The Israel Test. George Gilder
dollars of market capitalization for its companies, Israel these days is rich, they say. But look at the gap between its luxuries and Palestinian privation. Look at the gap between Jews in Israel and Arabs in Israel – sure evidence of “discrimination” and “exploitation.” Jews similarly lead all other American groups in per capita income, signifying another gap, presumably rectifiable by the United Nations.
Shaping the clichés of the gapologists is a profound misunderstanding. What makes capitalism succeed is not chiefly its structure of incentives but its use of knowledge and experience. As a system of accumulated knowledge, capitalism assigns to the entrepreneurs who have already proven their prowess as investors – who have moved down the learning curve in the investment process – the right to shape the future pattern of investments. The lessons of one generation of successful investments inform the next generation. The lessons of failure are learned rather than submerged in subsidies and gilded with claims of higher virtue and purpose. Information is accumulated rather than lost. Under capitalism, knowledge grows apace with wealth.
Disguising this edifying process in the United States are the handi-capitalists in nominally “private” institutions – from Wall Street money-shufflers and government-guaranteed mortgage hustlers to corn-state ethanol farmers and Silicon Valley solar shills – that are dependent on public handouts and mandates for their success. As explained in definitive works by the economist Daniel Doron in Israel and by the writer Jonah Goldberg in the United States, a perpetual temptation of democratic politics in Israel, the U.S., and around the globe is the use of government to reward political supporters, creating government-corporate alliances that are fascist rather than capitalist in character. In successful economies these alliances remain marginal, rather than central as they are in explicitly socialist regimes.
If governments were superior investors, the Soviet bloc would have been an economic triumph rather than an economic and environmental catastrophe. China would have thrived under Mao rather than under the current regime that claims, “To get rich is glorious.” Whether in the United States or in Israel, at Harvard or at the United Nations, an obsessive concern with gaps between rich and poor is the signature of a deep and persistent Marxism that is intrinsically hostile to the wealth-producing work of Jews in the world. At the heart of the UN’s case against Israel is the UN’s focus on gaps.
Misunderstanding the nature of capitalism, the critics turn to challenge Israeli democracy. They charge that Israel’s Jewish identity creates serious problems for its democratic values. Like former president Jimmy Carter in his book Palestine: Peace Not Apartheid, former Israeli foreign minister Shlomo Ben-Ami in an article in Foreign Affairs, the flamboyant Frenchman Bernard-Henri Lévy in articles and a book, Left in Dark Times, and Thomas L. Friedman in a series of books and in his New York Times columns, many people raise the chimera of a Jewish “apartheid” regime that will mar the purity of Israel as a homeland for Jews.
The apartheid claim is based on the possibility that at some future date Arab Palestinians will comprise a majority of the population under Israeli control. But Jews in Israel are already a minority in the region and will always be a minority. Once the Arab nations learn to tolerate the existence of the Jewish state, some federal system involving Jordan would be the next step for any Palestinian nationalism that transcends a mere desire to destroy Israel. Equating democracy not with the rule of law but with the claims of racist self-determination, even nominally pro-Israel writers imply that 5.5 million Jews are morally obliged to entrust their fate to some 100 million Arabs pledged to their total annihilation.
This bizarre conclusion is the perfectly logical result of the fondest dream of the twentieth-century Left, to reconcile democracy and socialism. Democracy without capitalism has no content, since no power-centers outside the state can form and sustain themselves. As a form of politics, dealing with relative power, democracy by itself is a zero-sum game, in which the winnings of one group come at the cost of others. There are only a limited number of seats in a legislature or executive positions in a government, only a limited span of territory to rule. By contrast, capitalism is a positive-sum game, based on an upward spiral of gains, with no limits to the creation of wealth. Under capitalism the achievements of one group provide markets and opportunities for others. Without an expanding capitalist economy, democracy becomes dominated by its zero-sum elements – by mobs and demagogues.
Throughout history, in any nation with a significant Jewish presence, such mobs and demagogues have turned against the Jews. Today they have turned against Israel. And Jimmy Carter, Thomas Friedman, and all the rest who advocate the claims of Arab “democracy” over Israeli accomplishment unintentionally side with the mobs and demagogues. Their equation of democracy with ethnic self-determination transforms democracy from a defensible polity into a figment of tribal polling. It puts Israel into a queue of petitioners with such entities as Tibet, Kosovo or Bosnia as if these “nations” were comparable to Israel.
Non-capitalist self-determination, though, is entirely self-defeating. Sleek new automobiles across the United States – Volvos and Priuses galore – bear bumper stickers declaring, “War is Not the Answer” or urging a “Free Tibet,” as if Tibet could be freed with hortatory vehicular adornments. Without capitalism and free trade, self-determination is a pretext for constant civil wars, as each ever-smaller shard of nationality seeks its own exclusive domain, presumably to be defended by the United States or the United Nations.
The critical test of democracy is its ability to free human energies and intellect on the frontiers of human accomplishment. More than any other country in the world, Israel resplendently passes this test. It is the test of zerizus, Hebrew for “alacrity,” or, as Rabbi Zelig Pliskin describes it on the Jewish World Review Web page, “the blessed willpower and aspiration that leads to exceptional achievement.” Passing this test, Israel is precious. All the carping and criticisms of Israel reflect a blind proceduralism and empty egalitarianism. The test of virtue is not mere procedure; it is content and accomplishment. If a system cannot pass this test – democratic or not, concerned with electoral politics or not – it is just another form of barbarism.
José Ortega y Gasset in his masterpiece, The Revolt of the Masses described the essential barbarian mentality as a failure or refusal to recognize our dependency on the exceptional men and women who created the civilization in which we live and on which we subsist. Like monkeys in the jungle reaching for low-hanging fruit without any clue of its source or science, the barbarian politicians leading the ranks of modern anti-Semitism promiscuously pick the fruits of modern capitalism and the pockets of capitalists without a clue as to the provenance of their own largely parasitical lives and luxuries.
More sharply and categorically than any other conflict, the Israel-Palestine dispute raises these issues of capitalism and democracy, civilization and barbarism. To many observers – in the army of the Left – it is obvious that Israeli wealth causes Palestinian misery. How could it be otherwise? Jews have long been paragons of capitalist wealth. Capitalist wealth, as Pierre-Joseph Proudhon put it in regard to “property,” is “theft.” Karl Marx was said to have shaped his opposition to property rights and his Jewish self-hatred by reading the even more virulently anti-Semitic Proudhon. In an 1883 diary entry, Proudhon declared, “The Jew is the enemy of mankind. One must send this race back to Asia or be exterminated.”
History, however, favors the view that poverty springs chiefly from envy and hatred of excellence – from class-war Marxism, anti-Semitism, and kleptocratic madness. It stems from the belief that wealth inheres in things and material resources that can be seized and redistributed, rather than in human minds and creations that thrive only in peace and freedom. In particular, the immiseration of the Middle East stems from the covetous and crippling idea among Arabs that Israel’s wealth is not only the source of their humiliation but also the cause of their poverty and thus an appropriate target of their vengeance.
This is the most portentous form of the Israel test. Inescapably, it poses the questions of life and wealth that lie behind nearly all the holocausts and massacres of recent world history, from the genocidal attacks on European Jews and the pogroms of Russian Kulaks and Jews to Maoist China’s murderous “cultural revolution,” from the eviction of white settlers and Indian entrepreneurs from Africa to the massacres of overseas Chinese businessmen in Indonesia.