Day: November 6, 2023

By Ratnadeep Chakraborty

Element of ‘Surprise’ 

On 6 October 1973, a day when Israelis were preparing for the solemn Yom Kippur services, Israel found itself completely surprised by an unforeseen attack launched by Syria and Egypt.^[1]  Despite significant improvements in Israeli intelligence and military capabilities over the years, the 50th anniversary of the Yom Kippur War witnessed a possibly more devastating shock as a devastating attack by the violent radical Islamist group, Hamas, rolled through Israeli defences on the border with Gaza.

The attacks that transpired on 7 October marked one of the deadliest days for the Jewish community since the Holocaust.^[2] Controlling the Gaza Strip, Hamas executed a well-coordinated assault on civilians, infiltrating by land, air (utilising hang-gliders), and sea, launching a relentless barrage of rockets on southern and central regions. In a chilling sequence of events, Hamas operatives utilised drones to destroy critical surveillance and communication towers along the Gaza border,^[3] breaching sections of the border defences and outmanoeuvring one of the most formidable military forces in the Middle East. They then launched a largely uncontested rampage of slaughter and kidnapping.

The timing of these attacks came as a surprise. It didn’t appear to have been triggered by immediate events, despite being referred to as a reaction to the incidents in the Al-Aqsa mosque by the military wing of Hamas, led by Muhammed Deif.^[4] The last significant engagement with Hamas prior to this occurred in May 2021, following the Supreme Court’s order for the eviction of six Palestinian families from Sheikh Jarrah.^[5] However, the recent attacks coincide with a period when Israel made notable progress in normalising relations with Arab states through the Abraham Accords and appeared to be shifting the focus away from the Palestinian conflict. It was also actively advancing negotiations with Saudi Arabia,^[6] which might not have been well-received by Hamas leadership and its supporters. While there is no direct evidence of the Islamic Republic of Iran’s involvement in planning these attacks, it is known to have provided funding and equipment to Hamas for such operations.^[7]

Capt. (Res.) Alex Grinberg, formerly at the IDF Intelligence Research Department and an expert on Iran observed, “These groups like Hamas receive funding, training, and support from Iran, but they retain a significant degree of autonomy in how they carry out their operations. Iran’s guidance is often broad rather than precise, and these proxies can decide on the specific execution of their activities. They provide general directives rather than explicit orders, and individuals in the field understand what the leadership expects.”^[8]

Deciphering Hamas and its Ideology

Hamas, officially “Harakat al-Muqawama al-Islamiya,” is a Sunni Islamist organisation whose origins can be traced to the changing political landscape of the Palestinian territories up to 1987.^[9] Before the mid-1980s, the Palestinian Muslim Brotherhood (PMB) held a virtual monopoly. However, its approach focused on the creation of an Islamic society, rather than engaging in persistent and aggressive resistance against the Israeli government.^[10] 

PMB had not been actively involved in resistance since 1948, as Gaza was under Egyptian influence and the West Bank was controlled by Jordan. As a result, was estranged from the Palestinian population and faced growing accusations of receiving Israeli funding to undermine the Palestine Liberation Organization (PLO).^[11] The turning point came with the rise of popular resistance during the First Intifada, triggered by the Israeli control of Gaza and the West Bank in 1967. This uprising was further exacerbated by Israeli settlement policies and economic hardship, which created conditions ripe for the emergence of a sustained and popular resistance movement. PMB’s perceived inaction in the face of these challenges led to increasing demands for resistance and accusations of collusion with Israel. 

To address these issues and divert attention from existing Palestinian movements such as Fatah and Islamic Jihad, PMB decided to create Hamas. Hamas solidified its position as a popular resistance movement during the Intifada and labelled the Oslo Accords as a Zionist plot to control Palestinians through a puppet government.^[12] The Palestinian Authority (PA) came into conflict with the movement as Hamas intensified attacks to sabotage the Oslo process. The resulting clashes and bombings led to a confrontation between the two. PA’s attempts to maintain power and crack down on Hamas eventually resulted in Hamas taking control of Gaza. This internal conflict had significant implications for the Palestinian territories and further fragmented the Palestinian leadership.^[13]

