This is the third time Israel has been strategically surprised. The first in 1973. The second in 2006 in the Second Lebanon War, and the third on Saturday, October 7 (The Jewish holiday of Simchat Torah) over a week ago. Each surprise has exacted a heavy price. Three times in 75 years means that on average a surprise should occur every 25 years, and in fact it has, more or less, been the case empirically (25, 33 and 17 years between instances). Is there any rhyme or reason to this pattern, or is it random – just bad luck or something else?
Perhaps we could understand this chain of events in the light of the behavioral economics of American economist Hyman Minsky (1919-1996). Minsky posited that economic cycles and financial crises are intrinsic to any free market economic system. He argued that each economic cycle has three stages and ends in a financial crisis. Each stage is characterized by different borrowing patterns among firms and individuals.
In the first stage (“hedge borrowing”), right after the last financial crisis, firms and individuals are exceedingly cautious. Businesses do borrow in order to grow, but they borrow in such a way that they can repay both principal and interest on the basis of current earnings. But as time goes on and the economy prospers, they regain confidence, and so do the lending banks. Thus begins the phase of “speculative borrowing.” Debtors can pay the interest but in order to repay the principal they have to take out new loans. The final phase is financial euphoria. Banks lend to people who cannot pay either the interest or the principal. Both lenders and borrowers depend on constantly rising asset prices (such as the market value of mortgaged homes) to enable loan repayment. This last “Ponzi” stage generally leads to debt failure, bankruptcy, and financial crisis as occurred in the subprime crisis of 2008.
Something similar seems to characterize the behavior of Israel’s defense system. After 1948, the Israeli military began to rebuild itself in the wake of the War of Independence, which almost completely exhausted its resources. Under the leadership of Moshe Dayan, Yitzchak Rabin, Ariel Sharon, and others it regained confidence. On the eve of the Six Day War, the IDF was fairly certain that it could win. Of course, after the Six Day War it entered the euphoria phase and developed the (mis)conception that no Arab state would dare to attack it, and ignored all the warnings and intelligence reports leading up to the outbreak of the Yom Kippur War on Oct. 6, 1973. After the devastating surprise and crisis of the war, with thousands killed and wounded, the cycle started again.
Israel invested massively in its armed forces in the 1970s and ‘80s, calling up thousands of reservists for long periods of guard duty on its borders and forcing the Palestine Liberation Organization out of Beirut. But again, time passed and confidence and complacency set in. Prime Minister Olmert ordered the IDF to attack after the kidnapping of two soldiers near the Lebanese border. Again, Israel was surprised by the sophistication and effectiveness of the enemy’s resistance, this time it was Hezbollah, a mere guerrilla-terrorist organization. After the Second Lebanon War, the IDF was much more careful in its troop deployment in its various military operations against Hamas and the Islamic Jihad in Gaza. But after a while, the military and technological superiority of the IDF was so apparent that over-confidence and complacency set in.
The period leading up to the current conflict was characterized, again, by a sort of euphoria in the defense and intelligence communities. Since Hamas sat out the last two rounds of conflict between the Islamic Jihad and Israel, the defense community was sure that Hamas would not dare attack Israel. Just two weeks before the Hamas invasion, Tzachi Hanegbi, the head of Israel’s National Security Council, declared: “Hamas is very, very restrained and understands the implications of further defiance.” This attitude dovetailed, as many have pointed out, with Prime Minister Netanyahu’s seeming to prefer Hamas over the Palestinian Authority . According to Ronen Bergman and Patrick Kingsly writing in the New York Times ,”When Israeli intelligence officials briefed senior security chiefs….The challenge posed by Hamas was barely mentioned.” They write further that Israeli intelligence officers failed “to monitor key communication channels used by Palestinian attackers.”
According to Hyman Minsky, the cycle of caution, confidence, complacency, euphoria, and crisis is a universal constant of human psychology. But it does not have to determine our fate. Minsky himself advocated for strong financial regulation to mitigate the excesses of financial complacency and euphoria. Here in Israel, we must be aware of these cycles and how they can affect our intelligence readings and defense posture.
As a first step, Israel must put in place an algorithmic system to identify verbal expressions – in public, military, and political channels – that are characteristic of “euphoria” such as “the enemy would not dare,” “the enemy is deterred,” “the enemy is restraining itself.” This would act as a “circuit breaker” and not allow orders regarding deployment of troops or weapons once euphoria had been identified. It is vitally important that this system be implemented by artificial intelligence which is not subject to human psychological weakness. Once euphoria has been identified, the system would require (human) deliberation to take place at the appropriate level – military intelligence, the general staff, or the cabinet. The default assumption in cases of euphoria should be that it is not justified. In order to justify a self-confident assessment of the enemy, his intentions and capabilities, hard evidence must be produced. The system is based on the assumption that it is counter intuitive, that it challenges the very human thoughts and feelings of decision makers. Decision makers will have to heed the impersonal assessments of algorithms along with their own intuitions and feelings
Israelis only have one Jewish state, and they must not lose it by giving in to misplaced complacency and euphoria.