The Future of Israel Looks Good
Professor Efraim Inbar President of the Jerusalem Institute for Strategic
Studies.
18 April 2018
http://jiss.org.il/en/inbar-future-israel-looks-good/

Time is on Israel’s side. A review of the balance of power between Israel
and its foes; of the domestic features molding Israel’s national power; and
of Israel’s standing in the international community, validates the
assessment that Israel has the dominant hand for the foreseeable future.

[This is the first article in a special series of studies by JISS experts to
mark Israel’s 70th anniversary. The series examines Israel’s diplomatic and
defense achievements in grand strategic perspective.]

Introduction

At 70, Israel stands strong, yet debates about its health persist. The
radical Israeli Left seems most concerned about the country’s future,
arguing that there is great urgency in solving the Palestinian-Israeli
conflict; otherwise, Israel is doomed. The Left contends that Israel’s
democratic character, its international legitimacy, and its ability to
withstand protracted conflict all are threatened by the ongoing stalemate.

Indeed, Israel has faced existential threats from its neighbors since its
establishment. And as a small state its existence is precarious. Moreover,
Jews with a historical consciousness remember that a Jewish state was twice
destroyed by powerful empires. So nothing can be taken for granted.

However, this article argues that time seems to be on Israel’s side. A
review of the balance of power between Israel and its foes, and of the
domestic features molding Israel’s national power (such as its economy,
social cohesion and political system), and of Israel’s standing in the
international community, validates the assessment that Israel has the
dominant hand for the foreseeable future.

The National Security Arena

The balance of power between Israel and its neighbors is the critical
variable in Israel’s quest for survival in a bad neighborhood. As long as
the power differential between the Jewish State and its foes is growing,
then Israel’s capacity to overcome regional security challenges is assured.

Israel has built a mighty military machine that has been successful in
overcoming many military threats, benefiting from skilled and well-motivated
manpower, as well as advanced weapons. The military victories have signaled
to Israel’s foes that Israel cannot be destroyed by force. Its military
superiority largely has contributed to the decline in the intensity of the
Arab-Israeli conflict. The last large-scale conventional military encounter
that involved aircraft and tanks was in 1982. Moreover, a peace process with
Arab states has started, effectively lowering the chances of an Arab-Israeli
large scale conventional war.

Since 1982, Israel has employed force primarily against armed organizations,
such as Hizballah, Palestinian terrorist organizations, and Islamist
militias, which use a combination of methods: terror, suicide bombings, and
guerilla tactics. Israel also increasingly faces the use of missiles
launched at its strategic assets and population centers. Terrorism is the
weapon of the weak and terrorists are less dangerous than states, although
the struggle against them often is costly in blood and treasure.

The capabilities of non-state organizations to harm Israel is amplified by
the support they receive from nation states, such as Iran. For example, the
arsenal of over 100,000 missiles in the hands of Hizballah poses a very
serious challenge for Israel. The enemy strategy is to inflict pain on
Israel and to test its resolve. Israel has established a multi-layered
anti-missile system, but this is unlikely to provide foolproof defense.

Israel’s anti-missile systems are impressive. The Iron Dome batteries
deployed to intercept missile threats of up to 70 kilometers registered an
impressive record of 88 percent interception rate in Gaza encounters. The
David’s Sling missile defense system for meeting threats of up to 300
kilometers is also operational. Israel also deployed Arrow-2 and Arrow-3
interceptors, designed to work against long-range missiles. The defensive
perimeter established reflects the excellence of Israel’s military
industries, an important component in Israel’s military superiority. But
again, these systems cannot provide a full defense in view of the numbers of
missiles arrayed against Israel.

Israel has also developed a nuclear option, buttressing its image of a
strong state. Such weapons serve as a constant reminder that attempts to
destroy the Jewish state could be extremely costly. They have a deterrent
value primarily against hostile states.

In contrast, Israel’s rivals in the Arab world suffer from great weakness.
Their stagnant societies still grapple with the challenge of modernity as
the upheavals in the Arab world indicate. Their ability to militarily
challenge the status quo is limited.1

In short, over time Israel has become stronger, while its enemies, with the
exception of Iran, have become increasingly weaker.

