Strengthening Israel's ability to protect itself with the demise of the global village - by Caroline Glick

Israel's ability to protect itself and adapt its economy to the new post-global village reality will in large part determine how it survives and prospers in the post-global village world now taking shape.

Caroline Glick..
Israel Hayom..
27 March '20..
Link: https://www.israelhayom.com/opinions/israel-and-the-demise-of-the-global-village/

In the face of the steeply rising number of coronavirus patients and the breakneck speed of political changes in Israel, few people have stopped to notice that the world we have grown accustomed to living in for the past generation is falling apart. The global village is collapsing under the weight of the pandemic.

How Israel deals with this dramatic turn of events today, and in the coming weeks, months and years will determine both how we emerge from the present crisis and how we manage in the new world now taking form.

Israel's food supply system is a perfect example of the global changes to being wrought by the virus. In Israel, five basic foodstuffs are produced locally: fruits, vegetables, eggs, poultry, and milk. Most grains, sugar, rice, salt, meat, and other foodstuffs are imported.

Out of a total agricultural workforce of 70,000, 25,000 are migrant workers from Thailand and another 25,000 are from the Palestinian Authority. According to Agriculture Minister Tzachi Hanegbi, concerns over the coronavirus prevented 1,500 workers from Thailand scheduled to arrive at the beginning of the month from entering the country. The Palestinian workforce is down to 18,000 and dropping due to the quarantine the PA has placed on its population.

The labor shortages couldn't come at a worse time. Currently, there are a half billion shekels worth of fruit and vegetables ready for harvest. If they aren't picked in the next three weeks, they will rot on the trees and in the fields.

Three weeks ago, the HaShomer HaHadash organization began getting flooded with calls from farmers for help. HaShomer HaHadash is a volunteer agricultural support organization founded in 2007 to protect Israeli farmers from Arab and Bedouin criminal gangs who extort farmers and ranchers and carry out agricultural theft and sabotage on a massive level.

"These calls were different," explains HaShomer HaHadash's leader Yoel Zilberman. "We are used to receiving calls about sabotage, and extortion and sending our volunteers to guard and herd. These calls were about the harvest, the national food supply."

Zilberman and his colleagues realized the implications of the loss of a harvest for Israel's food supply and began drawing up a plan to help the distressed farmers. Two weeks ago, Zilberman approached Hanegbi and offered to organize a corps of volunteers to save the harvest. Comprised of the organization's roster of volunteers, cadets at pre-military leadership academies, youth movement alumni and from twelfth graders, Zilberman's volunteers would work in shifts in the fields. With government finance, Hashomer Hahadash would provide for all their needs. Hanegbi agreed.

Israel – A Successful Powerhouse in the Collapsing Middle East - by Daniel Krygier

Israel’s economy is booming. The failure of the Arabs and BDS movement campaigns to destroy it are as spectacular as the Arab failures to defeat Israel in the battlefield.

Daniel Krygier..
MiDA..
15 January '18..
Link: http://en.mida.org.il/2018/01/15/israel-successful-powerhouse-collapsing-middle-east/

Economic indicators for Israel showed another successful year in 2017 as, for the first time ever, Israel’s GDP per capita has surpassed that of major industrialized countries such as Britain, Japan and France.

Israel stands out among the nations that won their independence after the Second World War. Despite facing more challenges than virtually any other country, Israel has transformed from a poor and fragile socialist backwater to a first world Start-Up nation of cutting-edge technologies and knowledge during seven brief decades, while fighting for its existence.

The failures of the Arab boycott and later the Boycott Divestment Sanction (BDS) campaign movement to destroy Israel’s economy are no less spectacular than the Muslim Arab failures to defeat Israel in the military battlefields. Israel’s economy is far stronger today than when BDS was launched in 2005.

The Economist publishes an annual global report with numerous data on the countries of the world. In its newly released report, Israel’s GDP per capita has, for the first time ever, surpassed $40,000. According to the Economist’s data, Israel’s GDP per capita grew from $38,127 in 2016 to $44,019 in 2017.

Israel’s economy expanded by 4.4 % during 2017, the highest growth rate among advanced economies. By contrast, the GDP per capita of France was almost $41,000 and nearly $40,000 for Japan.

Private consumer spending rose 3.0% in 2017, 1.1% per capita. Per capita spending on semi-durable goods (clothing etc.) grew 4.7%. Per capita spending on current consumption (housing, food, services, etc.) was up 2.2%. The account deficit in the government sector totaled NIS 8 billion in 2017, making up 1.1% of the GDP, down from NIS 15.6 billion in 2016.

The contrast between first world Israel and the surrounding third world Arab world is larger today than ever before. Israel’s GDP per capita is almost 20 times the GDP per capita of impoverished Egypt and five times larger than semi-developed Lebanon.

New milestone for Israel’s economy reveals the farce of the Guardian’s BDS obsession

...As Israeli technologies continue to have a growing impact on all our lives, the Guardian’s myopic focus on the BDS movement becomes almost comical.

CAMERA intern Aron White..
UK Media Watch..
13 March '17..

This week saw a new milestone for Israel’s economy, as an Israeli start-up, Mobileye, was bought for $15.3 billion dollars by Intel, marking the largest ever deal for an Israeli company.

It is hard to overstate the significance of the deal; the $1 billion sale of Israeli company Waze to Google in 2013 was considered a landmark moment, but that now looks like small fry compared to the Mobileye sale. As venture capitalist Michael Eisenberg wrote, this deal changes expectations and raises the bar, as Israeli entrepreneurs “now know they can build a $15 billion company in ten years.” Israel’s GDP is around $320 billion, so for two Israelis to create a company worth $15 billion, 5% of the country’s GDP, in just ten years, is simply staggering.

