Latest / Trumponomics / Will the Middle East War Lead to a Second Arab Spring?

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Will the Middle East War Lead to a Second Arab Spring? · Trumponomics

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  Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.
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  Speaker 2: Welcome back to voter Nomics, where politics and markets collimb.
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  Speaker 2: This year, voters around the world have the ability to
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  Speaker 2: affect markets, countries, and economies like never before, so we
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  Speaker 2: created this series to help you make sense of it all.
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  Speaker 2: I'm Stephanie Flanders.
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  Speaker 3: I'm Adrian Waldridge, and I'm Alegristratton.
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  Speaker 2: In this week's show, perhaps unsurprisingly, we are focusing on
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  Speaker 2: the Middle East, where the horrific loss of life and
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  Speaker 2: creeping escalation of the conflict between Israel and its enemies
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  Speaker 2: had been taking all the daily headlines this past twelve months.
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  Speaker 2: But beneath the surface, it's arguably the collision between politics
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  Speaker 2: and economics that will determine where the region heads next.
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  Speaker 2: And one big question coming out of all this that
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  Speaker 2: we're going to be talking about in various ways is
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  Speaker 2: how the events of the past twelve months are inflaming
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  Speaker 2: tensions not just in Israel but in neighboring countries and
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  Speaker 2: whether that could produce another Arab spring. One of our guests,
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  Speaker 2: Eugene Candell, former head of the Israeli Economic Council and
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  Speaker 2: economic advisor to Prime Minister Benjamin NT. Yahoo between two
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  Speaker 2: thousand and nine and twenty fifteen. We're going to get
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  Speaker 2: his thoughts on Israel's economic and political trajectory and if
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  Speaker 2: he still thinks there is any chance of Israel achieving
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  Speaker 2: its goal of being a true regional economic force, which
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  Speaker 2: it might well have hoped to become eighteen months ago
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  Speaker 2: when we were talking about normalization of relations with Saudi
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  Speaker 2: Arabia and anything that followed from that. In a minute,
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  Speaker 2: we'll be getting our on the ground view from Bloomberg
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  Speaker 2: reporter Sam Dagger, who's based in Dubai and reade a
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  Speaker 2: fascinating piece in the last few days about the dilemma
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  Speaker 2: facing Arab governments. Some of them are still prioritizing those
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  Speaker 2: close ties with the US in Israel, but that's in
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  Speaker 2: the face of increasingly vocal swaths of their population who
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  Speaker 2: are turning towards groups and politicians that they see as
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  Speaker 2: standing up better to the Israeli government and defending the
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  Speaker 2: rights of Palestinians. We're going to get to Sam in
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  Speaker 2: a minute, but Adrian, I mean one thing that struck
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  Speaker 2: me when we decided to focus this show on the
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  Speaker 2: Middle East, but often when we talk about what's happened
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  Speaker 2: in the last twelve months. It tends to be through
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  Speaker 2: the prism of things going on in our countries or
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  Speaker 2: other big events around the world, not least the election.
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  Speaker 2: We tend to talk a lot about what does it
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  Speaker 2: mean for Michigan and how is it potentially challenging leaders
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  Speaker 2: in Europe. And I don't feel like we've thought very
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  Speaker 2: much about what it means for the sort of underlying
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  Speaker 2: living standards and economic conditions of people in the Middle East,
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  Speaker 2: not justin Gaza, but what the future strategy is for
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  Speaker 2: all these countries that were hoping that they were going
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  Speaker 2: to draw a little bit closer to Israel.
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  Speaker 3: Absolutely, and I think we tend to think about the
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  Speaker 3: sort of the Iranian access of influence. We're not focusing
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  Speaker 3: anywhere near enough on Saudi Arabia and its economic ambitions
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  Speaker 3: and extraordinary achievements, really.
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  Speaker 2: And I think that's one of the things that I'm
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  Speaker 2: interested to talk about to Sam. It was Saudi government
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  Speaker 2: that has made a very big play for economic development,
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  Speaker 2: and it still seems to be quite keen on having
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  Speaker 2: relationships with Israel be part of that.