Hamas emerged as the leader of resistance during the Second Intifada, pushing Fatah into the shadows, since it was plagued by corruption and accusations of conspiring with Israel. This period also saw conflict over strategy within the Palestinian resistance. Tensions ultimately culminated in the violent takeover of Gaza by Hamas in 2007, leading to a split in Palestinian governance. Fatah controlled the West Bank and Hamas governed the Gaza Strip.^[14] Historically, the area had relied on funds from Palestinian expatriates, Gulf donors, and Islamic charities in the West. After the Hamas takeover, the Egyptian and Israeli blockade isolated Gaza and left over a million Gazans reliant on international aid.^[15] Israel permitted Qatar to provide substantial aid, while other support came via the Palestinian Authority and UN agencies.^[16]

Iran also became a major supporter, contributing funds, weapons, and training. Despite brief discord during the Syrian civil war, when Hamas criticised the Assad Regime and moved its political bureau from Damascus to Doha, Qatar to please the Muslim Brotherhood in Egypt (the ideological fountainhead for Hamas),^[17] Tehran pledged some USD 100 million annually to Hamas and other US-designated Palestinian terrorist groups.^[18]Turkey, a staunch Hamas supporter, faced accusations of funding terrorism, mainly due to its alleged aid diversions from the Turkish Cooperation and Coordination Agency after President Erdogan took office in 2002.^[19]

Dr Raz Zimmt, Research Associate at the Alliance Center for Iranian Studies, notes, “It’s important to distinguish two key aspects. One is Iran’s continuous support for Hamas, which it openly acknowledges. Iran has significantly increased its assistance to Hamas over the years, providing technology, training, and weapons. Without this support, Hamas wouldn’t have been able to conduct such attacks. These groups like Hamas maintain coordination and have overlapping interests with Iran, but they are not under direct Iranian command. It’s more about support and coordination.^[20]”

Capt. (Res.) Alex Grinberg further observes, “The Iranians handle these situations quite adeptly. They don’t provide financial support to everyone but prefer groups like Hezbollah to generate their funds through means such as drug smuggling or their networks in Africa and South America. The distinction is that Hezbollah serves as Iran’s proxy, while Hamas is considered Iran’s client. Hamas may seek money from Iran, but they can exist without it. Iranian support enhances their capabilities, and Hamas can secure more funding by demonstrating their commitment through actions, such as launching attacks. Iran offers technical training, including the use of drones and communication systems, mainly facilitated through Hezbollah because of the language barrier between Iranians and Arabic-speaking Hamas members.”^[21]

Hamas also has generated revenue by taxing goods transported through an elaborate network of tunnels that bypasses the Egyptian border into Gaza. This complex network of tunnels, reportedly extending several kilometres underground, serves multiple purposes, including the transportation of people and goods, storage of rockets and ammunition caches, and housing of Hamas’ command and control centres. The tunnels provide Hamas with a means of conducting activities without being observed by Israeli Defense Forces (IDF) surveillance.^[22]

Shlomi Eldar, an Israeli Journalist who has extensively reported from the Gaza Strip, states, “The population in Gaza has also suffered as a result of Hamas’ actions. In 2006, Hamas was elected as a response to the perceived corruption within the Palestinian Authority. People in Gaza and the West Bank sought to hold the leadership of Mahmoud Abbas and the PLO government accountable. However, they likely did not anticipate the dire consequences that would follow the election. Initially, Hamas was established as a welfare organisation. When I met with its leaders in the early days, their approach was notably different. Over time, Hamas has evolved into a more radical organisation. Sheikh Ahmed Yassin, one of Hamas’ founders, had a significant role in assisting the impoverished in Gaza. What has transpired is that a new generation has taken the reins, particularly figures like Muhammad Deif, who leads the Izz ad-Din al-Qassam Brigades, Hamas’ military wing, and Yahya Sinwar, who was released in 2011 as part of an agreement with Israel. Hamas has also used the aid money significantly in constructing an extensive network of tunnels throughout Gaza, effectively creating an underground city.”^[23]

What has now emerged in its horrific actions in many ways seems to resemble the Islamic State (IS), yet there are fundamental differences between the two. Initially, Hamas received some support from organisations such as Al-Qaeda for the Liberation of Palestine.^[24] However, this cooperation was short-lived and ended with the Mecca Agreement between Hamas and Fatah.^[25] The Islamic State views Hamas as an apostate associate of Iran,^[26] a Shia-dominated country. IS declared war on Hamas after the execution of a Hamas member in the Sinai province.

