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Is Israel the ‘Start-Up Nation’ Because of Its Security Situation?

The Western Wall and Temple Mount in Jerusalem. Photo: Wikimedia Commons.

The State of Israel is unique — it enjoys significant economic growth while maintaining one of the highest defense burdens of any country in the world. The reason for the high defense expenditure is that Israel has been engaged in a fight for its very existence from the day of its formation. Concurrently with the ongoing threat, Israel’s economy has grown rapidly, averaging around 4% annual growth over the last two decades.

Israel’s growth strategy is directly tied to investments in research, development, and technology. Science and technology have always been perceived by Israel as key factors in the power equation between itself and its surrounding adversaries. Israel’s expenditure on research and development as a proportion of GDP is one of the highest in the world at approximately 5%. The country’s emphasis on science and technology is evident in the high density of scientists and engineers within its population, which easily competes with that of any developed European country.

In its early years, Israel attempted to address its pressing security challenges by developing a national security strategy that emphasized qualitative parameters to neutralize the quantitative gaps vis-à-vis the surrounding enemy states. Soon after the establishment of the state, David Ben-Gurion — Israel’s first prime minister and minister of defense — articulated that due to Israel’s numerical inferiority, it must strive for qualitative superiority. Israel identified science and technology as critical for the accomplishment of this strategy.

Ben-Gurion further asserted that scientific research and technological development were essential not only for security needs, but also for the development of Israel in terms of agriculture, industry, and education. His plan was to enlist the best scientific minds of the Jewish people and to motivate young scientific talents to dedicate their lives to scientific research. They were to be provided with advanced equipment and well-equipped laboratories in fields such as physics and biology, with the expectation that they would align their research efforts towards the security and development of the country.

Given that “big science” involves long development cycles, high uncertainty, substantial risk, and a considerable chance of failure, engaging in extensive private-commercial science and technology projects without state intervention was exceptionally challenging, if not impossible, in the initial decades of Israel’s existence. The necessity for government funding stands out as a primary obstacle for smaller nations seeking to cultivate such capabilities. However, despite the challenges it faced and its status as a small state, Israel managed to overcome these barriers, successfully constructing and advancing a significant technological infrastructure. Israel attributes much of this success to making technological superiority a cornerstone of its national security strategy, which led in turn to the establishment of a well-developed and technologically advanced defense sector.

The end of the 20th century saw a dramatic change in the world’s technological landscape. State-owned technological innovation led primarily by the defense sector shifted towards innovation led by the entrepreneurs and investors of the private sector, establishing what we know today as the start-up age. Today, annual investment in commercial startups worldwide is significantly higher than investment in defense R&D. The private commercial sector dominates technological innovation and the defense sector often “feeds” on these innovations for its own applications, rather than the other way around.

Following this shift in technological dominance and leveraging its highly developed science and technology infrastructure, Israel has managed to position itself as a global source of technological innovation and business entrepreneurship, and is often referred to accordingly as the “Start-Up Nation.” Israel has many hi-tech companies listed on the NASDAQ, the second-largest stock exchange in the world after the New York Stock Exchange. Israel’s presence on the NASDAQ is second only to that of the United States and China. As of the end of 2022, there were over 130 Israeli companies listed on the NASDAQ, which is comparable to those of the British, French, and German companies on the exchange combined.

In the last decade, Israel’s investment in research and development has been the highest in the world relative to GDP by a significant margin. Additionally, Israel’s venture capital fundraising rate is among the highest globally on a per capita basis, and the success rate of its unicorn companies is particularly high. Between 1999 and 2014, approximately 10,000 start-up companies were established in Israel, with 2.6% achieving an annual profit of at least $100 million. In the Global Competitiveness Report for 2018-19, which ranked 141 countries, Israel was first in entrepreneurial culture and second in availability of venture capital. In 2021, investments in Israeli startups reached an unprecedented peak of $26 billion.