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  Speaker 4: I think your your opening point is right, Steph, which
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  Speaker 4: is the conditions for people living in these countries in
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  Speaker 4: the Middle East, and the conditioners were ripe for the
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  Speaker 4: Arab Spring, which is many, many years ago, and now
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  Speaker 4: that we have to assume that they will be even
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  Speaker 4: more ripe for you know, overthrowing revolution and so on,
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  Speaker 4: because people are feeling even more like they don't see
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  Speaker 4: the economic opportunities and that the future is even less
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  Speaker 4: clear for them. So I think it will be fascinating
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  Speaker 4: to hear from Sam about the conditions on the ground.
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  Speaker 4: I was reporting them at least in twenty five twenty
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  Speaker 4: oh six, around the time of great optimism, when there
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  Speaker 4: was lots of you know, the franchise and the vote
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  Speaker 4: being given to more people in Arab nations. So there
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  Speaker 4: was a great deal of opt that then withered away
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  Speaker 4: when Rafi Careri, who was the leader in Lebanon, was assassinated.
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  Speaker 4: So you have these these ebbs and flows in the
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  Speaker 4: Middle East, and it's hard to see how it's particularly higher,
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  Speaker 4: but at the moment, you know, there's been a lot
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  Speaker 4: of discussion around the past year about whether the conflict
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  Speaker 4: potentially between Benjamin Etnia, who's personal objectives were staying in office,
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  Speaker 4: avoiding various court cases, and the sort of long term
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  Speaker 4: interest of the country and whether he's undermining the sort
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  Speaker 4: of future security of the nation in order to try
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  Speaker 4: and protect his position. But you know, of course, the
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  Speaker 4: corollary to that is he's undermining the economic future of
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  Speaker 4: Israel as well.
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  Speaker 3: Absolutely, if you go back to before October the seventh,
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  Speaker 3: I mean, there was a very general optimistic mood around
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  Speaker 3: the place, and an optimistic mood which is partly on
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  Speaker 3: the fact that the Israeli economy was doing extremely well,
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  Speaker 3: but also on the idea that Israel would forge close
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  Speaker 3: relations with Saudi Arabia and other sort of economically vibrant
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  Speaker 3: forces in that region. What it's all been modified in
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  Speaker 3: various significant ways now.
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  Speaker 2: Gulf nations certainly that there isn't really a plan B.
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  Speaker 2: You know, they were building, they were vesting their continued
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  Speaker 2: sort of global heft in part on being able to
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  Speaker 2: sort of assume away the Palestinian problem and build their
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  Speaker 2: relations with Israel. Anyway, the loads of discuss we should
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  Speaker 2: get onto someone who knows even more about it than
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  Speaker 2: the three of us, which is Sam Daga. Sam, thank
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  Speaker 2: you very much for joining us. You cover a lot
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  Speaker 2: of countries in the region, primarily Saudi Arabia, But I
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  Speaker 2: know that you've also been roving quite widely, and you
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  Speaker 2: wrote I thought a great story recently about the dilemma
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  Speaker 2: facing Israel's Arab neighbors, which we've touched on just there,
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  Speaker 2: but maybe just spell that out for us.
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  Speaker 5: Sure, Thank you very much, Stephanie and everyone. I mean,
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  Speaker 5: I will start with Jordan, where I was a week ago,
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  Speaker 5: and I could tell you like Jordan literally and figuratively
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  Speaker 5: sits at the heart of the ever shifting sands of
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  Speaker 5: the Middle East, as the US Institute of Peace said
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  Speaker 5: in a report last month. Today its population of eleven million,
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  Speaker 5: sixty percent of those are of Palestinian origin, including King
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  Speaker 5: Abdullah's wife, Queen Rania. Later this month will mark the
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  Speaker 5: thirtieth anniversary of the peace treaty between Israel and Jordan,
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  Speaker 5: and the bilateral aid that Jordan depends on from the
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  Speaker 5: US is largely, you know, contingent upon maintaining this treaty.