This very significant story was not reported in the Guardian. This in and of itself is a little surprising, but not malicious or improper. What makes it noteworthy is that the pages of the Guardian feature much discussion and reporting about BDS, the Boycott, Divestment and Sanctions movement – but one wonders whether they are missing the real story.

(Continue to Full Post)

Updates throughout the day at http://calevbenyefuneh.blogspot.com. If you enjoy "Love of the Land", please be a subscriber. Just put your email address in the "Subscribe" box on the upper right-hand corner of the page.Twitter updates at LoveoftheLand as well as our Love of the Land page at Facebook which has additional pieces of interest besides that which is posted on the blog. Also check-out This Ongoing War by Frimet and Arnold Roth. An excellent blog, very important work. 

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With Israel’s energy boom in doubt, the hope that common sense prevails - by Jonathan Tobin

...For seven decades, Jews joked about Moses bringing the Jews to the one country in the Middle East without natural resources. The discovery of offshore gas, as well as shale oil reserves, gave the lie to that old jest. But if Israeli political maneuvering winds up sinking the Noble-Delek deal and setting back the exploitation of Israel’s gas reserves, it will be more than a political setback for the prime minister. It will be a disaster for Israel that will weaken its economy, its quest for energy independence, and its security.

Jonathan S. Tobin..
Commentary Magazine..
08 February '16..

Last year it seemed as if doubts about Israel’s bright energy future were put to rest. A clever move by Prime Minister Netanyahu’s government allowed the country’s Security Government to overrule an anti-trust commissioner who might have placed impossible legal obstacles in front of the effort to exploit the gas field called “Leviathan,” a massive off shore reserve. As Arthur Herman wrote in a 2014 cover story for COMMENTARY, the gas finds meant Israel was on the brink of becoming the world’s “next energy superpower.” After years of starts and stops and enough plot twists to fill a few novels, it appeared that Netanyahu had finally put in a place a plan that would allow the work to begin on Leviathan. More than that, recently concluded deals with Turkey and Greece and Cyprus to create an international pipeline to transport the gas ensured that the work would go forward and that there were international markets for Israel’s gas that would help enrich the nation even as its own energy needs were met.

But never underestimate the power of Israeli partisanship, bureaucratic inertia or the willingness of its courts to exert their influence on matters that ought to be the province of the executive or the legislature. The news today that Netanyahu has taken the unprecedented step of filing a personal affidavit to Israel’s high court shows just how seriously the government is taking the legal challenges that have been mounted to the gas deal that was supposed to be a fait accompli by now.

Netanyahu’s critics are accusing him of trying to intimidate the courts with a personal appeal. But while no prime minister has ever sought to play a role in a court case like this before, Netanyahu is right to treat the matter as one that requires unusual steps. If Israel’s judiciary heeds the efforts of a loose coalition of left-wingers and environmentalists, it will do more than delay the development of Leviathan. It may rob the country of an economic bonanza and undermine its security for decades to come.

In today’s Mosaic Magazine, Herman writes of the tangled path that the gas deal has followed. For the plan to succeed, the gas field had to be developed and then markets found for its product beyond Israel. Herman documents the perils involved with negotiations with an untrustworthy actor like Turkey’s President Recep Tayyip Erdoğan as well as some of the domestic critics of the gas project. Some Israelis illogically think all the gas should be kept at home. Some think, despite all evidence to the contrary, that it will harm Israel’s environment. Still others are suspicious of the deal with Noble Energy and Israel’s Delek Corporation for developing the field and fear that the Texas-based company will profit too much from any such arrangement. By treating it as a monopoly that is suppressing competition rather than a national security necessity, the scheme will be derailed.

Netanyahu thought he had dealt with the latter threat and set the wheels in motion once and for all last June. But with Israel’s opposition parties seeking to play the populist card on the issue and Israel’s Supreme Court have a record of being willing to rule on issues that might normally rest in the hands of the nation’s elected leaders, the issue is still in doubt.

Financial sector’s approval of Netanyahu's performance appears nearly unanimous

Jonathan S. Tobin..
Commentary/Contentions..
21 January '13..

Israelis go to the polls today (tomorrow) and, as we’ve noted previously, there’s not any doubt about who will lead their next government. The voters appear poised to give Prime Minister Benjamin Netanyahu a qualified endorsement, and while his own party appears to be getting fewer votes than expected, the factions that made up his current government will collectively get what amounts to a landslide victory over the prime minister’s left-wing and Arab critics in the Knesset. But the financial sector’s approval of his performance in office appears nearly unanimous. As Bloomberg News reports, the country’s bonds have gone up 36 percent in dollar value since he took office in 2009 as opposed to a 22 percent average rise for global government debt. The shekel has also gained 13 percent against the dollar in that period and is, according to financial experts, the second-best performing currency in Europe, Middle East and Africa during this time.

That’s a message that gets drowned out by complaints about the rise in the cost of living that generated street protests in Israel in the summer of 2011. Yet for all of the country’s problems, including a deficit that is fueled by Israel’s need to spend a disproportionate amount on defense, there’s little doubt that Netanyahu’s administration has been economically sound and that the country’s economy has grown by leaps and bounds under his leadership. His commitment to maintain the Jewish state’s commitment to a free-market model and the stability that his leadership has given the nation are not the only factors behind the growth numbers, but Israel has become an even better bet for investors in the past four years. The near-certainty that he will stay in office will ensure that this will continue.

Populist Fever, Budgets, and Israeli Elections

Sarah Honig..
Another Tack..
11 October '12..




If Prime Minister Binyamin Netanyahu hadn't moved up the elections to early 2013, we’d be voting in late 2013.

Sooner or later, the race must be run next year.

But the difference, in political terms, of when we go to the polls is huge. It matters cardinally to what’s best for the country rather than what’s best for any party. Here Netanyahu has undeniably opted for what’s best for the country.