Given this context, it might seem reasonable to argue that aligning Israel’s highly developed technological ecosystem with its unique security context may have been relevant in its early decades, but has grown less so with time. This might appear on the surface to be true, as Israel’s economy seems to have extricated itself over the last few decades from the clutch of the defense sector and transformed the country into the “Start-Up Nation” it is today.

But the argument is inaccurate, as the connection between the Israeli hi-tech industry and the Israeli defense sector remains robust. To appreciate why, we need to delve into the Israeli technological ecosystem.

The ties to the defense system, particularly to the IDF, play a pivotal role for the Israeli hi-tech industry. In Israel, most citizens undergo mandatory military service, and after their discharge, many continue on active reserve duty. There is thus a continual interaction between the Israeli civilian and military domains.

This ongoing connection significantly empowers entrepreneurs serving in the IDF’s technological units to introduce novel technologies and devise solutions that can benefit the defense system. These entrepreneurs possess an in-depth personal understanding of that system and can identify its needs, weaknesses, and vulnerabilities. They utilize the training and extensive knowledge they acquired during their military service in the development process to great effect.

In the Israeli hi-tech sector, many of the start-up companies specializing in intelligence and cybersecurity are predominantly staffed by graduates of military technological units like Units 8200 and 81. These start-ups are involved in advancing defense-related technological projects, delivering training to defense entities, and providing prompt responses to the system’s operational needs. In many cases, the products offered by these companies are not generic but are meticulously tailored to meet specific operational requirements. Many projects undertaken by these companies are at the forefront of technological advancement.

To comprehend just how profound is the influence of this phenomenon on the Israeli hi-tech industry, we should examine the two units mentioned above, 8200 and 81. In the late 1990s, the IDF recognized the pivotal role of the cyber domain and took on the challenge of identifying and training suitable human resources. The IDF accordingly instituted unique advanced selection processes to recruit high-quality personnel. The innovative training program and courses transformed these young recruits into true experts in their fields.

Between 2003 and 2010, 100 or so officers and soldiers who completed their service in Unit 81 established around 50 start-up companies, collectively raising over $4 billion. Many of these companies continue to yield substantial revenues, and some have achieved successful exits. Unit 8200 was a major contributor to the emergence of many cybersecurity companies, including the legendary Check Point; Adallom, acquired by Microsoft for $320 million; and Armis, acquired by Accenture for $1.1 billion.

More than 1,000 start-ups have been founded by 8200 alumni. Its graduates are involved not only in cybersecurity start-ups but in many other fields as well, ranging from Waze to Wix to SolarEdge. These examples represent only a small fraction of the broader trend. It is no exaggeration to assert that graduates of these units have significantly shaped the Israeli hi-tech sector over the past decade. These units are a true powerhouse propelling the Israeli hi-tech sector, with a significant portion of the technology they develop flowing back to defense applications.

When analyzing the unique relationship between the IDF and the private commercial hi-tech sector in Israel, we can see that Israel’s unique security situation has created a mechanism through which both parties are so interwoven as to make it difficult at times to tell them apart. It is in Israel’s best interest to continue to nurture this unique relationship, which is beneficial for Israel’s prosperity as well as its security.

Nir Reuven is a researcher at the BESA Center, an engineer, and a former officer in the Merkava development program (the main Israeli battle tank). He has held management positions in the Israeli hi-tech industry and is an expert on technology. Currently he is co-manager of the Sapir College Innovation and Entrepreneurship Center. He is working on his Ph.D. and lectures at Bar-Ilan University. A version of this article was originally published by The BESA Center.

The post Is Israel the ‘Start-Up Nation’ Because of Its Security Situation? first appeared on Algemeiner.com.

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UNRWA Meets the Spanish Inquisition

View of the United Nations Relief and Works Agency (UNRWA) building in Rafah in the southern Gaza Strip. Photo: Abed Rahim Khatib / Flash90.

JNS.orgThe collaboration between UNRWA, the U.N. agency solely dedicated to Palestinian refugees and their descendants, and the Hamas rulers of Gaza continues unabated.

