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Israel is 75 Years Old: Current Day Trends in Politics, Economics, and Society

The conflict of value orientations in modern Israel. According to Luiza Khlebnikova, the candidate of historical sciences, the research fellow of Department of Israel and Jewish Communities of the Institute of Oriental Studies, there are many key factors that characterize the current state of Israeli society. First, for Israelis, the country's internal problems are more important than external challenges (64% vs. 26%, according to research by the Israel Institute for the Study of Democracy and the Institute for the Study of National Security). The protests against judicial reform, which have been going on in Israel for more than 20 weeks, illustrate this issue clearly. Today this problem occupies a central place on the domestic political agenda and is still far from being resolved.

Secondly, the main and even traditional split lines (secularism-religiousness and/or nationalism-liberalism) were supplemented by disagreements on other issues fueled by the radicalization of the Israeli population’s certain groups. Moreover, the strengthening of disagreements in the society is connected not only with the Palestinian-Israeli conflict. The discussion about the nature and the prospects of the Israeli state is going on with particular urgency. The future of democracy in Israel causes concern among the part of the society, especially the secular one, among the supporters of the left and centrist views. The opponents of judicial reform stage protests, seeking to prevent the government's anti-democratic steps, while supporters of the ruling coalition, on the contrary, strive to defend the course taken and to weaken the powers of the Supreme Court. In general, the political sentiments in the country have become more nationalistic over the past decades - Israel is becoming a more conservative and religious state.

Thirdly, in Israel there is a crisis of parties and leadership, an increase of populism and a decline of trust in political institutions. It is important to note that some of the challenges, such as the democratic forms of government crisis, are global and not purely Israeli. Thus, Israeli society is being at crossroads, a conflict of value orientations is unfolding - the Jewish character of the state begins to prevail gradually over the democratic one. Now it is being determined what the character of the state will be in the future.

Tatyana Nosenko, candidate of historical sciences, the leading research fellow of the Department of Israel and Jewish Communities of the Institute of Oriental Studies, noted that the rift in Israeli society (confrontation between the secular and national-religious sectors) was not of a socio-economic nature, but of a value-based one. For example, during the reform protests, the demonstrators tried to establish a dialogue with representatives of one of the settlements supporting the reform. The attempt was unsuccessful. It was like the conversation of the deaf: the parties could not understand each other, because they assessed the situation differently. If for secular Israelis the settlements are a territorial and political problem, then for religious settlers it is a matter of fulfilling religious precepts that are not a subject for discussion. It is very difficult to find a solution that would give the opportunity to remove this contradiction.

Social and cultural problems of modern Israel. Tatyana Nosenko reminds that the Israeli society has been formed by immigrants. At the same time the “melting pot” principle, on which the state’s founding fathers had relied, has not been working very efficiently. The modern Israeli authors distinguish several ethno-cultural groups in the country: the upper and middle secular class (immigrants from Europe and America), traditionalists (“Mizrahim”, immigrants from the Middle East and North Africa), the orthodox sector, the national-religious sector, Israeli Arabs, new migrants from the USSR and Ethiopian Jews. Each one of these groups answers differently the questions “What does it mean to be an Israeli?” and “What should Israel be like?”

The difference in views on what Israel is was clearly manifested during the conflict over judiciary reform. On the one hand, the reform is seen as an attempt by the traditionally privileged Ashkenazi elites to hold on to their last bastion, the Supreme Court. On the other hand, it is an attempt to change the status quo by those, who for decades have been oppressed and humiliated and, as it seems to these groups, has been the target of the judicial system: "Mizrahim", settlers, "Haredim" (Ulra-Orthodox), residents of peripheral areas. Today considerable numbers of people from Eastern origin families have established themselves in the Israeli establishment; they have strong positions at all levels of government. But the persistent historical resentment of the Mizrahim group against the arrogance of the Ashkenazi group becomes one of the important mobilization factors in the struggle against the so-called old elites.

The waves of Russian-speaking immigration (especially the big aliyah of the 1990s) played an important role in the economic and cultural development of Israel. There has been a fairly successful assimilation of immigrants from the post-Soviet space in Israeli society over the past 30 years. The need for party associations, that would represent this particular segment, has disappeared. The electoral preferences of Russian-speaking Israelis are built on the basis of the national agenda. But according to some characteristics, they are still being in a worse condition than the other groups. For example, the emigrants from the former USSR are more likely to face the problem of confirming their national status. So, in 2020, the Israeli Ministry of Internal Affairs rejected the granting of Jewish status to 2,000 children who had been born in repatriate families. The dictates of Jewish orthodoxy are unacceptable to this group, for that reason they advocate a reduction in the influence and privileges of the religious sector.

