Geo-Political Status in Israel: An Analysis

Current conditions in the Middle East require a constant evaluation of ever-changing situations and possible outcomes. Broad sweeping predictions are no longer effective or accurate as global balances continue to erode standard thinking. The following points, although just generalizations, are my opinion only, and subject to change in an increasingly complex quagmire of conflict. Here is a look at the bad and the good, as it is today. All this could change tomorrow, but this is what we know.

The Bad:

The war in Gaza has endured ten months of death, destruction, and horror. Israelis and Palestinians alike are exhausted, both physically and emotionally. Although the War of Independence in 1948 was actually longer, the populations, infrastructure, and sophistication of the military conflict is on a scale of unprecedented size. 21^st century technology, such as drones, missiles, and cyber warfare, have elevated the ceiling to massive heights. Global response is far less sympathetic to Israel, as the memory of the Holocaust fades, and antisemitism is at the highest levels since the 1930s. The ‘Palestinian’ ideology has grown from just the ‘Arab’ people to an ‘organism like’ entity, and accepted as legitimate by most of the world, while Zionism’s ideals have become a toxic subject for the new ‘woke’ global thinking. It will take several generations to reverse this trend.

Israel enjoyed a remarkable economy for 75 years. The above factors, plus the danger of a wider conflict regionally, has pushed Israel into a budget deficit of 8.1%, for the first time in its history. While much of that may be due to the growing fiscal waste supporting a ‘socialist’ ultra-religious demographic, the military cost of a multi-front conflict continues to drain the country’s wealth. Israel’s credit rating, while consistently excellent, has slipped from A++ to A by Moody’s and other rating services, mostly due to budget issues, and the cost of warfare. Continuous worry over ‘judicial reform’, internal corruption investigations, and unqualified ministerial appointments, degrades global confidence and business investment. It is the political structure itself that needs overhaul if democracy is to survive. Again, this will take several generations to correct. Currently, the will power to do so is not there.

The IDF has always enjoyed deterrent superiority over its enemies with innovation, technology, and leadership. That is now deflating rapidly, and has been the root cause of October 7^th, and the current multi-front attacks by barbaric enemies who see Israel as weak and vulnerable. The continued reliance on the US, among others, for arms, credit guarantees, and political support, has put the country at the mercy of a ‘Chamberlain at Munich’ policy of appeasement. The Western allies do not, and never have, understood the mindset of Israel’s enemies, believing that diplomacy and paper treaties can replace 1000 years of conquest and aggression. Giving up on strong deterrent, and hoping Iran and its proxies will sit and compromise, is a fool’s errand. Barbaric aggressors rooted in the 10^th century thinking will only get emboldened, as the evidence since October has shown. Only strong threats of total destruction can quiet the playing field. The ‘MAD’ doctrine of the cold war era was respected by the West and Soviets alike, and kept the peace.

Reliance on the US for help, is like a dying patient on hospice. Still kicking, but that’s an illusion. The winds of change in the political spectrum in America are all but a given. If Harris and the progressive left gain power, and they eventually will, Israel will soon lose the aid packages that have supported the deterrent. New legislation for credit guarantees will be subject to intense opposition, filibustering that can take months, and, even if aid packages are passed, Harris will most likely veto them and any additional help for Israel. If there are not enough votes in Congress to overturn such a veto, Israel must find new ways of producing their own munitions. The IDF currently suffers from depleted sources of delivery platforms, ordinance, and support facilities to take on Gaza, Lebanon, Yemen, Iraq/Syria, and terrorism on the West Bank. Iran knows this, and is on the verge of all out prosecution of hostilities. The US and other allies, are slowly losing their stomach for this game of attrition. Back and forth deployment of assets is draining on American resources. China and Russia are more and more the focus of US strategic thinking. As the US pushes for more ‘negotiations’, the ugly head of ‘appeasement’ will surface again.

The cost of living in Israel is reaching epidemic proportions. The price for a modest 2-bedroom apartment is around $1,000,000 US currently. While mortgage taking is at a brisk pace in spite of the war, demand far exceeds the current supply of housing. New construction has been severely affected by the war, as workers are harder to find with the clamp-down on Palestinian work permits. Foreign labor from Thailand or the Philippines has also diminished considerably. Investment for commercial office space is still brisk, but fewer investors is reducing the influx of foreign currency, and the Shekel has experienced devaluations. While Israel’s sovereign wealth fund continues to grow, it is mostly based on the off-shore natural gas fields. That could all go up in a ball of fire if Iran and its proxies decide to target them. This financial atmosphere does not help those who struggle with the cost of living, nor does it provide much help for new Olim who wish to make Aliya. With cities in the Galilee almost deserted, many in shambles from Hezbollah attacks, it will still take several decades to recover, should the war end today.

The Good:

Israel’s most important asset, by far, is its people. The Jewish people have survived much worse over the last 3500 years. Expulsions, war, pogroms, inquisitions, genocides, and, of course, the Holocaust. We are still here. We not only live, but thrive. The corrective steps to fix ‘the bad’ will come from the Jewish spirit and minds of innovation. Israel has limited natural resources, but brain power is not one of them. Solutions will be found.

