The security junta who govern Israel
Here the first article is by Jonathan Cook followed by the original from Guy Rolnick on which Cook’s article is based. Rolnick includes an interview with author Oren Barak who refers to Israel’s military “securitizing” the gas fields so they fall under the control of security chiefs, not civilians. Third is an article from Forbes magazine which has uncritically followed up this line.
By Jonathan Cook, blog
January 23, 2014
Hidden away both behind the Haaretz paywall and in its business pages is one of the most astute articles I’ve seen in the Israeli media. It tells how Israel (more so even than other western states) has been taken over by a security elite – what is termed here a “security network” – that has no interest in peace, though it increasingly likes an endless peace process. War and security are good for business, as far as this elite is concerned.
It is more than possible, as the article notes, that the Palestinian leadership is part of this security network. An academic quoted observes: “I think that in both elites, the Israeli and Palestinian, some want this perpetual state of a nation-waiting-to-be-born, and benefit from it. An established state means not only grave social problems but also limitations and constraints on the political leadership.”
The first half of the article is equally interesting but of more parochial concern regarding what Guy Rolnik, one of Haaretz’s best writers, calls Israel’s “independent tax militias”, corporations that have ramped up the cost of living through government-sanctioned cartel practices.
[Jonathan Cook then quotes part of Guy Roinick’s article, the whole of which we reproduce below]
Israel’s public sector and society no longer have each other’s back. It’s grab what you can, when you can
By Guy Rolnik, Haaretz
January 06, 2014
In May 2012, TheMarker reported on wage costs of top people in the IDB group. They weren’t exactly luminaries of corporate management, but as long the group owned monopolies and cartels and had easy access to the public’s money, through their friends at banks and insurance companies – they could help themselves to sky-high salaries with impunity. How much? More than NIS 600 million (about $150 million) over a decade.
It can’t be said that such information makes waves. People figured they couldn’t do anything about sky-high executive salaries and they also figured IDB was a giant that couldn’t possibly fall. Nor did the public really distinguish between managers who create value and those who take value.
Nor did people see the connection between sky-high executive salaries and their cost of living, and pensions.
Now that IDB has collapsed, now that the court has sent its controlling shareholder packing, now that the banks have to admit that Nochi Dankner – who lived like a king with a private jet and mansion, with executives suites and servants – is bankrupt, people get it.
They get that IDB ostensibly operated in the free market – but only ostensibly. In practice, its monopolistic status, its political clout and its cozy relations with Big Finance made it, essentially, into a private tax militia.
Meanwhile, last week the wages director at the Finance Ministry published his annual report on irregularities within the public sector. As usual, nobody noticed. If any attention gets paid to that report at all, it’s just to the few most egregious examples it describes. Like in IDB’s glory days, the politicians and the watchdogs are evincing zero interest in the report. Nobody asks how much of the money paid to public servants serves the greater good and how much is pure pocket padding.
The total wage cost of the public sector is about 160 billion shekels a year (nearly $46 billion). That doesn’t include wage costs at the private monopolies such as the banks, or indirect wage costs: Add those and we reach 200 billion shekels. At the Israel Electric Corporation, the banks, the Israel Airports Authority and more, a quarter to a third of wage costs go to superfluous workers, and workers who earn double or even more than what they could in the free market. A conservative estimate puts unnecessary wage costs in the expanded public sector, including these monopolies, at NIS 40 billion.
But the people don’t care. They don’t see the link between their impossible cost of living, and the tattered safety nets for the poor, and the looting. They don’t see the link between the bad management and the poor service they get.
The social-justice protests helped tear the masks off the faces of the robber barons at the commercial pyramids and financial institutions. But we didn’t manage to bring the revolution to the pork barrels in the greater public sector, which constitutes the second, major cause of poverty, inequality, low productivity, the brain drain, and despair among the young.
The watchdogs have no great incentive to expose the looted billions. I asked a top source in Jerusalem last week how he explains the public’s indifference to the robbery, even after the social-justice protests. “It isn’t just the public,” he answered, adding that high-ranking managers in the public sector see the waste, they know who isn’t needed. But they have no incentive to lift a finger, knowing they’d just incur the wrath of the workers and even the minister, and wind up on the street themselves.
The people don’t see the connection between the bloated public sector, the corruption and their electricity bill and their taxes. The public sector is a reflection of society: the one is not the other’s keeper. No more mutual guarantees. They do not have each other’s backs. Grab what you can, that’s the principle.
The tycoon-ization and hedonism of our recent prime ministers, the mad dash after big, fast money, as the cost of living rises and private medicine spreads – these have led us all to cannibalism. Nochi Dankner has plenty of company.
The biggest tax militia of all
For years I have argued that in this country, decisions, and resource allocation, is not done democratically: It’s a matter of powerful groups achieving equilibrium. I call some of these groups “independent tax militias.”
It is practically impossible to disarm these independent tax militias and get the public its money back. One magnificent blow for the public was the dismantling of the cellular militias – Cellcom, Partner and Pelephone. Mobile phone bills in 2013 were 5 billion shekels (nearly $1.5 billion!) lower than in 2011, most of which benefited ordinary Israelis.
