Foreign Affairs

Israel’s Pivot to Eurasia – Part 2

In the second part of a detailed investigation of Israel's relations with major powers, Anthony Moulton takes a closer look at influences from the US and Europe.


Israel – a technological oasis

At the American-Israel Public Affairs Committee conference in 2018[19], Prime Minister Benjamin Netanyahu painted a grand picture of a uniquely booming Israel. In a speech that also addressed the burgeoning US-Israel ties under President Trump, and the thwarting of Iran’s nuclear ambitions, Netanyahu spoke of how a stronger military, but especially a stronger economy in high-tech and infrastructure, was “revolutionizing old industries and creating entirely new industries” for Israel.

“It’s a tremendously strong economy, and I’ll tell you, we made it stronger by moving Israel to free market principles, which unleashed the spark of genius embedded in our people, into innovation [and] entrepreneurship”, he explained.

He noted how Israel had capitalised on a perfectly timed global technological revolution, describing this change as “the confluence of big data, connectivity and artificial intelligence”.

“Look at the ten leading companies in 2006 – five energy companies, one IT company – Microsoft. And a mere ten years later, 2016, a blink of an eye in historical terms, it’s completely reversed. Five IT companies, one energy company left. You know these companies: Apple, Google, Microsoft, Amazon, Facebook. Guess what? They all have research centers in Israel. All of them, major research centers. And they’re not alone. There are hundreds more”, he continued.

He went on to describe how Israeli innovation and global contracts in agriculture, water and cybersecurity were making Israel and their allies “richer and safer”.

“We’re one-tenth of one percent of the world’s population, and we get a whopping 20% of global, private investment in cyber. We’re punching 200 times above our weight. That’s very strong”, he noted. “Israel is literally driving the world!” he joked, referring to Israel’s leadership in autonomous vehicle technology.

Two years earlier in 2016 he had shared this sentiment and expanded on the methodology when he spoke at the inauguration of Sheldon Adelson’s ‘School of Entrepreneurship’ at the Interdisciplinary Center private university in Herzliya, Israel [20]. Among others, the launching event was headed by Dr. Miriam and Sheldon G. Adelson themselves.

At the start of Netanyahu’s speech, he commented briefly in Hebrew on UNESCO, where he said Israel would “break the automatic majority in UN institutions” in “less than ten years”, and that with “time and a little help from above” the “decisive majority in UN institutions will go from opposing Israel to supporting Israel”.

Then switching to English, Netanyahu continued to the overarching subject of his speech – entrepreneurship, how it influenced Israel’s technological innovation, and ultimately how it affected their economy and position on the world stage.

“Now we’re at 37”, he said, referring to Israel’s $37,000 per capita income, “and we’re catching up to Japan, it won’t take us long. We’ll pass them probably. Which you might think is amazing. But I’d say ’37,000, that’s it?’ We? We who have the largest component of high-tech in any economy in the world, where about 13% of our people are in high tech. 13%. Okay that’s very, very big to be directly involved in high tech, that’s a very large number. And we’re only $37,000 per capita income? It’s absurd, because we should be a lot more, and we will be a lot more.”

Using the same comparison of the world’s top business from 2006-2016 that he would later share at AIPAC, Netanyahu continued, “Because the intersection of big data, connectivity, and artificial intelligence, and what it does in robotics, and genetics, and all the other fields – that is changing our world in rapid, rapid succession. And the future belongs to those who can seize this change. We are positioned right at the cusp of this change, right at the centre of this change. We can take it, and we are. It’s changing us – it’s giving us powers and prowess that we never had before. It is a force-multiplier.”

“Cyber is the real domain of power. It’s a huge domain of power”, he added, saying that Israel was “definitely in the top five cyberpowers in the world.”

“I think it’s safe to say we’re not #5, and I’d argue we’re not #4, and then from here on we can start arguing”, he asserted.
“This would be impossible if we only left it to our security services. It is replenished, and reinforced, by these hundreds of start-ups in this field, and thousands of start-ups in related fields.”

