By Daled Amos
George Gilder is an American author and economist. His book, The Israel Test, was published in 2009. A new version of the book came out last year.
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| George Gilder (YouTube screencap) |
What is so important about your book, The Israel Test, that it merits a new third edition?
The issues of The Israel Test are imperative for everyone to understand—a relaunch of the message of the essential book of my lifetime. I've been writing for nearly 70 years, and of all my books, I like The Israel Test best. It's the most personal of my books and the most fervent. It may be the most important. I write about entrepreneurship, I write about technology, I write about creativity as the paramount force in human life. It is all epitomized in the fabulous feats of Israel as the Startup Nation and now possibly the leader of the Free World.
I think Israel is transforming the world as we speak.
Briefly, what is the Israel Test?
The test is how people respond to those who excel in creativity, intellect, accomplishment, and wealth. Do you admire them and try to learn from them or do you envy them, resent them, and try to tear them down? This is the central test of the world economy and human life. When we resent those who excel us and attempt to suppress them, we doom our Human Experiment. To the extent that we admire them and emulate them, there are no limits to our achievements on this planet.
For whatever reason, most of the great breakthroughs of the century have come from Jews, and Israel now epitomizes this genius of the Jews. So when we attack Israel, we're really attacking the very source of human creativity and accomplishment in the world. That is the Israel Test.
U.S. corporations have some 70% of the global market cap and all the world's equity markets. When you examine the companies that account for this global leadership in the United States, they all have crucial, laboratories inventions, factories, research, and operations in Israel. People talk about Israel being dependent on the United States. But the U.S. is more dependent on Israel today than Israel is on the U.S. The United States is in a maelstrom at the moment, and Israel is really the inspirational leader of the world economy.
What are the biggest misconceptions about Israel's economy and the Israeli society that you debunk in your book?
First of all, the whole idea that Israel somehow is occupying something is just misconceived.
One of the reasons for the second edition of the book is that once, after I addressed a synagogue in Far Rockaway in New York, fifteen years ago, someone came up to me and gave me a beaten-up, frayed copy of a book by Walter Lowdermilk. That book is the basis for a couple of new chapters in the recent editions of The Israel Test.
Walter Lowdermilk was a Christian in the United States in the Agriculture Department under FDR. A heat wave had led to a terrible drought in the U.S. causing a crisis for US agriculture and for the West. Lowdermilk traveled around the world, in search of agricultural methods to meet this crisis. He ended up in then-Palestine and discovered amazing agricultural feats. This is back in 1938, before the establishment of the state of Israel. He found that the Jews had performed an agricultural miracle unparalleled anywhere else in the world.
Lowdermilk found that they had solved the water problem and made the desert bloom. In time, this led to desalination plants, drip irrigation, microirrigation, and the planting of a million trees. There is now an Israeli university with a Lowdermilk building because he became a hero and is recognized for his important contributions.
He reported that when the Jews moved to Palestine in the 19th century, there were only 200,000 to 300,000 Arabs in this wasteland that was really a desert. Their average lifespan was around 30 years old. When the Jews came and made the desert bloom, the Arabs crowded into Palestine to take advantage of these breakthroughs the Jews achieved. Jewish migration made a population of Palestinians possible. Without the Jewish immigration, there could not have been a sustained population because of the lack of water. Lowdermilk's book documents detailed observations and testimony about how the Jews transformed the desert and made Israel ultimately into the world's most Innovative agricultural country.
But Israel made a big mistake. They adopted socialism. By 1985, Israel was about over, approaching 1000% inflation with the economy on the verge of collapse. The Histadrut domination of banking had resulted in the bankruptcy of banks and the fall of the shekel. That was when the new government under Netanyahu led the transformation of Israel into a capitalist leader.
The real Israel Test came when Israel demonstrated that freedom, capitalism, and creativity enable human life and accomplishment. That vindication of capitalism, pioneered by Netanyahu, changed the Israel Test from a test of recognizing their agricultural changes to recognizing their technological changes. Israel was a key source of the success of Intel Corporation, the leading American semiconductor company. Nvidia achieved great success by buying an Israeli company called Melanox, making Nvidia one of the world's most valuable companies by enabling their Artificial Intelligence breakthroughs.
It begins with half the Nobel prizes and the serious Sciences and it goes on to the richest people in the world, to the most pioneering country in the world. And it's all ultimately a recognition of the incredible genius of the Jews.
The Israel Test is about how Israel's genius enriches the world.
Is the Israel Test of the Arabs different? Aside from the psychological and emotional elements of envy and hatred of the Jews, the Arab world also has a cultural aspect that you mention in your book: shame and honor. Going a step further, are those Arabs living in Israel under Jewish rule for the first time in Arab history being tested and challenged differently than any other people?
Israel is a democratic government that grants Israeli Arabs more rights than any other place in the world, except maybe the United States. Arabs do better in Israel than they do anywhere else. The million Arabs in Israel comprise 16% of all the engineers. The Arabs do well in Israel and do not support Hamas or Hezbollah activities. There are, of course, disgruntled Arabs. But I think that the Arab integration with Israeli Society and Israeli industry has been a lesson for the world and the Israel Test.
I've spent a lot of time in Israel, talking to Arab engineers. They are making crucial contributions. The ones who learn from the Jews rather than resent the Jews do brilliantly in Israel.
