The Israel Test, by George Gilder (Richard Vigilante Books, 320 pp., $27.95)

It was serendipitous that I was in Israel when I read The Israel Test, the latest book from George Gilder, the high-tech guru and author of the classic Wealth and Poverty. Almost every day during the six weeks that I spent in the country this summer, I experienced the vibrancy of an amazingly successful society that, in Gilder’s estimation, not only towers over all of its neighbors but invites a more ambitious comparison: “Dwarfing Israel’s own wealth is Israel’s contribution to the world economy, stemming from Israeli creativity and entrepreneurial innovation. Israel’s technical and scientific gifts to global progress loom with similar majesty over all contributions outside the United States.”

Gilder makes a convincing case that American political and military support for Israel should not be seen merely as a generous gift bestowed on a deserving country that shares our democratic values. Rather, Israel is now one of America’s most indispensable allies, contributing to our own economic growth and providing critical technology breakthroughs for the U.S. military. Israel recently passed Canada as home to the most foreign companies on the Nasdaq, has launched more high-tech companies per year than any country in Europe, and has become, in Gilder’s words, “an engine of global-technology advance.” Israeli venture capitalists started some 800 companies in 2000 alone, and annual revenues from information technology enterprises rose from $1.6 billion to $12.5 billion in just ten years. “Israel’s creativity now pervades many of the most powerful or popular new technologies,” Gilder writes, “from personal computers to iPods, from the internet to the medical center, from anti-missile defenses to the ascendant realms of ‘cloud’ computing.” He suggests, in fact, that a great deal of American technology ought to come with the label ISRAEL INSIDE. This high-tech explosion of the past two decades has made Israelis rich, with a GDP of $200 billion in 2008 and per-capita income of around $28,000.

Yet even Gilder inadvertently understates Israel’s historical achievement. In part that’s because he neglects to remind readers of the daunting external threats and challenges that the country faced during this period of innovation and economic growth. Consistently over the past four decades, I have either lived in Israel for a year or two or visited the country for short periods. During that time, Israelis lived through a series of shattering events that, aside from their tragic human cost, kept setting back the country’s economic progress. The 1973 Yom Kippur War, which I covered as a stringer for the New York Times, resulted in Israel’s losing 2,600 young, promising lives in two weeks, the equivalent for the United States of 130,000 battlefield deaths; the first Lebanon War in 1982, which I also covered, cost the lives of another 600 soldiers. And then, most recently, there was the economic cost of the second Lebanon War and the recent Gaza hostilities. In the second Palestinian intifada, over 500 Israeli civilians were murdered on buses, in pizza parlors, and in wedding halls, which necessitated the building of an expensive separation wall along the entire border with the Palestinian West Bank.

During the same period, Israel absorbed almost 800,000 new immigrants from the former Soviet Union, the equivalent of America’s throwing open its doors to the entire population of Mexico. Israel also enthusiastically welcomed over 100,000 poverty-stricken and uneducated Ethiopian Jews. For obvious reasons, their absorption into Israeli society has been more problematic than has the Russians’. Still, in Israel this summer, we saw hope for a better future in the black soldiers returning home for the Sabbath in their army fatigues.

But few observers of the Middle East conflict, Jewish or non-Jewish, share Gilder’s enthusiasm (or my own) for Israel’s accomplishments of the past few decades. A growing number of “realist” foreign-policy theoreticians believe that Israel—despite its high-tech contributions—has become an expensive burden on America. And there’s now a small cottage industry of books and articles by anguished liberal pundits, most of them Jewish, declaring mournfully that the Jewish state has “lost its soul” and that the creation of Israel may have been an unfortunate historical mistake—an “anachronism,” in the memorable words of the resident analyst of Zionism at the New York Review of Books, Tony Judt. These conscience-stricken progressives are joined in their disdain for Israel’s success by many in Israel’s own liberal punditocracy. Seemingly every other day this summer, I read a column by Gideon Levy in Haaretz (known as Israel’s New York Times) describing his country as a hell on earth. Levy writes with a venom that would make even Frank Rich blush.

“The dogs bark, but the parade moves on.” So goes a Middle East saying. For six weeks this summer, my wife and I rented an apartment about five minutes’ walk from the beach in a formerly seedy Tel Aviv neighborhood once populated by prostitutes and drug addicts. Bograshov Street, the main thoroughfare along which we walked to the beach, seemed more like heaven than hell on earth and the farthest thing imaginable from an “anachronism.” It pulsed with boutiques, specialty shops, cafés, and a variety of ethnic restaurants (Thai, Mexican, Italian, American hamburgers, sushi) that would match what my Upper West Side neighborhood has to offer. And unlike the Upper West Side, which now has three or four FOR RENT signs on almost every block of its three commercial avenues, Bograshov Street didn’t have a single square meter of unoccupied retail space.

