Israel vs. Iran: It’s the Economy, Stupid

Beacn goers fly kites with hotels/motels in background

Most people assume that the conflict between Israel and militant Islamic states is religious. Obviously, religion has a whole lot to do with it.

But Israel, unlike Iran, is not a religiously totalitarian state. Israel is full of freedom, while anyone living in Iran is a slave to the whims of the religious mullahs and ayatollahs. Any American (Jewish or not) could tolerate moving from the United States to Israel, if he or she had to do so. Any American (Muslim or not) would find conditions in Iran inconceivably difficult — not unlike an impoverished slave camp — if forced to move from the United States to Iran.

There’s something perhaps even more significant which distinguishes Israel from a nation like Iran: economics. And this factor might be the explanation for why Obama, like the Iranian fundamentalists, is so anti-Israel.

Here are some facts about Israel’s economy, reported at, who studies the relative economic freedom of different nations throughout the world:

Israel’s economic freedom score is 70.5, making its economy the 33rd freest in the 2015 Index. Its overall score is 2.1 points better than last year, with improvements in six of the 10 economic freedoms, including the management of government spending, trade freedom, labor freedom, and fiscal freedom. Registering the 10th largest score increase in the 2015 Index, Israel has achieved its highest score ever. Israel is ranked 4th out of 15 countries in the Middle East/North Africa region, and its overall score is above the world and regional averages.

Broad, sustained improvements in property rights and the regulatory sectors over the past five years have propelled Israel into the ranks of the “mostly free” for the first time. Since 2011, economic freedom has advanced by 2.0 points, with scores advancing broadly in six of the 10 categories measured. Improvements in property rights and the regulatory environment have been the backbone of this advance.

A democratic and free-market bastion in the Middle East, Israel has entrenched the principles of economic freedom during its development. A small, open economy, Israel relies on its competitive regulatory environment and well-established rule of law to attract international investment. While government spending is sizeable, the government has not interfered heavily with industrial activity.

Note that Israel’s economic freedom has been improving under Netanyahu. John C. Goodman, writing at on 3/28/15, points out:

In terms of skills and education, Israel probably has the highest level of human capital per person in the whole world. Yet [its] per capita output is mediocre – in the middle of the developed country pack. Why is that? Because Israel has been slow to adopt capitalism…

…In recent years Israel has become a center for entrepreneurship, innovation and capitalist spirit. But it wasn’t always that way. Modern Israel began as a quasi-socialist society with a centrally controlled economy and a Histadrut labor federation. The Histadrut became a mainstay of the Labor Zionist movement and it wasn’t merely a trade union. It owned a number of businesses and, for a time, was the largest employer in the country. Until Israel began moving away from … socialism, the Histadrut, along with the government, owned most of the economy.

It’s undeniably true that when militant, fundamentalist Muslims look at Israel, they look at an infidel state based heavily on Jewish religion and culture. But they despise the United States every bit as much, if not more. The United States government is not based on any particular religion. What do the United States and Israel have in common? Strong elements of capitalism, along with the material progress and development capitalism permits. Economic freedom leads to a better material (and mental/spiritual/psychological) life on earth. It makes religion — especially extreme religious fundamentalism — irrelevant. It even proves them wrong, suggesting that mankind can take care of itself. This is the thing that makes religious fundamentalists wild with rage (and envy), and this probably explains the antipathy against Israel as much as anything else.

What explains Obama’s antipathy against Israel? Some suggest he’s a closet Muslim. That might or might not be true. What we do know for certain about Obama is that he’s anti-capitalist. Leftist/socialist/progressives like Obama — particularly economically leftist intellectuals, and he was a professor — view capitalism as a form of treachery and force. When someone with that point-of-view looks at the Middle East, they see an increasingly economically free Israel (getting freer all the time) contrasted with stagnant and declining conditions in places like Afghanistan, Iran, Iraq.

When they think capitalism, they think victimization, as if Israel — by being materially more prosperous, due to the choices the people and their government have made — were somehow the victimizer, simply by being better and stronger than other nations who could also do better, if their people and governments made different choices. Choices? That concept is the intellectual Kryptonite of progressive politics and ideology. You don’t suggest there are choices. Instead, you treat the economically weaker side as the victims, and you make deals with totalitarian Iran, deals which — in effect — will clear the way for the development of nuclear weapons (assuming they can manage to make them).

It’s not a conspiracy. It’s simply the result of looking at the world as both Obama and the Islamic fundamentalists look at the world: victims and victimizers. In Obama’s mind, victimizers are those who flourish through the competence and self-direction, and self-responsibility, of capitalism. That includes the United States and Israel, relative beacons of prosperity and economic freedom when compared to much of the rest of the world, and most of human history.

Israel is better than Iran. It’s a better place to live, by any standard of human quality. For that reason, it has to be cut down a notch. Obama’s anti-Israel foreign policy is completely consistent with his anti-wealth, anti-private property and anti-economic freedom domestic policy.

Obama doesn’t like capitalism because it reminds him that human beings don’t need government, other than as a minimal police force to uphold life and property rights. Religious totalitarians don’t like capitalism because it reminds them that people can do better without living by the absurd and controlling rules they impose by force on their population. Each is threatened by freedom, particularly economic freedom, if for different reasons.



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