Middle Israel: Obama's real message to the Arabs

One side effect of the American stimulus plan will be the end of oil as we have known it.

amotz asa el 88 (photo credit: )
amotz asa el 88
(photo credit: )
"The communists," Harvard economist John Kenneth Galbraith wrote in the '60s, "not only socialized property, which seemed not a strong likelihood in the US, but they planned - which seemed more of a danger." Consequently, for officials to be dubbed back then "economic planners" posed a danger, he observed, even if "less serious than to be charged with communism or imaginative sexual perversion." That was then. Now everyone from Barack Obama to the government of Taiwan is competing in economic planning, eager to shackle national budgets to anything and everything from the refurbishment of Swiss railways, highways and bridges, to subsidizing Dutch workers who are prepared to shorten their work week. The most ambitious neo-planners are the Americans, who even under the outgoing Republican management have earmarked $700 billion - that's about four times Israel's entire GDP - with which their government has been deciding, like God on Yom Kippur, who in the financial sector shall live and who shall die. Now, as verbal billions are flying everywhere and vested interests elbow their way, with varying degrees of tactlessness, to the politicians' newly loaded picnic baskets, most people realize this is no time for anything other than economics. Most, that is, but not all. Some still think the Middle East will continue to dominate America's agenda, and one pundit has even announced with great confidence that Obama will put an end to what he described as Israel's "free lunches." Well - ha. FOR ONE thing, with the American economy losing more than half-a-million jobs last month alone, and almost 2 million since January, it would be ludicrous to expect Obama to care a fig right now about Ismail Haniya, Bashar Assad or Moshe Feiglin's latest exhortations. The future of Citigroup, AIG, Chrysler, Ford and General Motors is at stake. This is, of course, quite regardless of the fact that Israel never got a free lunch, whether from America or anyone else. America began aiding Israel only long after the Jewish state had matured, and it did so because it needed a reliable outpost opposite the USSR's local satellites. Now America's civilian aid to Israel has long been discontinued and the military aid that still arrives here is an American interest, as we learned in the 1980s, when Washington politely asked Jerusalem to cancel a fighter-jet project because it would have cost thousands of American jobs. Now, suggesting that Obama deprive Israel of "free lunches" means what - abolishing military aid? Never mind right now that the Israeli taxpayer can absorb such a burden with fair ease, considering that US aid, even when combined with the Diaspora's donations, equals less than 2 percent of our GDP, what about the meaning to the American economy of firing the engineers, technicians and blue-collar workers involved in manufacturing what the IDF buys in the US? It takes an aloof career diplomat to suggest that while dealing with a potential depression, Obama would find time, or reason, to twist Israel's arm, and that too by threatening precious American jobs. Israel therefore has nothing to fear, or hide, as Obama heads for the White House. The ones who should worry are its neighbors, and not because of Obama's diplomatic designs, but because of his stimulus plan. OBAMA'S ECONOMIC plan inevitably involves risks. Some experts argue that public works projects come at the expense of other jobs, others warn of overregulation, and some fear America might accumulate too much debt. Still, as far as the Middle East is concerned all this is immaterial. What matters in this regard is that Obama is now committed to producing no fewer than 2.5 million new jobs by 2011, and that he intends to do so through the federal budget in what will be the largest such endeavor America will have engaged in since Eisenhower's Highway Act. And since all this will have to cost exorbitantly to an economy that is already up to its neck in debt, the last thing it can afford is to pay a lot for the energy it will demand. That is why the many components of Obama's stimulus plan, from upgrading information highways and renovating schools to restoring sewers and spreading health care and higher education, are crowned by a quest to foster green energy. And that, the Obama energy revolution, is where the Middle East comes in. Make no mistake about it: The effort we are about to witness - whereby the world's smartest economy is led to develop fuel alternatives while building and improving windmills, dams, solar panels, mass transit and fuel-efficient heating - will bear fruit. This is what happened following the previous oil crunch, which led an economy like Japan's to halve its energy spending even while doubling its industrial output. Now all this spirit of frugality and invention will return, only with even greater momentum. A glimpse of it was offered this week outside Tel Aviv, where Israeli-made fueling stations for electric cars were first unveiled. THE PREVIOUS oil crisis stemmed from political pressure on Middle Eastern supply, while this decade's crunch stemmed from an unplanned rise in Asian demand. This demand is not likely to go away, and the current crisis is generally far from over, yet the markets are already indicating that the rules of the energy game are about to change. That is why oil prices have plunged 70 percent in less than half a year. The same markets that had initially appreciated crude because they had reason to suspect the world would have too little of it are now depreciating it because they have reason to believe that the world is about to have too much of it. And this is only the prologue. What will happen when we all drive electric cars, use solar lighting and feed airplanes with bio-fuels? What will the Arab rulers then do with their blackish lakes? Isn't it already too late to use those riches for the eradication of Middle Eastern poverty and ignorance? The oil producers who failed to use this decade's bonanza to diversify and modernize their economies are now in for a rude awakening, one that will reveal who was really enjoying free lunches in this region all these decades. For it turns out that they, too, forgot to plan, but unlike America, which has just turned over its government from anti-planners to pro-planners, Middle Eastern government is never handed over. And so, even while Obama makes the post-crude era a tangible prospect, the Middle East's petro-crats still have no plan for its arrival; no plan, that is, other than to say that their location deep in history's dustbin was the plotting of Israel, America and their free lunches.