The state is the cohesive factor in a social formation. But what happens to the social formation where the state disintegrates? This is not a mere polemical question if we consider the Lebanese experience.
This article looks at one community, the Shouf districts of Mount Lebanon, predominantly inhabited by the Druze since 1983. Over more than a decade of civil war and state disintegration, the relationship of this peripheral community to the country’s economic and political center in Beirut has altered considerably, with consequences for social class formation in the Shouf. The civil war brought to an end a phase in Lebanon’s socioeconomic and political development that had begun in the 1860s. That was when a new class of entrepreneurs and agro-businessmen, the majority of them Christians, emerged. Tightly allied with foreign capital, primarily French, they worked together to build industrial and export-import businesses. The emergence of this class was accompanied by the development of Beirut as the main center of economic and political activity. The remaining areas of Lebanon provided food products and cheap labor for the center, and an important market for imported goods.
The predominantly Druze districts of Shouf, Aley and southern Matn were part of this “periphery” to Beirut’s “center,” producing simple commodities and providing workers to the service sectors. With the outbreak of the first phase of the civil war, the Druze started building their own production bases. Since 1983, these areas have been virtually outside the control of the central government, and ruled by the Progressive Socialist Party (PSP).
The Druze of Mount Lebanon represent a community in transition from a subsistence agricultural economy to a capitalist economy largely based on services; people gradually moved away from agriculture as their incomes were not enough for their subsistence. By the 1970s, the income yielded from agriculture constituted about 31 percent of the total income of Mount Lebanon (including Maronite) inhabitants. The remaining 69 percent came primarily from non-productive service sectors. A major source was the remittances of those working abroad, particularly in the Arabian Peninsula.
Class stratification of the Druze community mainly involves three broad social groups: 1) the class of large entrepreneurs, including the industrial and agrarian elite; 2) the petit bourgeoisie, which includes artisanal producers, le menu peuple (or peddlers and other informal sector workers), household farmers and cash-crop farmers; and 3) wage laborers (industrial and agrarian).
The Druze entrepreneurs are a relatively recent addition to the old, established class of Lebanese entrepreneurs. Of the 207 large businesses owned by Lebanese entrepreneurs in the late 1950s, only three were owned by Druze businessmen.  Beginning in the late 1950s and early 1960s, the Druze emigrants — mainly to Africa and Latin America — returned to Lebanon with enough capital to start businesses. One Druze family, for example, opened an affiliate of Pepsi Cola in 1951, and in 1956 established the Bank of Beirut and Arab Countries. Another family that accumulated wealth in Africa established an exclusive dealership for American and later Japanese cars.
Investment of the Druze bourgeoisie in the industrial sector remained limited. A 1971 study of Lebanese industrial firms found that Druze businessmen are mainly traders engaged in non-risk ventures. Out of 20 Druze businessmen with a capital of 20 million Lebanese pounds or more: 1) Five had inherited large land tracts; 2) Most had invested their capital in services: five in hotels, seven in contracting, five in banks and three in export-oriented industries; and 3) Fifteen had accumulated their capital outside Lebanon, primarily in Africa, Latin America and Arab Gulf states. 
The economic ascendancy of the Druze entrepreneurs was not matched by an equivalent political role, either within their communities or in the Lebanese confessional system at large. The traditional, land-based Arslan clan represented the Druze in the political system. The Druze economic elite, though mostly non-feudal in origin, felt that the anti-reform political line of the Arslans was consistent with its political interests. Kamal Jumblatt, founder and leader of the Progressive Socialist Party until his assassination in March 1977, was seen as a threat to this group’s economic and political interests.
The composition of the political elite changed in the 1982-1987 period due to several factors. First, in 1983 Majid Arslan, the za‘im of the Arslan faction, died without leaving a strong successor. Second, the Druze community increasingly pressured its economic elite to play a more supportive role in a situation of high sectarian tensions, especially in the wake of the 1982 Israeli invasion. Third, Walid Jumblatt, son of Kamal Jumblatt and the current PSP leader, adopted a more conciliatory political line and tried to persuade the Druze economic elite to contribute more to the PSP effort to defend the Druze community.