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  Speaker 5: Jordan is central to this US vision of a region
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  Speaker 5: in which Israel is integrated economically, militarily. Jordan is also
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  Speaker 5: reliant heavily on aid from the oil rich countries of
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  Speaker 5: the region like Saudi Arabia and the UAE, and more
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  Speaker 5: importantly I mean for these countries. Jordan is actually the
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  Speaker 5: last piece of the puzzle in this sort of Iranian
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  Speaker 5: arc of influence in the Middle East, the so called
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  Speaker 5: Axis of resistance. It is the only country where Iran
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  Speaker 5: does it have real influence, either through the government or
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  Speaker 5: through militant groups like Hesbelan Lebanon or the or the
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  Speaker 5: militias in Iraq. So it is absolutely crucial for these countries.
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  Speaker 5: October seventh and the aftermath has really been a huge
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  Speaker 5: dilemma for Jordan because there's real pressure from the population
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  Speaker 5: itself to sever all ties with Israel, to renounce the treaty,
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  Speaker 5: to actually ask US troops to leave. This is what
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  Speaker 5: people on the streets are demanding. And then last month,
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  Speaker 5: the Islamic Action Front one the most votes parliamentary elections
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  Speaker 5: that were held there. It is the king that appoints
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  Speaker 5: the government. It's the king who actually can dissolve the
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  Speaker 5: parliament at any time. But he's under tremendous pressure and we
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  Speaker 5: see that in the rhetoric of Jordanis leadership. You had
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  Speaker 5: the King of Jordan last month addressing the UN General
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  Speaker 5: Assembly railing against Israel's what he called terror in Gaza.
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  Speaker 2: At the same time as participating in that effort to
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  Speaker 2: prevent the Iranian missiles from getting to Israel one hundred percent.
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  Speaker 5: They say, quote, we will not allow any alien objects
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  Speaker 5: to come through borders. I mean, that's the language they use.
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  Speaker 3: How sustainable is this tension between you know, the street
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  Speaker 3: on the one hand and the policy of the regime
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  Speaker 3: on the other hand.
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  Speaker 5: It is really under pressure at the moment, and Gulf states,
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  Speaker 5: particularly Saudi Arabia and the Arab Emirates, are really worried
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  Speaker 5: about this because they feel like there's this almost combustible
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  Speaker 5: mix between this rage on the street toward what's happening
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  Speaker 5: in Gaza and now Lebanon, coupled with real economic grievances there.
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  Speaker 4: So it sounds like, Sam, everything you're suggesting would indicate
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  Speaker 4: a second Arab spring.
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  Speaker 5: No, I mean, we have to be careful, very straightforward.
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  Speaker 4: It doesn't sound like it sounds like a recipe for
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  Speaker 4: people rising up. But I think you don't think it's
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  Speaker 4: that straightforward.
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  Speaker 5: This is what a lot of experts are saying, and
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  Speaker 5: this is also what a lot of officials in Riyad
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  Speaker 5: and Abu Dhabi are worried about. I spoke to people
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  Speaker 5: who are close to the leadership here, who meet with
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  Speaker 5: officials on a regular basis, and who say that it
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  Speaker 5: is a real concern at the moment because again of
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  Speaker 5: what I just mentioned, This this mix between you know,
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  Speaker 5: the real rage on the street over what's happening in
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  Speaker 5: Gozla and Lebanon and the rest of the region, and
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  Speaker 5: this also now what many are calling a reawakened consciousness
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  Speaker 5: towards the Palestinian cause, and also the sense among you know,
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  Speaker 5: large segments of the populations across the Arab world, not
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  Speaker 5: just in Jordan, that we may be suspicious of Iran
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  Speaker 5: and its motives, we may not like a lot of
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  Speaker 5: these groups that Iran you know, funds and backs like
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  Speaker 5: has Balan Habas, but hey, they're the only ones standing
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  Speaker 5: up to Israel. I mean, that's kind of the narrative
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  Speaker 5: on the street. And also you've got real economic issues
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  Speaker 5: in countries like Jordan, where you have unemployment well over
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  Speaker 5: twenty percent, with youth unemployment alone like around forty percent
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  Speaker 5: according to I believe World Bank figures.
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  Speaker 4: I mean, you tell us, but it is not necessarily
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  Speaker 4: only new, is it. I mean, there's been high levels
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  Speaker 4: of unemployment for a.
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  Speaker 2: Very long time.