Meanwhile, the processes taking place in the orthodox sector of Israeli society are alarming. In 1979 about 212,000 ultra-Orthodox people (5.6% of the population) lived in Israel. Today there are almost 1.3 million of them (12% of the population). This population group continues to grow at a faster rate than the others. According to some estimates, by the year 2065, 49% of newborns in Israel will belong to ultra-Orthodox families, 15% will be children from Arab families and 35% will be born in secular and non-Orthodox Israeli families. With such a demographic situation, the ultra-Orthodox may have from 1/4 to 1/3 of the seats in the Knesset, which will become a serious challenge for the Israeli society, political system and statehood.

The immigrants from Ethiopia (Falashi) are a small group of the Israeli population - about 170 thousand people. Moreover, approximately 1/3 of them were born in Israel itself. This is a rather closed ethno-cultural community: 87% of marriages are made within the group. But the process of integrating the Falashi into Israeli society is going quite well. Their community has a slightly lower per capita income than by general Israeli standards. Young people willingly serve in the army on conscription. About 3,500 Israelis of Ethiopian origin study in universities. At the same time the crime rate among the Ethiopians is quite high. Thus, the proportion of cases opened by the police against Ethiopians in 2019-2022 was twice their share in the population.

The Arab minority is traditionally considered as a group least integrated into Israeli society. But today, according to some reports, the process of israelification of this group is underway: about 65% of its representatives identify themselves as either Israeli Arabs or Israeli Palestinians. Moreover, as recent studies show, the vast majority of the Arab population (87%) wants to participate in the country’s political life and want their compatriots to be members of the government. However, the problem is that there are no leaders and parties in the country that meet these expectations. At the same time, the Jewish part of society is wary, if not negative, about the expansion of the Arabs’ representation in political and public life. It is significant that the Arabs practically do not participate in the protests over judicial reform. Apparently, this is due to their continuing distrust in state institutions. Among the demonstrators’ demands, there are no ones that would concern the elimination of discrimination against the Arab minority - therefore, the reform and opposition to it are considered by the Arabs exclusively as an intra-Jewish struggle.

Israel in the modern system of international relations. Elizaveta Yakimova, the candidate of historical sciences, the research fellow of Department of Israel and Jewish Communities of the Institute of Oriental Studies, believes that two approaches may be distinguished in Israel's foreign policy today. The first one, regional, contains the perception of Israel through the prism of its neighborhood. The main foreign policy task in this context is building relations with the neighbors. The second approach includes such a concept as "domestication" of foreign policy, that is, the formation of a foreign policy based on the interests of the government and the ruling elite.

Amnon Aran, the Israeli scholar, identifies several stages in Israel's foreign policy. The first one - "the national" - started from the moment of independence declaration until 1967. During this period, Israel, firstly, sought diplomatic recognition. At that time it was necessary to obtain regional and international legitimacy. Secondly, Israel actively used the military tool in foreign policy. Thirdly, the state had a monopoly on the definition and implementation of foreign policy tasks (at that time, non-profit organizations and the media were not developed, that could influence public opinion, as is the case today). During this period the formulation of Israel's foreign policy foundations took place: quality versus quantity (building alliances). At the same time Ben-Gurion recognized the importance of the diaspora in foreign policy. He considered it as a tool capable of supporting the Israeli diplomacy. At the same time, taking into account the confrontation between the USSR and the USA, he drew attention to the Northern Europe states, hoping to learn from them the neutrality experience in order to minimize the costs of the Cold War.

The second stage is ethno-national, covering the period from 1967 to the mid-1980s. At the initial stage Israel acquired new territories, united Jerusalem as a result of the 1967 war. However, then, from 1973, the process of reassessing the government perception started (after the intelligence failure on the eve of the Yom Kippur War) the first non-profit organizations began to appear. In general, two main signs of the ethno-national period may be distinguished. The first one - disagreements over the use of military force as a foreign policy tool. The second one –shifting away from equidistance in favor of closer relations with the United States (the memorandum of understanding on strategic cooperation, this document was signed in 1981).