Israel has been known as the ‘Start-up Nation’ for at least a decade now, but their unprecedented development and freedom for entrepreneurship in recent years has unsurprisingly attracted nations like China and Russia, who have had long histories of economic domination by state-owned companies. The three main sectors and resources fuelling the deals between these three nations specifically appear to be petrochemicals, consumer markets (in everything from consumer goods to military weapons systems), and advanced technology.[8]

Russia’s Gazprom, their operations in Shtokman field (one of the largest natural gas fields in the world), Israel’s own recently discovered offshore natural-gas reserves, and other nations like Iran, fulfil the need for gas and oil. Countries with large populations like Russia, Iran, Saudi Arabia, and Egypt provide the consumer markets for China at least. And although all three are invested in advanced technology, Israel holds a unique place in both China and Russia’s pursuit of this third resource.

The US – Trump’s great guys and fantastic business partners
“We came to a lot of good conclusions – a really good conclusion for Israel, something very strong. He’s a believer in Israel – he’s a fan of Bibi. Really helping him a lot, and will help him a lot, which is good for all of us.” – Donald Trump, speaking after the Russia-United States Summit in July 2018
Source: Fox News

In 1999, Vladimir Putin enlisted previously mentioned (Part 1) oligarchs Lev Leviev and Roman Abramovich to create a new Federation of Jewish Communities of Russia, under the leadership of Chabad Rabbi Berel Lazar, to replace the former Russian Jewish Congress. The Federation was seen as a deliberate undermining of the Russian Jewish Congress and especially its leader, Vladimir Gusinsky – who was seen as a potential threat to Putin and President Boris Yeltsin – as Gusinsky was inevitably replaced by Lazar as Russia’s chief rabbi, and was arrested by Putin’s government and forced into exile a year later.

A few years later in 2002, Trump would join forces with a partnership called Bayrock-Sapir, led by Soviet emigres and Chabad supporters Tevfik Arif, Felix Sater and Tamir Sapir, to capitalize on the capital and infrastructural projects that had been pouring out of Russia since the collapse of the Union and the freeing of their economy. Both of these developments would help spark a network of partnerships between Trump and Russia, and a subsequent national criminal investigation, all centred on the Chabad Lubavitch movement[21].

Felix Sater, and fellow Bayrock employee Daniel Ridloff, both went on to work directly for the Trump Organization, as well as Port Washington’s Chabad house, where Sater was named ‘Man of the Year’ in 2014.

Felix Sater is a Russian-American mobster, convicted felon, and real estate developer, whose father Mikhail Sheferovsky was an underboss for the Russian mafia’s ‘boss of bosses’, Semion Mogilevich. In 2006 Sater escorted Ivanka and Don Jr. around Moscow to scout potential projects, and he worked especially closely with Ivanka on the development of Trump SoHo. In January 2017, Sater met with Ukrainian politician Andrey Artemenko and Donald Trump’s lawyer Michael Cohen in Manhattan to discuss a plan to lift sanctions against Russia. Despite this, and despite numerous photos and reports of Sater meeting with Donald Trump, Trump has testified under oath that he barely knew Sater, and ‘would not be able to pick his face out in a crowd’.

In a video of the ‘Man of the Year’ ceremony honouring Sater, now scrubbed from the Port Washington Chabad’s official website but still available on their YouTube channel, the Chabad’s founder Shalom Paltiel, introduces Sater and recounts an old story. He speaks of how Sater would come to him with stories of his business and political adventures, which were “strange, and getting stranger with every passing month”.

“I only recently told Felix I really didn’t believe most of it. I thought perhaps he watched too many James Bond movies, read one too many Tom Clancy novels,” said Paltiel at the ceremony. “Anyone who knows Felix knows he can tell a good story. I simply did not put too much credence to them.”

But he then went on to recount receiving special clearance later in 2011 to accompany Sater to a private ceremony at the federal building in Manhattan. There, said Paltiel, officials from every American intelligence agency applauded Sater’s “clandestine” work and divulged “stuff that was more fantastic, and more unbelievable, than anything he had been telling me.”

But Sater and Daniel Ridloff are not the only ties Port Washington Chabad has with Bayrock. Among its top 13 benefactors is Bayrock co-founder Tevfik Arif.

Arif is a former Soviet bureaucrat turned real estate developer, who owns a mansion in Port Washington, is a Kazakh-born citizen of Turkey and not himself Jewish, despite his large donations to the Chabad. In 2010, he was arrested in a raid on a yacht in Turkey that once belonged to the founder of the modern Turkish state, Mustafa Kamal Ataturk. He was charged with running an international underage prostitution ring, but was later cleared of the charges. Before the scandal on Ataturk’s yacht, Arif had partnered closely with Trump, Ivanka Trump and Sater in the development of Trump SoHo.