We all know that the 2013 budget must be put together and then put to a Knesset vote. We all know that this annually entails intense haggling. We should all be equally aware that the budget now awaiting deliberation is likely to be full of edicts that would perforce increase the burdens already weighing down on ordinary folks.

We should all know that this isn't the product of arbitrary hardheartedness. The world’s leading economies are all – without exception – in deep trouble, and this cannot but rub off on us. Hence the need for what should be – for the collective good – an austerity budget, or one close to an austerity budget.

It’s conventional wisdom that it’s easier to pass an unpopular budget after having received a mandate from the public than to attempt it before having faced the electorate. Political common sense rules against going to the voter after having inflicted an austerity budget, even if this is warranted by objective reality.

Har Bracha - A small, sweet community with a winning economic formula

Emily Amrousi..
Israel Hayom..
20 September '12..

Thai kickboxing lessons for children at 65 shekels ($17) per month; zoology lessons at NIS 45 shekels ($12) per month; ballet lessons at NIS 60 shekels ($15) per month; Pilates for women at 55 shekels ($14) per month. These are not prices from a decade ago, nor is this a price list in Eritrea — this is Israel, 2012. These prices aren't subsidized by the state or a any private donor, they are simply the product of foresight and efficient public conduct.

The name Har Bracha may sound familiar in the political context: There was a clash there between the Defense Ministry and the head of the hesder yeshiva (which incorporates mandatory military service with Torah studies) over encouragement to refuse military orders, which consequently cost the yeshiva its place in the program.

I recently visited Har Bracha, a small, sweet community on Mount Gerizim, adjacent to the fascinating Samarian community and overlooking a heavenly view. What I found there was an economy that exquisitely cracked the code. Take the issue of housing. The community's leaders eschewed greedy developers and initiated its own housing projects: They figured the precise amount that young couples could afford in monthly mortgage payments, multiplied that sum by a certain number of months and years, and wrote up their own proposals, which they submitted to local developers. The proposal stipulated that the developers build dozens of units without exceeding the agreed sum.

The result: The pricing equation tipped in favor of the consumer, rather than the developer, and housing prices in Har Bracha are 40 percent lower than anywhere else in Samaria, and much cheaper than anywhere else in Israel. By saving management costs and doing away with middle men, and without a dime from the government, the community has attracted dozens of new families just this year.

The cost of summer day camps in Har Bracha also proves that where there is a will, there is a way to do things differently: 270 shekels ($70) per month for pre-schoolers, and 320 shekels ($82) for elementary school children. For an entire month. Including lunch. With a proper balance between indoor and outdoor activities. How? Frugal transportation and a carefully planned budget.

Israel's Field of Dreams - Natural Gas

Tobias Buck..
Financial Times Magazine..
31 August '12..

The black and yellow helicopter heads north from Tel Aviv, passing over empty beaches, a yacht harbour and a string of sprawling seafront residences that house some of Israel’s wealthiest families. After a few minutes the pilot makes a sharp turn to the left and steers his ageing Bell 412 towards the open sea.

For more than half an hour, all there is to see is the blue waters of the Mediterranean. Then suddenly a hulking mass of brightly painted steel rises from the midday haze. Towering more than 100m above the water, this is the Sedco Express, a drilling rig that has been operating in this stretch of ocean for almost three years. As the helicopter touches down on the landing pad, we see a small blue and white Star of David flag fluttering in the wind. It is the only sign that the Sedco Express sits atop one of the greatest treasures that Israel has ever found. Far below, connected to the rig by a slender steel pipe that runs through 1,700m of ocean and another 4,500m of rock and sand, lies a vast reservoir of natural gas known as the Tamar field.

(Read full "Israel's Field of Dreams - Natural Gas")

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Not a Kibbutz: Not America, Not Israel.

"While the kibbutz is an iconic symbol of the state’s beginnings, the collective farm movement is a dinosaur in modern Israel with only a minuscule role in its economy."

Jonathan S. Tobin..
Commentary/Contentions..
08 August '12..

Mitt Romney is catching some flak today for a statement made yesterday and first reported on BuzzFeed in which he contrasted American society and its economy as being very different from a socialist model. He told the crowd at a Chicago fundraiser:

“It’s individuals and their entrepreneurship which have driven America,” Romney said. “What America is not a collective where we all work in a kibbutz or we all in some little entity, instead it’s individuals pursuing their dreams and building successful enterprises which employ others and they become inspired as they see what has happened in the place they work and go off and start their own enterprises.”

This is being represented in some quarters as a knock on Israel or at least showing that, as BuzzFeed put it, his friendship for the Jewish state, “only extends so far.” But anyone who tries to represent this as somehow qualifying Romney’s backing for Israel or showing disrespect for it doesn’t know much about the real life Israel as opposed to myths from Leon Uris novels. While the kibbutz is an iconic symbol of the state’s beginnings, the collective farm movement is a dinosaur in modern Israel with only a minuscule role in its economy. Many of have gone bankrupt while others have become hotels or factories more than farms. Indeed, Israel’s current economic success is based on its transformation in the last generation into a first world economy rather than one handicapped by the socialist ideology of its founders.

Greenfield - Israel’s ‘You Built It’ Culture

Daniel Greenfield..
frontpagemag.com..
07 August '12..

When Mitt Romney arrived in Jerusalem and suggested that Israel’s success contrasted with its Muslim neighbors was due to a culture of success, he was waving a red flag in front of a red bull. Romney’s comments were as provocative to the left as Obama’s “You didn’t build that” remark was to us.

To the left, success has become the Mark of Cain. Where success once used to be proof of good character, the balance has shifted and it is now proof of bad character. The left blames all disparities on injustice. If A has less than B, then B has somehow discriminated against A. All that’s left is for the sociologists and critical race theorists to plug in the variables, write their papers and explain the mechanism for the injustice and how it can be remedied through centralized redistribution.

