Reach for the Top (Extract)

Extract of article in Issue 6, July 7, 2008 of The Jerusalem Report. To subscribe to The Jerusalem Report click here. Can Israel 'leapfrog' over other countries and become a world leader in quality of life? Gidi Grinstein is confident that within 15 years, Israel can become one of the 15 leading countries in the world in terms of quality of life. "Sure, this is an ambitious goal," Grinstein tells The Jerusalem Report authoritatively during an extensive telephone interview from Los Angeles, where he is raising funds for the Reut Institute, the non-partisan, non-profit policy institute of which he is founder and president. "But it's achievable. Zionism is an amazing success story and I am convinced that we can write another chapter in this story." In order to achieve this impressive goal and close the gap between this country and the wealthiest nations, he explains, Israel must socioeconomically "leapfrog" from its current low-ranking position among developed nations, grow by at least 4 percent per capita per annum for a period of up to 20 years, and transform many of the parameters of public life. "Leapfrogging is rare," Grinstein says. "Only about 15 countries have ever done it. But in the 1950s and 70s, Israel doubled its standard of living in comparison to the United States. Just because I'm an optimist doesn't mean that I am ignoring the problems along the way. I'll paraphrase a quote I once heard: 'Optimists are usually wrong, and pessimists are often right, but nothing good ever came out of pessimism.'" Grinstein, 38, has already developed an impressive resume. A graduate of the Tel Aviv University School of Economics and Law and the Kennedy School of Government at Harvard University, he served as secretary and coordinator of the Israeli negotiating team on the Permanent Status Agreement between Israel and the PLO under Prime Minister Ehud Barak (1999-2001), including the Camp David negotiations. He is tall, suave and exceedingly articulate, often speaking in complete paragraphs. He is also friendly, approachable and strikingly persuasive - qualities that have helped him gather an impressive group of senior supporters and young staffers around the Reut Institute. He founded Reut, he says, in order to "strengthen the vision of Israel as a Jewish, democratic and prosperous state by enhancing the capacity of the government to incorporate long-term thinking into its ongoing decision-making. We intend to make a substantive impact on the future of the State of Israel by providing Israeli leaders with real-time decision support and by highlighting the long-term implications of their actions." Noting that Reut means "vision" in Hebrew, Grinstein emphasizes that the Institute is not a traditional think tank. "Most think tanks operate on the assumption that the central problem is connected to the collection and processing of information. So they deal with research. We say that the central problem lies with the cognitive, conceptual understanding of the problem. We don't provide answers, we ask questions." Brashly, yet humorously, he adds, "I guess you could say some of the people in think tanks are has-beens. We're wannabes or will-bes. People in think tanks are experts with knowledge and experience. Our team is young - the average age is 29 and there isn't one PhD among us. That means that we can ask questions, that we can apply ourselves to think about problems in a fresh way." And the central problem to which they are currently applying themselves is "The Israel 15 Vision," attempting to identify, through a series of working papers, conferences and consultations, the scope of actions required for leapfrogging Israel's quality of living. Leapfrogging, he explains, is entirely different than economic growth and requires different sets of skills. "Leapfrogging means closing the gap in income per capita and quality of life in comparison to developed countries. Some people seem to think that in order to leapfrog, you have to do more, make a greater effort - a few more reforms, a bit more privatization, a larger, or smaller, tax cut or tax hike. But it's not like that. A country can grow without leapfrogging, but it can't leapfrog without growing. Leapfrogging requires a vision and leadership. It requires effective government polices and a bottom-up mobilization of local authorities, social entrepreneurs and civil society, philanthropists, business people and world Jewry." Leapfrogging is competitive and the World Economic Forum's annual Global Competitiveness Index (GCI) is the widely accepted measure of national competitiveness, pointing to the brakes and engines of growth that can bring about a signficant improvement in the quality of life in Israel. As explained by Grinstein, this is a complex tool, based on three sub-indices that measure competitiveness in the private, public-private and public spheres, based on "pillars" such as institutions, infrastructure, macro-economy, health and primary education; the pillars are composed of 90 variables. Overall, Israel is already ranked at 15 in overall competitiveness. But Grinstein cautions that this should not be viewed as an across-the-board success. GCI's three sub-indices indicate that Israel suffers from imbalances between the lack of competititveness of its public sphere, on the one hand, and an efficient and innovative private sector, on the other hand. As an example, a policy paper issued bythe Reut Institute reveals that Israel is ranked 8th in "innovation and sophistication;" 12th in "efficiency enhancers," and a lowly 29th in "basic requirements." Translating these measurements, Grinstein notes that the private sector is the main source of Israel's strong standing and the GCI indicates that the major hindering agents (variables in which Israel's ranking is 36 and lower) are dominated by the public sector. In the variable of "reliability of police services," Israel is ranked 42nd; in "government deficit," 71st; in the "period of time required for starting a business," 50th; and in favoritism in government official's decisions, 38th. Definitively, Grinstein declares, "Israel's No. 1 economic problem is the quality of the government. The data show that the business sector in Israel is in 8th place in terms of its sophistication and that the Israeli population is one of the leaders in terms of exposure to technology and education. But in whatever depends on the government - you find stagnation. The potential for a significant socioeconomic leap lies in improving the performance of the public sector - or by reducing its size." Does the possibility of impending general elections provide him with any hope. "No," he answers, "I don't think elections will make a difference. The problem isn't the specific people who are running for office. The problem is that our system encourages short-term thinking for short-term political gain and discourages responsible, long-term creative thinking." Grinstein distinguishes between "per capita income," which measures a country's wealth and standard of living and the concept of "quality of life," which refers to the general welfare of the state, including concepts such as health and nutrition and intangible perceptions such as community and family life. As with the GCI, he refers to internationally accepted indices, including the Economist's "Quality of Life Index" and the U.N. Human Development Index. On the Economists' Quality of Life Index, Israel is ranked 38th in the world. According to the 2008 U.N. Human Development Index, Israel is ranked 23rd. "For some countries, that might be enough. It's not enough for us," Grinstein rails. "We face the greatest gap between our potential, based on exposure to technology and education, and our achievements. The quality of our life is at the bottom of the developed world, and we don't have to be there." Leapfrogging, Grinstein says, "isn't just a nice thing to do. It's crucial for our survival - otherwise, we just won't be competitive." But why is this competitive aspect so critical to the Israel 15 Vision? "We need competitive assessments because the world is global. And in this world, there's fierce competition over important resources - technology, people and investments. These resources are mobile and they can easily move from place to place. So to succeed, a country has to be attractive, and attractiveness is measured competitively. You have to have a reason to want to live somewhere, since you have choices. Right now, Israel is one of the biggest exporters of highly educated people in the world. I believe that in the future, we could be one of the greatest exporters of quality educational programs, if we put our mind to it." Extract of article in Issue 6, July 7, 2008 of The Jerusalem Report. To subscribe to The Jerusalem Report click here.