Hezbollah, the Iran-backed Shia militia in Lebanon, was created in the early 1980s. Hezbollah has been increasingly dependent on Iranian cash subsidies to maintain itself. Somewhat abruptly those cash subsidies were cut in half in 2019. The main reason for this was the United States reviving economic sanctions against Iran in early 2017. This was aggravated by lower oil prices, brought on in 2013 by the enormous growth in oil and gas production in the U.S. and Canada with the aid of new technologies (mainly fracking). The Americans had also become more adept at shutting down illegal Iranian foreign financial operations. Additional economic pressure came from Iranian financial commitments to the Syrian government, which it had been supporting in a civil war that began in 2012 and is almost over. Iran sought to take advantage of this to increase attacks on Israel but the Israelis responded with hundreds of airstrikes against Iranian and Hezbollah targets in Syria, along with a successful hacking campaign plus with some spectacular espionage operations inside Iran and Lebanon (mainly against Hezbollah).
The 2019 financial aid cuts have cost Hezbollah over $30 million a month and Iran warns that it is liable to get worse. As of May 2019, this has caused massive pay and benefits reductions to Hezbollah members and families of Hezbollah members killed in Syria since 2012. These survivor payments have been cut in half and the several thousand families involved are not taking this quietly. That’s because the Hezbollah participation in Syria fighting to keep the Iranian backed Assad dictatorship alive was never popular with most Hezbollah members and even less popular with Lebanese in general. Thousands of Hezbollah employees have had their pay cut and all this has triggered a very visible economic recession in southern Lebanon, where Hezbollah dominates the local government and economy.
The Americans have also been increasingly successful in shutting down illegal Hezbollah fundraising around the world, especially in Europe and the United States. For decades Hezbollah got away with operating under the cover of Islamic charities. Since the late 1990s, more and more people involved with this fundraising have been identified and prosecuted. Hezbollah has also suffered increasing losses from Israeli defensive operations against two decades of Hezbollah efforts to attack Israel and Israelis wherever they are. Hezbollah also found itself increasingly restricted by getting labeled an international terrorist organization by the United States, Canada, most European countries and Arab ones as well (including the Arab League).
Hezbollah membership is only about 50,000 but is generally supported by the Shia minority in Lebanon, which is about 28 percent of the population. The rest of the Lebanese are largely Sunni or Christian with a number of other religious minorities. This religious mix, plus hundreds of thousands of Palestinian refugees, led to a 1975 civil war that ravaged the country until 1990. The peace deal that ended the war was more of a ceasefire than a true peace. Iran was resented for strongly backing Hezbollah. Israel was also criticized for backing Lebanese Christians in southern Lebanon and even invading Lebanon in 1982. Hezbollah was also resented for increasing Syrian influence in Lebanon. That is because Syria considers Lebanon a part of “Greater Syria” and illegally created by the European states that defeated Turkey in 1918 and reorganized the many Arab parts of the defunct Turkish Empire into independent states. This included Israel, which Hezbollah even went to war with in 2006. Hezbollah, and Lebanon, lost but that defeat was declared a victory because Israel did not invade. Hezbollah threatens another war, which only results in more attacks by Israel and miniscule Hezbollah success in destroying Israel.
What made Hezbollah particularly unpopular in the United States was a series of Hezbollah terror attacks against Americans in Lebanon during the last eight years of the Lebanese civil war. Most of these attacks were headline news in the United States and Europe. These attacks began in 1982 with the kidnapping of David Dodge, the president of the American University in Beirut. He was held for a year. In 1983 five American marines were wounded in hand grenade attack on Beirut International Airport. That was followed by a suicide truck bomb attack on the U.S. embassy that killed the CIA's Middle East Director and 83 others. In addition, 120 were wounded. That was followed by an attack on an American marine compound in Lebanon that left 241 Marines dead, and over a hundred wounded. The marines were there to try and quiet things down. In 1984 Malcolm Kerr, the new head of the American University of Beirut was killed by Hezbollah assassins. Later an American couple were kidnapped and held for 16 months. That was followed by a car bomb attack on the U.S. embassy that killed 80 (22 Americans) and wounded more than 200 (mostly Lebanese civilians). After that Hezbollah kidnapped, tortured and killed William Buckley, a diplomat at the U.S. embassy. Hezbollah also took credit for a bombing in Spain that hit a restaurant outside an American air base that killed 18 Americans and wounded 83. Later in the year, there was another bombing of the U.S. embassy in Lebanon that killed two Americans and wounded 21. That attack also killed 23 Lebanese and wounded over fifty. In 1985 an American journalist was kidnapped in Lebanon and held for six years. In 1986 Hezbollah kidnapped another head of the American University and held him for 44 months. Two other Americans were kidnapped and held for five years. In 1988 an American marine officer, working for the UN, was kidnapped and killed by Hezbollah. At the end of the year, Hezbollah bombed the American University in Beirut, killing 1 and wounding 12.
This Hezbollah mayhem ended with the signing of a peace deal in 1990 to end the civil war. Hezbollah used the more peaceful environment to concentrate on helping the Shia Lebanese recover from the 15 years of fighting. This was largely financed by Iran which, at that time, was also supporting the Assad dictatorship. The Syrian connection was a side-effect of the 1980s war between Iraq and Iran. Syria, a Sunni majority state ruled by a Shia minority, believed it was best to openly side with Iran and that alliance continues into the 21st century. Since 2012 the Syria support has cost Iran a lot more than the Hezbollah subsidies and with the sanctions and lower oil prices, it was all more than Iran could afford. Something had to go and Hezbollah took the hit and now has to scramble to reorganize its financial and logistical arrangements. One beneficiary of all this is Israel, who is less likely to suffer another Hezbollah rocket attack, and the non-Shia majority in Lebanon who finds a growing threat (to Lebanese independence) suddenly diminished and getting weaker.