This is the era of “You didn’t build that” where achievement is inherently unfair and an object of guilt. To succeed is to steal. Anyone who has achieved more than those around him has unfairly taken from them. And the more he succeeds, the more he has to feel guilty about and the more he must atone through social justice.

Mitt Romney didn’t build companies; he unfairly redistributed what should have been equal resources in an unequal way to create that success. America also didn’t build anything; it just looted the resources and markets that should have been divided equally among the nations of the world. And the same goes for Jews and the Jewish State. Individual success is not exceptionalism; it’s stealing from the collective.

The left already knows why Israel is more successful. Because it’s a greedy country whose success has come at the expense of its poorer neighbors. The left finds the idea of explaining success in terms of character, either individual or national, to be offensive. To suggest that success is due to personal virtue is to also imply that failure is due to a lack of virtue. The left is not interested in exploring what’s wrong with nations or groups that fail, only in explaining how their failure is no fault of their own.

The left was only interested in Jews as an oppressed minority and in Israel as a small doomed country. Once Jews became successful and Israel emerged victorious, the left turned on them and on Israel.

Israel’s success is one of the greatest weapons that the left uses against it. If Israelis were still living in tents and trying to get the power to stay on for more than a few hours a day, the Jewish State wouldn’t make nearly as tempting a target. Israel’s transformation from a bunch of refugees and farmers armed with third-rate weapons to a prosperous nation of flowering orchards, booming tech companies and new towns rising out of the earth, is proof of its immorality. If the Jewish State were truly moral, it would have stayed poor.

Tobin - Israel’s Dilemma: S&P Versus “Social Justice”

Jonathan S. Tobin
Commentary/Contentions
09 September '11

http://www.commentarymagazine.com/2011/09/09/credit-rating-israel-social-justice/#more-767302

For the past two months, hundreds of thousands of Israeli “social justice” demonstrators have jammed the streets of the country’s cities to register largely inchoate demands for more government spending and an end to the free market economics that have over the course of the last two decades transformed an economic basket case into the “start-up nation” that is the envy of the world. While there are aspects of the protests that have merit, the argument for a return to the Jewish state’s socialist past took another hit today when Standard & Poor’s announced it was raising the State of Israel’s credit rating from A to A+.

The S&P boost was a tribute to the wise stewardship of Israel’s economy by the team of Prime Minister Benjamin Netanyahu, Finance Minister Yuval Steinitz and Bank of Israel Governor Stanley Fischer. At a time when other countries in the developed world are experiencing instability and a worsening debt crisis, the Jewish state has managed to maintain both fiscal discipline and economic stability. But if the social justice protesters have their way, that could all change.

The clamor for social justice reflects genuine disgruntlement on the part of many Israelis with the lingering effects of the country’s former East German economic model, particularly the crony capitalism that allowed industries that were formerly state-owned to pass into the hands of a few families and companies at bargain prices. Yet much of the rhetoric emanating from the protests reflects a faux nostalgia for a socialist past whose inequities and glaring failures have been either forgotten or ignored. The solution to the problems of high prices and the scarcity of affordable housing is less government involvement in the economy and more free market reforms. The last thing Israel needs is a return to the nightmare of socialist economics that made it routine for a family to have to wait years to have a phone line installed.

But the nightmare of instability and debt is exactly what awaits Israel if the government allows the protests to start dictating fiscal policy. More government spending and subsidies of products and services leads in only one direction: the sort of debt crisis that brought countries like Greece to its knees this year. Unlike the nations of the European Union, Israel cannot afford such a collapse. It must also maintain a large military due to the ongoing threats against its security.

Were Israel to sacrifice its credit rating in order to satisfy demands for “social justice,” it would soon find it had neither justice nor a healthy economy. The demonstrators should heed the message they have just received from S&P. Israel’s government should stay the course on the free market.

Also a worthwhile read from the JPost Editorial Staff  "Trajtenberg’s task"

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Navon - Is Elvis Dead?

Emmanuel Navon
For the Sake of Zion
16 August '11

http://navonsblog.blogspot.com/

August 16th marks the anniversary of Elvis Presley’s death. Yet some of the King’s fans claim he never died and just went into hiding. The average person rightly scoffs at this science-fiction theory. But how can you ridicule those who believe that Elvis is still alive and, at the same time, continue to believe in socialism or in the Middle East peace process? Those Israeli academics and journalists who claim that both socialism and the Oslo accords can be salvaged may consider themselves to be the paramount of sophistication and rationality. In truth, however, they are no less irrational than Elvis Presley’s most wacky fans.

With Israel’s social protest movement in its fourth week, the Government has appointed a team of experts (the “Trachtenberg Commission”) to suggest ways of making life more affordable for the middle-class. High-rank academics have volunteered to help the protesters formulate their demands. Among those self-appointed consultants is Yossi Yonah, a philosophy professor at Ben-Gurion University. How exactly is Yonah qualified to argue about macroeconomics with the Trachtenberg Commission? True, the same question can be asked about Yuval Steinitz, himself a philosophy professor turned Minister of Finance. But the question is not whether philosophers can understand economics (Karl Marx had a Ph.D. in philosophy, in case you were wondering what the answer is). The question is what the presence of Yossi Yonah tells us about the true agenda of some of the movement’s leaders.

Yossi Yonah publishes mostly on “multiculturalism” and he summarized his views in an interview published in Ha’aretz in 2005 (“Brave New Multicultural World,” Ha’aretz, 14 October 2005). What is Yonah’s vision for the future of Israel? "Well” he says, “besides the naturalization of the migrant workers, it will include the annulment of the Law of Return; the cancellation of the arrangement of automatic naturalization for Jewish immigrants; and provision of a worthy solution for the Palestinian refugee problem, based on the Geneva Convention." So, you see, it’s not only about economics.

