Once upon a time, a little frog tried to compete with an enormous ox. It blew and blew and blew and swelled itself until it burst. The moral of the story, which is one of Aesop’s Fables, is a warning against greed or overindulgence. It suggests that pushing things beyond their limits can have catastrophic consequences. Every government or corporation, bloated by bureaucracy, needs to keep that dramatic image in mind.

The Lebanese government of Prime Minister Nawaf Salam faces enormous challenges, the least obvious of which is balancing its own role and share of the economy versus that of the private sector. Such restraint may be too much to expect, as it is not the way politicians work; their instinct is to expand their function. Much more wisdom and vision are needed to keep the size of government down.

It is easy for a government to succumb to the temptation of a bigger role after a destructive war and when government spending is much-needed. This is what happened in Europe after the Second World War: politicians got addicted to spending and could not give up the habit. Even while trying, they end up spending and borrowing more. The world’s worst-kept secret is that the global debt accumulated over the last 70 years will never be repaid, unless more is borrowed to repay it. It is obvious that the global economy is no longer sustainable with its growing deficits and debts. This was also the story of Lebanon at the end of its 15-year civil war in 1990.

When Lebanon was in need of recovery, Europe was busy dealing with the fall of the Berlin Wall and the Arabs were recuperating from the long Iran-Iraq War, from Iraq’s invasion of Kuwait and from the first Gulf War to liberate Kuwait. For Lebanon, it was bad timing in terms of getting help with its reconstruction and a conference of donors was canceled in 1992. The Lebanese government was rebuilding the country, as well as state institutions and the army, and had to borrow internationally to do so, meaning that the national debt grew until it eventually caused the big financial collapse of 2019.

Even if Rome was not built in a day, it can be destroyed in one. It can take centuries to build a city — its quarters have their own historical circumstances and actors. Beirut is a perfect example: the city center was largely built in the 16th and 17th centuries and inhabited by North African Berbers, while the hill of Achrafieh was settled by Damascenes in the 19th century and people from Haifa were dominant in the development of Hamra in the 20th century. Areas built by different people at different times were destroyed together, while the reconstruction and recovery of all was mainly led by the government.

We are there again now, with the Lebanese government about to embark on a major enterprise to rebuild the banking sector, as well as the areas destroyed by the war between Hezbollah and Israel. The resulting growth in public spending will set a trend that, if uncontained, will burst again one day. The difference is that each time this happens the crisis gets bigger.

Lebanon was not designed to have a large government sector. Michel Chiha, a prominent banker, intellectual and political thinker who was the main architect of the Lebanese system in the early years, devised it as a liberal, laissez-faire economy, the cornerstone of which was a sound monetary policy. He was wary of state intervention in the economy and of inflation, preferring individual initiative, entrepreneurship and innovation, with an emphasis on human capital and the free movement of capital and goods. It was mainly an economy of services, such as banking, tourism and education, and it saw Beirut become a financial and cultural center that attracted investment and talent from the region.

In the 1950s and 1960s, the cosmopolitan merchant and intellectual elite of the region, fleeing the nationalist revolutions in Egypt, Syria and Iraq, contributed to the prosperity of the capital, but not of the whole country. A backlash came with the presidency of Gen. Fouad Chehab, who advocated a harmonious development policy, with social services and balanced development including the regions and the productive sectors such as industry and agriculture. Chehab was elected with international support after an American intervention following a political crisis that resulted in a mini civil war, and in the context of regional unrest with the fall of the Hashemite monarchy in Iraq. It is not too far-fetched to compare this with the circumstances of today’s government.

The weakness of the state, its institutions and its services contributed both positively and negatively to the policy debate in the country at the time. Chiha and Chehab were seen as both complementary and contrasting, like the relationship between the city and the mountain, between the services sector and productive activities, with the core of the discussions centering on the role of the state. It was sometimes argued that, as a result of a lack of government services and protection mechanisms, Lebanese society developed strong alternatives. Communities had their own schools and hospitals and external relations independent of state services.

The government of Salam operates in the context of major regional and international changes, including the fall of the Assad regime and the aftermath of Israel’s wars with Hamas and Hezbollah. Internationally, there is also the unpredictability of the Trump administration and its relations with regional powers, as well its Department of Government Efficiency launching an assault on government bureaucracy.

The Salam government is also the first Cabinet under the presidency of Gen. Joseph Aoun and it operates amid the legacy of such policy debates, political conflict and economic crises in Lebanon. Will it have the wisdom to break the cycle and resist expanding government activity?

Since we are practically rebuilding state institutions from scratch, there is an opportunity to reduce the role of the state and encourage the alternative services that have emerged to replace it.