Ksenia Svetlova, a senior fellow at the Atlantic Council’s Middle East Programs and a former member of the Israeli Knesset however disagreed with the analysis and stated[28] “In terms of ideology, these movements share a common foundation rooted in the teachings of the radical preacher Sayyid Qutb, a key figure for both the Muslim Brotherhood and ISIS. Their ultimate goal is to establish a caliphate. Hamas, often considered an extension of the Muslim Brotherhood, doesn’t seek a national state for Palestinians. There was even significant cooperation between the ISIS and Hamas military wing in northern Sinai from 2014 to 2017. During those years, they launched joint attacks and learned from each other. While there are nuances between various radical Islamist groups, some being more pan-Islamic and others displaying nationalistic features, they all share the same origin, strategy, tactics, and endgame: the establishment of a caliphate and a return to the golden age of Islam in the 7th century.”

The Scale and Magnitude of the Attacks 

The assault on the outdoor Tribe of Nova music festival stands as the most devastating civilian massacre in Israel’s history, resulting in approximately 260 fatalities and numerous individuals held captive. Hamas militants opened fire on around 3,500 young Israelis who had gathered for an electronic music celebration during the Jewish holiday of Sukkot, intended to promote peace.[29] Disturbing videos emerged of indiscriminate firing at unarmed civilians and the abduction of young women into Gaza. An American citizen, Natalie Sanandaji, who attended the festival, recounted the incident: “We hastily gathered our belongings and proceeded to our vehicle, following the instructed route to safety. Initially, not overly panicked, knowing the protection of the Iron Dome, we began driving. However, the security changed directions, indicating the escalating threat was not yet clear to them. This realisation unsettled us. As we manoeuvred, we heard gunshots, realising the danger extended beyond rockets. Following the security’s instructions, we abandoned our cars and ran on foot. It was a chilling moment as we heard gunfire and had to make instant life-or-death decisions about where to flee. This continued for about four hours, the uncertainty and split-second decisions defining our survival.^[30]”

Apart from the music festival, several kibbutzim, small farming communities near the Gaza border, were also targeted. Kfar Aza, one of these kibbutzim, endured one of the deadliest attacks, with houses ransacked and set ablaze, resulting in numerous fatalities.^[31]  According to Tal Heinrich, a spokesperson for Israeli Prime Minister Benjamin Netanyahu, “There were babies and toddlers found decapitated.”^[32]

Adele Raemer, a resident of a kibbutz located two kilometres from the Gaza border, shared her harrowing experience: “I was in my house with my 33-year-old son who was visiting. We stayed in the safe room from 6 a.m. onwards, anxiously waiting for the IDF to come and rescue us. Although each community has a team of first responders, they are not initially sufficient to handle a large-scale infiltration, such as the one we experienced. We heard terrifying messages through our internal messaging system from people desperately seeking help as the terrorists stormed inside their houses, even setting them on fire to force occupants out. We were petrified, listening to Arabic voices, gunshots, and explosions all around us. As someone who has lived in a kibbutz since 1975, I had never experienced such fear in my life.^[33]”

A former journalist, speaking under the condition of anonymity, shared her experience covering conflicts in the past decade. She expressed that reporting on warfare in which soldiers are the intended targets is markedly different from witnessing the tragic loss of life, including entire families and young children being brutally killed. The “distressing similarity to the actions of the Islamic State is quite apparent.” Recently, her husband received the heartbreaking news that a friend and her husband were killed “while protecting their ten-month-old twins,” who had to hide from the terrorists in a closet for over ten harrowing hours.”^[34]

While many have drawn parallels between this assault and the Holocaust, Dov Golombovitch, a Holocaust survivor who escaped from Poland and found himself tragically confined to a safe room for 10 hours during the attack at his Kibbutz, observed, “In the Gaza Strip, the actions of Hamas are not equivalent to the Holocaust. The Holocaust was a systematic and industrial genocide of unprecedented magnitude, making it inaccurate to draw a direct comparison. It’s important to understand that the situation in Gaza involves a radical Islamic group, Hamas, which not only expresses a desire to eliminate Israel but has also sought to suppress other Palestinian factions. Approximately a decade ago, they forcibly took control of the Gaza Strip from another Palestinian organisation.”^[35]

Intelligence Failure

As events unfolded, the full scope of this brutal assault became painfully apparent, with a staggering toll of at least 1,400 people killed and 3,800 injured, along with 239 individuals of diverse nationalities kidnapped.^[36]Israel found itself caught off guard by this savage onslaught, exposing a critical intelligence failure and a breakdown in its entire security infrastructure. 

