Economics Über Alles

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Economics Über Alles

By Steve Eggleston

The move of Jews to Israel has been an arti­cle of faith for mil­lenia, stretch­ing back to the Baby­lon­ian con­quest of the King­dom of Judah. Indeed, the Hebrew terms for immi­gra­tion to and emi­gra­tion from Israel, respec­tively aliyah and yerida, trans­late to, respec­tively, ascend and descend.

A recent Face­book cam­paign by young Israeli expa­tri­ates in Berlin to get more of their coun­try­men to join them caught the ire of the older gen­er­a­tion, espe­cially those in gov­ern­ment (via Daily Mail). That cam­paign, based on the high cost of liv­ing in Israel and the rel­a­tively lower cost of liv­ing in Berlin, has been dubbed the Milky protest after the Israeli brand name of pud­ding that is the extreme exam­ple of the dis­par­ity in costs. Accord­ing to the founder of the protest, Naor Narkis (via The Wash­ing­ton Post), he could get a larger por­tion of the choco­late pud­ding in Berlin for a third of the cost he could in Tel Aviv, and eat it in an apart­ment with a rent half the price.

The 2012 edi­tion of The Economist’s Big Mac Index bears some of this out, though the dis­par­ity is more related to the Big Mac’s cost as a per­cent­age of GDP rather than the cost. In Ger­many, which had a per-​capita GDP of US$42,569, a Big Mac cost US$4.94, while in Israel, which had a per-​capita GDP of only US$33,451, a Big Mac cost US$5.13.

Even though this is not the first protest over the high cost of liv­ing in Israel, even the politi­cians that ben­e­fited from the 2011 protests that nearly top­pled the gov­ern­ment are decry­ing the cur­rent move­ment as “anti-​Zionist”. The founder, who served sev­eral years in the IDF, coun­tered that he would rather live in the coun­try of his youth, but he couldn’t afford it at this point in his life.

The eco­nomic prob­lem is that Israel is a wel­fare state with a rel­a­tively small and highly-​regulated pri­vate sec­tor. The Her­itage Foun­da­tion ranked Israel the 44th-​freest econ­omy, while Ger­many was the 18th-​freest economy.

There is another issue because it is Ger­many — specif­i­cally the his­tory of Ger­many in the 1930s and 1940s. Narkis, who first went to France from Israel before going to Ger­many after expe­ri­enc­ing France’s anti-​Semitism and high cost of liv­ing, noted Ger­mans still take the credo of “never again” to heart.

By Steve Eggleston

The move of Jews to Israel has been an article of faith for millenia, stretching back to the Babylonian conquest of the Kingdom of Judah. Indeed, the Hebrew terms for immigration to and emigration from Israel, respectively aliyah and yerida, translate to, respectively, ascend and descend.

A recent Facebook campaign by young Israeli expatriates in Berlin to get more of their countrymen to join them caught the ire of the older generation, especially those in government (via Daily Mail). That campaign, based on the high cost of living in Israel and the relatively lower cost of living in Berlin, has been dubbed the Milky protest after the Israeli brand name of pudding that is the extreme example of the disparity in costs. According to the founder of the protest, Naor Narkis (via The Washington Post), he could get a larger portion of the chocolate pudding in Berlin for a third of the cost he could in Tel Aviv, and eat it in an apartment with a rent half the price.

The 2012 edition of The Economist’s Big Mac Index bears some of this out, though the disparity is more related to the Big Mac’s cost as a percentage of GDP rather than the cost. In Germany, which had a per-capita GDP of US$42,569, a Big Mac cost US$4.94, while in Israel, which had a per-capita GDP of only US$33,451, a Big Mac cost US$5.13.

Even though this is not the first protest over the high cost of living in Israel, even the politicians that benefited from the 2011 protests that nearly toppled the government are decrying the current movement as “anti-Zionist”. The founder, who served several years in the IDF, countered that he would rather live in the country of his youth, but he couldn’t afford it at this point in his life.

The economic problem is that Israel is a welfare state with a relatively small and highly-regulated private sector. The Heritage Foundation ranked Israel the 44th-freest economy, while Germany was the 18th-freest economy.

There is another issue because it is Germany – specifically the history of Germany in the 1930s and 1940s. Narkis, who first went to France from Israel before going to Germany after experiencing France’s anti-Semitism and high cost of living, noted Germans still take the credo of “never again” to heart.