Sunday, November 11, 2012

How Will Obama's Re-election Affect Israel's Economy?

The concern for the negative effects of Obama's re-election are real -- both in terms of the US economy, other domestic issues and foreign policy as well.

But those economic effects go beyond the US and have gloabal implications, including implications for Israel.

With Obama given another 4 years, Barry Rubin writes about The U.S. Election's Impact on the American and Israeli Economies -- after all, Obama is sure to continue the same economic policy.

As a result, we can look forward to:
  • Lack of business confidence in Obama's plans
  • Even higher taxes
  • A complex and costly new health care system
  • Uncertainty about new costs Obama is going to impose
The effect of these reactions will stretch beyond US borders:

And that will have a big effect on Israeli thinking. If Israeli policymakers--and businesspeople--view certain policies as failing in the United States they are unlikely to adapt those ideas to Israel, even if some of seem ideologically attractive to the moderate left here.

The strategy of higher taxes, high regulation, increasing government intervention, and bigger government are already unattractive in Israel and will be even more so. The Labor Party wants more effort on improving social welfare and lowering the country's high prices yet knows the Obama-European approach has been disastrous. .

Poor performance by the U.S. economy will also have a negative effect on Israel’s own growth and trade, reducing the prospects for exports to America and by having a depressing effect on the global economy.
Building on what Rubin writes here, perhaps between the disastrous foreign policy decisions and equally bad economic decisions of the Obama administration, it is time for Israel to look elsewhere for an ally that it can rely on.

Maybe China fits the bill.
After all:
And since Obama will remain in power for another 4 years, who is to say that in a few years China might be the most important country for Israel?

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