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Israel’s best hope lies in a single state

In East Jerusalem, vigilantes prowl, hunting for Jewish girls who consort with Arab men. Slavoj Žiže

In Israel, there is a growing number of initiatives - from official bodies and rabbis to private organisations and groups of local residents - to prevent interracial dating and marriage. In East Jerusalem, vigilante-style patrols work to stop Arab men from mixing with local Jewish girls. Two years ago, the city of Petah Tikva created a hotline that parents and friends can use to inform on Jewish women who mix with Arab men; the women are then treated as pathological cases and sent to a psychologist.

In 2008, the southern city of Kiryat Gat launched a programme in its schools to warn Jewish girls about the dangers of dating local Bedouin men. The girls were shown a video called Sleeping With the Enemy, which describes mixed couples as an "unnatural phenomenon". Rabbi Shmuel Eliyahu once told a local newspaper that the "seducing" of Jewish girls is “another form of war" and a religious organisation called Yad L'Achim conducts military-style rescues of women from "hostile" Arab villages, in co-ordination with the police and army. In 2009, a government-backed television advertising campaign, later withdrawn, urged Israeli Jews to report relatives abroad who were in danger of marrying non-Jews.

It is no wonder that, according to a poll from 2007, more than half of all Israeli Jews believe that intermarriage should be equated with "national treason". Adding a note of ridicule late last year, Rabbi Ari Shvat, an expert on Jewish law, allowed for an exception: Jewish women are permitted to sleep with Arabs if it is in order to gather information about anti-Israel activity - but it is more appropriate to use unmarried women for this purpose.

The first thing that strikes one here is the gender asymmetry. The guardians of Jewish purity are bothered that Jewish girls are being seduced by Palestinian men. The head of Kiryat Gat's welfare unit said: "The girls, in their innocence, go with the exploitative Arab." What makes these campaigns so depressing is that they are flourishing at a time of relative calm, at least in the West Bank. Any party interested in peace should welcome the socialising of Palestinian and Jewish youth, as it would ease tensions and contribute to a shared daily life.

Until recently, Israel was often hit by terror attacks and liberal, peace-loving Jews repeated the mantra that, while they recognised the injustice of the occupation of the West Bank, the other side had to stop the bombings before proper negotiations could begin. Now that the attacks have fallen greatly in number, the main form that terror takes is continuous, low-level pressure on the West Bank (water poisonings, crop burnings and arson attacks on mosques). Shall we conclude that, though violence doesn't work, renouncing it works even less well?

If there is a lesson to be learned from the protracted negotiations, it is that the greatest obstacle to peace is what is offered as the realistic solution - the creation of two separate states. Although neither side wants it (Israel would probably prefer the areas of the West Bank that it is ready to cede to become a part of Jordan, while the Palestinians consider the land that has fallen to Israel since 1967 to be theirs), the establishment of two states is somehow accepted as the only feasible solution, a position backed up by the embarrassing leak of Palestinian negotiation documents in January.

What both sides exclude as an impossible dream is the simplest and most obvious solution: a binational secular state, comprising all of Israel plus the occupied territories and Gaza. Many will dismiss this as a utopian dream, disqualified by the history of hatred and violence. But far from being a utopia, the binational state is already a reality: Israel and the West Bank are one state. The entire territory is under the de facto control of one sovereign power - Israel - and divided by internal borders. So let's abolish the apartheid that exists and transform this land into a secular, democratic state.

Losing faith

None of this implies sympathy for terrorist acts. Rather, it provides the only ground from which one can condemn terrorism without hypocrisy. I am more than aware of the immense suffering to which Jews have been exposed for thousands of years. What is saddening is that many Israelis seem to be doing all they can to transform the unique Jewish nation into just another nation.

A century ago, the writer G K Chesterton identified the fundamental paradox facing critics of religion: "Men who begin to fight the Church for the sake of freedom and humanity end by flinging away freedom and humanity if only they may fight the Church . . . The secularists have not wrecked divine things but the secularists have wrecked secular things, if that is any comfort to them." Does the same not hold for the advocates of religion? How many defenders of religion started by attacking contemporary secular culture and ended up forsaking any meaningful religious experience?

Similarly, many liberal warriors are so eager to fight anti-democratic fundamentalism that they will throw away freedom and democracy if only they may fight terror. Some love human dignity so much that they are ready to legalise torture - the ultimate degradation of human dignity - to defend it. As for the Israeli defenders of Jewish purity: they want to protect it so much that they are ready to forsake the very core of Jewish identity.

Slavoj Žižek is a philosopher and critic. His latest book, "Living in the End Times", is published by Verso (£20)

This article first appeared in the 07 March 2011 issue of the New Statesman, The great property swindle

MUCHTAR ZAKARIA/AP PHOTO
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Breaking the consensus

Even IMF researchers are calling time on free market dogma and the neoliberal orthodoxies of the past 30 years.

What has come over the International Monetary Fund? Not content with playing the good cop to Europe’s bad in the ongoing Greek crisis – in which it has been arguing for debt relief and less austerity – the fund has just published an article in its in-house magazine by three of its leading researchers entitled “Neoliberalism: Oversold?”. Their answer is “yes”.

The article takes aim at two of the most important aspects of the neoliberal economic agenda that has been so influential since the early 1980s. The first is the removal of restrictions on the movement of capital across international borders – so-called capital account liberalisation. Readers of a certain age will recall that 40 years ago there were strict limits on the amount of foreign currency one could buy before going abroad on holiday and companies had to show evidence of the need to import supplies to gain access to the foreign exchange market. Such restrictions were even harsher for international investment – making it almost impossible for institutions in one country to invest in the equity and bond markets of another.

