Israel’s Current Government Aims to Imitate Benjamin Netanyahu’s Great Economic Transformation

Aug. 10 2021

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.

Read more at Times of Israel

More about: Benjamin Netanyahu, Israeli economy, Israeli politics, Second Intifada

What Iran Seeks to Get from Cease-Fire Negotiations

June 20 2025

Yesterday, the Iranian foreign minister flew to Geneva to meet with European diplomats. President Trump, meanwhile, indicated that cease-fire negotiations might soon begin with Iran, which would presumably involve Tehran agreeing to make concessions regarding its nuclear program, while Washington pressures Israel to halt its military activities. According to Israeli media, Iran already began putting out feelers to the U.S. earlier this week. Aviram Bellaishe considers the purpose of these overtures:

The regime’s request to return to negotiations stems from the principle of deception and delay that has guided it for decades. Iran wants to extricate itself from a situation of total destruction of its nuclear facilities. It understands that to save the nuclear program, it must stop at a point that would allow it to return to it in the shortest possible time. So long as the negotiation process leads to halting strikes on its military capabilities and preventing the destruction of the nuclear program, and enables the transfer of enriched uranium to a safe location, it can simultaneously create the two tracks in which it specializes—a false facade of negotiations alongside a hidden nuclear race.

Read more at Jerusalem Center for Security and Foreign Affairs

More about: Iran, Israeli Security, U.S. Foreign policy