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April 25, 2015 / 6 Iyar, 5775
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Israel, Capitalism, And Human Excellence: An Interview with Author George Gilder


George Gilder’s latest book, The Israel Test (Vigilante Books), is so unabashedly pro-Jewish and pro-Israel that it would make many Jews blush.

In the book (an excerpt of which was featured as the front-page essay in The Jewish Press’s November 6 issue), Gilder argues that “Jews have forged much of the science and wealth of [our] era” and Israeli “microchip designs are fueling the growth of nations everywhere.”

Editor in chief of the Gilder Technology Report and a senior fellow at the Discovery Institute think tank, which he cofounded, Gilder was educated at Harvard University; served as a speechwriter for Nelson Rockefeller and Richard Nixon, among others; and has written over a dozen books, including the influential Wealth and Poverty (1981).

The Jewish Press recently spoke with him about The Israel Test.

The Jewish Press: What exactly is the “Israel test”?

Gilder: The Israel test registers how you respond to people who excel in performance, achievement, innovation, or creativity: Do you resent and envy them, or do you imitate and admire them? And in economic terms: Do you regard their success as coming at your expense, or do you regard their success as creating new opportunities for you?

Much of the world sees Israel’s success as creating gaps rather than opportunities for others. In the Middle East most of Israel’s neighbors regard Israel’s success as somehow coming at their expense, and thus they seek to destroy Israel, as if somehow the destruction of Israel would enhance them.

You admit in the book’s afterword that you yourself failed this Israel test as a teenager.

I had a sense that Jews were different and that WASPs were entitled in some way. As a student at Phillips Exeter Academy I had devoted all my efforts to the school newspaper and expected to be made editor. Instead I was left entirely out. So I complained that New York Jews had [invaded the school and taken my rightful position].

We all understand that how we treat the poor is a crucial moral issue. But I think there’s just as acute a moral issue about how we treat the excellent, the few geniuses, the small and vulnerable groups of creators, innovators and inventors on whom all our prosperity and opportunities ultimately depend.

You argue in the book that this jealousy of excellence explains anti-Semitism.

Yes, I think anti-Semitism is essentially a virulent form of anti-capitalism. The key rule of capitalism is that the good fortune of others is also your own. It’s not a zero-sum game. But if you don’t believe that, you end up envying and resenting the successes of others.

In the book you write at length about Jewish contributions to scientific and technological progress in the 20th and 21st centuries. Can you elaborate?

The 20th century was dominated by Jewish science. Jewish scientists were really the key figures determining whether a country succeeded or failed. The Manhattan Project [in which Jewish scientists played a leading role] won the war for the West.

My thesis is that similarly small numbers of Jews in Israel today are making analogous contributions. For instance, three-quarters of Intel’s major innovations in the last 30 years have come from Israel, and Intel has been, by far, the leading company in the United States in advancing microchip technology.

Microsoft has also depended critically on its Israeli design centers and programmers, and Cisco is now becoming increasingly dependent on Israeli innovations as well.

I believe that without this collaboration with Israel, the United States would be drastically less wealthy than it is today.

How do you explain this disproportionate Jewish contribution to science and technology?

Well, there’s a lot of mysteries here but The Bell Curve, Human Accomplishment and other works by Richard Herrnstein, Charles Murray, and others indicate that Jews have higher IQs than others on average.

Also, my thesis is that the synoptic and integrative genius of Jews springs from their monotheist vision and their faith in a coherent and meaningful universe. Einstein was very willing to assert that connection, and so was David Bohm, another great quantum theorist. John von Neumann also reflected this demand for coherence, integration and synthesis.

The theory of relativity and quantum theory are insights that are not restricted to a narrow experimental base but reflect a kind of synoptic imagination that can integrate all sorts of different fields. I think this is essentially a religious impulse. It reflects the monotheist demand that the whole universe be in some way integrated, unified, coherent and meaningful.

The scientific vision reflects the religious vision and is enabled by it. And the abandonment of the religious, monotheist vision results in the tower of Babel that we now see in theoretical science, where the whole effort to unify the sciences has broken down pathetically.

In your book, you shower praise on Benjamin Netanyahu. Why?

Netanyahu is the Reagan of our era. He is a leading authority on supply-side economic theory, he understands it better than any American politician, and he just has the kind of intuitive mastery of economics that eludes most other politicians around the world.

He has advocated market-oriented policies and supply-side tax cuts, which really climaxed in 2004 when he managed to get the percentage of ownership of Israel’s leading corporations reduced from 60-80 percent down to 20 percent. He also managed to secure the privatization – over 20 years – of the pension system, which was run by Histadrut with heavy government subsidies. Today the privatization of this system is yielding some 400 million dollars a month of capital.

These developments are presumably good for Israel.

Well, it’s also good for the United States because we’re in financial turmoil. We have very little idea of what we’re doing with economic policy these days. Israel has become a haven for American capital and talent. Israelis are taking the lead under Netanyahu.

I think it’s a providential development to have Israel following aggressive supply-side policy at a time when the United States is debauching the dollar and socializing a lot of its economy. Israel is proving that the other line of policy is more promising.

Interestingly, in your book you demonstrate that Israel’s economic policies have benefited Arabs even more than Jews.

When Israel inherited the territories in 1967, it administered them, but much more loosely than it administered it own economy. And so the territories became the fastest growing economy on the face of the earth. Some 250,000 Israeli settlers moved to these previously Judenrein areas, and they attracted some two million Arab settlers. Eight Arabs moved in for every Jew.

This was a golden age for Arab Palestinians. Their numbers tripled, their per capita incomes also tripled, their educational levels soared, and their life expectancy rose from 42 to some 70 years.

My belief is that it was the manifest success of this collaboration between Jews and Palestinians that terrified Arafat and the PLO and precipitated the intifada, the return of Arafat from Tunisia, and the delivery by the international community of the territories to the PLO – who then brought to a screeching halt all the economic development. The PLO caused a 40 percent drop in GDP per capita incomes, and just generally reversed the huge achievements of the previous 20 years.

I mean it’s just overwhelming when you look at the numbers. And these are not particularly debatable numbers. They are all from UN studies. It’s an amazing story.

About the Author: Elliot Resnick is a Jewish Press staff reporter and author of “Movers and Shakers: Sixty Prominent Personalities Speak Their Mind on Tape” (Brenn Books).


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