The third stage is "globalist". It conditionally began in 1985 with a plan to rebuild the country after the economic crisis. The distinctive features of this period: the establishment of relations with the PRC and India (expanding the geography of foreign economic activity); the cooperation with Japan developed (there had been relations before, but they had not been given much importance). The key feature of the "globalist" period was the linking of foreign policy activity with foreign economic activity. A good example was Ariel Sharon's presentation of a unilateral disengagement plan at the economic site in Caesarea. The leader needed at that time, among other things, to convince the economic community that this plan was good for him too.

Turning to today, we should answer the following question: are we witnessing a crisis or a new stage of politics? There is crisis evidence in all spheres of Israeli public and political life, including foreign policy. At the same time, despite the turbulence and frequent leadership change, thanks to diplomacy, the succession in politics is being maintained.

Perhaps today's stage is the quintessence of all the previous ones. The desire to build alliances was inherited from the first stage. Israel excels at forging new alliances, both regionally (the Negev Forum with Egypt, UAE, Bahrain, Morocco and the US) and globally (I2U2 including Israel, India, the UAE and the US). From the second stage - the development of relations with the diaspora around the world. From the third - the usage of the economy for solving foreign policy problems. In this case two features of this period may be distinguished. First, the current stage of Israel's foreign policy is largely personalized. Benjamin Natenyahu tried to establish good personal relations with the other countries’ leaders (Russia, Hungary, India). Yair Lapid continued this practice: during his visit to Paris, he spoke of his similarities with the leadership of the Fifth Republic. Secondly, as Tatyana Karasova, the candidate of historical sciences, the research fellow of Department of Israel and Jewish Communities of the Institute of Oriental Studies, noted, that these days Israel had become one of the regional centers in the Middle East. If before it could not interfere in the regional processes, that day it directly influenced the political dynamics of the Middle East.

Speaking of external factors, the three main ones may be distinguished. First, it is the signing of the Abraham Accords. At the end of 2022 the trade with the Arab countries, that signed an agreement on the normalization of relations with Israel, amounted to $3.37 billion, it increased by 82% compared to 2021. This rapid growth is partly accounted for the low base effect, but it is safe to say that this figure will continue to grow. Unlike the agreement with Egypt and Jordan, the new agreement with the Arab world is economically full, at least in the case of the UAE and Bahrain (however, the same cannot be said about interaction with Sudan, Saudi Arabia and Oman). Nevertheless, in more than 70 years of its existence, Israel has emerged from regional economic isolation.

The second factor is the conflict in Ukraine. Because of it, it became more difficult for Israel to do business with Moscow and Kiev: the payment system became more complicated and the prospect of image losses appeared (companies with serious interests in America and the EU refrain from developing cooperation with Russia). One of the consequences of the Special Military Operation for Israel became an immigration increase from Russia and Ukraine. It created a problem in the field of economics: the costs of providing new repatriates are increasing (absorption basket, consular service, integration, Hebrew education, etc.) The new immigration wave turned out to be unexpected, so the necessary measures implementation laid an additional burden on the budget. But in the medium and long term, this wave of repatriation will bring economic dividends to Israel: the purchase of durable goods by new residents of the country, the stimulation of small businesses, investments, including intellectual ones.

The third factor affecting the Israeli economy is the confrontation between China and America. Today China is more actively involved in Israeli tenders than the United States, occupying a leading position among the foreign companies. This speaks to the growing importance of China for Israel in economic terms. China is interested in the main sectors of the Israeli economy: mobile communications, artificial intelligence, healthcare, biotechnologies. Beijing's investments grew at a rate of 15% per year - from $20 million in 2002 to $200 million by 2020. Israel has a significant trade deficit with China: it imported $16.64 billion and exported $4.4 billion. At the same time the volume of Israel's financial ties with China is less than with the United States. Thus, foreign direct investments in Israel at the end of 2019 amounted to $28.5 billion. The main areas of investments are manufacturing, professional, technological and information services. The economic war between the US and China affects Israel. At the same time Tel Aviv wants to maintain good relations with both countries: Israel has had long special relations with the United States, and China is of interest in terms of logistics, existing port infrastructure, and high-tech. In conclusion it is important to note that for the Israeli economy internal factors are more important than external ones.