Israel’s Free Market “Solution” for the Middle East

By Maidhc Ó Cathail

The Passionate Attachment
May 27, 2012

In the Spring issue of Middle East Quarterly, a publication of Daniel Pipes’ hawkishly pro-Israel and Islamophobic Middle East Forum, influential Israeli economic advisor Daniel Doron argues that “free markets can transform the Middle East.” Doron, the founding director of the well-connected “pro-market” Israel Center for Social and Economic Progress, writes:

As the high hopes for a brave new Middle East fade rapidly, Western policymakers must recognize that promoting market economics and its inevitable cultural changes are far more critical to the region’s well-being than encouraging free elections or resolving the Arab-Israeli conflict. In addition to producing material prosperity, diffusing power, and curbing tyranny, economic freedom promotes social, cultural, and religious changes conducive to democracy and tolerance. It enhances personal responsibility and social involvement and instills good work habits and accountability. It builds a civil society with a stake in peace. If there is to be any hope of lasting peace and stability in the Middle East, nothing less will do.

Doron, who was greatly influenced by Milton Friedman, Friedrich Hayek and other free market ideologues at the University of Chicago, sees the “Arab Spring” uprisings as an opportunity to put an end to government domination of the economy in the region. In his conclusion, the former Israeli intelligence officer who has served on an economic advisory group for Prime Minister Binyamin Netanyahu and on the Israel Government Council for National and Economic Planning, urges:

Western policymakers must refocus their attention on combating the root causes of Arab authoritarianism: Holding free elections in the region is less important than the advent of market economies.

In support of his view that “[t]he collapse of autocratic regimes in the Arab world will not necessarily promote economic freedom,” Doron interestingly cites another staunch and controversial supporter of Israel, Elliott Abrams, who wrote on his CFR blog on October 17, 2011 that the United States should begin to negotiate free trade agreements with Tunisia and Egypt. As Abrams, an early and enthusiastic advocate of the so-called Arab Spring, explained:

…an FTA creates real and continuing pressure for a freer economy, the rule of law, more open markets, and less corruption. This is precisely why negotiating FTAs with Tunisia and Egypt should begin now, as they begin their political and economic transitions. There will be many pressures to maintain corrupt, anti-market practices, and those who hold monopolies and other economic advantages will seek to keep them. An FTA will push in the other direction, toward an open market and the economic growth it can bring. There are few things we can do to nudge both countries in a positive direction that would have greater effect than FTAs with each.

Considering the provenance of all this concern for their welfare, the newly-liberated people of the Middle East and North Africa would do well to remember the price that was paid for earlier popular “revolutions” in Eastern Europe and the former Soviet Union. As the Guardian’s Mark Almond wrote in the wake of Ukraine’s so-called “Orange Revolution”:

The hangover from People Power is shock therapy. Each successive crowd is sold a multimedia vision of Euro-Atlantic prosperity by western-funded “independent” media to get them on the streets. No one dwells on the mass unemployment, rampant insider dealing, growth of organised crime, prostitution and soaring death rates in successful People Power states.
[...]
People Power is, it turns out, more about closing things than creating an open society. It shuts factories but, worse still, minds. Its advocates demand a free market in everything – except opinion. The current ideology of New World Order ideologues, many of whom are renegade communists, is Market-Leninism – that combination of a dogmatic economic model with Machiavellian methods to grasp the levers of power.

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