A Review of The Israel Test

Even the thought of summarizing the premise of George Gilder’s new book, The Israel Test, causes my mind to reel.

To attempt: The cause of the conflict between Israel and the neighboring Arab countries is not religion (although there are certainly elements) nor racism (although there are certainly elements), but rather it is caused by envy. Israel, in the 60 plus years of its existence, has been extraordinarily successful and the perception is that it has done so by taking from the Palestinians. In short, the conflict is about the zero-sum thinking of demand economics versus positive-sum thinking of supply-side economics. It is about the jealousy felt against people who have attained success and the belief that the only way they could have attained that success is by taking from others.

“The real issue is between the rule of law and the rule of leveler egalitarianism, between creative excellence and covetous ‘fairness’,’ between admiration of achievement versus envy and resentment of it,” Gilder says.

In Part One, Zerizus, Gilder, in his best and most brilliant prose since Wealth & Poverty, develops this premise and destroys any and all arguments against it. He posits his Golden Rule of Capitalism – The good fortune of others is also one’s own. One of the troubles with government, indeed with even democracy, is that government (transfers of wealth) and democracy (elections)  are zero-sum, while the economic system, capitalism is positive-sum. This influences the thinking of all leaders in democracies that they need to create an equity of outcomes, not just an equality of opportunity. He terms these people, “handi-capitalists!”

In Part Two, Israel Inside, Gilder introduces us to Jewish and Israel scientists and entrepreneurs who have had a profound influence on the world as we know it and a few, who he believes, are about to have even great influence. Intel’s latest microprocessors, they are coming from Israel; Petaflop networking, from Israel; Wireless high-definition interface standards, from Israel; Algorithms which map the human genome, Israel.

In Part Three, The Paradox of Peace, Gilder puts forth his by far most controversial and thought provoking  postulate – the Peace Now movement inside and outside  Israel, condemn themselves to Peace Never. Gilder quotes Nobel Laureate Robert Aumann, “If you want peace now, you may well never get peace. But if you have time – if you can wait – that changes the whole picture; then you might get peace now.” Gilder states, “Peace requires the imposition of penalties on aggression.”

Simply said, The Israel Test is not a easy read, but it is absolutely a must-read.

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