According to The New York Times, an initial assessment highlights the factors contributing to the success of the recent attack, which includes Israel’s intelligence and military facing significant security failures.^[37] These lapses encompass intelligence officers’ failure to monitor essential communication channels used by Palestinian attackers, a heavy reliance on border surveillance equipment vulnerable to disruption by assailants, the clustering of commanders in a single border base overrun during the attack’s onset (hindering communication with other armed forces units), and a propensity to be led astray by disinformation planted using private channels known to be monitored by Israel, especially false indications of a lack of combat preparations. 

Rami Igra, the former head of the Hostages and MIA Unit within Mossad, Israel’s intelligence agency, acknowledged^[38] that the Israeli military had “heavily emphasised advanced technology, particularly along the border. This overreliance on cutting-edge solutions overshadowed the importance of having soldiers on the ground equipped with binoculars”. It became clear that technology couldn’t adequately substitute the value of human observation and vigilance. Furthermore, due to concerns about the safety of West Bank settlers, the government shifted its focus away from the Gaza Strip and redeployed troops. This change in deployment left “insufficient forces to prevent Hamas from launching their attack”.

More recent assessment, however, has echoed what is now known about past spectacular failures, such as 9/11 and Pearl Harbor – in addition to Yom Kippur 1973 itself. That is, it now appears that much in fact was monitored but that the dots were not connected.^[39]

Most tellingly, preparations are now known to have gone on for at least a year prior to the assault.  The attack does not appear linked to a specific triggering incident as reasoned by the Hamas leadership, though key Israeli intelligence officials did attempt to warn the government that there were strong indications that the distraction accompanying Netanyahu’s ongoing attacks upon democracy was creating a critical vulnerability that foes seemed to be considering exploiting. Despite the outward emphasis on security and safety by the government, strategic distraction was the order of the day.^[40]

Former Deputy National Security Advisor, Dr. Eran Lerman, observed, “This wasn’t a recent intelligence failure over the last few weeks or months leading up to the recent operation. Instead, I believe this represents a failure that extended over a more prolonged period. The extent and precision of the Hamas operation, which involved infiltration by land, air, and sea, suggests meticulous planning over at least a year. The fact that they knew specific locations, including events like the Peace Festival and the rave party, indicates thorough preparation. Detecting these preparations earlier should have been our priority, and our inability to do so represents a significant intelligence failure.^[41]”

Amit Halevi, a Knesset member representing the Likud Party, also offered a longer look: “The Israeli political landscape may witness transformations in the future. However, it’s crucial to contemplate past decisions. Throughout the years, blunders made by left-wing political parties have significantly contributed to our present circumstances. The crux of the matter is to adapt our approach. We must explore various strategies and concepts that encompass the intricate security landscape we confront. This pertains not just to politics but also to the security system itself. I hold hope that a fresh generation will emerge, characterised by profound and analytical thinking, stressing a comprehensive comprehension of the challenges we encounter, going beyond superficial politics. This is imperative for our nation’s future, assuring the triumph of peace, justice, and morality.”^[42]

The comparison of these attacks to the 9/11 attacks in the United States thus warrants thorough analysis. While the 9/11 intelligence failure primarily resulted from shortcomings in the analysis of the gathered intelligence rather than intelligence collection itself, the Hamas attacks revealed a significant deficiency in both. In particular, while there was, on the one hand, excessive reliance on Signals Intelligence (SIGNIT); reporting indicates, on the other hand, that key monitoring at the tactical level, which could have provided an invaluable early warning, had been stopped as non-productive. Likewise, it is clear that the vaunted capabilities of Israeli Human Intelligence (HUMINT) failed utterly. 

Additionally, “hubris,” a term that has surfaced often in recent analysis, was the order of the day. Israeli policymakers displayed a sense of overconfidence which led to confirmation bias, akin to their attitude before the Yom Kippur War. Israeli assumptions as to threat perceptions reflected not evidence gathered but what the Israeli authorities themselves wanted to believe. In the event, the illusion of invincibility was shattered when the enemy swiftly penetrated Israeli territory, marking the first such incursion since the War of Independence.^[43] The fallacy that economic incentives could contain a self-proclaimed resistance organisation proved to be a grave miscalculation, since it assumed interests would trump ideology. 