There are economic experts on the team, though, such as Prof. Avia Spivak from Ben-Gurion University. He recommends raising taxes, especially corporate taxes, which would supposedly fill public coffers –as if Israeli companies couldn’t pick-up and leave, and as if both economic theory and practice hadn’t showed that governments’ revenues decrease when taxes are too high.

Avni - Israel’s discon-tents

Protests no crisis of the state

Benny Avni
New York Post
14 August '11

http://www.nypost.com/p/news/opinion/opedcolumnists/israel_discon_tents_LlCgwBs0N4QFu0GxepGn7K

Sorry: The huge tent protest in Tel Aviv isn’t likely to bring down Prime Minister Benjamin Netanyahu, let alone threaten Israel’s stability.

Since mid-July, protesters have occupied tents along prestigious, historic Rothschild Boulevard in Israel’s largest city. Their beef? To borrow from perennial New York candidate Jimmy McMillan: The rent is too damn high.

Social-media-empowered students, egged on by leftists demanding a reversal of Israel’s market-oriented economy, started the protest this summer. Last week, more than 300,000 filled the streets of Tel Aviv in one of Israel’s largest demonstrations ever. On Saturday, tens of thousands marched in cities across the country.

Countless early-to-mid career Israelis, with good educations and seemingly well-paying jobs, struggle to keep a roof over their heads. Amid an economic boom, the vast middle class can’t afford some of modern life’s necessities.

Why? Let’s look at cottage cheese -- a staple of the Israeli diet that provided the revolutionary spark for this summer of discontent.

In mid-June Israelis were stunned by a significant hike in the price of cottage cheese. Using Facebook (another staple of Israeli life), consumers called for a boycott. The media loved it, running with a “The Arab Spring is Finally Here” theme. The “cottage revolt” was the hottest story of the early summer.

Some blamed capitalism: Once government-controlled, the consumer dairy market is now governed by cruel market forces.

But is it? Three conglomerates -- Tnuva, Strauss and Tara -- control Israel’s dairy market. But rather than compete, these big cheeses seem to act in cahoots. A strong dairy-farming lobby helps them by successfully resisting imports. With no real market competition, dairy prices rise arbitrarily.
They’re not the only aspect of Israel’s life controlled by a small number of tycoons. Once, the government and its political cronies strangled the economy, stifling healthy competition. Now wealth cronies choke it.

Even this isn’t the complete picture. Yes, a few tycoons controlling the construction business are one big reason that rents are out of reach for many. But another reason is the government, which still owns a corporation that controls the country’s real estate. (Israel has yet to shed its socialist past.)

Also, Israel -- and especially its most fun-loving city -- is a victim of its success. In recent years, fabulous Tel Aviv has become one of the world’s most attractive places to live, summer and vacation -- and wealthy locals, as well as Europeans and other foreigners, have driven the real-estate market to the stratosphere.

French Jews, especially, bought up beachfront land and other real estate. In part, it’s an insurance policy -- a shelter in case the French economy tanks or Gallic antisemitism grows even worse. But for now, they live there for just a month a year.
So the rent is too damn high.

Yet, while many tent protesters would love to cast a wider political net, they recognize a simple truth. Once saddled with Palestinian solidarity or any other unrelated issue, their protest is bound to lose the sympathies of middle Israel.

Some of them, and their cheerleaders in the Israeli media (which, curiously, are largely controlled by the very tycoons at the heart of the problem) thought that the protest would topple Netanyahu. But while recent polls show some popularity loss, the right, for now, remains the strongest political bloc in the country.

Even some of the protesters realize that only a true market-based economy can drive housing prices down. Plus, Netanyahu, throughout his career, has been a potent force for undoing the socialist mistakes of Israel’s founders. (Last week the government named a committee to look for solutions.)

Israel’s detractors in the West and the Arab world -- along with the hardcore lefties among the Tel Aviv protesters -- hope the country will implode under the tent revolt. No chance. This is no Tahrir Square, where people with no say in government yearn for a bit of freedom. This isn’t even Tottenham, where some bums yearn for free flat-screen TVs and new iPhones.

To date, Israel’s protest has been mostly peaceful -- on both sides. That’s democracy. Citizens petition their government; the government tries its best to correct course -- and if it fails, there’s always the next election.

beavni@gmail.com

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Tobin - The Deep Roots Of Israel’s Capitalist Democracy

Jonathan S. Tobin
Commentary/Contentions
14 August '11



http://www.commentarymagazine.com/2011/08/14/israel-protests-capitalism-democracy/#more-763825

Last night for the first time since Israel’s housing and cost-of-living protests began, there was no massive Saturday night demonstration in Tel Aviv. But there were several well-attended demonstrations in other cities such as Haifa, Beersheba and Afula. Though many leftists groups and non-governmental organizations have sought to exploit this movement for their own political ends, it cannot be denied that the protesters have touched a nerve since the vast majority of Israelis see them as a reasonable response to genuine problems.

Though much of the coverage of these demonstrations have sought to shoehorn them into a political context in which the Israeli government can be depicted as the villain of the story, COMMENTARY contributor Sol Stern points out in the City Journal that in fact this unrest represents an opportunity for Prime Minister Netanyahu to advance the cause of free market reform.

Stern rightly notes that the demonstrations, which have been a model of civil behavior and nothing like the unruly mobs that have protested against entitlement reforms in Europe, are not the result of economic failure but of Israel’s success as its economy expanded and real estate in Tel Aviv became even more valuable. Though, as he points out, many Israelis have been left behind by the boom, the answer to the problem is not the socialism of the past, but more free enterprise to break the shackles of government intervention that are the vestiges of the country’s old East German model.

