Politics & Policy

Choosing the Chosen People

Anti-Semitism is essentially hatred of capitalism and excellence.

Would you pass it? Kathryn Jean Lopez sat down with George Gilder, author of The Israel Test, and asked him a few questions about Israel.

KATHRYN JEAN LOPEZ: What’s the Israel Test and who is administering it?

GEORGE GILDER: Do you admire and emulate excellence and accomplishment, even if it excels your own? Or do you envy and resent it? And try to tear it down?

That’s the Israel Test and it is administered by cosmic law — the law of capitalist success: The good fortune of others is also one’s own. The people who admire and emulate excellence thrive. Those who resent and envy it gnash their teeth and tear their hair and never accomplish anything worthwhile.

You can see the Israel Test play out in the Middle East and in Washington.

#ad#LOPEZ: Why is Israel itself so important?

GILDER: Israel, per capita, is the most creative and innovative country on the face of the earth.

Since 1991, venture capital in Israel has increased sixtyfold. Israel has become an extension of Silicon Valley that is excelling its source. It is a paragon of defense-technology innovation. In 2008, a study by Deloitte and Touche showed that Israel has become the world’s chief fount of innovation outside the U.S. in such fields as microchips, telecom, software, biotech, medical devices, and cleantech. Only Germany is close, and they are ten times larger.

Israel epitomizes the excellence and accomplishment of Jewish culture. It is hated by anti-Semites not because of any flaws or legal infractions but because of its unique virtues, which show up and shame the forces of mediocrity everywhere.

LOPEZ: How does defending Israel defend capitalism?

GILDER: Under Benjamin Netanyahu, Israel is the world’s ascendant capitalist country. While the U.S. is immersed in a slough of increasing taxes and regulations, Israel has been privatizing its companies and deregulating its financial institutions. They are reducing tax rates and preserving the key capitalist assets of the West while the U.S. is trying to cap and trade capitalism, suppress energy production, and raise tax rates on everything. As rates rise above 50 percent, entrepreneurs have a greater incentive to shuffle and hide existing wealth than to create new wealth.

LOPEZ: Can Israel save Western civilization? The way you write about technology and medicine, among other things, I am beginning to wonder.

GILDER: Western civilization, in part, originated in Israel. Now Israel is a crucial source of invention, military intelligence, and entrepreneurial creativity that may yet save the West. I believe Netanyahu is a Churchillian figure emerging at the perfect time to confront the jihad.

LOPEZ: Can evangelicals save Israel?

GILDER: I believe that facing the most critical Israel Test are my fellow evangelicals, who are inclined to support Israel as the heart of their religion but who also can be gullible about the so-called oppression of the Palestinian Arabs. This is just stupid, because the Palestinian Arabs have benefited more from Israel than any other people — by far.

LOPEZ: What do you mean these wretched refugees benefited from Israel?

GILDER: The key period was between 1967 and 1987 when the Israelis administered the territories after Arabs refused all negotiations with their famous three “nos.” The Arabs were adamant against trading “land for peace” following their defeat in the ’67 war, so Israel inherited the territories.


During this 20-year period under Israeli rule, some 250,000 Israelis settled in the Territories. These were the supposedly predatory settlers. They supplied the infrastructure of power, water, education, and medical care that attracted nearly ten Arab settlers for every one Israeli. During this period, the economy in the territories grew some 25 percent per year, nearly the fastest in the world, and far faster than that of Israel itself, which was still bogged down in socialism. Arab life expectancy rose from 40 to around 70. Their incomes tripled while their population soared. Seven universities and 2,500 factories were established. It was the golden age for Palestinian Arabs.

Then, in the early 1990s, the U.N. and the West sold out the country to Yasser Arafat and his terrorist forces. The Palestine Liberation Organization became the world’s leading per capita recipients of foreign aid as international organizations squandered billions on them and thus transformed the Palestinians from entrepreneurs and workers into terrorists, welfare queens, and political poseurs of victimization and violence. 

#ad#LOPEZ: You talk a lot about Israel’s enemies. Is anti-Semitism enough of a reason itself to defend Israel?