With his attempts to distance himself from these dodgy business partners, and a voter base that is increasingly opposed to further intervention in the Middle East, one might ask why Trump is nonetheless throwing himself into the ring with these Russian-Israelis by continuing to paint himself as one of the most pro-lsrael U.S. presidents to date, but the answer may just come down to spiritual belief, or at least religious rhetoric.

On the same day that Trump tweeted his desire to “fully recognize Israel’s Sovereignty over the Golan Heights”, Secretary of State Mike Pompeo posted his own tweet, with a short video documenting his recent trip to Jerusalem[22]. In the clip, which notably contains no imagery of the Al-Aqsa Mosque and the Dome of the Rock, Pompeo is seen inspecting a model of the planned ‘Third Temple’, a deeply important structure for both Jews and Christians, which Israel wishes to build in place of the Dome of the Rock. In both religions, the symbolic or physical building of the Third Temple signifies a step closer to the ‘end times’ and the arrival of the Messiah/Moschiach.  

With this and his links to Chabad, it appears that the Trump administration’s support for a strong Israel could be due to the similar ‘Messianic’ narratives and beliefs of the two powers[23]. But it could also simply be that this spiritual fervour keeps the red state Evangelical votes and donations coming in, with the old promise of revelation and rapture just around the corner, and all backed up by news reports of an Israel constantly under threat.

Europe and the Transatlantic/Trans-Pacific bloc
unnamed (1).png
‘The Renaissance of the West” co-authored by Roland Freudenstein
Source: Euractiv

One mysterious aspect to this issue is the question of where the European Union’s own future prospects fit into the equation. Back in March of 2015, European Commission President Jean Claude-Juncker told German newspaper Welt am Sonntag that the EU states should establish a common army to “convey to Russia that we are serious about defending the values of the European Union”.

The Wilfred Martens Centre, the official think-tank of Juncker’s European People’s Party, even published a booklet entitled “The Renaissance of the West: How Europe and America Can Shape Up in Confronting Putin’s Russia”[24], in which it states that “The European Union has to bury the idea of a modernisation partnership with Russia as long as the Putin regime is in power, let go of its Russia First approach, engage massively on reform in Eastern Europe and learn to accept the reality of a substantial conflict with Russia.”

Yet at the UN general assembly in New York in September last year[25], we saw a materialised vision of the potential future, with EU leaders showing solidarity with Russia and China against the US, over the US’ sanctions on Iran. In a joint statement, the EU, Russia, and China stated that they “deeply regret” Trump’s decision, and that the EU sought to forge a “Special Purpose Vehicle” to enable the EU and others to buy Iranian oil, skirting Trump’s new sanctions.

Mike Pompeo told press that he was “disturbed and indeed deeply disappointed” by the plan. “This is one of the most counterproductive measures imaginable for regional and global peace and security,” he added.

This tension between the two powers comes after the EU have suffered multiple upsets at the hand of recent US policy, including Trump’s trade wars with Europe and China, his threatening to pull the US out of NATO, and his withdrawing from the Paris Climate accord. But it was his recent threat to fine Austrian, Dutch, German, and French firms if they financed a new Russia-Germany gas pipeline that seems to have really caused a rift.

‘Nord Stream’ is an offshore natural gas pipeline from Vyborg in the Russian Federation to Greifswald in Germany, which is owned and operated by the Gazprom-funded consortium ‘Nord Stream AG’[26]. The project has already laid two parallel lines, but plans to double their capacity and have an additional two lines laid by the end of 2019. This project, named Nord Stream 2, is what the United States had opposed, over concerns that it would allow Russia to further expand their influence in the region.

“Germany will become totally dependent on Russian energy if it does not immediately change course,” Trump warned during his speech at the UN that day.

But Trump is not completely alone on this issue.  The president of the European Council Donald Tusk spoke to the press in Brussels on the 18th of December last year, stating that “The [European] commission has assessed that if Nord Stream II were to be constructed, it would increase Europe’s dependence on one supplier and concentrate 80 percent of Russian gas imports on one route.”