It is well understood within Israel that to the extent that the protests become co-opted by the left, their support from the general public will drop. In fact, as Stern writes:

If Netanyahu plays his political cards right, he could emerge from this season of demonstrations as the winner who pushed forward the additional economic liberalization and reforms that this “start-up nation” still needs. He has already acted to release massive tracts of government-owned land for the construction of new housing, including rental units. Last week, he appointed a committee of independent experts to report to his government on further steps that can be taken to meet the protesters’ more reasonable demands, without indulging in the levels of welfare spending that brought the economies of Israel’s Mediterranean neighbors—Greece, Spain, and Italy—to their knees.

Though the left would like to hijack the protests, this middle class revolt is likely to remain a mainstream movement. That means that as Stern puts it, they will actually demonstrate “how deep and stable the roots of Israel’s capitalist democracy are.”

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Steinberg - Protests won't topple Netanyahu

Gerald M. Steinberg
Israel HaYom
12 August '11

http://www.israelhayom.com/site/newsletter_opinion.php?id=319

No, the summer protests in Tel Aviv, Jerusalem and other cities are not comparable to the "Arab Spring" – which turned into murderous clashes and epic power struggles in Cairo and Damascus. In contrast, the Israeli demonstrations have a light summer air to them, with top entertainers taking center stage. In Cairo, Ramy Essam, a musician who led protests, was badly beaten by opponents, and in Syria, no one is singing. In Israel, the protests celebrate the democratic process, and are not an attempt to create one.

But the Israeli demonstrations reflect real grievances -- particularly the huge gaps between the top and bottom of the economic pyramid. Although Israel’s leadership has acted wisely to avoid the devastating unemployment prevalent in Europe and the U.S., many students get exploitation wages and cannot find basic accommodation. In addition, the small market is dominated by politically connected monopolies and cartels that overcharge for basic goods and services.

The media immediately embraced the protest movement, which provided the low costs and trite messaging of the reality shows that dominate the airwaves. In addition, newspapers and journalists who have been at war against Prime Minister Benjamin Netanyahu and his government from the beginning, although not because of his economic policies, played up the anti-government signs and slogans among the demonstrators.

In parallel, some editorial writers thrilled at what they referred to as a “crisis atmosphere” and “panic,” gleefully predicting Bibi’s imminent downfall.

But there is no evidence of panic, and little likelihood of a revolution. While protest leaders can get large crowds to turn out for demonstrations and street festivals, they are having trouble turning the malaise into concrete and realistic policies. As is often the case, the protesters know what they are up against, but converting slogans like “the people want social justice” into viable public policy is far more difficult. Different constituencies have different and even opposing priorities, making this task more difficult.

As in all such activities, anywhere in the world, the impact of these demonstrations will be determined by their impact on the power distribution in the Israeli democratic system. Political power, like gravity, is ever-present and cannot be ignored for long.

Many of the energetic protest leaders interviewed on television and radio come across as vain publicity seekers, good at using Facebook and Twitter, but with no understanding of economics and public policy. This reduces their potential impact significantly.

In theory, social protests benefit the Left; in Israel the political reality is more complicated. This political vacuum is reinforced by the official opposition, led by Tzipi Livni and her Kadima party, which is weak and divided. For many decades, the Labor Left, in various forms, was the dominant power, and was responsible for socialist policies that choked economic development and empowered a privileged and often corrupt elite. During a brief return to power in the early 1990s, the Left led the messianic peace efforts, but the collapse of Oslo furthered damaged its image among many Israelis. Similarly, numerous civil society groups that claim to promote social justice, but have devoted much of their resources to promoting failed peace plans, are largely ineffective, and some have even hidden their involvement in the demonstrations to avoid the popular backlash.

As a result, with the Left splintered into numerous small factions, they have not provided the coherent and realistic alternative policy needed to turn the protests into a political comeback. The remnant of the Labor Party has a few potential leaders with serious social policies and track records, but remains weakened by past failures. Labor is also weakened by its association with the Histadrut, the national labor union, whose leaders use the language of social justice while protecting the worst monopolies – particularly the electric company and the dock workers – that have added to the income gap and high cost of living.

In the absence of credible alternatives, the Netanyahu government is not seriously threatened by these demonstrations and the summer of social protests. But this is a serious wake-up call, and unless the low wages, student housing, monopolies and inflated costs are addressed in a serious and sustained manner, Israel’s vibrant democracy will eventually force a change.

Beyond party and politics, the Jewish emphasis on social justice, embodied in the biblical injunction to care for the needy, and insistently demanded by the prophets, remains central to Israel’s moral foundation.

Professor Gerald Steinberg teaches politics and public policy at Bar Ilan University and heads NGO Monitor.


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Arlosoroff - Where the shekel stops ...

The tsunami is coming - and we're playing on the beach

Meirav Arlosoroff
Haaretz
08 August '11

http://www.haaretz.com/themarker/where-the-shekel-stops-the-tsunami-is-coming-and-we-re-playing-on-the-beach-1.377524

The protest movement must not endanger the enormous achievements of budgetary

'The hand of the Lord was on me, and he brought me out by the Spirit of the Lord and set me in the middle of a valley; it was full of bones - bones that were very dry. He asked me, "Son of man, can these bones live?" I said, "Sovereign Lord, you alone know." (Ezekiel 37:1 )

Are the people of Israel frolicking on the beach while a tsunami threatens and looms? We are: The danger is real. Some 300,000 people marched in the country on Saturday night, chanting slogans that were all variations of "Gimme" - at the very time that tidal waves of economic crisis are crashing down, threatening to engulf the unprepared.

The United States lost its perfect credit rating on Friday, for the first time in history. Beijing, unnerved at the thought of losses on its massive investment in U.S. government debt, has started bossing Washington around, ordering it to cut its defense and welfare budgets! That's also a first.

Spanish and Italian government bonds are now junk and need rescue. The European Central Bank said it would try to rescue them by buying their bonds.