PSP officials say the major Druze entrepreneurs have become more supportive of the party, but less so than expected.  Some investments have been made in the ports of Jiyya and Khalda, opened after 1983 to import commodities such as fuel, food products and weapons. These ports are administered by a shareholding company in which some non-Druze have invested capital. Approximately 51 percent of the capital has been provided by the PSP.
The external origin of much of the accumulated wealth of the Druze economic elite distanced this class from the internal Lebanese capital accumulation processes, thus weakening its economic role and probably also undermining its political role. Lack of class solidarity and class consciousness partially explains this elite’s failure to form its own political party and to distinguish itself politically from the PSP. The Arslan faction, lacking political organization, could not fill this role.
In contrast, the Maronite economic elite succeeded in transcending its class interest through the Kata’ib (Phalange) Party.  The Amal movement, founded in 1974, became the political vehicle through which the growing Shi‘i economic elite, which also accumulated its wealth outside Lebanon, pressed for more political representation.  The PSP, however, is more committed to a secular social reformist program that does not specifically advance the interests of the Druze economic elite.
One important development in Mount Lebanon is the emergence of an industrial elite in the years since the outbreak of the civil war. More than 100 industrial firms were established in an area where industry was almost non-existent beyond artisanal workshops (employing five or less workers). Data is unavailable regarding the volume of capital invested. For this reason, we consider owners of firms employing more than 25 workers comprising the industrial elite. Twenty-nine firms are found in this category, employing about 1,900 workers, or about 47 percent of the industrial working class in these areas. 
There is, in addition, an increasing number of small industrial firms concentrated in construction, food processing and textiles. These three industries accounted for more than 81 percent of the industrial firms in Mount Lebanon in 1987, and employed about 80 percent of the work force.  This specialization in certain light industries resembles that of the Lebanese economy as a whole. In a 1970 survey, food processing, textiles and construction material constituted about 65-70 percent of the general Lebanese industrial output and employed about 58 percent of the Lebanese work force.  This structural imbalance in the sectoral distribution of industries takes place in the absence of any protective measures on imported goods such as tariffs. So far, the PSP, which controls the two ports of Jiyya and Khalda, had made no efforts to introduce any such measures.
The Petit Bourgeoisie
The petit bourgeoisie — independent artisans, small shopkeepers, small-scale producers and le menu peuple — is by far the largest class in the Druze community, largely shaped by the conditions of economic transition between simple commodity production and capitalist production.  As in the rest of Lebanon, the petit bourgeoisie is both traditional and modern: traditional in that many are still engaged in simple commodity production, either in artisanal shops or in subsistence household farming; modern in that some segments include professionals, clerks, salaried employees and managers.
The traditional-modern classification should be seen as a continuum rather than as a rigid separation in the ranks of the petit bourgeoisie class. In the majority of instances, individuals could be occupying both positions at the same time. A bank employee may also be a member of a subsistence household farm where he shares in working the land. The only category thoroughly consistent with the capitalist mode of production is the cash-crop farmers’ stratum.
The stratum of menu people is the most impoverished within the petit bourgeois class. They usually hold more than one job at a time (a characteristic shared with other petit bourgeois strata), but they are less fortunate in terms of income. The class origin of this stratum is household farming. Because the process of economic transition in Mount Lebanon is incomplete, this stratum is still situated between subsistence agriculture and capitalist production. Since 1975, these people increasingly depend for their livelihood on the war economy created by the militias. A very thin segment of this stratum succeeded in achieving upward class mobility by levying taxes on local entrepreneurs and by other means, becoming a new addition to the Lebanese dominant classes. This class segment crosscuts sectarian boundaries with its real estate speculations and investments in import-export and service-related businesses.
Le menu peuple, including taxi drivers, militiamen, peddlers, butchers and builders, tend to be individualistic, competing with one another for work, customers and patrons. Politics involves wheeling and dealing, with personal ambitions prevailing over class solidarity.  In comparison with the salaried employee strata, menu people tend to be less educated and lack vocational or professional training. They get the lowest share of the income distribution, are less secure economically (no guaranteed paycheck at the end of the week or month) and are more independent in their jobs (minimal labor relations, like peasants).
