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Dec 2012 Journal

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Letter from Israel

I heard about the book Start-Up Nation: The Story of Israel’s Economic Miracle by Dan Senor and Saul Singer a couple of years ago but didn’t take too much notice. After all, the fact that Israel is a hotbed of innovation, high-tech industry and networking is nothing new to me. I see it all around me among my friends and family, read about it in the newspapers, and have even worked on translating and editing economic reports of it. When I recently toured Jerusalem Venture Partners, a venture capital firm set up in order to attract young high-tech entrepreneurs to Jerusalem and support their endeavours, the book was mentioned, especially since one of its founders, Erel Margalit, is cited extensively in it.

But I spied the paperback version in the airport bookshop as I was leaving Israel on holiday and thought it might make good reading on the plane. I was right. It is, in fact, a fascinating and insightful account of what lies behind Israel’s remarkable record in high-tech innovation. According to the authors, many factors are responsible for this phenomenon, among them chutzpah, that untranslatable combination of audacity and pushiness that seems to have defined the sabra ethos since before the founding of the State of Israel. In fact, without chutzpah the state might never have come into existence. But that isn’t the whole story.

Another factor is adversity. The Arab boycott and de Gaulle’s 1967 decision to impose an arms embargo on Israel obliged it to become self-reliant in manufacturing arms and weapons systems, and the country has gone on to achieve stellar results in those fields. Israel was established despite intense opposition on several fronts, and in overcoming adverse conditions it had to come up with original and creative solutions.

Senor and Singer maintain that these and other factors explain Israel’s outstanding record in registering patents, establishing start-ups and successfully launching new industries, not to mention the number of ‘exits’ (sales of high-tech firms) which have brought billions of dollars into Israel, giving the national economy an exponential boost in the process. Foremost among these factors is Israel’s requirement that all youngsters (apart from the ultra-orthodox and Arabs) serve in the army. This gives young people the opportunity to learn skills, acquire experience and engage in teamwork that many adults in other countries are able to obtain only at a much later stage of life.

Successive influxes of immigrants have also contributed to Israel’s pool of innovative talent. This applies particularly to immigrants from the former USSR, causing Israel to have one of the highest proportions of qualified engineers. But even those who arrived without academic qualifications have shown an ability to adapt and integrate that has served to enhance Israel’s labour force. It is hardly surprising, therefore, that major high-tech firms such as Intel, Microsoft and IBM have R&D centres and/or plants in Israel - not to mention Israel’s home-grown high-tech, biotech and nanotech firms.

A salient feature of life in Israel is the fact that the country has what the authors call a ‘motive’. It was created in order to provide a homeland for Jews, no matter who, how or from where. When most countries restricted immigration, in the 1930s and subsequently, the Jews who were not wanted in their countries of origin were unable to find a haven. As we know to our cost, this ended in the wholesale slaughter of many of our co-religionists. Israel was founded to ensure that this never happened again. For Jews there are no entry barriers or residence requirements to becoming citizens of Israel. This is no small matter for anyone who has experienced prejudice and/or discrimination in their home country.

It’s a rare book whose acknowledgements section brings tears to my eyes, but this one did.



previous article:Law of the jungle (review)
next article:‘LAW OF THE JUNGLE’