Peter Zeihan on the Israeli intelligence failure regarding the October 7 Hamas attack

Peter Zeihan: There’s a political class [Haredim] in Israel that’s basically a bunch of religious Orthodox – ultra-Orthodox folks – who are not employed in the traditional sense.  They’re a combination of religious scholars in keeping the faith alive.  And their taxes are very low, their subsidies are very high.  It turns out, because of that, they’re net beneficiaries of the state and they have lots and lots and lots and lots of kids.  So they don’t contribute much, they’re not part of that tech story we discussed and they’re multiplying like rabbits.  And you play that forward for fifty years and they are now, based on who’s drawing the line, somewhere between 10% and 30% of the population.  So from an economic point of view, absolute dead weight. 

So the efficiency of the Israeli workforce is not going up, it’s going down.  And it doesn’t matter if you’re economically dead weight or not, you can vote.  So we’re getting ever more disconnected, unprofessional, non-technical governments in Israel and you can easily make the argument today that the current government, where these folks are a huge chunk of it, are part of the reason why the Israelis missed everything [October 7 Hamas attacks].  Because you now have people in all the ministries who have no idea what they’re doing. 

Dan Ferris: Missed everything, you mean the big sort of intelligence… 

Zeihan: Israel supposedly is the platinum standard for intelligence gathering.  Gaza is supposed to be the thing they watched the most.  And they missed all of it. 

Ferris: And there are, of course, batty theories coming out of the woodwork as to why that is. 

Zeihan: Well, and they’ve got batty ministries, so some of them might actually be right!  When you’ve got a system when the population is becoming less competent and the government is becoming less competent for structural reasons, but nothing to do with politics directly, that’s a problem if you’re a value-added economy. 

[…]

Zeihan: You may have seen this debate over judicial reforms?  That’s basically what’s going on here.  So you’ve got this rising part of the population that is more and more a burden on the state and then you’ve got the judicial system that is still kind of a remnant of the old professional system, and the two are coming to clash.  With every day that passes, that rising population is getting more and more power.  So the question is, “Can the judicial process rein them in or is it the other way around?”  And that’s the core of the debate. 

~ Peter Zeihan, "It's the End of Globalization as We Know It," interview with Dan Ferris, Stansberry Investor Hour, 32:10 mark, October 23, 2023