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  Speaker 5: Absolutely but in terms of like how how all of
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  Speaker 5: this is being seen from Abu Dhabi and Riad is
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  Speaker 5: what this part of the world needs more than anything
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  Speaker 5: else is economic prosperity and development, and not democracy and
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  Speaker 5: free speech and resistance, which is iron narrative.
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  Speaker 3: When we talk about the Hora Spring, I think partly
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  Speaker 3: of the liberal element of that, which is, you know,
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  Speaker 3: the demand for demography and democracy, free speech and rolling
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  Speaker 3: back sort of autocratic dictators. But isn't this new incarnation
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  Speaker 3: much more sort of Islamacist in its in its inspiration,
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  Speaker 3: I mean, driven much more by anger and religious further
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  Speaker 3: than than any liberal elements.
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  Speaker 5: And not really, not really, because there are a lot
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  Speaker 5: of liberal elements, including people I've spoken to, you know,
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  Speaker 5: in Jordan elsewhere, who are saying, we don't agree with
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  Speaker 5: the Islamists, we don't share their ideology. But again, it's
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  Speaker 5: the sense of this camitment to the Palestinian cause that's
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  Speaker 5: kind of been reawakened all over the region.
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  Speaker 2: Also, going back to the Arab Spring, what's happened since then?
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  Speaker 2: I mean, I guess it's coming up for fourteen years
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  Speaker 2: in December, but you've had the sort of reassertion of
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  Speaker 2: autocracy and authoritarian regimes, most of the places which had
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  Speaker 2: previously seen more democracy, whether in Bahrain, Egypt, Tunisia that
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  Speaker 2: the Tunisian populist leader was re elected last week, but
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  Speaker 2: with not a very sort of lively democracy behind him.
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  Speaker 2: And then you have those are the sort of Saudi
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  Speaker 2: UAE backed countries, but you also have leban and Syria,
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  Speaker 2: Yemen on the Iran side, and I guess the problem
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  Speaker 2: is that none of them, those authoritarian regimes have been
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  Speaker 2: able to deliver economically in a way to shore up support,
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  Speaker 2: and that it feels like what you're saying is that
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  Speaker 2: all of that has just paved the way for this
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  Speaker 2: because there's nothing tying the Arab street to the regime
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  Speaker 2: in the way that they had hoped there would be
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  Speaker 2: with this kind of economic success.
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  Speaker 5: Yeah. Absolutely, And I would just you know, ask Stephanie
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  Speaker 5: that in the countries that you mentioned that are seen
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  Speaker 5: as being within sort of the sphere of influence of Iran,
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  Speaker 5: like Lebanon, like Iraq, like Syria, like Yemen, I mean,
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  Speaker 5: these countries have not fared any better economically. I mean
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  Speaker 5: Lebanon has faced its worst economic crisis ever, I mean
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  Speaker 5: since its creation. It is a bleak picture all around.
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  Speaker 2: The most expansive economic vision of courses come from Saudi Arabia,
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  Speaker 2: and that's the one that we've perhaps heard most about
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  Speaker 2: outside the region because money is coming out of Saudi Arabia.
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  Speaker 2: But also there's these very grand schemes that Muhammad bin
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  Speaker 2: Summan has for the country. Is there a serious challenge
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  Speaker 2: out of all this for Saudi Arabia or is the
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  Speaker 2: regime there really immovable?
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  Speaker 5: I would say there is, and they would admit to
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  Speaker 5: it themselves in private conversations. I mean, people who are
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  Speaker 5: close to the royal court, they feel there is a
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  Speaker 5: real risk here, particularly, you know, given what I just described,
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  Speaker 5: this kind of reawakened interest and consciousness, you know, toward
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  Speaker 5: you know, the Palestinian cause, including in Saudi Arabia itself.
