Israel’s Wartime Economy: How Bad is it? - Karnit Flug Interview

This interview with Karnit Flug was on January 2, shortly after the government of Israel released all manner of statistics and announced some rather significant tax tweaks. I had intended to publish this the second week in the month, but then all hell broke loose, as President Trump would say. His repeated warnings that the hostage issue had better be resolved by Inauguration Day made everything else irrelevant. This entire country was on 24/7 hostage alert. The good news is that our discussion was very macro, so the podcast remains as relevant today as it was a few weeks ago. Based on my anecdotal conversations with people in the VC and tech sectors, there is growing concern that the new tax measures will have the most deleterious-and disproportionate-impact on the small independent businesses in Israel. Karnit Flug, as you will hear, thinks otherwise. So, I will keep an eye on how this develops. And in the coming months I intend to publish more podcasts and RUclips videos focusing on the economy. It’s amazing how overlooked this critical topic has been throughout the war. Then again, our Minister of Finance is Bezalel Smotrich. He has a lot to say about annexing various territories, but he is much less engaged on, you know, financial and economic matters. We have included in the podcast notes two previous podcasts with Karnit Flug, in the days when judicial reform was seen to be an economic threat. Then-and perhaps more so now-Flug is very concerned with the emigration of Israel’s most talented citizens to Europe, North America, anywhere but here. The pressure of serving most of the year in reserve duty, the huge stress this puts on families-and all that compounded by deep concerns with the political direction of the country and how that is impacting our economic power-well, many are voting with their feet. That trend is among the top economic issues and threats facing Israel today, in her view.
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[@issiedorenbush875]

Very informative. Thank you.

[@alangould7154]

i, too, am too old to know anything about computers. pls confirm if comments have a positive effect on the algorithm. i told a quad viewer to subscribe to u and she will. i knew who karnit was, but this was the 1st time i got to hear from her and a lot was very educational to a lay person. i'd b curious to know what % of their income reservists' receive. ur point about reservists being so glad to return home period was a good response to haredim who fear military service will result in their leaving the fold.

[@abdalehassan4598]

May ask you a question? What do you feel when you see the things that are happening in Gaza and West Bank? With all of those babies and innocent people killed, do you feel they deserve it, or maybe it's brutal world so if one group gonna suffer let it be the Palestinians. I kind of understand religious jews who believe that God gave this land to them and they will it no matter the cost. But what do liberal Israelis tell to themselves when they know the land that they live in stolen land and its inhabitants have been made refugees by the IDF?

[@benqurayza7872]

What do you think of the atrocities of Oct 7th 2023 and the endless war crimes of the Palestinian Arabs?

[@lindenthoburn4793]

This was so informative. Thank you. Praying for a 2025 that is a little better too.