The tax militias of the banks and insurers is three times bigger than that of the cellular companies, and both these monsters looks like minnows when seen against the other militias mentioned above. But of course the biggest tax militia of them all is the Israeli military.
I have constantly maintained that there is no connection between the threats Israel faces and its defense expenditure. Like all big systems, the defense establishment is preoccupied mainly with its own survival, with increasing its clout and budget. And now let us ask the real question: Do the interests of the defense establishment lead to a waste of billions upon billions, but also block any chance of diplomatic understandings in the region?
“Israel’s Security Networks” by Oren Barak and Gabriel Sheffer, Cambridge University Press, 2013
I asked these questions of Prof. Oren Barak, of the Hebrew University of Jerusalem, who recently published the book “Israel’s Security Networks” together with Prof. Gabriel Sheffer. The two claim that much of local politics, and economic and social affairs can be explained through the excessive influence of the “security network,” as they call it. They claim that since Israel’s establishment, and mainly since the Six-Day War, an informal but powerful security network has been evident, consisting of security officers (on active duty and retired) and their civilian cohorts. This network affects the culture, the politics, society, the economy and the public debate. It also impacts Israel’s foreign relations. The two experts describe the weakness of Israeli civilian society and explain that it’s in the interest of the security networks to keep it that way, relegating economic, cultural and civilian considerations to the margins.
I asked Barak if behind the arguments on the territories and the peace process, something simpler lies – a powerful interest group fighting to preserve its status; a defense clique that managed to bend foreign policy, politics and the budget to its interests.
Prof. Barak: Yes, that is exactly what we claim in the book. It isn’t a club in the sense of a place where people meet, but of people who share the same beliefs and values, first and foremost the supremacy of security as they perceive and represent it, with the Israeli army as its main representative.
Those involved in this network can certainly collude to advance policy that serves their interests, Barak continues:
The defense budget is an outstanding example of the might and influence the security network has. Each year you can see how they frustrate any attempt to reduce that budget, and often act to increase it after its formal approval by Knesset. That explains the big gap between the approved budget and actual one.
Fifty-two years ago Dwight Eisenhower warned the American public about that very thing: a club of generals and arms-dealers conquering U.S. foreign and defense policy. He coined the phrase “the military-industrial complex,” and indeed that club has dragged America into war after war during the last 50 years.
Isn’t the Israeli security junta, which inflated the defense budget to 70 billion shekels, essentially an Israeli military-industrial complex?
Prof. Barak: When Eisenhower spoke in 1961 about the complex in the U.S., he was talking about its formation following the Cold War and the U.S.’ massive arms buildup, which could create ‘misplaced power’… he was warning the American people about what could happen. What we’re talking about in Israel’s case isn’t theoretical, it’s reality: The security network exists and penetrates a great many public areas, including politics, society, the economy and the culture.
Take the gas found in the Israeli seabed, Barak says. Right after its discovery, a process of “securitizing” the gas began – meaning it morphed from a civilian issue to being tagged as a military one, with the help of the security network. [see article below] Since it had become a military issue, it suddenly became important to produce the gas quickly, lest it fall into enemy hands, and now also to protect the gas-drilling sites using costly new boats. “That’s exactly how the security network operates: frame a topic as military, and take it away from the civilian apparatus – the public, the Knesset, the government,” Barak says.
There are claims that a military-industrial complex arose anew in the United States, especially given the interminable war on terrorism, he notes. Israel isn’t a military empire like America, but it does have massive defense exports and, of course areas that need protecting within and beyond its borders.
In the book we discuss cases like the Israeli case: a small country facing a genuine or imagined existential threat, which chose to build a large military establishment that is not separate from the civilian sector. Good examples of this include South Korea, Taiwan, South Africa and Singapore, says Barak.
Both Israel’s left- and right-wing parties frame the debate on the Palestinian issue as ideological, religious, cultural and historic, and associate the inability to reach a solution with the ideology of the leaders, religion, history and so forth. The simpler possibility, the incentives of the leaders, is not seriously discussed in Israel or elsewhere, Barak says.
Could it be that the peace process is stuck because the status quo, meaning war and unending tension alongside an interminable peace process, serve the security, diplomatic and political elites in Israel and the Palestinian Authority, the Arab world and in the other involved countries?
Prof. Barak: I think the state of perpetual war in our area serves the security network, because it creates a need for the unique skills of its members as security experts. I do not necessarily claim that all the network members are warmongers. Some sobered up and acknowledge the importance of regional peace … but most still look at things through a gun-sight, and even when involved in a diplomatic process, they view it mainly as a defense issue, not a civilian one . Oslo began as a civilian initiative and underwent securitization.
The left views Israel’s leadership as bearing the main responsibility for the failure to progress in peace talks. Could there be elements on the Palestinian side who also want to perpetuate the process, because in the event of the establishment of an independent state, they’d have to contend with serious social problems?
