ABSTRACT
The period from 1985 to the present has been marked by a transition of the Israeli economy towards neoliberalism. This chapter poses two questions: (1) what kind of neoliberalism characterizes the Israeli economy?; and (2) what have been the key drivers that have shaped the Israeli neoliberal regime? The chapter makes a distinction between internationalist neoliberalism and nationalist or hawkish neoliberalism. It argues that the period from 1985 to 1995, from the execution of the Stabilization Plan up to the assassination of the Prime Minister Yitzhak Rabin, was a manifestation of internationalist neoliberalism guided by Shimon Peres’ vision of the New Middle East. Since the outbreak of the Second Intifada, the failure of the Camp David negotiations in 2000 and the political success of the hawkish right-wing parties, the economic regime in Israel has transformed into hawkish neoliberalism. The chapter argues that whereas internationalist neoliberalism is driven by a dovish and cosmopolitan world view, the hawkish neoliberalism in Israel has been driven by the quest of right-wing parties to reach a level of economic independence that would allow the government to pursue its hawkish national security policy without external pressure and interference.
