Monday, September 26th | 1 Tishri 5783

June 19, 2012 3:26 pm

Thanking Jabotinsky For Israel’s Booming Economy

avatar by Ronn Torossian

Eric Schmidt, Executive Chairman of Google Inc. Photo: wiki commons.

With political upheaval taking place throughout the Middle East, one could be forgiven for overlooking Israel’s booming economy. The acclaimed book “Start-up Nation” which deals with Israel’s intrepid economic growth has rightfully received accolades and has in part ensured that no discussion about the Jewish state today can be complete without recognizing Israel’s great economic accomplishments. I wish to focus however, on the ideology of Ze’ev Jabotinsky in connection with the success of Israel’s economy.

This week, Facebook announced it was buying, an Israeli company that provides facial-recognition technology which will now used by the world’s largest social network to help users identify and tag photos. The deal is believed to be for close to $100 million. The same day as the announcement,  Google’s chairman Eric Schmidt, during a visit to Israel, said that the company’s development centers in Israel are among their most efficient and that Google is constantly expanding them. Schmidt said that the quality of Israel’s engineers is extremely high, and that local salespeople are among the best in the world.  To a thunderous applause, Schmidt proclaimed: “We love Israel.”

A country of 7.1 million people, only 64-years old, with no natural resources, surrounded by enemies and in a constant state-of- war since its founding, produces more start-up companies than most other large, peaceful, and stable nations. In the past 10 years, Israel’s stock market produced better risk adjusted returns than all other developed stock markets, and the TA-25 returned 161 percent, including dividends.

I believe that it is precisely because the nationalist camp is currently in power that the economy has thrived.  The ideological leader of the right, Ze’ev Jabotinsky, made clear his support for economic freedom. Jabotinsky believed that “every individual is a king” and the state should not impair one’s freedom. He noted that freedom of speech and assembly, majority rule, and equality for all are ideals that socialism combats. Practically, he advocated an end to the Histadrut’s monopoly over labor in Eretz Israel, which was preventing non-socialists from getting work.

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Jabotinsky wrote that the Bible is full of social protest, but not socialism. Its economic and social policy is one of freedom rather than direct control over economic activity by the government.

Jabotinsky believed in a competitive market and explicitly wrote that Israel’s economy must be a free market.  Israel is a remarkably resilient country and while  the nationalist camp is certainly best for the security of the Jewish people, it’s also best for the economic development of the Jewish state.

Ronn Torossian is a Jewish philanthropist who owns 5WPR, a leading PR firm.

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