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The economic costs of permanent war.(INSIDE REPORT)

The New American

| July 25, 2005 | COPYRIGHT 2005 American Opinion Publishing, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

"Since the 1973 Yom Kippur War, Israel has had a destructive wartime economy that weakens its society, suffocates its economy and threatens its existence as an independent state," wrote left-leaning Israeli entrepreneur Ofer Kornfeld in the June 24 issue of Haaretz. Each Israeli household spends the equivalent of tens of thousands of dollars each year "on the wartime economy."

Foreign capital outlays in Israel depend "on American guarantees and are for the most part speculative financial investments rather than real investments," he continues. "A decision to withdraw foreign capital from Israel can come suddenly." During Israel's first 25 years, its economy grew at an annual rate of about 5 percent. Since 1975, "the Israeli economy has moved to a growth of about 1 percent in per capita production," Kornfeld points out. Israel's economy is thus almost entirely dependent on U.S. foreign aid--that is, wealth transferred from U.S. taxpayers.

"The wartime economy is found everywhere, and it affects all aspects of life in the country," Kornfeld observes. "In the State of Israel, the construction of roads is decided according to military priorities. The establishment and dispersal of communities is designed to strengthen [settler] communities ...

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