Shomron Center for Economic Policy Research

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Few Lessons from Ukrainian War for Israel

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We can’t afford more economic nonsenses

Weak leadership and socialist policies of the Western Governments, weak Ukrainian economy and Army, and rapid increase in gas-oil incomes combined, had encouraged Putin to start his all-out war against the neighboring country.

D.Trump[1] had provided a simple and highly relevant explanation of Putin’s bold assault:

Russia has become very … rich during the Biden Administration, with oil prices doubling and soon to be tripling and quadrupling. The weak sanctions are insignificant relative to taking over a country and a massive piece of strategically located land.

Now it has begun, oil prices are going higher and higher, and Putin is not only getting what he always wanted, but getting, because of the oil and gas surge, richer and richer. The U.S. was energy independent under the Trump Administration, an independence that we had never obtained before, and oil prices would have remained low…”

Israel’s Government had stopped exploring our gas fields for purely ideological, not economic, or security reasons.[2]

The only reliable scientific (economic) advice on how to encourage both, economic progress and a cautious approach to the environment is to secure private property rights and to provide well-defined delimitation of these rights on lands, forests (case of Finland), etc. Secured and well-defined for generations property rights cause strong personal interest to care about clean air and water (see, first and foremost, classical Ronald Coase book (Coase, 1988[3]). The governmental care on the environment manifests clear case of ownerless property, therefore, ownerless ‘public’ resource is routinely doomed to predatory use.[4]  So caring government can’t prove success in environment protection comparable to privately owned lands and forests.[5]

We had imposed a heavy regulatory burden on our business.[6]  The business climate in Israel is rated among the worst among developed countries (OECD members) and far behind some developing countries (like Georgia).

In addition to ‘traditional’ (Doing Business measured) costs: “trading across the border”; “registering property”, “getting electricity”, “Construction permit” etc. our business suffers the heavy burden of ‘anti-discrimination’ control, manifesting, in fact, assault on freedom of private contracts.[7] 

Last, but not least, we shocked our economy numerous times without any scientific foundation by lockdowns (see for references the Library, III.3 and latest update February, 16)[8] Then we assaulted businesses and households by useless coercion to vaccination.[9] To say nothing on surprising preference expensive experimental vaccines to reliable old and cheap drugs outlawed by healthcare bureaucracy.[10]

All these wrong decisions sent a message of weakness to our numerous enemies, encouraging their resolution to invest in wars against Israel.

We need further development of the gas industry on the reliable basis of well-defined private property on gas fields.

We can’t afford sophisticated, burdensome, and generally useless regulations imposed on business. We need to cut off ‘traditional’ – above-mentioned business regulation costs and eliminate the ‘new’ regulations restricting private freedom under the pretext of ‘anti-discrimination’.

We can’t afford to waste resources on ‘COVID-19’ coercive measures – let return right to decide to the patient and to his doctor (to vaccinate or not, if yes – how many times, to use old fashioned or newly invented drugs, etc.).

Drop all this nonsense, break with self-destructive policies now, send the most impressive signal of our force to our enemies.


[1] https://www.newsmax.com/newsfront/donald-trump-russia-vladimir-putin-ukraine/2022/02/22/id/1057933/

[2] https://oilprice.com/Latest-Energy-News/World-News/Israel-Stops-Onshore-Oil-Exploration-Permits.html

https://www.jewishpress.com/news/israel/energy-minister-halts-expansion-of-israeli-natural-gas-exports-blocks-explorations-in-2022/2021/12/15/
https://www.jewishpress.com/news/israel/energy-minister-halts-expansion-of-israeli-natural-gas-exports-blocks-explorations-in-2022/2021/12/15/

[3] Coase R.H.. The Firm, The Market, and The Law, Chicago, IL: University of Chicago Press, 1988.

[4] See: Hardin  Garrett. The Tragedy of the Commons. Science, New Series, Vol. 162, No. 3859 (Dec. 13, 1968), pp. 1243-1248.

[5] https://www.wri.org/insights/3-reasons-property-rights-are-essential-healthy-ecosystems

[6] https://www.doingbusiness.org/content/dam/doingBusiness/country/i/israel/ISR.pdf  Doing Business (WB Project) measures in days/money costs of doing business in Tel Aviv; the worst situation in “trading across the border”; “registering property”, “getting electricity”, “Construction permit”; https://www.heritage.org/index/pdf/2021/countries/2021_IndexofEconomicFreedom-Israel.pdf (the country rated below “the most free” group); Fraser Institute “Economic Freedom in the World” – 2019 Israel is rated 43rd https://www.fraserinstitute.org/studies/economic-freedom.

[7] See Block Walter. The Case for Discrimination. Auburn, Alabama: Ludwig von Mises Institute, 2010 and a case of 2013 analysis: Block W. Are Criminal and other Background Checks Racially Discriminatory? 2013:   https://www.mises.ca/are-criminal-and-other-background-checks-racially-discriminatory/

[8] Yanovskiy M, Socol Y. “COVID-19 Library. Filling the Gaps’”   https://dx.doi.org/10.2139/ssrn.3784709  and Yanovskiy M.  “The Latest Update for ‘COVID-19 Library. Filling the Gaps’” respectively. https://dx.doi.org/10.2139/ssrn.4034961

[9] The same “Library” III.5, IV.5 https://dx.doi.org/10.2139/ssrn.3784709   “Mandatory vaccination’

[10] The same “Library“ III.6.

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