This isn't the first time two big countries have stood at the brink of collapse. Much the same happened during the Great Depression of the 1930s, which is a thought of comfort to nobody. What ended that terrible time was World War II.

The collapse of Italy, Spain or both means exactly one thing - that the world will slide into its worst depression since the 1930s. Italy and Spain are too big to be bailed out, certainly with Uncle Sam on his knees because of the downgrade. No wonder Italy's perennially haughty Prime Minister, Silvio Berlusconi, had to accept an emergency plan for his country as a precondition for ECB support for bonds. The plan includes liberalization of the economy, selling government assets and amending the constitution to force the government to run a balanced budget.

Sound familiar? Those are, roughly, the rules that have been governing Israeli economic management for 25 years, and against which the tent movement is fighting - no more privatization, no liberalization of the economy (free economics / capitalism ), no to balanced budgets (witness their demands for government spending on the middle class, never mind the deficit ).

Global catastrophe

The world is quaking. Its strongest economies are crashing. The giants aren't sure they can pay their debts. Only in tiny Israel, which survived the crisis by the skin of its teeth, are people taking to the streets to demand it shatter its budget, increase debt and lavish money on all.

Make no mistake, the tents protest is critical to Israel's future. The middle class is arising for the first time and demanding that the national priorities be changed. But the changes aren't supposed to include abandoning budgetary discipline. Irresponsible nations won't make it. Pure and simple.

That's the lesson: Responsibility pays. The United States waxed fat and abandoned the economic principles that had made it great. It became accustomed to consuming more than it should and financing it by debt. Europeans, meanwhile, grew accustomed to working little and maintaining unsustainably generous welfare policies, assuming the empire of Europe would last forever. The United States and Europe forgot what responsibility is and are now paying the price.

Countries that continued to work hard, to live within their means and to avoid piling up debt weathered the crisis. Australia did. Israel did too.

The world applauded Israel's economic performance for good reason: Israel maintained budgetary discipline for 25 years, since its great economic crisis of the 1980s. For 25 years, the Finance Ministry and Bank of Israel warned successive prime ministers that abandoning discipline spelled doom. And over those 25 years, that tight Finance Ministry policy saved Israel from collapse thrice - the recession of the second intifada, the Second Lebanon War and the global crisis of 2008.

And that last one proved once and for all how crucial it is to maintain responsible policies. Spend less, save more, and in the future, you will survive.

This lesson was driven home terrifyingly on Friday.

Even hedonist Italy will be enacting a law to maintain a balanced budget. Only here in Israel, for some reason, in Israel that has done right for 25 years, do we not get it. Only here is the law that requires the government to reduce its deficit being presented as capitalist piggishness on the part of the Finance Ministry. Only here is everybody demanding more and more, without thought of who will pay.

Only here are the ungrateful people of Jeshurun getting greedy just as the vision of seared dry bones strikes worldwide.

The protesters want change in national priorities. All well and good; but they must not imperil Israel's achievements based on its responsible conduct. Budget discipline must stay on the table and it must be clear that for every upgrade in priority, something else must be downgraded. Otherwise, the tsunami rolling across the world's oceans will not spare us this time. It will engulf us, drown us and wash away the tents too. A country with no resources, such as Greece, Spain, Ireland, the United States or Italy, can't be sued for more.

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Tobin - Will Israelis Vote to Join Greece on the Bread Line?

Jonathan Tobin
Commentary/Contentions
06 August '11

http://www.commentarymagazine.com/2011/08/05/living-costs-israel-greece/

While few saw it coming, many observers are now speaking of the staying power of Israel’s economic protest movement as a major threat to the government of Prime Minister Netanyahu. Though the demonstrators seem devoid of a coherent alternative policy and seemingly ignorant of the tremendous damage out-of-control government spending has done in Europe, there is no denying they have tapped into popular discontent with the current state of affairs.

The question is how serious a threat does it pose to Netanyahu in the short term and what impact will it have on the next election.

As Herb Keinon writes in the Jerusalem Post, the high cost of living in Israel has had a terrible impact on middle class Israelis. Moreover, it is an issue that won’t be swept away even if the country finds itself embroiled in a new round of Arab violence in the aftermath of the United Nations General Assembly vote on Palestinian independence in September. That means the prime minister will be spending the coming months dealing with both the threat of a new intifada while also attempting to cope with a broad-based protest movement on the domestic front. These twin challenges will test Netanyahu’s political and diplomatic skills. But the expectation the protest movement will transform the country’s politics in the next year may be overblown.

The first problem with such a scenario is Netanyahu’s main competition is poorly placed to take advantage of the protests. Though Kadima Party leader Tzipi Livni has been trying to capitalize on the discontent as part of her non-stop campaign to abuse Netanyahu, her party has been as much a part of the free market consensus of the last two decades as Netanyahu’s Likud. The notion this alliance of opportunists can morph into a social democratic liberal alternative to Likud will require more fancy footwork than even Livni can manage. As is the case on the Palestinian question, there is actually very little difference between the two parties on economics.

Though Kadima may not be the beneficiary of the protests, they have the affect of pumping some life into the seemingly moribund Labor Party that crashed and burned in the last decade along with public trust in the peace process. But even more likely is the protests will lead to the creation of a new party or two at the next election (which will probably take place sometime in late 2012 or early 2013) that will exploit public dissatisfaction better than any of the other existing leftist factions. That may be more problematic for Netanyahu because, unlike conservative parties in the West, Likud’s grass roots have always been among lower income Sephardic Jews who were not any more enamored of free market economics than kibbutzniks. As Netanyahu has admitted, the economic stance of Likud in the era of Menachem Begin was more Peronist than anything else. Though times have changed, the vulnerability of that constituency to the siren song of government handouts could prove a problem.

