The Land of Milk & Honey, But No Butter ? (and 9 Other Paradoxes of Israel)

Last time that I tried to repair the socket on my internet router, it took me 8 days. I had inadvertently broken the plug while moving a couch, and I foolishly thought that in this high-tech Start-Up Nation, I could buy the missing piece in any branch of my internet provider… well, I was wrong.

It took me 8 days, 6 visits to different stores (many of which only accessible by car), and 4 bitter conversations with incompetent people from customer service who all contradicted one another. I also had to face the repairman who did nothing else but offer us to sell me a more powerful router, 2.5 times the price of the previous one.

As I was on the edge of a mental breakdown, I first thought of filing a complaint and setting up a class action suit for deceived consumers. Once it was finally fixed, a question lingered in my head: how is it possible that, in 2019, in an overdeveloped country, replacing a f** internet outlet can take 8 days?

This question was particularly apropos because I was organizing a conference with the AlumnIsrael association on the paradoxes of Israeli society with an economist who, I hoped, could provide some answers.

Jacques Bendelac listed 10 paradoxes about Israel. Here they are:

1. The High Tech Nation is only a small percent of the actual nation

Israel faces a shortage of manpower – especially skilled ones. In terms of research, the ratio of R&D spending to GDP has dropped, and Israel has even been surpassed by South Korea. Only 8% of active people work in high-tech, compared to 92% in low-tech.

I suspect my internet repairman to be in the 92% group, otherwise, the statistic is even worse than it sounds.

2. The economy is rich but the people are poor

Israel may be very successful in terms of the number of startups, innovations, and Nobel Prize wins, but in terms of social justice and income equality, most Israeli homes are low income and have low living standards in comparison to countries of the same development level. With a rank of 35/36 in the OECD ranking, Israel still has a lot of room for improvement.

3. We have highly-valuable cows, but no butter in supermarkets

After my visit to yet another supermarket, I realized that there was no butter on the shelves anywhere. I finally found 500g of a Finnish brand. Israel is not a communist country suffering from the embargo of the Cold War. So, what exactly is going on?

According to Jacques Bendelac, Israel is clearly a monopoly economy, where one business can dominate 80–90% of a given market. In the case of butter and dairy products, the country suffers from a cruel lack of competition, notably due to the Strauss family’s control of the dairy industry. The authorities have started importing European butter to compete, but imports are subject to severe quotas.

So we end up needing to choose between rationed Finnish butter, or French butter at triple the price. This is not a good solution. I hope someone is working on it… In the meantime, I’ll stick with olive oil.

4. We work a lot in Israel, but we don’t produce much

An Israeli works an average of 43 hours per week but produces 40% less than a French workerman. 

Maybe because the French are on holiday vacation every six weeks?

5. Israel is a country where 40% of people have a jobs that will disappear in 20 years

Everything is being modernized, robotized, from cash registers in supermarkets, to more complex activities in agriculture. And professional reorientations are not always that simple.

That being said, is this challenge really specific to Israel? And that’s what wase also said decades ago about for factory employees.

6. Israel is proud to have received 12 Nobel Prizes, but academic results arein dropping

Apparently, education is neither the government’s main concern, nor the country’s first item of expenditure. 

Ouch, I’m going to have to follow mythe kids’ education more closely.

7. The country has too many cars and not enough roads

Israel has twice as many cars per kilometer km of road as Europe does! The lack of infrastructure and public transport is a concern for all residents. A recent example is the Jerusalem tram, in which a track segment between two stations took 15 years to complete run between two stations. Political and financial problems do not help to overcome the delays.

No wonder that ideas such as Waze, Moovit, Mobileye, and so manyall the mapping and traffic optimization companies were born here, where the need to unclog the roads iswas critical.

8. Israel has a very high standard of medicine, but the waiting wait lines are too long for users 

There is a shortage of doctors, nurses and medical personnel. Specialists are too rare for the growing population. Jacques Bendelac highlighted the lack of training, budgets and infrastructure.

9. The country is rich but still usescalls on American aid

Israel receives $3.8 billion in American an aid annually, despite the fact that the. The country’s good financial stability is attractive to bringing lenders.

Is this a good strategy, knowing that this aid is intended to be spent onbringing American goods? The allocated budgets are used more to support military purchases than the latest collections of Abercrombie sweatshirts.

10. In 2020, the rich vote on the left and the poor on the right

This trend has been going on for 20 years and continues has been confirmed from election to election. Why? The poorest cities vote on the right and the electoral choices are more motivated by culture and identity than by economy.

Projections for 2020: what will drive the economy up? Gas, cannabis, and the cybersecurity industry according to our economist.

All these facts won’t help me find cheap butter or solve the next internet outage, but at least I now have a better overview of the Israeli economy andits paradoxesin Israel.

The “AlumnIsrael Business” Association brings together Alumni from French Business Schools, Dauphine, Sciences Po etc. living in Israel. Its purpose is to allow us to exchange advice, share job offers, and welcome newcomers.

Elodie Tordjman-Garel created the content agency Smart Content and advises companies on their communication strategy.