The only grave national security challenge in the region is a nuclear Iran.
Such a development is not only a direct threat to Israel, but also could
start a chain of nuclear proliferation, a change in the regional balance of
power, and an Iranian takeover of the energy resources in the Gulf and
Caspian Basin. While the world has become more attentive to Israel’s
perspective on this matter, the international community, by supporting the
July 2015 JCPOA, has failed to stop Iranian progress in the quest for a
nuclear arsenal. It is quite possible that Israel may be left on its own in
dealing with the Ayatollah’s nuclear aspirations. Fortunately, obstruction
and perhaps even destruction of the Iranian nuclear program is not beyond
the capabilities of Israel.

A Strong Economy

Military and economic power are related and reinforce each other. Israel’s
edge over its Arab neighbors continues to grow also because of its economic
prowess. Israel’s strong economy is a result of wise economic policies,
stressing market values, and adapting to globalization. Israel is one of the
most developed market economies with substantial, though diminishing,
government participation. The main driver of the economy is the science and
technology sector. Israel’s manufacturing and agriculture, despite limited
natural resources, is highly developed and sophisticated.

In recognition of Israel’s economic achievements Israel was admitted in 2010
to the Organization for Economic Cooperation and Development (OECD), which
brings together the 33 most developed countries that are committed to
democracy and market economy.

After years of annual growth rates above 5 percent, the economic expansion
has been slowing down. In 2016, the growth was 4 percent and in 2017 it was
3.4 percent. Yet, the long-term projection for 2020 is 4.1 percent. Israel
also managed to reduce its debt/GDP ratio from 100 percent in 2002 to 74
percent in 2012 and to 61.9 percent in 2017. The forecast is continuous
decline, while most of the world experiences a soaring ratio. Israel’s 2012
budget deficit and unemployment were 4.2 percent and 6.9 percent
respectively. In 2016, the respective figures were 2.5 and just above 4
percent. These figures are much lower than the OECD average. Indeed, all
international economic institutions such as the International Monetary Fund
(IMF) and the World Bank commended Israel’s economic performance and
expressed confidence in its long-term viability.

Israel is also an attractive site for overseas investors, particularly in
the high-tech area.2 Scores of major US manufacturers, including General
Electric, General Motors, Microsoft, IBM, Google, Apple and others, have R&D
centers in Israel. Some 300 US high-tech companies have R&D presence in
Israel, and many overseas entrepreneurs invest in and/or acquire Israeli
high-tech companies. Israel is a global leader of microchip design, network
algorithms, medical instruments, water management and desalinization,
agriculture, missile defense, robotic warfare, and UAVs. The successful
integration into a globalized economy also testifies to the fact that Israel
is not isolated in the international community – an issue discussed below.

Israel has the highest ratio of university degrees to the population in the
world. Israel produces more scientific papers per capita than any other
nation by a large margin, as well as one of the highest per capita rates of
patents filed. Most important, 4.5 percent of its GDP goes to research and
development, the highest proportion in the world.

Israel’s robust demography, a record high fertility rate in Western
countries of three births per woman, provides a tailwind for its economy.
Moreover, Israel’s government is developing programs for training better the
Arabs and the ultra-Orthodox sectors to increase their participation in
Israel’s workforce. Additional qualified manpower is an important element in
economic growth. Moreover, the natural gas findings in Israel’s economic
zone in the Mediterranean allow Israel to enhance its economic viability and
achieve energy independence.

Sustained economic growth requires responsible economic policies and ability
to resist populist demands. So far, Israel’s political leaders have met this
challenge, and there are signs that the political system has internalized
the need to continue such policies.

Despite the remarkable economic progress, Israel’s 2016 GDP per capita is
$37,292 (less than most Western countries), leaving room for further
improvement. Nevertheless, Israel’s 2016 $318,7 billion economy is larger
than all of its immediate neighbors combined, Moreover, Israel’s expanding
economy can afford larger defense outlays to meet its national security
challenges, and the resources to ensure continued R&D for winning future
wars.

A Strong Society

People who portray Israel as a deeply-divided society – a society split into
separate tribes – are mistaken. In fact, social cohesion in Israel is
greater than ever before. Most of Israel’s social rifts have been bridged
creating a stronger society. This is good news for the ability of Israeli
society to withstand the inevitable tests of protracted conflict in the
future.

Significantly, the acerbic ideological debate over the future of the
territories acquired in 1967 is over. The Sinai that was traded for a peace
treaty in 1979, the Golan Heights that was de facto annexed in 1981, and
Gaza that was evacuated in 2005, are no longer bones of contention. Over
two thirds of Israelis oppose any territorial concessions in the Golan
Heights. The civil war in Syria has only solidified such positions.