Two episodes over the last week underscore that claim. On May 14, Israeli jets carried out a precision strike against a Hamas war room and weapons depot that was concealed beneath an UNRWA school in Nuseirat. Fifteen terrorists—10 of them members of Hamas’s elite Nukhba Force—were killed in the strike. Meanwhile, three days earlier, the Israelis released aerial surveillance footage of armed Palestinians in an UNRWA compound in the southern city of Rafah, where the IDF is facing off against four Hamas battalions. The video showed the gun-toting Palestinians milling inside the compound, from where they launched attacks on the gathering Israeli forces.

The intermingling of UNRWA facilities and personnel with Hamas and its nefarious aims has been a constant theme of Israeli messaging throughout the current war in the Gaza Strip. At the beginning of this year, it seemed as if other Western countries shared Israel’s concerns, with 18 of them, among them the United States, suspending funding to UNRWA. However, as the NGO UN Watch has documented, in the intervening period, nine of them have quietly restored their fiscal support. One of these countries was Germany, whose foreign ministry declared in an April 24 statement that UNRWA’s verbal willingness to implement the recommendations of an independent commission headed by former French Foreign Minister Catherine Colonna was enough to turn the money faucet back on. Israel’s vociferous objections—pointing out that Colonna had elided Jerusalem’s claim that more than 2,000 UNRWA staff members retain ties with Hamas—made no difference to the Germans, nor to the Japanese, or the Canadians or the other six nations who resumed financial assistance to the agency.

In the midst of all this, UNRWA received an award from the government of Spain—one of the countries that has maintained its funding throughout the conflict triggered by the Hamas pogrom in southern Israel on Oct. 7. The spectacle of a U.N. agency that indulges a terrorist group, whose tactics include the mass murder and rape of civilians for the crime of being Jews, being feted like this is, of course, deeply regrettable. But looked at from another angle, it is highly appropriate.

The award presented to UNRWA director general Philippe Lazzarini by Spanish Foreign Minister José Manuel Albares during his visit to New York on April 19 inducted him into the “Royal Order of Isabella the Catholic.” The “Isabella” referred to here is Queen Isabella I of Castile, who ruled Spain alongside her husband, King Ferdinand II, from 1474 until her death 30 years later. In 1492, at the height of the Spanish Inquisition, Isabella and Ferdinand issued an order for the ejection of Spain’s Jewish population, estimated to have been 300,000-strong.

The king and queen’s announcement of the expulsion—known as the Alhambra Decree—is on display, fittingly, at the United States Holocaust Memorial Museum in Washington, D.C. Spanish Jews were given four months to pack up their belongings and settle their affairs, a chaotic and painful process that left Spain as a country economically and culturally impoverished. Sultan Bayezid II of the Ottoman Empire, who offered shelter to some of these Jews (among them my own family, who lived for centuries under Turkish rule in the Balkans), poked fun at the Spanish monarchs, questioning the judgment of those who would degrade their own kingdom only to “enrich ours.” In making that observation, Bayezid inadvertently grasped one of the more curious aspects of Jew-hatred—that its advocates will push for it relentlessly, even when it doesn’t suit their own interests to do so.

One of the more curious aspects of Jew-hatred is that its advocates will push for it relentlessly, even when it doesn’t suit their own interests.

Few institutions would be as receptive as UNRWA when it comes to Spain expressing pride in a monarch who deservedly has the reputation as one of the worst persecutors of Jews in their history. The history of antisemitism has been captured in a simple formula: You have no right to live among us as Jews; you have no right to live among us; you have no right to live. Queen Isabella’s place on this spectrum is evident and unarguable. Equally, Hamas belongs there no less. The Iranian-backed organization doesn’t like Jews, doesn’t like Jews living among Muslims and doesn’t like Jews being alive at all. They may be separated by seven centuries, but Isabella and UNRWA, which has actively promoted Hamas-style antisemitism in its schools, have a huge amount in common when it comes to the Jewish people.

