Despite its many economic successes, Israel is plagued by an unusual high cost of living relative to wages, making life difficult, especially for young people and recent immigrants. Simona Weinglass writes:

[The economists] Gilad Brand and Eitan Regev surmised that these [market] problems are caused by government regulation that allows industry after industry . . . to be very concentrated [in the hands of a few businesses].

“An Israeli importer has an agreement with a global producer and the global producer works only with him,” explained Brand. “He is not willing to sell his products to other importers. . . . In other countries, . . . other entrepreneurs [would] come along and buy products in a secondary market, but in Israel the government ministries don’t make this possible.” . . .

“Many people think the problem of the Israeli market is that it’s too capitalistic,” said Regev. “Actually, it’s the exact opposite. It’s not competitive enough. It’s controlled by oligopolies and monopolies that reduce productivity and raise prices. Many Israelis blame the wrong address and think the problem is the improper distribution of public funds, when actually the real robbery is in the private sector.”

Yesterday I saw an unconfirmed report that the Biden administration has offered Israel a massive arms deal in exchange for a promise not to strike Iran’s nuclear facilities. Even if the report is incorrect, there is plenty of other evidence that the White House has been trying to dissuade Jerusalem from mounting such an attack. The thinking behind this pressure is hard to fathom, as there is little Israel could do that would better serve American interests in the Middle East than putting some distance between the ayatollahs and nuclear weapons. Aaron MacLean explains why this is so, in the context of a broader discussion of strategic priorities in the Middle East and elsewhere:

If the Iran issue were satisfactorily adjusted in the direction of the American interest, the question of Israel’s security would become more manageable overnight. If a network of American partners enjoyed security against state predation, the proactive suppression of militarily less serious threats like Islamic State would be more easily organized—and indeed, such partners would be less vulnerable to the manipulation of powers external to the region.

[The Biden administration’s] commitment to escalation avoidance has had the odd effect of making the security situation in the region look a great deal as it would if America had actually withdrawn [from the Middle East].

Alternatively, we could project competence by effectively backing our Middle East partners in their competitions against their enemies, who are also our enemies, by ensuring a favorable overall balance of power in the region by means of our partnership network, and by preventing Iran from achieving nuclear status—even if it courts escalation with Iran in the shorter run.