You write that capitalism is one of the best remedies for antisemitism. How does that work?
Capitalism is based on giving. A fundamental principle of capitalism is its dependence on the moral fabric that the Jewish and Christian traditions enabled. capitalism is the secret behind the emergence of Israel as the world's leading creative force and its world leadership. Israel did not become the Startup Nation until it adopted capitalism and they didn't employ all these Arabs either until it adopted capitalism.
Probably seven out of the ten richest people in the world are Jews. All their wealth is invested in projects and companies that employ millions of people around the world. This makes the continued triumph over human exigency possible. It explains why the genius of the Jews converges with the capitalist insights to make Israel's emergence as the leader of the West possible. Israel's amazing achievement is that this tiny country has accomplished so much, yet has only existed for 75 years. And it could only have happened with capitalism.
The American economist and political commentator Thomas Sowell makes an important observation. He studied minorities all around the globe. He acknowledges the incredible achievements of the Jews and of Israel as the spearhead. However, he also shows that a similar phenomenon exists in Asia with the overseas Chinese. There are some 40 million overseas Chinese, more overseas Chinese than there are Jews. It's not exactly comparable, but the overseas Chinese dominate the economies of Asia in the same way that Jews dominate the Middle Eastern economy--and the American economy for that matter. Millions of overseas Chinese have been killed in pogroms in Indonesia, for example. This ended up depleting the Indonesian economy for decades They imagined that the overseas Chinese were somehow stealing wealth instead of creating wealth. Wealth is created; it is not stolen.
You write that anti-Semitism withers in wealthy capitalist countries. But is that really true today?
We are slipping back into Socialism. The West is no longer so wealthy and our wealth does not distribute itself as thoroughly as in a free economy. We are socializing our economy in the name of climate change and other delusions that are inducing us to abandon capitalism. When we abandoned capitalism, people began to look for victims. They consider themselves victims and resent the wealthy. They start failing their Israel Test.
So it's not just because we're living post-October 7th?
That's right. Marxism is based on resentment of wealth. If you start resenting and tearing down wealth, you end up failing your Israel Test and bring about catastrophe. And that's our history.
One of the stories I like to tell is about World War II. It was won because the U.S. admitted Jews to lead the Manhattan Project and create the nuclear weapons that made the triumphs of the Western order possible. After the Second World War, democracy and capitalism were the fruit of the Manhattan Project, and the Manhattan Project was accomplished almost entirely by the Jewish scientists fleeing Europe.
John von Neumann is a great hero of the Israel Test. He was a pivotal figure both in the Manhattan Project and in the creation of the computer industry. He won his debate with Albert, Einstein and persuaded Israel to create a supercomputer and acquire nuclear power. Israel could not have survived without von Neumann's contributions. A Jew who fled Europe for the United States ultimately saved both Israel and The United States.
You mention the United States. Generally, antisemitism doesn't seem to be as large a problem here as it is in Europe. Why is that?
One of the reasons is that Europe accepted massive Muslim immigrants without requiring them to adopt the principles of a free society, and without requiring them to abandon their antisemitism. Europe got occupied. It's a terrible problem and it's why Trump's insight about immigration is so critical. You accept immigrants who accept the constitutional principles of your society, the key moral underpinnings of civilized society. An obsession with exterminating Jews is utterly inconsistent with the principles of any kind of free, civilized society. Europe accepted too many jihadists and it's changing their culture.
Eastern Europe is now becoming more prosperous than Western Europe because of this. It is not trivial. Eastern Europe refused Islamic migration and has managed to continue its capitalist prosperity. Poland is now one of the world's most creative and productive countries.
You write that Judaism perhaps more than any other religion favors capitalist activity and provides a rigorous moral framework for it. How so?
Capitalism is based on escape from materialism. It is based on the belief that human beings are created in the image of their Creator. These Judaic insights and principles help explain why Jews lead the world economy.
Is capitalism the escape from materialism? Some say capitalism is dependent on materialism.
No, it absolutely isn't. Many models imagine the economy is dominated by land, energy, resources, rare metals, or whatever claims they make. Actually, ideas are all the world has. As Thomas Sowell puts it, the Neanderthal in his cave had all the material resources that we have today The difference between our age and the Stone Age is entirely the triumph of intellect and ideas and the transcendence over our material bondage and our material entrapment.
What are Israel's biggest challenges in maintaining its economic growth?
Israel led the world in new venture capital in 2024. It grew its venture capital by 38% over 2024 while the U.S. expanded its venture capital, because of the advance of artificial intelligence and the transformative impact of AI on various industries. But even during this horrific war, Israel has expanded its economic leadership. That is why I say they are the leader of the West. They have to maintain their openness, creativity, and inventiveness. They can't retreat to the materialist superstition that wealth comes from the land. Israel demonstrates that wealth doesn't come from the land--it comes from the mind.
What would you like your readers to take away from The Israel Test, especially the younger readers, who may not be familiar with Israel's story?
They should understand that this is a world of abundance. They should be careful not to accept the materialist superstition that ends up resenting wealth by imagining wealth is something material that was stolen from them. And that's the crucial recognition.
We always face the Israel Test. We all have the propensity to envy people who excel us. We all feel that temptation. We must shun the material superstition and embrace the infinite possibilities of the human mind and creativity.
Monday, February 24, 2025
Elder of Ziyon
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