Were Hamas to succeed in its goal of eliminating Israel as a sovereign state, we might well expect an announcement to that end not dissimilar to the Alhambra Declaration. Those Jews who survived the destruction of their only state would, if they were lucky, be given four months to liquidate their assets, hand over their properties to “returning” Palestinian refugees and make their way out of the country. No doubt some would figure out a way to stay—probably by hiding their Jewish identities and attempting to integrate with the rest of the population, as those Jews who remained in Spain after the expulsion did. UNRWA, by a twist of historical irony, might even offer to shepherd their exit within parameters set by Hamas that would prevent forever any possibility of returning. While such a scenario may seem improbable today, if history has taught us anything, it’s that it’s not improbable tomorrow.

The history of antisemitism has been captured in a simple formula: You have no right to live among us as Jews; you have no right to live among us; you have no right to live.

Fundamentally, the problem here is that too many states—not just Turkey, Iran, Russia, North Korea, China and other citadels of authoritarian rule, but democracies as well—believe that the way to convince the Palestinians to accept peace is by kowtowing to their jealously guarded victimhood status.

By the end of this month, it’s likely that several European Union member states, including Spain and also Ireland, Malta, Slovenia and Belgium, will have unilaterally recognized an independent Palestinian state. Albares is one of the foreign ministers actively promoting the fiction that such a move will bolster, rather than undermine, the prospects for the creation of a Palestinian state alongside Israel that will coexist peacefully.

Deep down, you have to believe that Albares knows that’s simply not true—that most Palestinians, as successive opinion polls since Oct. 7 have borne out, regard a state alongside Israel not as a final settlement but a step towards conquering the entire land “from the river to the sea.” These are the stakes that Israel has to contend with when it deals with diplomats and other foreign officials quietly sympathetic to the idea that the Jewish state shouldn’t be there in the first place.

Isabella the Catholic would be proud.

The post UNRWA Meets the Spanish Inquisition first appeared on Algemeiner.com.

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The UN’s World of the Absurd

Mahmoud Abbas, President of the Palestinian Authority, delivers a speech remotely at the UN General Assembly 76th session General Debate in UN General Assembly Hall at the United Nations Headquarters on Friday, September 24, 2021 in New York City. Photo by John Angelillo/UPI Pool via REUTERS

JNS.org – Only in the world of the absurd can a despicable purveyor of terror, Hamas, carry out a brutal massacre, killing over a thousand innocent people, torturing, murdering and carrying out sadistic mass rape, over a space of just a few hours, and then run home to Gaza taking with them hundreds of hostages.

Only in the world of the absurd can the Palestinian representative organization that encourages, finances, supports and represents such murderers be feted and upgraded by the majority of member states in the international community.

Only in the world of the absurd can a group of non-democratic, terror-supporting states oblige the United Nations General Assembly by proposing a resolution that indulges in pampering a terror-supporting entity in a misguided and surreal demonstration of naïveté, skewed political correctness and acute hypocrisy.

Only in the same world of the absurd can 143 states parrot their support for what they blindly proclaim to be a “two-state solution” without really understanding what they are talking about out of ignorance and stupidity.

Only in the world of the absurd can the majority of the international community deliberately ignore the openly declared genocidal intentions of Iran, Hamas and the Palestinian Liberation Organization in their efforts to eliminate the Jewish state and kill all Jews. And this, while at the same time upgrading the Palestinian representation in the United Nations.

Lastly, only in the world of the absurd can all this happen at the same time as incited and handsomely financed and organized groups of violent, hysterical, antisemitic demonstrators occupy campuses and town centers in U.S. and European cities, calling for the elimination of the only Jewish state.

Shooting blanks for statehood

Despite the artificial hype surrounding this resolution, the bottom line is that this upgrade does not grant the Palestinians the status of statehood or U.N. membership that they wished to receive. The U.N. General Assembly has neither authority nor jurisdiction to establish states and grant membership status without Security Council sanction.

The sad naïveté and hypocrisy of those states that proposed and voted in favor of this abnormal new General Assembly resolution are evident in their stated determination in the body of the resolution to the effect that “the State of Palestine is qualified for membership in the U.N. in accordance with article 4 of the U.N. Charter.”

But the U.N. Charter article 4 requires that United Nations membership be open to “all other peace-loving states which accept the obligations contained in the present Charter.”