Concerning Judea and Samaria, there is a great majority in favor of
partition – which is the historical Zionist approach. But large majorities
also insist on retaining the settlement blocs, holding Jerusalem (the Temple
Mount in particular), and the Jordan Rift. The establishment of a
Palestinian Authority (PA) in 1994 amounts to another de facto partition,
albeit a messy one. Skepticism over the state-building ability of the
Palestinians is widespread, but very few Israelis advocate annexing the
cities of the West Bank. Moreover, Israel built a security barrier in the
West Bank in 2002, signaling determination to disengage from the main
Palestinian population centers and marking a potential future border.

The current territorial debate is not couched in ideological reasoning, but
in a pragmatic assessment of what is needed for Israel’s security and what
is least costly in terms of domestic politics. The expectations of the
mid-1990s for peaceful coexistence with the Palestinians have been replaced
by a realistic consensus that peace is not around the corner. The Israeli
public is largely reconciled to the idea that Israel will have to live by
its sword for the foreseeable future, and most of the public is ready to pay
the price of long-term struggle. Managing the conflict with the Palestinians
has become the mainstream position in Israel, for lack of a better option.

Israelis reject the argument that the continuation of the current impasse in
Israeli-Palestinian negotiations inevitably constitutes a demographic
dynamic leading to a bi-national state. Israel’s willingness to partition
the territory, and the ability of the political system to disengage
unilaterally from territory heavily populated by Arabs, nullifies the
“demographic” argument. Just as Israel is not concerned by the numbers of
babies born in Amman, Jordan, it is not overly concerned by the fertility
rate of Arab woman in Nablus, in the West Bank either.

Israelis understand that, alas, they are locked into a long-term, tragic
conflict with the Palestinians; and they have patience to wait for better
times. Palestinian rejection of Israeli partition proposals (from Ehud Barak
in 2000 and Ehud Olmert in 2007) has strengthened the feeling of “ein
breira” (there is no choice) – meaning the conflict must simply be managed.
This consensus is an important asset in terms of Israel’s ability to fight
future wars, if necessary. And thus, criticism of far Left in Israel and of
foreign observers regarding Israeli West Bank policy can be dismissed. It
hasn’t cracked the Israeli consensus.

Similarly, debates over Israel’s preferred economic regime have long
disappeared. Nearly all Israelis agree that capitalism is the best way to
create further wealth. Government policies along such lines are widely
supported. The Likud, and primarily Prime Minister Binyamin Netanyahu,
advocated a market economy and have been in power for most of the last two
decades.

Another long-simmering social rift, the Ashkenazi-Sephardic cleavage, is
gradually attenuating. The number of “intermarriages” is on the rise,
obfuscating ethnic differences. The past three decades have seen a dramatic
increase in the proportion of university students of Sephardic origin, and a
similar growth in the ranks of the senior officers of the IDF. Their numbers
in municipal and national politics increased significantly.

The only rift within Israeli society which is still of great social,
cultural, and political importance is the religious-secular divide. Despite
efforts to mitigate the consequences of the growing estrangement of the
secular sector from traditional values and Jewish culture, we are in the
midst of a Kulturkampf.3 However, this situation does not differ greatly
from the afflictions of identity politics faced by other Western societies.

Moreover, the conflict is not between two clearly defined camps. The number
of those defining themselves as secular is diminishing (only 40 percent),
while a growing number of Israelis identify themselves as traditionalists,
in the middle of the orthodox-secular continuum. The proportion of the
Orthodox in society is also growing. Precisely because there are Jews of
different degrees of observance and knowledge, there is room for mediation
and a modicum of understanding.

Not everything is perfect in the Israeli society and economy. There is some
violence in the streets and in the schools; the education system has
problems; the gap between rich and poor is too large; economic competition
is insufficient; and housing prices are too high. Nevertheless, a Gallup
poll of 2017 rates Israel eleventh in the world in terms of happiness. As
well, over 90 percent of the Jews in Israel consistently are proud to be
Israeli. Ascribing dissatisfaction and discord to Israeli society at large
is simply wrong.

A Flourishing Democracy

Part of the frustrated Israeli Left argues that Israel’s democracy is in
danger. The frustration stems from the fact that for more than two decades
the Left has failed to garner support in the electoral arena for it
policies. Yet Israel’s democracy is alive and well. It is far more vibrant
and open than it was during the days of the Labor Party’s hegemony
(1948-1977). The end of the hegemonic party era democratized Israel’s
political system, allowing for new forces to appear on the political stage
and for greater social mobility.

The erosion of socialist practices and privatization of a centralized
economy contributed to the growth of a non-Ashkenazi middle class. Social
mobility has also been enhanced by a greater access to higher learning.
During the post-1977 period a large number of colleges of varying quality
were opened and competed with the established universities for students and
resources. Over time Israel has also seen slightly less influence of central
power at the municipal level, allowing for the emergence of new foci of
power and a new venue for leadership recruitment.

A pivotal component in any democracy is the judicial system. The ascendance
of the Israeli Supreme Court to its current elevated status started after
the decline of Labor. It was Prime Minister Menachem Begin who encouraged a
more active role for the Supreme Court, and he was instrumental in the
nomination of the interventionist Aharon Barak to the Supreme Court in 1978.
The independence of the police and the judicial system in Israel has
drastically increased in recent years. Israel’s judicial system fearlessly
prosecuted a president, prime minister, and cabinet ministers, becoming the
subject of envy in many democratic states. Attempts to curtail Supreme Court
activism are under way by appointing more conservative judges. Redressing
the balance among the government, Parliament and Supreme Court is part of a
democratic process.

The media – the watchdog of democracy – was totally transformed after 1977.
The mobilized written and electronic press disappeared. In their place a
plethora of media outlets with different agendas emerged. Most of the
written and electronic media, as well as the new social media, is free and
fills its duties as the watching dog of the politicians. There is also
greater sensitivity and corresponding legislature for equality among women
and disadvantaged groups.

The IDF is a favorite address for criticism. It is accused of having
disproportionate clout in the decision-making process and of breeding
militarism in Israel’s society. Nothing is further from the truth. Labor
convictions are no longer a necessary condition for being appointed to the
position of chief-of-staff. The military actually became more representative
of the demographic trends and the growing social mobility. Its ranks include
new immigrants, Sephardi, and members of the national-religious camp, the
latter making part of the Ashkenazi old elite feel uncomfortable.

After 1977, the military displayed more professionalism and has actually
been more obedient in accepting the judgment of the elected political
leadership in decision-making.4 The military was kept in the dark during the
negotiations of the September 1993 Oslo Accords. It also recommended against
the May 2000 unilateral withdrawal from Lebanon and the 2005 disengagement
from Gaza. The three most important strategic decisions since 1993 were
implemented despite lack of support from the IDF, proving that Israel does
not have an army-dominated militaristic government.

While there is always room for improvement, Israeli democracy is thriving
and fares better on most scores that in the past. Complaints from the Left
about Israeli democracy is basically sour grapes, stemming from the fact
that the wisdom of the Left has been rejected by the electorate.

The International Arena

Since Israel’s establishment, Arab countries have sought to isolate Israel
and deny it international legitimacy. Yet a review of Israel’s contemporary
interactions with the international community shows that Israel is not at
all isolated. The international campaign to boycott, divest, and sanction
Israel (BDS), initiated by the Palestinians, has failed to make a real dent
on Israel’s diplomatic status and flourishing economy, and has only
marginally affected its cultural life.

Vicious criticism of Israel, particularly at the morally bankrupt United
Nations, has little practical effect on bilateral relations between Israel
and most states. At the end of 2017, Israel had diplomatic relations with
158 states out of 193 UN members. Considering that most Arab states and
additional Muslim countries do not have diplomatic relations with the Jewish
state, Israel’s diplomatic network cannot be much wider.

The emergence of a victorious US at the end of the Cold War bode well for
Israel, a valued American ally. Many important countries decided to improve
relations with the Jewish state which was perceived as a good conduit to
Washington and a strong state, militarily, economically and technologically.
The year 1992 marked the establishment of ambassadorial relations by
important states such as China, India, Turkey, and Nigeria.

Following its win in the 1991 Gulf War, the US convened the November 1991
Madrid conference, which marked greater Arab acceptance of Israel. The Arab
League peace initiative (2002) and the Arab states’ presence at the
Annapolis gathering (2007) indicate the continuation of this trend. While
the rise of Islam in the region is problematic for Israel, Egypt and Jordan
still cling to their peace treaties with Israel. Israel strengthened its
informal dealings with Arab states in the Gulf and in the Maghreb. Israel
conducts extensive, if quiet, trade relations with the Arab world,
nullifying much of the Arab economic boycott’s impact. Moreover, the
ascendance of Iran in Middle East politics and its nuclear threat makes
Israel a potential ally of the moderate Sunni Arab states.

Significantly, relations with the Muslim world have improved as Israel has
established cordial relations with Muslim states that emerged from the
dissolution of the Soviet empire in the Caucasus and Central Asia, such as
Azerbaijan, Kazakhstan, Turkmenistan, and Uzbekistan. The Muslim identity of
their populations hardly hinders relations with Jerusalem in areas important
to their national interests.

The ups and mostly downs in Israeli-Palestinian relations have a little
impact of how states conduct their bilateral relations with Israel.
Actually, the failures of the Palestinian national movement and the ascent
of Hamas in Palestinian politics have elicited greater understanding for the
Israeli predicament. The 9/11 attacks and the rise of the Islamic State
organization further sensitized much of the world to Israel’s dilemmas in
fighting Palestinian terrorism. Moreover, the challenge of terrorism and
radical Islam have pushed many states to seek cooperation with Israel in
counter-terrorism.

The two most populous and dynamic states on the world scene – India and
China, rising global powers – evince a high level of friendship for Israel.
Both are old civilizations that have not been burdened by anti-Semitic
baggage. They treat the Jewish State with reverence, seeing in Israel an old
civilization that has reached remarkable achievements. Israel also has been
very successful in forging a strategic partnership with India.

Finally, Israel’s ties with the most important country in the world, the US,
have greatly improved since 1973. The increasingly institutionalized
strategic relationship is very strong. The US will continue to be the
leading global power for some time to come, which is good for its small ally
Israel.

It is noteworthy that the level of the American public support for Israel
has remained remarkably stable over the past four decades, at around 65
percent. This also translates into congressional support, and it stands
independent of any Jewish lobby. Even Israel’s use of force, which is
criticized in many parts of the world, is well accepted and seen similar to
the American way of war.5

The events of the “Arab Spring” also have strengthened Israel’s status as a
stable and reliable ally in a region fraught with uncertainty. The Netanyahu
government survived with relatively little damage from President Barack
Obama presidency and has lived to see President Donald Trump move the US
embassy to Jerusalem. Hopefully, this move will be emulated by other states,
lending even greater international legitimacy to Israel.

Conclusion

Despite that not everything is perfect in the Holy Land, Israel’s time
vector seems to be positive. Israel is a prosperous and vibrant democracy
that maintains strong internal social cohesion. In parallel, Israel’s
international status has improved, and support for Israel in the US, its
main ally and the main hegemonic power in international affairs, remains
very high. Moreover, the Jewish state is widely recognized as an entrenched
reality even by Arab and Muslim states. Israel has built a mighty military
machine that can parry all regional threats. The IDF remains the most
capable military in the region, with the motivation, equipment, and training
to overcome the capabilities of any regional challenger. Only, a nuclear
Iran would be a negative game changer in the strategic equation, and
everything should be done to prevent this development.

Discontinuities in Israel’s political, social, and economic fortunes are
unlikely. This means that time is on Israel’s side. The zeitgeist of this
epoch, which stresses democracy and free market values, also favors Israel –
as opposed to its Muslim opponents. They remain in great socioeconomic and
political crisis.

At 70, Israel is a great success story. If it continues prudent domestic and
foreign policies and remains successful in transmitting a Zionist ethos to
future generations, its future looks bright. While peace with all Israel’s
neighbors is desirable, that eventuality is not a necessary condition for
Israel’s survival or prosperity in the medium- to long-term.

[1] Efraim Inbar, ““Israel’s National Security Amidst Unrest in the Arab
World,” Washington Quarterly, 35 (Summer 2012).

[2] Dan Senor and Saul Singer, Start-up Nation: The Story of Israel’s
Economic Miracle (New York: Twelve, 2009).

[3] Nissim Leon, “Secular Jews: From Proactive Agents to Defensive Players,”
Israel Studies Review, January 2012, pp. 22-26.

[4] Stuart A. Cohen, “Changing Civil-Military Relations in Israel: Towards
an Over-Subordinate IDF,” in Efraim Inbar, ed., Israel’s Strategic Agenda
(New York: Routledge, 2007), pp. 156-66.

[5] Walter Russell Mead, “America, Gaza, Israel, the World,” The American
Interest, November 18, 2012.
http://blogs.the-american-interest.com/wrm/2012/11/18/america-israel-gaza-the-world/.