By Alistair Lyon, Special Correspondent, BEIRUT (Reuters) - Empty seats are proliferating in Beirut's political theatre of the absurd, symptoms of a deep malaise that has crippled Lebanese government institutions, damaged the economy and fuelled fears of renewed civil war.

The president's chair has been vacant since November. There is no sign the palace in Baabda will get a new occupant soon.Lebanon's parliament, whose own benches have been deserted since October 2006, failed for the 18th time on Tuesday to meet formally to elect a president -- although rival factions agreed months ago that the army chief should be the next head of state.

Last week Parliament Speaker Nabih Berri installed a table with 14 empty chairs in the assembly building to accommodate a "national dialogue" he argues is the best way out of the crisis."He is willing to hold a marathon dialogue after which everyone moves straight from the room to the general assembly to elect (a president)," Berri's media adviser Ali Hamdan said. However, aware that anti-Syrian factions dominating the government have rejected his proposal, Berri has yet to issue invitations to politicians to fill those neatly arranged seats. Outside the building are yet more desolate chairs in the once-crowded bars, cafes and restaurants of downtown Beirut. Many are shuttered. Those that have hung on rarely have more than a few customers to reward their fortitude."Downtown we are making only 7 percent of our past revenue," Michel Ferneini, who runs Medi Resto, an Italian restaurant and food business with outlets in the area, told Reuters.

"I'm not ashamed to say it -- instead the politicians who brought Lebanon to this blind alley should be ashamed of such results," he added. "I'm sure one day we will throw them in the garbage of history. Our losses are losses for all Lebanon."

Beirut's centre, destroyed in the 1975-90 civil war and then lavishly rebuilt, was a magnet for tourists until war broke out between Israel and Lebanon's in July 2006.

TATTERED TENTS

As the months went by, the protest ran out of steam and the tents are now tattered and largely unoccupied, but remain as a symbol that the opposition cannot be ignored.

Prime Minister Fouad Siniora's Western-backed cabinet has defied the pressure, hunkering down in the Grand Serail, an elegant Ottoman-era government edifice separated by troops and barbed wire from the opposition tents in an adjacent square.

The cabinet has vacant seats too. Seven of the 24 are empty due to the resignations of six opposition ministers and the assassination of Pierre Gemayel.

There is no end in sight to Lebanon's crisis, whose local protagonists are linked to those in a broader regional conflict pitting the United States and its allies against Iran and Syria.

The tension has occasionally flared into violence, so far contained by factional leaders. But some Lebanese worry that the lessons of the civil war have been lost to collective amnesia.

Among them is Nada Sehnaoui, who has installed 600 empty toilets on a vacant downtown lot to make her point -- from afar the startling white rows resemble a military cemetery.

"Every now and then you hear of a group rearming or militias re-forming. This scares the hell out of me," she said, standing among the lavatories erected for a two-week show to mark the April 13 anniversary of the start of the civil war.

Her idea is to remind Lebanese of the madness and futility of that conflict, when civilians often sheltered in their bathrooms while militias indulged in cross-town artillery duels.

"It was nightmarish," said the flame-haired artist. "I was 15 when the war started and I remember hiding in the toilets, first as a teenager and later as a mother with a baby."

The Lebanese, Sehnaoui argued, have never come to terms with the civil war. Instead they have swept it under the carpet, amnestying militia leaders and avoiding any kind of South Africa-style truth and reconciliation process.

She said specters from the past could not be simply wished away, noting that in Lebanese school text books, history stops in 1975. "You have to face it, look at it in the eyes."

What would she say to the politicians at loggerheads over how to share power in a disintegrating country?

"They can come and meet here, on the toilet seats."