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  Speaker 5: And I wrote a piece in May I believe about
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  Speaker 5: how the government was over there. The security forces and
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  Speaker 5: the intelligence services were actually arresting people who are posting
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  Speaker 5: anything relating to the Israel Hamas conflict that they are
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  Speaker 5: that they do not approve of. That's their way of
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  Speaker 5: asserting control. But a lot of people would argue that's
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  Speaker 5: not sustainable because while Vision twenty thirty has made a
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  Speaker 5: lot of progress, particularly when it comes to women, unemployment,
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  Speaker 5: to certain social changes in Saudi Arabia. It has made
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  Speaker 5: a tremendous progress. But you know, based again on some
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  Speaker 5: one dozen trips that I've made to Saudi Arabia in
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  Speaker 5: over the past couple of years, this vision has not
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  Speaker 5: reached beyond like the big the big cities Riyad and Jeddah.
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  Speaker 5: I mean, if you go to some of these other
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  Speaker 5: sort of places, uh, it's really a bix bag. And
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  Speaker 5: and people, people do have grievances, economic grievances, even in
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  Speaker 5: Saudi Arabia. So the leadership is aware of that.
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  Speaker 3: We have this huge event coming in in the film
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  Speaker 3: of the American election. Can you give any sense of
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  Speaker 3: what impacts either of the two results might have on
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  Speaker 3: the on.
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  Speaker 2: Just toasted a couple of minutes.
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  Speaker 3: You know, how is that going to play out in
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  Speaker 3: this region?
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  Speaker 5: God, you're the other spot. Okay. We know that that
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  Speaker 5: a lot of the leaderships in the Gulf States had
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  Speaker 5: had enjoyed, you know, very good, very good and warm
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  Speaker 5: ties with with the Trump administration. If you remember that
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  Speaker 5: famous first visit to to Red the Sword exactly. But
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  Speaker 5: I mean, and here's the caveat.
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  Speaker 2: I mean, you had the Secret Service is not going
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  Speaker 2: to let him near any swords.
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  Speaker 5: But the big caveat here. I mean in terms of
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  Speaker 5: like Saudi Arabia's experience, you know during that period, it
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  Speaker 5: is like when you had, you know, that huge attack
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  Speaker 5: on Saudi oil facilities for which the Huthis and Iran
• 15:17
  Speaker 5: were blamed. I've seen both being blamed. I mean, the
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  Speaker 5: Houthis are this militant group that Saudi Arabia itself was
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  Speaker 5: fighting directly, you know, starting in twenty fourteen after it
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  Speaker 5: seased power in Yemen, you know, taking over the capital
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  Speaker 5: Sanna so and back then, you know, from a Saudi perspective,
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  Speaker 5: you know, Trump did very little to respond to that, right,
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  Speaker 5: so that kind of made you know, the Saudi leadership
• 15:44
  Speaker 5: and also by extension, the leadership here, you know, rethink
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  Speaker 5: everything and say, like, we really cannot have all our
• 15:52
  Speaker 5: eggs in one basket and rely on the US. And
• 15:55
  Speaker 5: hence you've seen this this pivot towards China and Russia,
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  Speaker 5: which has kind of alarmed you know, the Biden reministration,
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  Speaker 5: particularly people you know in the National Security Council. And
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  Speaker 5: that's when we saw this this kind of extended hand
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  Speaker 5: to Saudi Arabia. We were on the cusp of this
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  Speaker 5: of this grand deal whereby you know, uh, Saudi Arabia
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  Speaker 5: was going to get potentially potentially again we we we
• 16:23
  Speaker 5: don't know all the specifics, but potentially you know, this
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  Speaker 5: this very solid defense fact with the United States, this
• 16:30
  Speaker 5: this agreement to to develop nuclear technology, this new strategic
• 16:35
  Speaker 5: relationship with the United States. It returned for normalizing ties
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  Speaker 5: with with Israel, and all of that came to a halt.
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  Speaker 2: So and we could do this all day, it doesn't
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  Speaker 2: It does sound like we should probably talk to you
• 16:46
  Speaker 2: again at the end of the year, after we or
• 16:48
  Speaker 2: maybe the beginning of next year when we know, when
• 16:51
  Speaker 2: we know hopefully who won the US president to election
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  Speaker 2: new the next president is going to be, and maybe
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  Speaker 2: how you're feeling about that question for for the region.
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  Speaker 2: But thank you so much for this. It was fascinating,
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  Speaker 2: my pleasure.
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  Speaker 5: I really enjoyed it, and I really do hope we
• 17:05
  Speaker 5: do it again.
