Israel, the Start-Up Nation

With all of the daily political happenings surrounding Israel, it’s quite easy to overlook Israel’s booming economy. And while the great book “Start-up Nation” has rightfully received tremendous accolades as no discussion about Israel today can be complete without recognizing Israel’s great economic accomplishments, it must not be overlooked that indeed the nationalist camp, and the ideology of Ze’ev Jabotinsky are to thank for Israel’s economy.

Recently, Facebook announced it was buying, the Israeli company that now provides facial-recognition technology used by the world’s largest social network to help users identify and tag photos. The transaction is believed to be close to $100 million. The same day, in this tiny nation Google chairman Eric Schmidt said that the company’s development centers in Israel are among the company’s most efficient and that Google is constantly expanding them. Schmidt said that the quality of Israel’s engineers is very high, said local salespeople are among the best in the world – and to loud applause proclaimed, “We love Israel.”

A country of 7.1 million, only 64 years old, surrounded by enemies, in a constant state of war since its founding, with no natural resources – produces more start-up companies than large, peaceful, and stable nations. In the past 10 years, Israel’s stock market produced better risk adjusted returns than all other developed stock markets in the past decade. The Tel Aviv TA-25 returned 161 percent, including dividends, over the past 10 years. What a beautiful Israel public relations success story.

It must not be overlooked that it is precisely because the nationalist camp is in power that the economy has thrived – as the ideological leader of the right, Ze’ev Jabotinsky had clear support for economic freedom. Jabotinsky believed “every individual is a king” and the state should not impair his freedom. He noted that freedom of speech and assembly, majority rule, equality for all – are ideals that socialism combats.  Practically, he advocated an end to the Histadrut’s monopoly over labor in Eretz Israel, which was preventing non-socialists from getting work.

Ze’ev Jabotinsky wrote that the Bible is full of social protest, but not socialism. Its economic and social policy is one of freedom; rather than forbid or control economic activity, it deals with any negative results by means of institutions such as the Sabbath, tithing, the gleanings and corners of the field that were left for the poor, and the Jubilee.

Jabotinsky believed in a competitive market and explicitly wrote that Israel’s economy must be a free market – could one imagine the catastrophe Israel would have today been facing if the socialist unions and left-wing controlled the State? Israel is a remarkably resilient country and while naturally the nationalist camp is best for the security of the Jewish people, its also best for the pockets of the Jewish people — and the world.

So when you hear Eric Schmidt of Google say “We love Israel,” all of Israel should proclaim, “We love Ze’ev Jabotinsky.”

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  • Schlomotion

    Most amusing. I was going to compare Israel’s so called “booming economy” based on US taxpayer and ethnic nationalist handouts to that flaccid upstart, Facebook. A nonproduct, exhibitionist media regurgitation, overhyped by some Jewish inside traders, overhyped like your PR firm, overvalued, insider traded, and symptomatic of a broken economic system. But you did it for me.


      Schmucklotion, US taxpayer?

      US AFTER-TAX payers and the entire world are getting raped at the gas pump by OPECkers.

      High gas prices will lose Obama the election.

    • BS77

      Schlockmotion must be miserable living in a world where a nation like Israel prospers and is a shining nation in a sea of mud and violence in the Middle East….There are millions of Muslims who live in Israel who would never want to live in Syria, Libya, or Iraq!!! Never. Israel is NOT the problem in the middle east…..Israel hating Schlockmotion must be fit to be tied, seeing this pioneer nation succeeding against a wave of hatred and ignorance.

    • JoJoJams

      We give them 2 billion/yr. The same that we give to Egypt. One is thriving – one is not (could it be the culture?). Any monies donated from over-seas Jews I would hazard to guess is much less than the mexicans in America send back to Mexico, which is also in the billions, and is the 2nd largest income for Mexico…. Regardless, much of the 2b we give is with the stipulation that they purchase military hardware from us. What do we get from Mexico besides drugs and illegals, and chaos on the border? And 2 billion is pocket change compared to the trillions Israel produces, and the inventions/products by Israeli's are used throughout the world. But let's not let facts get in the way of your absurd hatred for anything Jewish.

      • Cynic

        Last I read earlier this year was that $45 billion was being sent to mexico each year by its expatriates.

        And what does the US get when compared to the return on the $3 biilion to Israel?

  • Schlomotion

    Most amusing. I was going to compare Israel's so called "booming economy" based on US taxpayer and ethnic nationalist handouts to that flaccid upstart, Facebook. A nonproduct, exhibitionist media regurgitation, overhyped by some Jewish inside traders, overhyped like your PR firm, overvalued, insider traded, and symptomatic of a broken economic system. But you did it for me.

  • Ziv

    Schlo – (1) you don't read very well, do you? (2) There were far more Protestants, Catholics, Hindus and others hyping Flakebook as there were Jews, and I certainly heard Jewish analysts standing up and saying "don't buy that thing." So you needn't parade your arrant bigotry quite so vigorously. (3) Israel mostly gets loans from the US, which it uses to purchase US weapons systems; in other words, the US loans Israel the money, Israel buys systems from the US with it, and then Israel is responsible for paying it back with interest. ECONOMIC aid to Israel has fallen over the last 20 years by 95%, to near zero.

    Israel has an enormously successful high-tech industry that includes best-in-class companies in a number of areas, and the emigration to Israel of highly educated Jews from around the world has created an R&D "mecca." Israei Computer science, agritech and medical research include ground-breakers and world leaders.

