The Knesset is considering an ambitious budget bill that promises sweeping reform. As Haviv Rettig Gur explains:

This bill . . . upends the old ways of thinking about the Israeli state’s responsibility for its Arab citizens; takes a sledgehammer to structural obstructions that have long plagued the Israeli economy, from protectionist import policies to state price-setting on basic staples; reimagines Israel’s public-transportation network and environmental commitments; . . . opens the banking system to more competition, especially online and via mobile apps; dramatically increases spending on health and defense while cutting expenditures on most other things; and promises a major overhaul and streamlining of governmental red tape.

To Gur, there are only two precedents in Israeli history for such radical change, each of which followed a major economic crisis, perhaps parallel to that caused by the coronavirus: the first was in 1985, when a unity government similar to the current one ended crippling inflation by wresting the country away from the socialism of its founders. The second was in 2003, when then-finance minister Benjamin Netanyahu enacted a further program of economic liberalization, paving the way for Israel’s high-tech revolution. At that time, the crisis was of a different kind:

[T]he Palestinian economy before 2000 was deeply integrated into, and dependent on, the Israeli economy—and was flourishing because of it. Israelis could safely travel in Palestinian cities in those days and had developed a habit of buying cheaper Palestinian goods and services, from car parts to dentistry, valued at hundreds of millions of dollars annually. Together with overseas tourists, they dropped half a billion dollars annually, equal to over 10 percent of the Palestinian GDP, at Jericho’s casino.

But Israel’s economy needed the Palestinians, too, at least in those days. As they grew wealthier from trade with Israel, Palestinians became eager consumers of Israeli products, with some $1.7 billion in Israeli exports to the PA annually, or 7 percent of total Israeli exports excluding diamonds. Palestinian labor drove the Israeli agriculture and construction industries.

The onset of the second intifada reversed those trends, hurting both sides deeply and in interconnected ways.

While roughly a third of Saudis are willing to cooperate with the Jewish state in matters of technology and commerce, far fewer are willing to allow Israeli teams to compete within the kingdom—let alone support diplomatic normalization. These are just a few results of a recent, detailed, and professional opinion survey—a rarity in Saudi Arabia—that has much bearing on current negotiations involving Washington, Jerusalem, and Riyadh. David Pollock notes some others:

When asked about possible factors “in considering whether or not Saudi Arabia should establish official relations with Israel,” the Saudi public opts first for an Islamic—rather than a specifically Saudi—agenda: almost half (46 percent) say it would be “important” to obtain “new Israeli guarantees of Muslim rights at al-Aqsa Mosque and al-Haram al-Sharif [i.e., the Temple Mount] in Jerusalem.” Prioritizing this issue is significantly more popular than any other option offered. . . .

This popular focus on religion is in line with responses to other controversial questions in the survey. Exactly the same percentage, for example, feel “strongly” that “our country should cut off all relations with any other country where anybody hurts the Quran.”

By comparison, Palestinian aspirations come in second place in Saudi popular perceptions of a deal with Israel. Thirty-six percent of the Saudi public say it would be “important” to obtain “new steps toward political rights and better economic opportunities for the Palestinians in the West Bank and Gaza.” Far behind these drivers in popular attitudes, surprisingly, are hypothetical American contributions to a Saudi-Israel deal—even though these have reportedly been under heavy discussion at the official level in recent months.

Therefore, based on this analysis of these new survey findings, all three governments involved in a possible trilateral U.S.-Saudi-Israel deal would be well advised to pay at least as much attention to its religious dimension as to its political, security, and economic ones.