I think that in both elites, the Israeli and Palestinian, some want this perpetual state of a nation-waiting-to-be-born, and benefit from it. An established state means not only grave social problems but also limitations and constraints on the political leadership, such as clear boundaries vis-a-vis not only the nation and its neighbors, but in areas such as politics, the economy, society, the army and religion. It’s a lot easier to be an unborn state fighting for its existence against a hostile world … It’s quite clear that a Palestinian state, if one arises, and that’s highly doubtful, will be a failing state dependent on others, like Israel and the European Union, which is not a tempting scenario for its leaders. Look at South Sudan.
The Lahav class Saar 5 [above] is a multi-purpose missile corvette designed and planned by the Israel Navy as an effective response to future challenges. The Saar 5, which has a high level of survivability is equipped with a helicopter and surface-to-surface, anti-aircraft and anti-submarine capabilities. Designed to remain at sea for relatively long periods of time, its primary use is as a command ship for task forces. As such, it is equipped with the most advanced combat, navigation and propulsion systems existing in the world today. The Israel Navy currently has three Saar 5 missile boats. Information from Jewish Virtual Library.
By Paul Alster & David Andrew Weinberg, OpEd Forbes
January 08, 2014
Israel is looking forward to a considerable energy windfall with the development of the Leviathan and Tamar natural gas fields in the eastern Mediterranean. These new resources should produce a revolution in Israel’s energy security, provide a new source of economic vitality, and turn the country into a significant energy exporter in the very near future. Physical security for these resources, however, remains a daunting challenge for a country that has historically given short shrift to its navy.
The rigs required to lift the gas from the sea floor are a target that some commentators have referred to as a “sitting duck” for terrorists. The gas platforms are to be situated outside of Israeli territorial waters, but inside Israel’s Exclusive Economic Zone (EEZ), an area roughly twice the size of Israel itself. Inside this zone any foreign vessel is legally allowed to approach within half a kilometre of Israeli infrastructure before defensive action can officially be taken.
IDF officials concede that they do not have the resources as of now to properly secure the infrastructure at sea. In particular, defense officials in Tel Aviv express concerns that terrorist groups might attempt to disrupt operations though suicide operations, with divers, depth charges, surface-to-surface missiles, or UAVs.
Rig owners, including Houston-based Noble Energy, are working intensively in conjunction with the IDF to ensure the security of their investment. There are private armed security forces on each platform that have radar to monitor sea traffic in the area. These radars are designed to link up with those operated by the IDF, measures that will be supplemented by increased naval patrols and UAV surveillance.
Navy officials have lobbied hard for a supplementary budget of $820 million, arguing that they required four new vessels, additional defense hardware, and more manpower, but recent budget constraints across the government left just $790 million USD in new funds for Israel’s entire military, only a fraction of which is earmarked for naval expenditures.
Even with capped funding levels, however, the Israeli navy has recently signed contracts to acquire two state-of-the-art German-built MEKO class F221 frigates bound for patrol of the Mediterranean gas fields, an apparent sign that their argument has won over most doubters. The two frigates will be armed with Israeli-built Barak 8 medium-range air defense systems alongside the 76mm guns and on-board surface-to-air missile systems and are a positive step in the right direction for Israel’s maritime security needs.
Yet how the battle to protect these rigs plays out depends at least in part upon a domestic Israeli battle over priorities, planning, and the ultimate value of the resources at play. Israeli naval officials claim that there is 1400 billion cubic metres (BCM) of natural gas in Israel’s new wells, amounting to $260 billion in assets that now need to be protected by the state. They therefore claim that the navy’s latest budgetary request represents just 0.45% of projected revenues from the gas fields over the next twenty years.
However, according to the Tzemach Committee charged with reviewing Israel’s natural gas policy, 1400 BCM is actually a hypothetical estimate that includes not just proven, recoverable reserves, but also “prospective reserves” with “various probabilities of geological success”. Further, the Israeli government’s predicted share of this revenue through taxes and royalties is only about $60 billion, according to Prime Minister Benjamin Netanyahu at a press conference this summer.
Even after accounting for a recent announcement by Tamar’s rig owners that they have discovered small additional amounts of natural gas, it seems likely that Israel’s navy has arguably inflated the (already considerable) value of natural gas at the site in order to procure the equipment and funding that they say is needed to defend Israel’s critical new energy infrastructure.
Regardless of how its intramural battle over spending and defense priorities plays out, Israel’s rivals in the region seem perfectly happy to invent new pretexts to threaten Israel’s nascent energy security. Turkey,Lebanon, and Hezbollah have all challenged Israel’s access to its rich new natural gas fields.
And according to Israeli intelligence officials, when Hezbollah sent a drone into Israeli territory in 2012, it actually did so by flying over one of Israel’s older natural gas rigs off the coast of Ashkelon. And that’s not even accounting for Hamas and Hezbollah’s widely recognized arsenals of sophisticated missiles, which pose an obvious danger to Israel’s newer Mediterranean rigs.
Many countries maintain a navy to protect their coastline and offshore assets from threats out at sea,but no other country has to account for the sorts of strategic threats that Israel faces to its promising energy windfall.
Paul Alster is an Israel-based journalist who can be followed at www.paulalster.com. David Andrew Weinberg is a senior fellow at the Foundation for Defense of Democracies.