By Ali Hasnain

The myth of Israel has haunted Middle East for generations. We are at a stage where the fabric of Israeli society is being torn apart, socially and economically. The mythology media spreads supersedes facts; supposed technology, backing from bankers, import and export from United States and Europe.

Just to give those readers a little background who are not into economics, In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. In modern banking system (Riba system) one of the reason system collapses is hyperinflation. Hyperinflation occurs when a country experiences very high and usually accelerating rates of inflation, rapidly eroding the real value of the local currency, and causing the population to minimize their holdings of the local money.

In Israel, in 1984 inflation was reaching an annual rate close to 450% and projected to reach over 1000% by the end of the following year. This is simply too high by any standards and it means that the country is in a state of collapse. Desperate measures were taken and with foreign help (a lot of it) and desperate local measures country was stabilized. One wonders where did the supposed genius of Jewish bankers vanish. Government was made to stop printing Shekel (Israeli currency) to cover deficit among other actions, prices were frozen among other options. In contrast, highest inflation figures in Pakistan have been 37.7% in supposedly prosperous era of Z. A. Bhutto (1976). Lowest inflation, which was actually deflation (1959) was -10.32% in “Dictator” Ayub’s era. Prices were actually going down.

Today Israel’s foreign economic debt is US $ 95,019,000,000 (Too much for a country its size). Here are some figures for Israeli Internal debt. 3.97 Israeli Shekel equals 1 Dollar.
Population of Israel is 7,990,000.
Internal debt estimate: ₪ 871,321,150,084.
Interest per year: ₪37,461,028,079.
Debt as % of GDP: 76.92%

Israel’s political system is almost dysfunctional; their military gives an illusion of democracy. Military in turn is controlled by the CIA. Israel is no stranger to conspiracy theories like the rest of region. The toll wars take on Israeli Economy is enormous.

Fact is Israeli youth are facing increasing housing and employment problems. Israel lacks natural resources and a dedicated work force (like their previous generation). They are trying to make Israel Diamond capital of the world. Diamond industry is like the king of all fads. Diamond industry itself was dead in the 19th century and was revived by the interested industrialists who managed to make it a compulsion with marriage. It is an artificial industry and can collapse on any bad year.
Israel has basically minimum or no trade with its neighbours and their hatred for each other is mutual. There are sane voices in Israel I must say; Gershon Baskin is one of them but few listen to them.

Most of the domestic industries are monopolies that face little or no competition. Current Prime Minister Netanyahu, also known as “King BB” or simply “BB” in Israel for his hawkish attitude is a menace for US. US Senator John Kerry has reportedly refused to talk to him directly after he yelled at him. He is famous for obliging the rich and taxing the poor. In my opinion he is out of American hands and would either be removed or assassinated because of his aggression in the region. At the moment Israel is heading towards early elections with BB’s chances of success as low as Nawaz Sharif’s in Pakistan in next election, if not lower. Israeli peace with Sadaat and Shah Hussien is another topic but I want to mention the fact that Netanyahu was the man who led the protests again Rabin (pro-peace Israeli prime minister who promised two state solution and peace) that preceded the assassination.

From what I read in the Israeli press Netanyahu would be removed soon, otherwise he would bring Israel’s demise. Economic disparities and poverty in Israel since he took power are appalling.

About the Israeli economy, Israel grows some vegetables and other products and this is good for propaganda, but they import most stuff including expensive milk, meat and grains. European subsidies would eventually dry up. Their Major imports include telephone (Motorola parts included, prone to boycott) computer hardware and software which IDF (Israeli defence force) propagandists proudly pronounce as their own version and medical stuff which they export with heavy co-operation with multi national and global firms and are quick to take credit. Europe is already tired of Israel; for a long time Israel has been a liability then an asset. Saudis have a very strong lobby in the West, some say the strongest lobby money can buy. Israel cannot sustain itself for long. The collapse of Israel would come from within. With their human right records most Western countries are already distancing themselves from the de facto (in effect) rogue state.

For me, the fault line in Israeli Economy is the trade factor. Any Future Naval Blockade, which in military terms is not hard to enforce, would collapse Israeli economy in days unless Israel declares war to break it.

Israel is building walls non-stop. I would quote what JFK said in Berlin in a different context, but same quote goes for India which has built the wall all over the border with Pakistan:

“Freedom has many difficulties and democracy is not perfect,” he continued. “But we never had to put up a wall to keep our people in.”