For more than six years, Lebanon has lived through what would normally be considered an impossible experiment: a society operating with a hollowed-out state. Public institutions barely function, banks are frozen or irrelevant to daily life, courts are slow and selectively applied, and the government’s capacity to deliver even basic services is sharply constrained. Yet Lebanon has not ceased to exist. On the contrary, much of its society and economy has continued to function-often imperfectly, but sometimes surprisingly effectively-without meaningful state support. This reality forces an uncomfortable but necessary question: can Lebanon function better without a state, or at least without the kind of state it has known for decades?

At first glance, the idea seems absurd. Modern political theory treats the state as indispensable: the guarantor of law, economic stability, welfare, and national defense. But Lebanon’s experience challenges this assumption. Over the past decade, the Lebanese state has increasingly acted less as a protector of society and more as a liability. Its economic mismanagement, corruption, and capture by political factions were central causes of the financial collapse that began in 2019. The state accumulated unsustainable debt, drained public resources, and refused to acknowledge responsibility even as the banking system imploded and living standards collapsed.

What followed was not a planned withdrawal of the state but its de facto disappearance. The financial crisis, the COVID-19 pandemic, the catastrophic Beirut port explosion in 2020, and the consequences of war and regional instability were all confronted largely without state leadership. Civil society organizations, religious institutions, private companies, family networks, and the diaspora filled gaps left by a paralyzed government. This was survival by necessity, not ideology-but it revealed something important about Lebanese society’s underlying resilience.

Now, paradoxically, the state is attempting to reassert itself in ways that risk deepening the damage. Proposed financial gap laws aim to address the losses of the banking system by placing much of the burden on banks and depositors. In theory, the goal is to rebuild the state and preserve public assets. In practice, this approach punishes those who survived the collapse-businesses, professionals, and families who kept economic activity alive-and risks finishing off what remains of Lebanon’s productive economy. Rebuilding a predatory state on the ruins of a functioning society is a recipe for further decline.

One of the clearest indicators of how Lebanon adapted is trade. In the last year alone, the country imported around $17 billion worth of goods without relying on letters of credit from local banks-once the backbone of Lebanese commerce. Informal financial networks, foreign accounts, and private arrangements replaced a collapsed formal system. In parallel, legal disputes increasingly moved away from state courts toward arbitration and private mediation, reflecting both the inefficiency of the judiciary and society’s search for workable alternatives.

Social services tell a similar story. Education, healthcare, and support for the poor have long been delivered primarily by private, religious, and civil society institutions. Even before the collapse, the state played a secondary role in these sectors. After 2019, its role shrank further. Schools, hospitals, charities, and NGOs-often funded by the diaspora-became the backbone of social stability. In many cases, state institutions only functioned at all when cooperating with these non-state actors.

This pattern did not emerge overnight. For years, Lebanese businesses adapted by separating their operations: productive activity and markets abroad, legal presence and families at home. After the crisis, even banking moved offshore. Families stayed in Lebanon to benefit from relatively high-quality private education and healthcare, enjoying a decent quality of life as long as the state did not interfere too much. Now, however, as insecurity and uncertainty persist, even families are leaving. The greatest structural damage was not caused by the absence of the state, but by its capture-most notably through Hezbollah’s influence over key institutions, which contributed to isolation, sanctions, and eventual bankruptcy.

The structure of public spending before the collapse further exposes the problem. Nearly 68 percent of public sector salaries went to the army and security services. Public education accounted for another 17.5 percent in a country where up to 80 percent of education is nongovernmental. Only 13.5 percent of salaries covered the rest of the public administration. This imbalance created a bloated, unproductive system that functioned less as an engine of governance and more as a disguised welfare scheme. Meanwhile, massive losses came from energy subsidies, corruption, debt servicing, and the hidden costs of conflict and political paralysis.

A persistent fallacy in public debate is the claim that depositors represent only a privileged minority-perhaps 20 percent of the population-and that compensating them would unjustly burden the remaining 80 percent. This framing is misleading. The collapse harmed everyone. Inflation destroyed wages, savings vanished, public services deteriorated, and job opportunities disappeared. Reviving the economy by restoring trust in the financial system would benefit society as a whole, including those without bank accounts who depend on private-sector employment and remittances.

An even more corrosive fallacy is the idea of collectively suspecting depositors of corruption. By implying widespread wrongdoing, the state undermines trust in the very financial institutions it claims to regulate. Instead of rebuilding confidence, it accuses society itself, deepening cynicism and encouraging capital flight.

Ironically, Lebanon’s suffering may give it a historical advantage. Across the world, the post–Second World War welfare state is under strain. Expanding public obligations funded by debt and taxation are proving unsustainable. European governments struggle to roll back spending, often denying the depth of the crisis. The results-rising debt, inflation, and currency erosion-mirror Lebanon’s experience, albeit on a slower timeline.

In 2013, the Dutch king publicly acknowledged that the welfare state was no longer viable, calling for renewed reliance on families, communities, charities, and local institutions. This echoed older traditions of mutual aid, professional associations, and religious organizations-structures that Lebanon never fully abandoned. While many states replaced these systems with centralized bureaucracies, Lebanon’s weak state left space for them to survive.

The modern state was often built on pessimistic assumptions about human nature: that people are inherently selfish and require domination to prevent exploitation. By contrast, anarchist and communitarian theories assume a capacity for cooperation, empathy, and voluntary solidarity. Lebanon’s last six years suggest that, under pressure, society can indeed self-organize. Neighborhoods helped each other, NGOs delivered aid, doctors and teachers stayed despite collapsing incomes, and the diaspora mobilized resources at remarkable scale.

This does not mean Lebanon needs no state at all. A functioning legal framework, basic security, and fair regulation remain essential. But Lebanon has demonstrated that it can survive-and sometimes function better-without a predatory, captured, and extractive state. The lesson is not to abolish the state, but to radically rethink it.

If Lebanon is to have a future, it must build a state that serves society rather than feeds on it: smaller, accountable, focused on justice and infrastructure rather than control and patronage. Until then, the past six years have shown a sobering truth. If the choice is between a predatory state and no state at all, Lebanese society has already learned how to survive without the former.

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