More than 50 percent of the Druze working population of Mount Lebanon are members of this stratum.  Le menu peuple have proven to be most supportive of the PSP, as indicated by the rank-and-file composition of the party and its standing army. They are attracted to the PSP not solely by ideological, political or sectarian factors, but also by economic ones. With its standing army and civil administration, the PSP currently employs at least 15,000 to 16,000 persons — it is the largest single employer in these areas.  A plumber or a taxi driver could be employed in one of the PSP offices or recruited in one army and at the same time practice his profession in his spare time. One example of this phenomenon is provided by the Office of the Secretary-General of the PSP. In the summer of 1987, at least 15 employees worked in that office, ten of whom had other jobs after hours. Party officials confirmed that holding two jobs is typical of most of the party’s rank and file. 
Household farming and simple commodity production constitute the core of agricultural production, but the economic returns of household farming are also supplemented by agricultural or artisanal wage labor, service-related jobs such as taxi driving, or joining the PSP’s standing army or bureaucracy. These three sources of supplemental income help maintain the traditional organization of peasant communities which is functional for the dependent Lebanese economy. It provides a pool of cheap labor while at the same time retaining a subsistence base that offers security in times of crisis. 
Capitalist development in the village economies had transformed large numbers of peasants into workers, service sector employees and le menu peuple. But in 1975 the economy reached saturation level, as reflected by the 15 to 20 percent rate of unemployment.  The civil war (1975-1976) and the subsequent destruction of most of the country’s industrial base and important segments of the service sector (hotels and restaurants, especially in Beirut) slowed down the process of transformation still further.  The 1982 Israeli invasion and the subsequent deterioration of the Lebanese economy regenerated household farming and probably increased its economic importance for the Druze community. The PSP estimates that by 1987 about 10,000 families relied on household farming as a main source of income.
In contrast with household farming, cash crop farming is directly linked with urban capital and international markets. Prior to 1975, about 75 percent of cash crop plantations were geared to foreign markets, primarily Arab countries.  Cash crop plantations seem to be concentrated in the Matn district rather than the Shouf or Aley. On the other hand, capitalist penetration in the form of services took place primarily in Aley in the pre-1975 period. Most of this sector has been destroyed since 1975, while cash crop farming has suffered from the decreasing profits and increased exploitation by middlemen during the 1982-1987 period, and from competition by Israeli products.
Stagnating cash crop production and the general economic plight have reduced the importance of this sector, not only in Mount Lebanon. Another factor is the loss of the Arab markets, especially Iraq, Saudi Arabia and Kuwait, to cheaper and superior European and US agricultural products.
The PSP has not devised a policy to halt the decline in cash crop farming, although the party has invested in a large profitable banana plantation in Damour, a non-cooperative, profit-oriented operation based on wage labor. The extent of this experiment’s influence on PSP policies towards cash crop farming remains to be seen.
Capital-intensive agriculture, based on wage labor, had not been implemented widely in Mount Lebanon for two main reasons: the difficulty of using modern machinery on mountain terrain, and the highest fragmentation of land holdings in Lebanon. About 88 percent of the large ownerships are less than half a hectare.  Some Lebanese families in the Upper Shouf, though, have accumulated land holdings of more than 250 hectares in the last few years. Capital extensive farming, a new phenomenon in the Shouf, emerged as new landowners, having accumulated their wealth in investments in the Arab states of the Gulf, felt the heat of the growing crisis there and thought that investments in the Shouf could prove a less risky alternative.
Four thousand of the estimated 7,000 Druze laborers work in industries; the remainder work in agriculture. About 57 percent of all industrial workers work in firms employing 25 or fewer laborers. About 2,000 of the agricultural laborers work in PSP-administered plantations in the Damour field and in some adjacent villages; because they are seasonal workers they are also engaged in other economic activities to support themselves. 
Before the 1975 civil war, most agricultural workers were Syrians and Palestinians. In the 1980s, agricultural workers have been mostly local Druze and Sunni from the Shouf. Industrial workers are also drawn from the local population. This stratum, which emerged after 1975, did not undergo a drastic change in its sectarian or national composition.