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  Speaker 2: Thank you, And now we can talk to Eugene Candel
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  Speaker 2: in Jerusalem, previously head of the National Economic Council and
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  Speaker 2: economic advisor to Prime Minister Binyaminnett and Yahoo between twenty
• 17:23
  Speaker 2: nine and twenty fifteen. He's been many other things, including
• 17:26
  Speaker 2: the CEO of the startup Nation, central economics professor at
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  Speaker 2: Hebrew University, and the co founder of Israel's Strategic Futures Institute. Eugene,
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  Speaker 2: thank you very much for joining us. Obviously, particularly in
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  Speaker 2: the last few days, we've focused enormously on the human
• 17:42
  Speaker 2: and psychological cost of the past twelve month. Because of
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  Speaker 2: the focus of this podcast, I'm wanting to ask you
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  Speaker 2: how costly has this period been for Israel's economy and
• 17:54
  Speaker 2: indeed like its long term economic model.
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  Speaker 6: Well, you know, Israeli economy is very resilient. There's a
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  Speaker 6: military conflict. If you look at the Israeli history of
• 18:04
  Speaker 6: let's say stock market to exchange rates or growth statistics,
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  Speaker 6: and you look at annual statistics, you would not know
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  Speaker 6: that Israel had several wars, whether it's in two thousand
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  Speaker 6: and six, twenty twelve, twenty fourteen, you would barely detectiven
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  Speaker 6: the global financial crisis. So the economy is very resilient.
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  Speaker 6: But at the same time, this war is different from
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  Speaker 6: the previous military experiences that Israel had because it's much longer.
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  Speaker 6: It's probably the longest war that we ever had. It
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  Speaker 6: is much more difficult because we have to fight on
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  Speaker 6: multiple fronts, and so the cost of this war is
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  Speaker 6: significant for the economy going forward. Will have to figure
• 18:50
  Speaker 6: out how to deal with it.
• 18:51
  Speaker 2: I hear what you say about the resilience of this
• 18:53
  Speaker 2: radio economy, which is apparent, but a lot of people
• 18:56
  Speaker 2: have emphasized to me that it's in the periods of
• 18:59
  Speaker 2: the relative peace, when at least there's been a sort
• 19:02
  Speaker 2: of stable status quo in the conflict. It's in that
• 19:07
  Speaker 2: period where Israel has really come into its own as
• 19:10
  Speaker 2: a tech powerhouse, has been hugely dynamic. I'm interested in
• 19:15
  Speaker 2: how that part of the economy kind of holds onto
• 19:18
  Speaker 2: its dynamism and how keen it is to stay in
• 19:21
  Speaker 2: Israel in an environment when there is so much uncertainty
• 19:25
  Speaker 2: and when so much money is being shoveled into the
• 19:27
  Speaker 2: war effort.
• 19:28
  Speaker 6: Well, there are a couple of things what you call
• 19:31
  Speaker 6: peace period. We now understand that it was a period
• 19:34
  Speaker 6: of build up by our enemies to try to destroy us,
• 19:37
  Speaker 6: which obviously failed, But it was to some extent period
• 19:44
  Speaker 6: for us to build our capabilities, and I think we've
• 19:47
  Speaker 6: shown them to the world in the last months. Of
• 19:51
  Speaker 6: what we can do when we set our mind to it,
• 19:55
  Speaker 6: we create the correct policies, and if we bring back
• 19:59
  Speaker 6: the the dynamism and the hope that that we just
• 20:04
  Speaker 6: need to pull together and get out of it, we
• 20:06
  Speaker 6: can We can definitely do it, and they will be
• 20:09
  Speaker 6: in the forefront.
• 20:10
  Speaker 3: The startup immunity is presumably very mobile and very interlinked
• 20:14
  Speaker 3: with Silicon valleyes full of people who can will work
• 20:17
  Speaker 3: anywhere in the world, but certainly in the United States.
• 20:19
  Speaker 6: Is that a problem that is definitely a problem, that's
• 20:22
  Speaker 6: a threat. So far, however, most of their community, instead
• 20:27
  Speaker 6: of leaving, they came back from where they lived, or
• 20:30
  Speaker 6: much of their people came back and joined the military force.