    In contrast, the US and the west provide economic aid to the Palestinians, whose leaders steal it and then demand more. Per capita, the Palestinians receive more economic aid than any other group in the world, even though all of us are spending $$$$$ on the oil that we buy from their brothers and cousins in the Gulf. Funny, though, that you're just hating on the Jews. There's a word for that.


      That word is NAKBA.

      Happy Nakba to Schmucklotion and david puke and Mr. Charlie Barren.

    • Schlomotion

      No one denies that Israel is capable of producing technology, microirrigation, and good human beings. Thank you for elaborating the Ponzi scheme of loans and arms deals, though. That's the one I'd like to see eliminated.

    • Raymond in DC

      That's not quite true. What Israel gets these days is not loans but restricted grants under the rubric of military assistance. Israel used to get loans or sometimes loan *guarantees*, but both have been or are being phased out. Of the roughly $3 Billion Israel gets each year (less than 2% of Israel's current GDP), about 70% must be spent on US military goods; most of the rest goes to internal military defense procurements. Special projects of interest to the US, like the Arrow anti-missile defense system and Iron Dome procurements, add a few hundred million more.

      Just for comparison sake, Egypt gets roughly $2 Billion annually – still not cut off despite the prospect of an Islamist leadership – most of it in military assistance (against whom, one wonders?). If one adds what the Palestinians get yearly (roughly $1 Billion through various mechanisms), Jordan, Lebanon and even Turkey get, it exceeds that granted to Israel. For *these* outlays, the US gets little more than the back of their hands.

  • StephenD

    All I can say is…VIVA ISRAEL!

    To think, those foolish neighbors of Israel could have just as easily shared in her success and prosperity. They have given up what would have been a very good friend indeed full of life for substandard living and death. They pitched their coins in with the rest that wanted to annihilate Israel and lost the bet.

    They made their rock pile, let them sleep on it.

  • H&R_ Barack

    May enemies of Israel have a Muslim doctor conduct their heart by-pass surgery.

    • Schlomotion

      That wouldn't be a bad thing. There are a lot of outstanding Muslim vascular surgeons.

      • H&R_ Barack


        There are a mere 12 Million Jews in the entire world yet they have received 192 Nobel Prizes.

        The Muslims number 1.4 Billion (with a very big "B")… or 117 times the number of Jews!

        Based upon this 117:1 Muslim-to-Jewish ratio, one might expect the Muslims to have 22,464 Nobel Laureates.

        Muslims have NINE! and one of them [Arafat], – is a murderer (Allahu Akbar, indeed!)

        But even if you only want to compare sheep and goat herdsmen; there even are some outstanding Israeli goat herdsmen.

        Take King David, for instance. BTW, David was also an anointed King over Israel and Judah.

  • Raymond in DC

    "could one imagine the catastrophe Israel would have today been facing if the socialist unions and left-wing controlled the State?"

    One doesn't need to imagine. The socialist unions and left-wing *did* control the state, having laid the foundation for their preeminence during pre-state days. It was an economy that struggled, surviving on loans, financial support from Diaspora Jews, and war reparations, but regularly faced bouts of inflation, currency devaluations, labor unrest, and recessions. It was only in the mid-1980s, after a bout of hyper-inflation, that the first of a series of reforms were undertaken. More took place in the 1990s as Israel was dealing with the massive influx of Jews from the former Soviet states, and into the 2000s when Netanyahu pushed further reforms (with outside help from US Treasury Secretary Snow).

    I've long argued that Israel would have "taken off" economically years earlier had they adopted what I call the Salonika model, rather than that of European socialism. Salonika was a community settled by mostly Sephardi Jews, exiles from Spain. They built an economy around maritime trade, which they dominated until the Greeks took over much of the business. Such an economy – and the vibrant culture they sustained – was built on free market principles.

    Those Salonika Jews who survived the Nazi depredations and made it to the new State of Israel weren't able to ply their business skills under socialist strictures, though they were involved in the new country's nascent navy.

  • Bert

    Jabotinsky may be a positive influence for Israel's economy but his wise influence is ignored by Israel's corrupt political leaders. Jabotinsky would never support the suicidal policies of endless appeasement of Israel's implacable enemies.

  • Atlas_Collins

    Has Jonathan Pollard been executed yet?

    • Cynic

      No, he’s busy partying with Aldrich Hazen Ames who compromised more CIA assets than any Soviet mole in American history.

  • Galveston

    have you found out your sister is really your aunt?

  • Ghostwriter

    I'm amazed Schlobrain continues to sympathize with those who want to kill us. Maybe it's just that his brain is malfunctioning or he doesn't have a heart,that's probably it.

  • WilliamJamesWard

    I question what good can come out of Islam and Muslim Nations that would attract me or cause
    me to have comfort and peace in thinkng on their societies and their Sharia laws. I come up with
    a big fat zero and considerable negative thoughts and feelings concerning them and their kind
    who would enslave me or behead me because I would not submit to their evil. On the other hand
    I question what good can come out of Judaism and the Jewish Nation of Israel. I come up with
    to many good things that have happened to me because of the influence, kindness and friendship
    I have experienced with the Jewish people. Who would I want to share life and Earth with, air
    for that matter, certainly not a people of death and destruction, absolutely not. Jews love life and
    when they realise a friend thy are warm and receptive, I will testify to that with my life……….William