“It would also lead to a dominant position of Gazprom on the German market, by increasing its share to over 60 percent,” he added. He also noted that the commission has not yet decided whether Nord Stream II actually complies with the EU’s ‘third energy package’ laws, on ownership structure and competitors’ rights.

Italian Prime Minister Matteo Renzi, Hungarian Prime Minister Viktor Orbán, Ukrainian President Petro Poroshenko, and Polish Prime Minister Mateusz Morawiecki, have all also expressed similar opposition to the project.

Gazprom, the company behind the project, is Russia’s largest company and the world’s biggest public energy supplier. Its CEO Alexey Miller, who works alongside 36th Prime Minister of Russia Victor Zubkov, was also sanctioned as part of the SDN sanctions list. Around the same time Gazprom plan to have Nord Stream 2 finished, they’ve also planned to have their ‘Power of Siberia’ pipeline – connecting gas fields in Eastern Siberia to China – completed and running. Gazprom and the China National Petroleum Corporation – one of the largest integrated energy groups in the world, with operations spanning from Iraq and Iran, all the way to New Zealand – signed the $400 billion contract on the 21st of May 2014, to deliver China 38 billion cubic meters of natural gas per year, starting in 2018.

The future of the West

‘Silicon Wadi’[27] has become the battery and engine of the East. Much like the tiny Israeli-manufactured Intel microprocessor, Israel is a small nation punching well above its weight and building a vital, force-multiplying array of technologies and entrepreneurships.

The question this leaves for the West, and especially the nations of the US-directed Five Eyes, is how – or even if – we can maintain healthy multilateral relations with these emerging powers, and unstable allies. Both the big two Australian major parties appear to be throwing their lot in, at the least, with their own individual cliques within the Eurasian trade bloc. The Liberal party’s position on Israel has so far echoed that of Trump’s government, with Scott Morrison supporting the moving of Australia’s embassy to the disputed capital of Jerusalem, as well as pledging $44 million to “turbo charge [Australia’s] national effort in engaging China” through a founding of a ‘National Foundation for Australia-China Relations’. Meanwhile Bill Shorten[28] – in response to backlash against former NSW Labor Leader Michael Daley’s comments about “Asians with PhDs” – recently took to Chinese social media platform WeChat to field questions from the Asian community, and was noted as saying that he welcomed the rise of China, and did not see Beijing as a threat.

The change may have to come from the US or Israel themselves. Due in part to the historical prevalence of Labor Zionists within Israel, as well as in part to Israel’s self-promotion as a beacon of freedom, democracy, and even gay rights – in a sea of ‘oppressive’ Middle Eastern regimes – Israel has found itself dealing with a sizable leftist, and sometimes anti-Zionist, contingent within their own communities. The lead up to Israel’s election on the 9th this April has seen a sharp increase in mainstream Israeli critique of Netanyahu’s increasingly ‘far right’ government, and media pundits are calling it the most difficult Israeli election to pick since Netanyahu’s first victory in 1996. But with his toughest rival right now being Benny Gantz, former chairman of the aforementioned ‘Fifth Dimension’, it’s not likely that any great swing to the left will occur in this election at least.

The US has recently seen a similar mainstreaming of even tougher anti-Israeli views, with Trump’s recognition of the Golan Heights as Israeli territory, and the rise of US representatives like Ilhan Omar and Tulsi Gabbard, helping to spark unprecedented levels of anti-Zionist sentiment in US politics and mainstream media. As in Israel, anti-Zionism is being pushed by the younger generations, who are nationally, not to mention globally, becoming more left-leaning.

A relatively recent survey conducted by the Pew Research Center[29] found that the divide between Democrats and Republicans on support for Israel over the Palestinians is now the widest it’s been in four decades. While 79% of Republicans sympathize more with Israel than Palestine, only 27% of Democrats do. If this trend continues and Israel policy becomes a genuinely partisan issue, and the Democrats are able to seize the senate in the future, the US and Israel may be forced to come to new arrangements and alliances.

Regardless of which paths the US and Israel choose to take, we in Australia can only hope that a future government, whether Liberal or Labor, will come to intelligent, future-securing decisions in the balancing, or possible restructuring, of our relations with China and the US – and that we ourselves don’t suffer our own ‘Finlandization’.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: