Turning Tides

I’m resolutely unfashionable when it comes to the recent mania for Israel bashing. In fact, I’m an enthusiastic cheerleader for this plucky, civilized and pluralistic nation. I’m sure it’s partly an inclination to root for the underdog though not entirely so.

I’ve just finished Senor and Singer’s Start-Up Nation: The Story of Israel’s Economic Miracle. This book, full of astonishing facts and historic context, made my respect and admiration grow by considerable measure.

On a per capita basis, Israel is, by far, the world leader in technology innovation; a true  ” idea factory”. Here’s an (to me) astonishing contrast: Between 1980 and 2000, the (combined) number of patents issued to applicants from Saudi Arabia, Egypt, Kuwait, United Arab Emirates, Syria and Jordan was 367. From Israel? 7,652(!).

Israel’s government and various private sector planners and thinkers have had the perspicacity and perseverance to identify problems, craft and implement solutions that are models of brave entrepreneurial initiative. As a bracing change from the norm, government intervention has avoided the usual muddling and mismanagement. Israel’s now reaping the benefits and is positioned for continuing technology leadership.

By contrast, the Arab street continues its economic foundering. Non-oil GDP exports by the collective Arab world (representing  260 million people) is less than that of Finland (population: 5 million). The elephant in the room for their rapidly growing populations will be the challenge of providing employment for their emerging work force.

Israel’s future is by no means without its challenges, not the least of which is an Iranian madman with an itchy nuclear trigger finger. But, I think a bet on Israel’s survival is now increasingly less of a long shot, particularly now that Israel has recently discovered domestic oil reserves that are estimated to rival that of Saudi Arabia. Innovation leadership + an oil card = a pretty compelling survival formula.

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