past the “what a bunch of crooks” point of view when it comes to these more technical issues, as opposed to policy questions that are more purely political (if such a thing exists).
All that to say that if either of you guys come across some worthwhile literature on either of those subjects, blease, blease send it my way!
P.S. Ms Tee: David just put me on to your blog, and so far, I really like what I see. Are you in Lebanon or abroad?
October 10, 2008 at 7:57 pm
Thanks, Sean (and thanks to David for the publicity). Alas, I am not in Lebanon at the moment. I take it you are, given the power cuts.
If you read Arabic there is a good working paper on the electricity sector here. I will let you know if I run into something else.