The Middle East War For Hearts and Minds

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The scale of Lebanon's destruction has provided opportunities as well as heartbreak. According to the Lebanese government, the war not only has killed 1,183 people, wounded 4,055 and displaced 974,184 but has also caused $3.6 billion in damage to residential buildings and civilian infrastructure like bridges, roads, power stations, telecommunications systems and airports. Hizballah has pledged to rebuild apartment buildings and entire villages within three years; it has sent civil-affairs teams wearing hats that read JIHAD FOR RECONSTRUCTION. The group's offensive is most evident in ruined towns like Srifa, south of the Litani River, where piles of rubble are all that mark where houses once stood. Broken guardrails, shattered glass and pulverized concrete make it difficult even to walk around. Thirty-two people, mostly Hizballah fighters, died in the town, but within a day of the cease-fire with Israel, the militants turned into recovery workers, bringing in bulldozers and earth-moving equipment to dig through the debris. Residents say Hizballah is the only group they trust to help. "It's our government," says Abdel-illah Haidar, 24, an electrician.

In addition to strengthening Hizballah, the race to rebuild Lebanon has exacerbated conflicts that are tearing the region apart--between the U.S. and the Arab street, between fundamentalists and the West, between Sunni and Shi'ite Muslims. Hizballah's principal sponsor, Iran, has moved quickly to take advantage of the respect the organization is now receiving. According to Lebanese officials, the Tehran regime sent some $150 million in cash for Hizballah's initial postwar handouts, and is expected to give hundreds of millions more to finance reconstruction projects. The consolidation of Hizballah's support in southern Lebanon may make it more difficult, meanwhile, for Lebanese and U.N. forces to oversee the disarming of the group's fighters. That's good news for Iran, which wants to preserve Hizballah's military capacity as a deterrent against any possible U.S. or Israeli attack on Tehran's nuclear facilities. Although Hizballah officials claim that most of their money comes from charitable donations, an official interviewed by TIME acknowledged the importance of Tehran's support. "Thank God that Iran exists in this world," he said.

That kind of talk is unnerving the region's Sunni Arab states, which have watched helplessly as Iran's Shi'ite rulers have accelerated their nuclear program and carved out areas of influence in Lebanon and Iraq. Not surprisingly, the Arabs are eager to be in the Lebanon game: between them, Saudi Arabia and Kuwait have pledged an $800 million aid package to the Lebanese government for rebuilding projects while handing an additional $1.5 billion in soft loans to the Bank of Lebanon to shore up the nation's currency. Saudi officials believe that the kingdom's support will far surpass the amount Iran provides Hizballah and will enable Lebanese Prime Minister Fouad Siniora to ride out the group's grab for influence. "You have to empower the Lebanese government so that it can reconstruct the country," says Nawaf Obaid, head of the Saudi National Security Assessment Project, which advises the Saudi government. "Iran and Hizballah will be the losers in the long run."