One may legitimately ask if the self-respecting states voting in favor of this resolution, including Russia, China, Norway, Japan, South Korea, and Australia, and E.U. member states Belgium, Denmark, Estonia, France Greece, Ireland, Luxembourg, Portugal, Poland, Slovakia, Slovenia and Spain, genuinely believe that the Palestinians are, or could be a “peace-loving state,” or is this just self-delusion, artificial political correctness or naive wishful thinking?

International law requires the fulfillment of universally accepted criteria for statehood, including control of a defined population and territory and enforcement of the rule of law, none of which the Palestinian Authority has ever fulfilled. This is in addition to the Charter requirement of being a peace-loving state, assuming responsible governance and the capability of respecting international obligations. Therefore, it is clear that this resolution is nothing more than a sad and miserable fiction, a sham.

Clearly, no element of the Palestinian political existence—neither the infamous and brutal terror organization Hamas nor the terror-supporting PLO and its Palestinian Authority—can seriously claim to fulfill such criteria.

Like all General Assembly resolutions, the resolution is not binding, only recommendatory. It does not represent international law and only reflects the political views of those states that proposed and supported it.

The various modalities listed in the resolution for improving the seating, establishing a speaking order of the Palestinian delegates in the General Assembly’s chamber and other U.N. bodies, and upgrading their participation in meetings and conferences are cosmetic, symbolic lip-service.

Despite its call for full Palestinian membership, the resolution distinctly denies and negates any notion of full membership in the United Nations. As such, the Palestinian delegation remains nothing more than an observer delegation, wherever and however they may be seated.

The resolution stresses that they have no entitlement to vote and have no right to membership in U.N. organs, including the Security Council.

The violations inherent in the resolutions

However, in the context of the Palestinian obligations set out in the Oslo Accords, this attempted change of status constitutes a serious and fundamental violation of the agreed obligation not to change the status of the territories pending the outcome of the permanent status negotiations.

The Palestinian leadership and Israel agreed that all outstanding issues, including the permanent status of the territories, must be resolved through negotiations and cannot be determined by unilateral action, whether in the United Nations or anywhere else.

Even the United Nations itself, in several resolutions, has given its endorsement to the Oslo Accords as the only agreed-upon means to resolve the Israel-Palestinian dispute.

Similarly, the European Union, Russia, Egypt and Norway, together with the United States, are signatories to the Oslo Accords as witnesses. A vote in favor of this new resolution by these witnesses undermines the Oslo Accords and is contrary to the accepted obligations of states and organizations that witness international agreements.

Indeed, by supporting this new resolution, they seek to bypass the requirements in the Oslo Accords for the negotiation of the permanent status of the territories and attempt to prejudge the outcome of any such negotiations unilaterally.

Despite this resolution’s artificial and ineffectual symbolic and cosmetic aspects, the overall result of the exercise is nevertheless grave and unfortunate. It will be seen by Hamas and the Palestinian leadership as a green light from the international community for them to continue to support and conduct terrorism.

The regrettable message emanating from this resolution is that the international community is not just ignoring Palestinian terror against a fellow U.N. member state; it is encouraging it.

Originally published by the Jerusalem Center for Public Affairs.

The post The UN’s World of the Absurd first appeared on Algemeiner.com.

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Is God Protecting Us?

Moses Breaking the Tables of the Law (1659), by Rembrandt. Photo: Wikimedia Commons.

JNS.orgIt’s been a tumultuous, emotional roller coaster of a week in Israel and around the Jewish world: Memorials, moments of silence and then celebrations, albeit muted and rather subdued under our current difficult circumstances.

In this week’s parsha, Emor, we read about the required standards of behavior of the Kohanim, the Priestly tribe. They are not permitted to come into contact with the dead and their marriage choices are more limited than the average Israelite.

We also find the commandment of Kiddush Hashem. Every Jew, not only a Kohen, is expected to sanctify the name of God. Sometimes, this means actually giving up one’s life for the faith, as millions of our brethren have done throughout the ages. For most of us, however, it means behaving in a way that will bring praise to the God of Israel. When we act morally, ethically and righteously, people generally respect us, and this brings credit to our God and our faith.

