Israel’s economic and strategic situation is surprisingly bright right now. That’s partly due to the government’s own economic restraint and strategic balancing act, partly due to a shift in Obama Administration policy, and partly due to the conflicts among Israel’s adversaries.
Let’s start with the economy. During 2012, Israel’s economy grew by 3.1 percent. While some years ago this would not be all that impressive it is amazing given the international economic recession. The debt burden actually fell from 79.4 percent of Gross Domestic Product to only 73.8 percent. As the debt of the United States and other countries zooms upwards, that’s impressive, too.
Israel’s credit rating also rose at a time when America’s was declining. Standard and Poor lifted the rating from A to A+. Two other rating systems, Moody’s and Fitch, also increased Israel’s rating.
And that’s not all. Unemployment fell from 8.5 percent in 2009 to either 6.8 to 6.9 percent (according to Israel’s bureau of statistics) or 6.3 percent (according to the CIA)
In terms of U.S.-Israel relations, the visit of President Barack Obama and Israel’s cooperation on Iran and on an attempted conciliation with Turkey brought quick rewards. For the first time, Israel will be allowed to purchase KC-135 aerial refueling planes, a type of equipment that could be most useful for attacking Iranian nuclear facilities among other things.
The same deal—which includes sales to Saudi Arabia and other Arab countries to make U.S. allies feel more secure vis-à-vis Iran—includes V-22 Osprey planes that can switch between helicopter and plane mode. Israel is the first foreign country to be allowed to purchase this system. It could be used for border patrols—a bigger problem given the decline in the stability along the Egyptian and Syrian borders—and troop transport.
Finally, there would be more advanced radars for Israeli planes and a new type of missile useful for knocking out enemy anti-aircraft sites, potentially useful against Iran among other targets. In addition, an Israeli company is now going to be making the wings for the advanced U.S. F-35 fighter planes.
The completion of the border fence with Egypt increases security in places where Palestinian and Egyptian Islamist groups are trying to attack. It also has reduced illegal civilian crossings to zero. Ironically, Israel has gotten control of its border while the U.S. government proclaims that task to be impossible for itself.
And of course there is the usual and widely varied progress on medical, agricultural, and hi-tech innovations. Here is a summary of those inventions.
The picture is even bright regarding U.S.-Israel relations, certainly compared to the previous four years. This point is highlighted by Wikileaks publication of a U.S. embassy dispatch of January 4, 2010, describing my article that day in the Jerusalem Post:
“[As far as Israel is concerned] what is important is that Obama and his entourage has learned two things. One of them is that bashing Israel is politically costly. American public opinion is very strongly pro-Israel. Congress is as friendly to Israel as ever. …read more