Saturday, January 22, 2005
Is Israel threatened more by its own statist economy than by its avowed enemies and terrorism?
Somebody who might know thinks so...
Official: Economy Threatens Israel More Than Terror
The former chairman of Israel's National Security Council warned yesterday that the "real threat" to the 56-year-old Jewish state comes not from Islamic terrorists or Palestinian guerrillas but from a high unemployment rate, an insipid annual economic growth rate, corruption, social inequality, and the deteriorating quality of general education.
"The combination of these elements constitutes the biggest threat that Israel is facing - and it's time that we got our act together," the current president of the Zionist Council in Israel, Uzi Dayan, told The New York Sun in an interview.
"I am not worried about whether Israel will continue to exist. The world need not fear that our Jewish democratic state will be extinguished. What worries me is what kind of existence we are going to have, what kind of society we are going to bequeath to our children."
His worries, Mr. Dayan said, flowed from a study of statistics that suggested that Israel's economic well-being may be endangered. For example, he said, there was a cumulative drop of 6% in per capita income, starting in 2000 and continuing through the end of last year.While living standards in OECD's seven wealthiest industrial countries - America, Britain, Canada, France, Germany, Italy, and Japan - rose by 82% between 1973 and 2003, they increased in Israel by barely 48%, added Dan Ben-David, professor of economics and public policy at Tel Aviv University. Mr. Ben-David accompanied Mr. Dayan on his trip to New York to brief policy-makers...
He said he was particularly troubled by the fact that Israel allocated more than $12 billion of its $45 billion budget on social expenditures, such as subsidized housing and welfare payments to the unemployed - almost 25% more than the figure spent on defense. The country's unemployment rate has been rising steadily since 1973, when it was 3%, to nearly 11% in 2004.
"More than one-third of Israeli families have fallen below the poverty line," Mr. Dayan said ...
Mr. Ben-David said that while it was customary in many Israeli circles to apportion the country's economic woes to the Palestinian Arab intifada ... the economic deterioration began "well before the intifada." ...
Since Israel's founding in 1948, America has given it more than $100 billion in aid, averaging around $2 billion annually. American economic assistance to Israel accounts for almost a third of the aid it provides to developing countries ...
In addition to bilateral assistance, Americans give Israel $1 billion in private philanthropic assistance, as well as another $500 million worth of Israeli bonds. Israel also typically gets short-term commercial loans from American banks of about $1 billion a year.
"The problem is not lack of public money," Mr. Dayan, who has served as an adviser to Prime Ministers Sharon and Barak, said. "The problem is a lack of direction." [NY Sun]