But as potent as the protest have been, the notion Israel will actually vote to go back to its socialist roots seems to be rooted more in the prevalent anti-Netanyahu sentiment among the country’s press than anything else. The idea most Israelis want to jettison its status as a first-world state in favor of the impoverished government-run economy that existed before both Labor and Likud adopted the cause of the free market gives the populace little credit. Israelis may not like the high cost of living, but the belief they will vote to become a second Greece seems far-fetched.

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Optimism, Israeli Style; Negativity on Israel, Western Style

Barry Rubin
The Rubin Report
31 December '10

Israelis are known for being gloomy about the political situation. In fact, they generally enjoy criticizing things (themselves above all). As a result, Israel's enemies often make the mistake of underestimating the country's ability to endure, struggle, and prevail.

A typical example came in a recent Arab newspaper article that claims the serious fire in northern Israel was a sign of the country's collapse. Not so fast!

So when very positive economic figures are released for 2010, Haaretz, the left-wing newspaper, has to put its own spin on them.

Actually, the numbers are really impressive: Israel's economy did better than predicted. It grew by about 4.5 percent in 2010 compared to only 2.7 percent for all of the other OECD (the club of developed) nations. While living standards went down in most of the West, in Israel they rose by 2.7 percent in Israel.

Pretty good, right?

So naturally, at the bottom of this article, Haaretz had to have the following:

(Read full "Optimism, Israeli Style; Negativity on Israel, Western Style")

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Thou Shall Not Steal: Not Even from Rich Oil Tycoons

Moshe Feiglin
Manhigut Yehudit
21 Kislev, 5771
(Nov. 28, '10)

Translated from Ma'ariv's NRG website

Editor's note: A number of months ago, the Noble Gas Company discovered vast stores of natural gas in Israel's territorial waters. According to a prior agreement with the Israeli government, the royalties from the discovery were supposed to have been substantial. But after politicians mixed in, the government appointed the Sheshinski Committee, which advised Israel to re-adjust its tax/royalties structure on hydrocarbons. This proposal means that Israel will renege on its initial agreement with the drilling company and significantly lower the sum of the royalties.

First, proper disclosure. I have never met oil tycoon Yitzchak Teshuvah and I do not have any stocks or interests in Noble Energy. I have no reason to support them. On the contrary – as a politician, it is worthwhile for me to ride the populist wave and vociferously align with the witch hunt against the tycoons who "steal" the public's wealth.

But I have a small problem. Theft is theft and robbery is robbery – even when the victims are wealthy. True, many aspects of the Israeli version of capitalism are avaricious. The huge profits pocketed by Israel's banks are mostly based on interest gained on private accounts – not from actual business deals. This totally contradicts Jewish law and the Jewish spirit. This means that the banks are a motor of servitude – not of economic growth, as they are supposed to be.

The banks are only one glaring example. The salary gap in Israel is among the highest in the world. It's a dog eat dog world out there and the cunning chap who amasses power uses it to trample the person beneath him – without blinking an eye.

The solution for our problem with capitalism is not to institute socialism. Socialism is simply a sophisticated form of robbery that makes everybody poor. An ideology that rejects the sanctity of one's possessions will ultimately lead to a complete contempt for the sanctity of life. It is no coincidence that Stalin and Mao were the greatest murderers in the history of mankind. For some reason, we also seem to have forgotten that "Nazism" is a shortened version of "National Socialism." Socialism is the last thing we need.

We suffer from an exploitative form of capitalism because we have adopted it without our Jewish culture that would refine and restrain it. Jewish economics is based on a triangle. Its base is the sanctity of life and possessions, a.k.a. capitalism. But the triangle has two other sides: faith and kindness. The three Forefathers of the Nation of Israel; Abraham, Isaac and Jacob, were billionaires. The approach that associates property with immorality is Christian. But if you remove capitalism from the ethical envelope of Jewish faith and kindness – you are left with the jungle that we experience today.

Back to the gas royalties. It is sad to see the transformation of politicians who espouse capitalism at every opportunity into populist Robin Hoods, robbing the rich to feed the poor. What usually happens in these cases is that if the Robin Hood doesn't know when to stop when he gets into power, the rich flee and he proceeds to rob the next layer of society.

(Read full article)

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Economy and Security

Moshe Feiglin
Manhigut Yehudit
08 Elul 5770
18 August '10

Israel's economic and security might are at their highest point ever, while its moral standing and ability to preserve the legitimacy of its existence are at an all-time low.

Defense Minister Barak announced this week that he has authorized Israel's purchase of F35 fighter jets from the US. The defense department debated long and hard over whether it is worthwhile for Israel to invest billions for the new jets. Traditionally, the purchase of new jets would set off a mini-celebration in Israel. But this time, it looks like there is nothing to celebrate.

The main argument used time and again to explain why Israel must retreat or why we must not attack Iran is that we will not be able to manage without the American-made spare parts for our fighter jets. This claim is not true. Israel can and does acquire most (and possibly all) of its required spare parts on the open international market – at better prices than from their source.
Israel's continued reliance on American weapons is the perpetuation of the self-loathing mentality that bases Israel's existence on its big brother across the ocean.

It is not even clear that Israel needs these jets. What then, motivates the Defense Minister to authorize their purchase?

The disengagement of the Jews from reality - a.k.a. G-d - leads to its disengagement from its Land. This process of disengagement inevitably results in Israel making "painful concessions." Before these concessions, the US always sends some new weapons system our way, in an attempt to ease the pressure on Israel's leadership and to help it convince the Israeli public to swallow the bitter pill.

Israel should have neutralized the Iranian threat a long time ago, with or without the F35. It did not do so, and probably will not do so until the nuclear reactor is activated in a few days – not because of lack of operational capabilities but due to lack of moral/societal/political resilience. The F35 purchase will not add to this resilience. It will only to serve to make Israel more mentally subservient to the US, aggravating an already bad situation.

Does this mean that Israel should not use American weapons?

(Read full article)

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