Tel Aviv’s magnificent beachfront is the new Riviera of the eastern Mediterranean. City fathers and private developers made a major entrepreneurial investment over the past decade, improving the beaches and creating a glittering new promenade that runs five miles, from the northern end of the city to Jaffa in the south and lined with luxury hotels and beachside restaurants. The sand is pristine white and the water as clean as anything you’ll find on this end of the Mediterranean (admittedly, that’s not saying much). With Tel Aviv already known as one of the world’s 24-hour cities and boasting a kaleidoscope of high culture and entertainment, the result has been an explosion of European tourism, particularly from France and, to a lesser extent, from Italy and Russia. In August, when France shuts down, Tel Aviv fills up with French Jews. Many are buying apartments—both as an investment and as a hedge against the new European anti-Semitism—which has driven the local real estate market to record heights. Many French families and the young Jews we mingled with on the beach will eventually “make aliya,” immigrate to Israel, and prove the continuing relevance of Zionism as a haven for Jews in trouble—in no small measure because of the passions stirred up by left-wing European propaganda about Israel as an historical “anachronism” or worse.

I can hear the objections now. Why am I crowing about the sybaritic pleasures of a Tel Aviv beach while ignoring Palestinian suffering? What about the settlements, the separation fence, the immiseration of Gaza due to Israel’s blockade? I heartily agree: one cannot honestly and reasonably recount Israel’s success story without understanding the roots of the Palestinian people’s failures and, yes, their suffering. Often in the late afternoon, as we watched the spectacular sunsets on the Bograshov beach, I did think about the human tragedy of Gaza, just 80 miles down the coast.

If there is an “anachronism” in this part of the world, it’s Gaza. Sixty years ago, it was left as a 20-mile rump on the map because the United Nations’ enforced armistices during the first Arab-Israeli war were only imposed each time little Israel seemed to be winning against five invading Arab armies determined to end the Zionist “mistake” at its birth. When the last armistice was declared, Gaza wound up cut off from the West Bank and occupied by the Egyptian army. For the next two decades, Gaza was subjected to a corrupt Egyptian military administration that ruthlessly suppressed Palestinian nationalism but used the residents as sacrificial pawns in terrorist attacks on Israel. The post-1967 Israeli occupation was certainly not pleasant for the Palestinians, but it did lead to a period of spectacular economic growth (as Gilder underscores), with Gazans finding paid work outside their isolated enclave for the first time. And it was also the beginning of relatively free political expression for the Palestinians.

When the Israeli army pulled out of Gaza in 2007, the Palestinians had a golden opportunity to rebuild their economy, create a functional government and civil society, and prove that they were ready for statehood. The sands on Gaza’s 20-mile stretch of beach are reputedly even whiter and more inviting than Tel Aviv’s. With the willing financial support of every Western government and numerous outside investors, Gazans could have created their own Bograshov beaches and turned their little strip into a mini-Singapore of trade and commerce. Nothing prevented them from writing their own economic success story except their paroxysms of rage, a self-destructiveness almost unparalleled in the history of political movements. Indeed, to understand fully the disaster of Gaza, one has to throw away the political-science texts and turn to abnormal-psychology studies and the history of self-immolating millenarian religious movements.

In addition to Gilder’s vivid description of the technological and medical breakthroughs by Israeli scientists that are positively changing the world, he also manages to provide a plausible historical context for what would otherwise seem to be the totally irrational behavior of Palestinian leaders in the West Bank and Gaza. In effect, Gilder offers us an alternative theory of twentieth-century anti-Semitism. It has little to do with the historical Christian depictions of the Jews as Christ killers, or even with the late-nineteenth-century scientific racism that infected Nazi Germany. It dwells instead on the consequences of the Jews’ emergence in the twentieth century as disproportionately dominant figures in the arts, in finance, and, above all in science. “In countries where Jews are free to invent and create,” Gilder writes, “they pile up conspicuous wealth and arouse envy and suspicion. In this age of information, when the achievements of mind have widely outpaced the power of masses and material force, Jews have forged much of the science and wealth of the era. . . . Their genius has leavened the culture and economy of the world.” And as Gilder reminds readers on almost every page, “Israel today concentrates the genius of the Jews.”

Thus, even “moderate” Palestinian leaders’ stance toward Israel and Zionism is not really shaped by concrete (and therefore negotiable) grievances about land and borders. Rather, it is stoked by resentment and jealousy of the extraordinary historical accomplishment of Israel and the Jewish people. If this is true, the Obama administration’s efforts to get minor concessions from Israel over peripheral issues like curtailing building in existing West Bank settlements are not only doomed to failure; they are dangerous illusions about what is at the heart of the conflict.

