The Arab Boycott of Israel Hurts Arabs

A simple comparison of national economies.

Fred Taub, Boycott Watch

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The enforcement of the Arab boycott of Israel in the Middle East forces Israel to ship virtually all of its imports and exports, rather than drive them across a border in trucks,
Oil-rich countries such as Saudi Arabia have an immense number of paupers.
which adds some cost to foreign trade. Despite the Arab boycott, which started in 1921, 27 years before Israel was established, Israel is flourishing and oil-rich countries such as Saudi Arabia have an immense number of paupers. A simple comparison of national economies, according to the CIA World Fact Book
, reveals the plain-spoken truth.

Gross Domestic Product, or GDP, is the overall annual measure of how profitable a country is. If you divide this number by the total population, you then get the average productivity of each individual, or the GDP Per Capita. Economists like to equalize this with currency exchange rates to establish the absolute Purchasing Power Parity, or PPP. By using the parity numbers, we can make fair comparisons.

The GDP vs. Per Capita in Parity for 2006 chart (sample data), per the CIA:

              GDP                      PPP
USA       $13.06 trillion          $43,800
Israel     $170.3 billion          $26,800

Brunei   $9.557 billion          $25,600
Kuwait   $55.96 billion          $23,100
Saudi     $371.5 billion          $13,800
Iran        $599.2 billion          $8,700
Egypt     $334.4 billion          $4,200
Syria      $78.04 billion          $4,100
Iraq        $87.9 billion            $1,900
This chart is very revealing. The average Israeli has a much higher standard of living than the people in the Arab countries President George Bush touts as the wealthiest nations on earth. The difference is that, in the US and Israel, being democracies, the wealth is spread out amongst the people. Sure, there are people in both the US and Israel who are very rich and those who are very poor, but in order for a society to thrive, there must be a strong middle-class, such as exists in these two free-market democracies.

In Brunei, Kuwait and Saudi Arabia, the next three economic powerhouses on the list, there is an extremely wealthy ruling class, which must mean there is also an extremely poor class in balance. This explains why there is no - or in some cases, highly restricted - tourism in these countries; these governments do not want you to see the oppressed minorities conditions in contrast with the excesses of the ruling class.

In the next tier, we see countries that are, well, broke. If you take into account their ruling and upper class, even the middle class is beyond poor. The poorest people in the US and Israel live like kings as compared to the poor in Arab countries. A simple look at these numbers negates all "refugee" complaints by Arabs directed toward Israel, as poor Palestinian Arabs simply have a far better standard of living than their Egyptian or Syrian counterparts.

From an economics standpoint, free-market economies work far better than dictatorships, even with exorbitant oil profits. This is because no dictator can run an economy more efficiently than the basic rule of economics - supply and demand. Additionally, the Arab boycott of Israel restricts the floundering Arab economies from accepting Israeli investments. Israeli companies would love to take advantage of lower manufacturing wages by building factories in Arab countries the same way US companies build factories in Mexico to lower their costs. Mexico is benefiting from US investment, while Arab pride is resulting in self-inflicted economic devastation.

On the other hand, Israel has some trade - and a growing peace based on this trade - with Jordan. While Jordan is not on the chart above, it is an example of a growing economy, now with a $5,100 PPP.

The fact is that Israel, being the only free-market economy in the region, is exceedingly successful and is quickly approaching the United Kingdom's PPP of $31,800. Considering the age differences between these countries, Israel is on pace to pass the PPP of world economic superpowers, including Australia and Canada. Arab countries in the region, on the other hand, are in desperate need of economic boosts, yet cling to the Arab boycott of Israel like a prized radioactive trophy.

Simply stated, boycotts never foster peace because you can not have peace with people you refuse to do business with, let alone even just share a pot of coffee with. The egos of dictators prevent them giving up their economic stranglehold on their own economies,
Arab pride is resulting in self-inflicted economic devastation.
because dictators think they have everything they need. But as the Beatles so aptly sang, "Money can't buy (dictators) love.” Rather, dictators worry all day about which army faction and who else is plotting to overthrow them. Dictators seldom even trust their own wives, which explains why they have so many. They engage in a never-ending and futile search for a true confidante who can give an undying love in return, something dictators can never achieve.

As a result, Arab dictators redirect their anger toward scapegoats in an effort to self-justify their own shortcomings while celebrating their very own albatross. The goal of the Arab boycott of Israel is to destroy Israel economically, but in the end, the boycotters are destroying themselves.

© Fred Taub, 2007