• 20:34
  Speaker 6: And then of course those that live here, a lot
• 20:36
  Speaker 6: of them were drafted in the into the reservist duty.
• 20:41
  Speaker 6: And the application for the reservist duty at the beginning
• 20:44
  Speaker 6: of the war was one hundred and twenty percent, so
• 20:47
  Speaker 6: twenty percent more people that were not even called came
• 20:50
  Speaker 6: because they flew back from wherever they were. So we
• 20:55
  Speaker 6: start from a strong position. The question whether we will
• 20:58
  Speaker 6: continue with a strong position is that question, or whether
• 21:00
  Speaker 6: we can pull together as people and whether our government
• 21:04
  Speaker 6: will create right policies that will allow israel economy to
• 21:08
  Speaker 6: grow much faster.
• 21:10
  Speaker 3: What you's asking about the manpower side of things, which is,
• 21:15
  Speaker 3: you know, the political coalition that netting arrests on is
• 21:19
  Speaker 3: very the Orthodox community is very well represented. How do
• 21:22
  Speaker 3: you deal with the fact that the Orthodox community doesn't,
• 21:25
  Speaker 3: as far as I can say, you know, take part
• 21:27
  Speaker 3: in the military, take a big part in the economy,
• 21:30
  Speaker 3: and it's getting bigger as a percentage of the population.
• 21:33
  Speaker 6: It is one of the internal threats that we have
• 21:37
  Speaker 6: to come to terms with. And the problem is not
• 21:40
  Speaker 6: this government or the government. The problem is structural.
• 21:44
  Speaker 5: We have.
• 21:46
  Speaker 6: A structural demographic problem of large population that designed to
• 21:51
  Speaker 6: jump into the safety net of the welfare state together
• 21:55
  Speaker 6: rather than individual and unfortunately the welfare state safety is
• 22:00
  Speaker 6: not designed for you know, a million and a half
• 22:04
  Speaker 6: people jumping into it together and reproducing the record rate.
• 22:09
  Speaker 6: So we will have to deal with that. This war
• 22:12
  Speaker 6: made it plain and clear that the things cannot go
• 22:16
  Speaker 6: forward as they were progressing until today. It is still
• 22:19
  Speaker 6: this government cannot really do much about it because it
• 22:23
  Speaker 6: hinges on the coalition partners. But it's obvious to everybody,
• 22:28
  Speaker 6: including the members of the coalition, that going forward has
• 22:33
  Speaker 6: to and has to change. We have to create conditions
• 22:36
  Speaker 6: in which, on the one hand, they do not collapse economically.
• 22:41
  Speaker 6: On the other hand, they going forward, they face the
• 22:44
  Speaker 6: same basic conditions as they face in the UK, or
• 22:48
  Speaker 6: in the US or in Belgium, where these populations live
• 22:53
  Speaker 6: and thrive, and nobody forces them to be something different.
• 22:58
  Speaker 6: Yet nobody allows them to be with you whatever they
• 23:00
  Speaker 6: want and base, which is what we go love.
• 23:02
  Speaker 2: There was a future that was mapped out for Israel
• 23:07
  Speaker 2: within the region a year and a half ago, say,
• 23:10
  Speaker 2: as of a year and a half ago, which involved
• 23:13
  Speaker 2: we talked about it earlier in the show, normalization of
• 23:16
  Speaker 2: relations with Saudi Arabia, deepening of the normalization treaty with
• 23:19
  Speaker 2: the UAE, becoming a sort of a regional economic power,
• 23:24
  Speaker 2: and having a more stable future in the region because
• 23:27
  Speaker 2: of those economic ties. Do you see any prospect of
• 23:31
  Speaker 2: that now? And I'm wondering or as a country, is
• 23:36
  Speaker 2: the path being charted now entirely military, entirely about self defense?
• 23:40
  Speaker 2: And if so, who's going to join with Israel regionally
• 23:43
  Speaker 2: in that?