According to Gilder, the same attitude toward Jewish success also explains current anti-Israel and anti-Semitic sentiment in Europe, particularly on the left. “As one of the world’s most profitable economies built on one of the world’s most barren territories, Israel challenges all the materialist superstitions of zero-sum economics, based on the ‘distribution’ of natural resources and the exploitation of land and labor.” And that’s why Gilder’s defense of Israel is part of a broader expression of the main political schism in the world today, which he connects to the ultimate question of survival: “On a planet where human life subsists upon the achievements of human intellect and enterprise, Jews are crucial to the future of the race.” Gilder then delivers this extraordinary peroration: “Israel is the pivot, the axis, the litmus, the trial. Are you for civilization or barbarism, life or death, wealth or envy? Are you an exponent of excellence and accomplishment or a leveling created of troglodytic frenzy and hatred?”

Gilder’s inclination to put the case for Israel in such stark, almost apocalyptic terms will bring out all the old Gilder haters. Just as his seemingly elitist defense of the traditional capitalist virtues and of the nuclear family infuriated them, just as they were enraged by his objections to modern feminism and, more recently, his evangelizing for Intelligent Design, they will surely reject out of hand his understanding of the underlying factors behind the current conflict in the Middle East. That’s too bad. For one can put aside some of the book’s hyperbole and still recognize the timeliness of many of Gilder’s observations about the political motivations of Israelis and Palestinians.

I was reminded of this after I learned about and independently confirmed the details of an extraordinary one-on-one meeting held last September 16 between Israel’s then–prime minister, Ehud Olmert, and Palestinian president Mahmoud Abbas. In the U.S. media, only Newsweek reported on the meeting, and then, unfortunately, in an abbreviated and distorted version. The event deserves a great deal more attention for what it tells us about the roots of the Israel-Palestine conflict.

The meeting was a follow-up to a previous negotiating session in which Olmert, for the first time, offered Abbas a map showing the borders of a future Palestinian state that his government was willing to accept. That earlier meeting broke up because Abbas insisted that the area was too small. At the September 16 meeting, held in Olmert’s house in Jerusalem, the two leaders asked their aides to leave the room. This time Olmert unfurled a gigantic map, carefully prepared by an Israeli cartographer, of the future border between the two states, with all its twists and turns. Spreading the map on a table, Olmert showed Abbas that the Palestinians would get back 93.5 percent of their original West Bank area, plus 5.8 percent more through land swaps carved out of Israel, plus another 0.7 percent in a safe-passage corridor connecting Gaza and the West Bank and controlled by the Palestinians. This added up to the equivalent of 100 percent of the territory controlled by the Arabs before the 1967 Six-Day War. Olmert also officially proposed dividing Jerusalem, with the Palestinians retaining sovereignty over the city’s Arab sector and the Temple Mount area placed under the control of a five-member international consortium consisting of Israel, Palestine, Jordan, Saudi Arabia, and the United States. The Israeli prime minister agreed to allow a token number of Palestinian refugees—around 3,000—to enter Israel on humanitarian grounds, but he emphasized that this would end all claims about the Palestinian “right of return.”

Abbas said that he was interested but wanted more time to study the map. “If you sign it,” Olmert responded, “you can have it.” He added that he didn’t want the map to become the baseline for demanding more concessions in some future negotiation. Abbas promised that he would keep the map overnight and bring it back for further discussion the next morning. (Abbas’s office in Ramallah and Olmert’s home in Jerusalem are about a 30-minute car ride apart.) Olmert reluctantly agreed and Abbas left with the map, without signing it. The next morning, Abbas’s main aide in the negotiations, Saeb Erekat, telephoned Olmert’s office and explained that Abbas had to go to a meeting in Jordan, and that they would return the following week with the map for further discussions. But Abbas never returned, and neither did the map. The September meeting was the last contact between the two leaders while Olmert was still in office.

Aluf Benn, a top reporter at Haaretz who wrote about the meeting, has concluded that it shows that both sides haven’t budged on their bedrock positions and therefore need a forceful mediator like the United States to bridge their differences. I think that one can reach a different conclusion. For all the talk about the need to pressure Israel into agreeing to a two-state solution, the Palestinian president has already been offered an independent state on a silver platter—but he can’t say yes. And this has nothing to do with Israeli settlements. To accept the independent state would have meant breaking radically with the political culture of envy and rage about Israel’s accomplishments that generations of Palestinians have been reared on and that leaders like Abbas benefit from. Abbas couldn’t sign the map because he knew that it would have meant telling his people, and particularly the millions in the refugee camps, that their own leaders had lied to them for the past 60 years: the refugees weren’t going back to their former lands in triumph and redemption, and Israel, successful and powerful, was here to stay as a permanent part of the Middle East.

Because the Palestinian president can’t own up to six decades of wasted rage and envy, his people will go on suffering. Of course, despite rejecting statehood, the Palestinians and their leaders will continue to draw the world’s profound pity. They will be comforted by their compassionate friends in the West, those who denounce the “anachronism” of Israel and the historic injustice of the Jewish state. All this love and condescension is insulting and infuriating to the Jews. But it is absolutely killing the Palestinians.


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