Way back at this very first revelation at the Burning Bush, Moses was told by God that we were expected to become a “kingdom of priests and a holy nation.” When we have lived up to that calling, we have indeed been a “light unto the nations.”

Today, Israel is confronted with a world in which hypocrisy has reached proportions unheard of in the annals of history. The whole planet seems to have lost its moral bearings, and frankly, its senses. Even our friends are pressuring us, and now threatening and extorting us, too.

Yet we must do what we must do. Will all the hundreds of precious, young lives snuffed out be in vain if we don’t finish the job in Gaza?

Things seem very confusing. On the one hand, we recently witnessed the incredibly miraculous hand of God protecting us from a 300-plus missile and drone attack by Iran. The 99.9% success rate of our defenses simply cannot be explained militarily or scientifically. On the other hand, we have lost hundreds of our best brave defenders. Where was God there? Is there a contradiction here?

This is shaping up to be nothing less than an existential war for our very survival. The question is: Are we safe or not? Is God protecting us or not?

My mind goes back to 1991 and the Gulf War. Saddam Hussein of unblessed memory was threatening Israel with his lethal Scud missiles and even chemical weapons. Israel was distributing gas masks to every citizen in case of a chemical attack by the vicious dictator.

Iraq had invaded Kuwait. The United States warned Iraq to get out and gave it a deadline. It was not our battle. Israel has no border with Iraq and the war had nothing to do with Israel. Yet Saddam was threatening us and America provided Israel with the Patriot missile-defense system and asked us to stay out of it. The United States would deal with Iraq.

So they did, but not before Iraq had fired dozens of Scud missiles at Israel. Miraculously, there was not a single fatality.

I remember clearly how the whole Jewish world was petrified at the time. There were prayer meetings and emergency fundraisers for Israel in Jewish communities around the world, including ours.

There was one lone voice in the wilderness, however, who declared that Israel was safe and would be safe from any such attacks. Rabbi Menachem Mendel Schneerson, the Lubavitcher Rebbe, went further and advised the Israeli government that gas masks would not be needed. How right he was.

Here in South Africa, the Zionist Federation was organizing a solidarity mission to Israel. The Rebbe encouraged us to join and several of my Chabad colleagues went with me, along with the late Chief Rabbi Cyril Harris. I even took along my 12-year-old daughter, Zeesy. She was the youngest member of the mission.

It is my personal belief that Israel was miraculously protected by God from the Iraqi Scuds because Israel was simply minding its own business. It was attacked for no reason whatsoever. We had done nothing to compromise our security. The heavenly Guardian of Israel responded accordingly.

Similarly, in the recent Iranian attack, we were completely innocent targets. We have no border with Iran and they have zero justification for being involved. So, we suffered not one fatality. Again, God watched over us miraculously.

But when we make strategic mistakes in our approach to Hamas; when we allow international pressure and public opinion to endanger the lives of our valiant young soldiers; when we refrain from bombing and instead send them into booby-trapped buildings; then, tragically, we suffer fatalities.

It’s one thing to boast about being the most moral army in the world (and we are), but is it wise to tell our enemies in advance when and where we are coming for them? We are damned if we do and damned if we don’t. Our unprecedented noble gestures have been completely ignored by the world, and we are still being accused of genocide. So shouldn’t we be sparing our innocent, precious boys from harm instead?

I am fond of quoting Israel’s founding father and first prime minister, David Ben-Gurion, who once said, “It doesn’t matter what the world says. It matters what the Jews do.” How true.

I believe that when we do what we must do, then God does what He must do. May we merit His Divine protection now and always and may our defenders be completely safe and successful.

Please God, we will practice Kiddush Hashem by behaving as noble examples of humanity rather than as martyrs in a war in which, sometimes, we seem to be fighting with our hands tied behind our backs. Six million was enough martyrs. Not one more, please God.

The post Is God Protecting Us? first appeared on Algemeiner.com.

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