• 23:44
  Speaker 6: I think you're placing these two things as contradicting each other,
• 23:48
  Speaker 6: and I think that they actually support each other. I
• 23:51
  Speaker 6: want to remind you that when Iran was shooting ballistic
• 23:55
  Speaker 6: missiles on in April, Saudi Arabia Angel was shooting down
• 24:01
  Speaker 6: They want friendship with us and we want friendship with them.
• 24:04
  Speaker 6: And the collaboration, by the way under the table has
• 24:07
  Speaker 6: been happening for many, many years. And the fact that.
• 24:10
  Speaker 7: Iran has been trying to and Commas we're trying to
• 24:14
  Speaker 7: attack us so early is because we were very close
• 24:17
  Speaker 7: to signing an agreement with Savi and so the idea
• 24:21
  Speaker 7: was to derail. We cannot sign an agreement with Saudy
• 24:25
  Speaker 7: as if we don't exist, we're continuously being under threat
• 24:30
  Speaker 7: of annihilation.
• 24:32
  Speaker 2: You mentioned earlier that one of the questions was about
• 24:35
  Speaker 2: whether or not this government would be able to take
• 24:38
  Speaker 2: the decisions and push through policies that could help strengthen
• 24:42
  Speaker 2: the economy and the basis for that sort of particularly
• 24:47
  Speaker 2: that the tech sector and startup nation. Do you see
• 24:51
  Speaker 2: this government being able to make those investments, take those
• 24:55
  Speaker 2: decisions or did you think any government could in this
• 24:58
  Speaker 2: kind of environment.
• 25:00
  Speaker 6: If you ask me whether this is the best go
• 25:05
  Speaker 6: best coalition for this type of scenario, I would definitely
• 25:10
  Speaker 6: tell you that it's not whether you ask me whether
• 25:16
  Speaker 6: there is anything we can do about it, the answer
• 25:19
  Speaker 6: is no. Because this is a democratically elected government which
• 25:22
  Speaker 6: has another two years on its clock until it has
• 25:26
  Speaker 6: to go to elections.
• 25:29
  Speaker 2: Do you think this government will last the full time
• 25:31
  Speaker 2: this coalition?
• 25:32
  Speaker 6: It is real.
• 25:33
  Speaker 2: A year ago, no one would have bet on that.
• 25:35
  Speaker 2: So I'm interested that you say that in passing Well.
• 25:37
  Speaker 6: Actually, my view was that this government will survive for
• 25:43
  Speaker 6: most of its term, even after October seventh, because there
• 25:47
  Speaker 6: were no you know, legal forces that could bring it down,
• 25:51
  Speaker 6: and the members of the coalition were not definitely were
• 25:54
  Speaker 6: not interested to go to the electorate right after this disaster.
• 26:00
  Speaker 6: It right now, I think there are two possible ways
• 26:04
  Speaker 6: of this government going to elections. Ay that wanting the
• 26:09
  Speaker 6: small right wing parties will bring it down because it
• 26:14
  Speaker 6: will not want to go to the to the elections
• 26:18
  Speaker 6: because they haven't done anything that they promised, or that
• 26:21
  Speaker 6: the Prime Ministry decides that it's a fortunate time for
• 26:25
  Speaker 6: him because of various successes on the military, to go
• 26:30
  Speaker 6: for an election. That's that's what I think might happen. Otherwise,
• 26:33
  Speaker 6: I think it will survive till till the end of.
• 26:36
  Speaker 2: Its term eusine. Thank you very much, Yes, thank you
• 26:39
  Speaker 2: very much.
• 26:39
  Speaker 6: Absolutely well.
• 26:46
  Speaker 2: That's it for this week's voter nomics from Bloomberg. Thank
• 26:50
  Speaker 2: you for listening. This episode was hosted by me Sephanie
• 26:53
  Speaker 2: Flanders with the Legro Stratton and Adrian Wildridge. It was
• 26:56
  Speaker 2: produced as effort by Samasadi, with production support from Chris
• 27:00
  Speaker 2: Mark Lou and Isabella Ward and sound design by Moses Ander.
• 27:04
  Speaker 2: Brendan Francis Newnham is our executive producer and Sage Bowman
• 27:07
  Speaker 2: is Head of Podcasts. With special thanks this week to
• 27:10
  Speaker 2: Sam Dagger and Eugene Candell