The Abraham Accords were a monumental achievement, bringing an end to the old ‘Arab’ isolation of the Jewish State. There is a long way to go yet, but if hostilities end we might just see the load bearing piece of the puzzle finally join this new way of critical thinking about the region. The Saudi signature on the process will trigger a change in the winds that blow in the Middle East. As mentioned above, I don’t place much value on a piece of paper like a treaty. The Abraham Accords, however, represents more than that. They are a part of a process that alters the very way Israel is perceived by its neighbors. A significant move toward the idea of ‘inclusion’ that is all the rave now. The way it should work. Others will follow, surely. Money, technology, commerce, and mutual safety in numbers can go a long way to expunge old hatreds. Multiple nations with common cultures and economies can thrive together.

Israel’s economy is ready to purr again. In spite of the war, the country boasts five of the magnificent seven tech leaders with headquarters located in the Jewish State. Microsoft, Google, NVidia, Amazon, Intel, and others have, and continue to locate offices, plants, and research facilities in and around Tel Aviv. With a ready source of high tech, and a well-educated employment base, Israel will continue to lead the region, and the world, in future science innovations like AI, robotics, quantum computers, and new sources of energy such as thermo-nuclear fusion. This is, of course, incentive for the growing interest by Abraham Accord nations and their move away from fossil fuels.

Much work needs to be done to restore the Galilee cities and help resettle the displaced citizens, now around 100,000. The same goes for the people of the Gaza envelope who suffered so greatly on October 7. New ways to facilitate their recovery economically have to be found, so it’s not on the back of the individual, the government, or the insurance companies. The UN will be no help. They will never consider Israeli citizens as war victims, as they do for Gazans, for example, so that option is not on the table, now or ever. That’s just politics and hatred, and may never change. But the future looks bright if Israel applies what it learned in the 1950’s absorbing 1.3 million immigrants.

One area of concern that is ripe for the plucking, is the Diaspora. As always, Jews around the world will continue to support the Zionist spirit, and help. Israeli connections have suffered over the last few decades in terms of public relations. The approach has been abysmal. Many Jews in the US have, and will continue, to support progressive ideologies, without seeing the shape shifting these beliefs have experienced. Being a “Zionist” is almost a dirty word now among many. That needs to change. Post war changes need to happen and bring back the Jewish spirit and support for Israel as a Jewish State to current generations. New strategic initiatives are needed to re-connect with all of our people. The ideas and talent are here, it needs to be tapped, and I think it will.

Israel’s independence from arms suppliers is a must. That too, is happening. New contracts have recently been signed with Elbit, IAI, and other Israeli firms to make 155mm artillery rounds, guided bomb units like 2000-pound MK 84s. Work continues on the Iron Beam, the anti-aircraft laser weapon. Electricity is cheap, Iron Dome interceptors are not. They should be operational next year, from Raphael. Israel must re-establish its deterrent!

Transportation to relieve the country’s gridlock traffic issues is still behind schedule, but light rail systems and new expressways are inching forward. It is bureaucracy that slows these down, not funding. Within five years or so, most of the Negev and major cities of the north and central will have better transportation. Israel expects a population of 15 million by 2030, driven by global antisemitism, increased birth numbers, and Aliya. The percentage of Jewish demographics will continue to stand around 80%, so the divisive “Nation State” law can be dispensed with. Israel will make great strides in improving its inclusive relationships with Arab, Christian, and Druse citizens. Much to the delight of the ‘woke’ Europeans and Americans.

That Elephant in The Room:

I can’t leave this forum without mentioning the biggest sticking point that no one wants to talk about. The dreaded “two state solution”. Anyone with any understanding of recent history knows that this idea is dead on arrival. I don’t know how anyone can promote a new Arab Palestinian state that would immediately weaponize itself and proceed with a new war of annihilation against Israel. That is what would happen. There should be no argument there. The idea of a “one state solution” is just as bad. I don’t have the answers. Many have proposed other ideas like the “Hashemite Kingdom of Palestine”. That means replacing Jordan, and adding 2 million or so Palestinians to a state that doesn’t want them anyway. Perhaps a confederation protectorate of Israel or Jordan like Monaco is to France. Someone more brilliant than I will find a solution. It will take a long time.

In Conclusion:

There are many other issues not covered here, but it is hoped that by touching on the most pressing issues, there is a glimmer of hope in some of these ideas. One thing for sure. Things cannot go on the way they are. The “Status Quo” is destroying lives everywhere in the region. Everyone involved needs to regain their sanity.

Sources:

“Globes International”

“The Times of Israel”

“Arutz Sheva International edition”

“The Jerusalem Post”

“Moody’s Financial”

“Intel Today: Innovations”

“The Google Stream”

“Israel Ministry of Transportation”

“Israel Ministry of Finance”