Netanyahu Sparks Economic Storm with Call to Transform Israel into Sparta

SadaNews - Israeli Prime Minister Benjamin Netanyahu's statement, made a few days ago, that Israel "will have to adapt to an autarkic economy due to its diplomatic isolation, and become a great Sparta," has sparked widespread controversy and sharp division among economists. Experts described it as a return to the "Stone Age," according to a report published by the Hebrew economic newspaper Globes.

"Autarky" means economic collapse

Professor Manuel Trajtenberg, former head of the National Economic Council in Netanyahu's office and former director of the National Security Studies Institute, launched a scathing attack on the statements, saying, "Such a statement in the 21st century means we will return to the Stone Age."

He explained that "the Israeli economy is very simple: we sell brains to the world and buy everything else. Autarky means that we sell brains to each other and produce everything else."

He added that any approach towards reducing economic ties with the world "will mean a dramatic collapse in living standards and a loss of the ability to fund the military, security, and social services."

Attempts to soften the image

On the other hand, Amir Ayal, head of the Infinity Investment Group, tried to downplay the impact of the crisis, considering that "autarky may seem like isolation, but I see it as strength and resilience," adding that Israel is "already independent in crucial fields like water and energy."

However, he acknowledged that the word "autarky" has gone too far, referring to the exaggeration.

Nevertheless, he confirmed that "Israeli industries in technology, gas, and weapons are still in demand globally, and no one will abandon them," yet market analysts viewed this approach as merely an attempt to soften the reality of the worsening economic isolation.

Trust crisis in leadership and fears for the future

Globes reported a former financial official in the Ministry of Finance saying that analyzing Netanyahu’s statements is "fundamentally psychological," adding that "the prime minister is losing control, but he has to appear to be in control, speaking as if he is consciously planning to turn Israel into an autarkic economy instead of acknowledging that the world is pushing us into a corner."

Amir Kahanovich, chief economist at Profit Finance, confirmed that "diplomatic isolation is not new; it has been a continuous process since October 7, primarily concentrated in the fields of culture, academia, and arms trade," but emphasized that "any scenario for an economic Sparta will mean long-term disasters."

Industrialists warn of "catastrophe"

Ron Tomer, president of the Manufacturers' Association of Israel, was more explicit in his warning, stating, "Autarky will be a catastrophe for Israel and will affect the living standards of every citizen." He added that "exports are the primary engine of growth, and abandoning them means abandoning our future."

Tomer called on the government to reverse the trend, saying, "Instead of shrinking into ourselves, we must enhance export capabilities, expand trade agreements, and provide certainty for the industrial sector."

Towards suffocating economic isolation

Globes concluded that Netanyahu's statements expose the extent of the diplomatic and economic impasse facing Israel, and that talk of "autarky" or a "great Sparta" is nothing but a reflection of the loss of traditional tools of influence.

While some close to him try to portray this as a strategic choice, economists see it as threatening to return Israel to the "Stone Age," with its position in global markets eroding and its ability to finance its security and economy simultaneously collapsing.