Neoliberal theorists decried this situation as absurd. Rich countries have abundant capital, so the rate of return on it is relatively low, they argued. Poor ones are capital-scarce, so the returns on investment are high. Erecting artificial barriers preventing capital from flowing from rich countries to poor ones was therefore like stopping water from flowing downhill: an unhelpful intervention in the natural order of things, with detrimental consequences for all. During the 1980s and 1990s, international capital controls were thus dismantled worldwide – and often as a precondition for IMF assistance. The scale of private cross-border capital flows rocketed and soon eclipsed those of public-sector lenders, such as the World Bank and the IMF itself. 

But while these private capital flows were large, it quickly became obvious that they could also be extremely erratic. Throughout the 1990s, a succession of big developing countries enjoyed huge inflows of money  to be used for financing government spending and infrastructure development. But in each case, the new sources of funding turned out to be fickle, as private investors proved far less tolerant of heterodox economic policy than official funders had been. The result was a succession of crises – in Mexico in 1994, in east Asia in 1997, in Russia in 1998, in Argentina in 2001 – as the newly discovered rivers of capital suddenly began flowing the other way.

The IMF became well known at the time for insisting that these occasional stunning crashes should not derail liberalisation: they were just the price of reforms not fully complete. The new IMF article, in the June edition of Finance & Development magazine, disagrees. After nearly 30 years, it argues, the growing pains have not stopped. Open capital accounts have indeed increased developing countries’ access to capital for development but, strikingly, there is little evidence that this has raised growth rates. And there is no question that it has exaggerated the boom-bust business cycle, increased inequality and raised the odds of periodic financial crises.

Couched as it is in the equivocal language of cost-benefit analysis, this change of tune might sound inconsequential. It is not. Twenty years ago, Malaysia’s prime minister, Mahathir Mohamad, was branded an international pariah for reimposing capital controls to insulate his country from the east Asian financial crisis. The new IMF article concludes that such measures are “a viable, and sometimes the only, option”.

The second plank of the neoliberal agenda at which the IMF article takes aim will be even more familiar to UK readers: curbing the size of the state. In the 1980s and 1990s, the main emphasis on this front was on privatisation. As that agenda began to run its course, emphasis shifted to methods of constraining governments’ abilities to run excessive deficits of spending over revenues – and rules to avoid the accumulation of too much public debt. The Maastricht rules introduced by the eurozone countries in 1993, which mandated annual deficits of no more than 3 per cent of GDP and public debt of no more than 60 per cent, were perhaps the most prominent example.

For most of the 2000s, such self-denying ordinances seemed to be costless virtues.  Then, in 2007, the global economic crisis hit. After a brief flirtation with increased state spending when confronted with the steep recessions of 2008-09, the governments of the eurozone and the UK were converted again to the crucial importance of shrinking public debt and cutting spending. The notion that cutting spending can (or even is necessary to) boost growth – of “expansionary fiscal contraction” – came roaring back into fashion.

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The IMF broached its dissent early in the post-crisis period, with its economists expressing scepticism over the pace and timing of austerity in Europe. Christine Lagarde, the fund’s managing director, and Olivier Blanchard, its chief economist, argued for relaxing spending constraints and turning a blind eye to debt burdens until depressed economies were solidly recovering. 

Gossip-mongers at the World Economic Forum in Davos put it down to the fact that they are both French and therefore constitutional backsliders on matters of fiscal prudence; and policymakers preferred to pick up on pseudo-scientific economic sound bites such as the idea of a public debt tipping-point at 90 per cent of GDP. In reality, however, the IMF was merely stating the clear conclusions of conventional economic models – models that the vast difference since 2009 in the recovery of the US, which did not opt for austerity, and Europe, which did, appears to have proved largely correct.

The new IMF article drives home the point. The “short-run costs of lower output and welfare and higher unemployment”, it concludes, “have been underplayed, and the desirability . . . of simply living with high debt and allowing debt ratios to decline organically through growth is underappreciated”. Austerity is often self-defeating and debt limits by themselves are meaningless.

Is this two-part mea culpa on both capital flows and the size of the state a major landmark in the evolution of the IMF’s thinking – and could this be important in practice, given the intellectual heft that the Washington institutions bring to the international policy debate? It is, and it could.

Will it rehabilitate the IMF as an institution among the populations of the countries it is meant to serve? Here I am more sceptical. There is no question that there was disagreement on policy in east Asia in 1997, for example. But the real problem with the IMF’s intervention had to do not with the correctness of its prescriptions but their legitimacy. The single most enduring image of that painful period was the photo of the then managing director of the IMF, Michel Camdessus, arms folded and frowning like a schoolmaster giving detention, watching over President Suharto of Indonesia as, humiliatingly, Suharto bowed to the inevitable and signed up to the fund’s financing plan.

In many developing countries, memories of unjust colonial domination are raw and if the IMF is to help resolve the growing dissatisfaction of populations with policymaking elites, it will need to do more than just make improvements to its advice – no matter how sincere and welcome such improvements may be. The reality that, in effect, power over its assistance belongs exclusively to a handful of rich economies will have to change. Reforming its governance to give developing countries more control is the place to start.

In the UK, meanwhile, we can have no such complaints. We have no one to blame for taking neoliberalism’s crazier ideas too seriously but ourselves.

Felix Martin is the author of “Money: the Unauthorised Biography” (Vintage)

Macroeconomist, bond trader and author of Money

This article first appeared in the 02 June 2016 issue of the New Statesman, How men got left behind