The total bill for Israel’s war on Gaza and Lebanon over several years will be some $66 billion, about 11 to 12 percent of Israel’s pre-war GDP, according to the Israeli Central Bank.
The number was revealed by Adam Tooze, a history professor and director of the European Institute at Columbia University in New York, who has written extensively about financial crises.
He stated in a 7 October interview with Foreign Policy that Israel is fighting a war of choice, which includes the goal of unleashing mass violence to make Gaza “unlivable” and “deal” with Hezbollah.
Israel “is in a deliberate way escalating the destruction in Gaza and the effort to deal with Hezbollah in Lebanon. So this is expensive,” Tooze observed.
Even with US aid, which Tooze estimates at roughly $14 billion to $15 billion per year, the cost of the war is a strain on the Israeli government and society, he added.
Separately, a report published by Brown University’s Costs of War project said the US has given Israel $17.9 billion in military aid in the past year, and spent at least $22.76 billion assisting Israel, the highest amount in the two countries’ histories.
Tooze noted further that as a result of the war, Israeli tourism has collapsed by 75 percent, and hundreds of thousands of workers have been taken out of the economy at times while serving as reservists in the army.
“This is obviously disruptive to Israel, with a population of 10 million. If you take that number out of the workforce, prime-age, working young people, this is going to hurt.”
Tooze says that the Israeli economy, in particular the construction sector, has further suffered after imposing a ban on some 80,000 to 150,000 migrant Palestinian workers from the West Bank.
Estimates of Israeli GDP growth have fallen from three or four percent to roughly zero in the near future. At the same time, it faces a large surge in government spending.
In contrast, the relatively small economy of the West Bank, with a GDP of as little as $18 billion, has plunged roughly 20 to 25 percent.
Hellbound and Down 