The development of wage labor is a byproduct of the center-periphery restructuring process. Mount Lebanon, once integrated into the world economy through the commodity production of raw silk for French factories, shifted in the twentieth century to provide cheap labor to local urban centers, especially Beirut. After the 1975-1976 civil war devastated most of the industrial centers of Shiyah, Tal Za‘atar and Hadath (in Beirut and its suburbs), both capital and labor sought refuge in safer areas. Consequently, workers moved from urban areas back to their villages to escape sectarian strife. Druze workers moved back to Druze areas, a process which accelerated in the aftermath of the 1982 Israeli invasion, and particularly after the sectarian confrontation in 1985 and 1987 between the Shi‘i Amal movement and the predominantly Druze PSP for control of the Western quarters of Beirut.
The most remarkable outcome of this process has been the development of nascent industry, but industry that suffers from sectoral imbalance and the predominance of light industry. Other important local outcomes of the economic restructuring are: first, the return to household farming as a supplementary source of income under the pressures of the economic crisis and the growth of the service sector as indicated by the increasing numbers of restaurants, hotels and casinos.
The economic policies of the Progressive Socialist Party, the de facto political authority in the area, emphasize the development of the service sector. Mount Lebanon, as a result of its relative independence from Beirut, is following a process similar to the one pursued by the center in the preceding period. If this process continues, the evolving center in Mount Lebanon will likely create another set of peripheral areas within and around it. Most of the capital invested in Mount Lebanon is centered in the Shouf mountains, and is not evenly distributed in surrounding areas.
Class formation in the Shouf areas had been largely influenced by two interrelated factors: the general condition of Lebanese dependency on the metropolis, and the path of development which emulated the center’s experience. Thus class formation in Mount Lebanon largely parallels that of the center, and illustrates the capabilities of the dominant classes to establish replicas of the center in peripheral areas, maintaining a capitalist socioeconomic order and its class relations even after the collapse of the state.
 Yusif Sayigh, Entrepreneurs of Lebanon (Cambridge, MA: Harvard University Press, 1962), p. 70.
 Personal interview with PSP politburo member Fu’ad Salman, summer 1986.
 John Entelis, Pluralism and Party Transformation in Lebanon: Al Kataib, 1936-1970 (Leiden: E. J. Brill, 1974), pp. 108-113.
 Augustus Richard Norton, Amal and the Shia (Austin, TX: University of Texas Press, 1987), p. 59.
 Tajammu‘ Sina‘iyyin al-Jabal, unpublished records.
 Claude Debar and Salim Nasr, Al-Tabaqat al-Ijtima‘iyya fi Lubnan (Beirut: Arab Research Institute, 1982), p. 95.
 The petit bourgeoisie in transitional societies characterized by overlapping modes of production is different from the petit bourgeoisie in countries where the capitalist mode of production is the predominant one. The main difference lies in control of physical means of production and control of investments and resources. See Erik Olin Wright, Class, Crisis and the State (London: Verso, 1979), pp. 79-91.
 Michael Johnson, Class and Client in Beirut (London: Ithaca Press, 1986), p. 38-40.
 This is a rough estimate based mainly on the accounts of PSP officials and local civil administration personnel interviewed.
 This situation should be seen in the general context of a severe economic crisis: By 1987, the US dollar was worth 500 Lebanese pounds (as opposed to 5 in 1982), inflation was rampant (about 200 percent) and unemployment affected roughly one fourth to one third of the working age population. Samir Makdisi, Political Conflict and Economic Performance in Lebanon, 1975-1986 (Washington: Center for Contemporary Arab Studies, 1987), p. 5.
 Interview with PSP politburo member and party treasurer Na‘im Ghanam, summer 1987.
 A case of dependent capitalist development exhibiting similar characteristics is that of peasants in central Peru, where traditional subsistence farming is largely preserved and integrated into the capitalist market economy. This traditional type of farming is reinforced in times of economic recession. See Norman Long and Bryan Roberts, Peasant Cooperation and Capitalist Expansion in Central Peru (Austin, TX: University of Texas Press, 1978), pp. 297-324.
 Jack Couland, “Al-Mujtama‘ al-Lubnani,” al-Tariq (June 1986), p. 73; Johnson, op cit., p. 32.
 Makdisi, op cit., p. 5.
 Ahmad Baalbaki and Farajallah Mahfouz, Al-Qita‘ al-Zira‘i fi Lubnan (The Agricultural Sector in Lebanon) (Beirut: Dar al-Farabi, 1985), p. 11.
 Interview with agricultural engineer, summer 1987.
 Interview with Na‘im Ghanam.