GILDER: Perhaps it is. Anti-Semitism is essentially hatred of capitalism and excellence. It epitomizes all the most reactionary and destructive forces in the world economy and culture. It should be opposed wherever it arises, from U.S. campuses to Middle Eastern regimes. But it is the achievements of Israel, not the animus of its enemies, that make its defense both possible and imperative. Israel is a bastion of Western culture and achievement and military technology at a time when other Western countries have fallen into socialist and pacifist doldrums.

LOPEZ: Can you really call the PLO Nazis and supporters of a Palestinian state essentially Nazi supporters?

GILDER: They may not know it, but Palestinian nationalism began with the grand mufti of Jerusalem, who was a fanatical Nazi, friend of Heinrich Himmler and Adolf Eichmann, and critic of the Holocaust as moving too slowly and inefficiently. Arafat was an ardent reader and promoter of Hitler’s Mein Kampf. The current leader, Mahmoud Abbas, a so-called moderate, devoted his university thesis to denying the Holocaust. Hamas and Hezbollah are worse. You can’t create a civilized country out of a Nazi movement. The only hope for the Palestinians is for Israel to help civilized Palestinians retrieve their country and throw out the terrorist thugs that currently define their national socialist identity.

LOPEZ: What do you mean by calling Israel Hong Kong in the desert?

GILDER: Just as Hong Kong eventually took over China by providing the model for the “free zones” that revived the Chinese economy, Israel will take over the Middle East by achieving overwhelming economic, technological, and financial dominance. Hong Kong was a unique financial center. Israel is about to become one. Time is on Israel’s side. In time, the Arabs will prefer working with Israel to fighting it.

LOPEZ: What’s wrong with Amos Oz?

GILDER: I haven’t read his novels, but as a political analyst he is a fool. His rule, like that of most of the Israeli Left, is blame Israel first and always.


LOPEZ: Roleplay: President Obama just appointed you Mideast Peace Czar, what do you do?

GILDER: It is what I stop doing that matters. I stop trying to solve the problem. I stop paying attention and respect to terrorist thugs. I stop giving foreign aid by the billions to terrorists. As David Gelernter put it, “The problem will be solved as soon as the world stops trying to solve it.”

I also increase investment in missile defense and I stop haggling with Israel about their domestic policies (as if we know better). We give them whatever military systems they need to defend themselves and us.

#ad#LOPEZ: Is Obama making things better or worse?

GILDER: Obama is encouraging the terrorists to believe that they can win. That makes things worse.

LOPEZ: How would you grade Pres. George W. Bush’s administration?

GILDER: Bush was terrific in most of his policies but he refused to defend them effectively. In the end he gave up his economic policy to Treasury Secretary Paulson, who was an abject Keynesian, and gave up his Middle East strategy to Condoleezza Rice, who was a gullible appeaser.

LOPEZ: What does Netanyahu mean?

GILDER: Having immersed himself in the works of Churchill and the war against jihadist terror, and having mastered the theories of supply-side economics, he is the perfect leader for the West at this moment of economic and political crisis. Netanyahu is the Churchill of this epoch. The question is whether we follow him or subvert him. That is the Israel Test in another form.

LOPEZ: As the author of Wealth and Poverty: How’s capitalism doing in the U.S.?

GILDER: Energy is crucial to any economy and to national defense. U.S. energy policy is being run by climate cranks and weather bores. In centuries to come, the idea that CO2 is a pollutant will represent the summit of political idiocy.

Meanwhile, tax rates are rising and regulations are increasingly oppressive. These put a cap on investment. But innovation continues. By tapping resources of entrepreneurship and invention across the world economy, American entrepreneurs can collaborate with Israel to lead a new global boom.

LOPEZ: Can Israel teach us a lesson or two?

GILDER: This is Israel’s moment. They have privatized their economy, they have unleashed a new financial industry at a time when U.S. finances are in the doldrums, they have created a new Silicon Valley in the desert that promises to outperform the original Silicon Valley in California. They have elected the world’s most visionary and courageous leader. I hope we can take inspiration from this superb country in our time of trial.

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