Yet there were few who did not know Hamas ideology openly aims at the destruction of Israel and the annihilation of the Jewish people, as highlighted by specialist Bruce Hoffman in The Atlantic. Hoffman references Article 2 of the Covenant of the Islamic Resistance Movement (HAMAS), which states, “Israel will exist and will continue to exist until Islam will obliterate it, just as it obliterated others before it.”^[44]

In dealing with such motivation, evidence becomes essential, gathered in response to a calculated collection plan that allows forks in the decision tree, the result emerging from the analytical process, not predetermined conclusions.  Micky Aharonson, who formerly headed the foreign relations directorate of the Israeli National Security Council in the Prime Minister’s office, concurred as to the now fully revealed self-deception: “We faced a significant setback with this strategy. At the outset, there was a collective belief that engagement with the Palestinian authorities, potential management of Hamas and its supporters, and gradual regional progress were achievable goals. The objective was to await more favourable opportunities for peaceful coexistence with the Palestinians while simultaneously striving to enhance their living conditions. Unfortunately, this approach proved to be highly unsuccessful.” ^[45]

Yet, amidst many other indicators that were ignored, Hamas had reportedly created a simulated Israeli settlement in Gaza to conduct military training and operations.^[46] Yael Medina, a resident of Moshav Netiv Haasara, observed, “Hamas established checkpoints near the border, monitoring our daily activities. As civilians, we had been discussing this situation for two years, and we had a growing sense that something significant was imminent.” ^[47]

Regardless, distracted and committed to limiting the powers of the independent judiciary, Israel’s right-wing government convinced itself that Hamas was not fully prepared for a hostile confrontation. Apparently, the Gaza front had even been stripped of forces in order to support right-wing settler attacks and death-squad activity against West Bank Palestinians – even as, just a week before the attack, the Erez crossing was opened,  allowing Gazans to seek employment in Israel.^[48]  

Amit Halevi, a member of the Knesset, acknowledged Israel’s miscalculation. “It’s a sobering realisation,” he observed, “that well-intentioned actions can lead to unintended consequences. Israelis have consistently extended a hand for peace and prosperity. Every Israeli Arab residing here attests to the positive transformations Israel has brought to this region, turning the desert into a thriving environment. This reflects the character and heritage of our nation. However, the perpetrators of this atrocious act are entirely contrary. One among them, who had been employed on the kibbutz for 25 years and even worked as a babysitter, resorted to such extreme violence. We must treat these matters with utmost seriousness and refrain from solely concentrating on economic aspects. This was an error, and we must acknowledge it.”^[49]

Dr. Ely Karmon, senior research scholar at the International Institute for Counter-Terrorism, adds, “The current situation is a glaring example of both strategic and tactical intelligence failures. There were clear indicators that should have prompted an assessment of an impending event. For instance, the increased missile firings towards the sea, initially perceived as attempts to enhance precision or operational efficiency, were integral to their preparations for this assault. Likewise, exercises conducted by groups such as the Islamic Jihad along the border fence initially portrayed as routine drills, were tactical preparations. Unfortunately, our intelligence lacked access to vital strategic information and failed to conduct a thorough analysis of these precursor signs. The second major failure lies in their successful execution of tactics to infiltrate and occupy parts of our settlements, villages, and breach towns, using a modus operandi well known to our army. It’s concerning that they managed to breach some of our military posts on the frontline and neutralise defending soldiers.^[50]

The Hostage-taking and Crisis Management

“Soldiers” are perhaps the least vexing challenge of the moment. A manual retrieved in the aftermath of the attack indicates that hostage-taking was an explicit objective, even if operations did not go entirely as planned.^[51] The manual suggests that the group originally intended to take hostages inside Israel for a prolonged standoff rather than bring them into Gaza. It describes methods of torture, abduction, and using hostages as human shields. The manual details separating women and children from men and advises senior field commanders to negotiate with Israeli authorities. However, a final section regarding threats to prisoners was not authenticated. The manual is written in Arabic and features references to Israeli military ranks and weaponry. It was produced by the Izz al-Din al-Qassam Brigades, Hamas’ military wing, and includes a watermark from the “al-Quds Battalion.”^[52]

Nitsana Darshan-Leitner, founder of Shurat HaDin–Israel Law Center, further notes, “This situation is indeed a war crime and a crime against humanity. The majority of the hostages are civilians, including women, children, and even babies from various countries. Among the hostages are foreign citizens from different countries. These people are held by Hamas, and we don’t know if they are alive or dead, or if they are wounded. It is crucial to involve the Red Cross in this matter. Despite initial claims that the Red Cross doesn’t work in Gaza, they do have a presence there. They should be fulfilling their duty according to the Geneva Convention, similar to how they monitor and ensure compliance with rules in other conflict situations. The international community needs to put pressure on Hamas to release these innocent hostages, and Israel should approach other nations and show them the evidence of the brutality of Hamas.^[53]”

An illustration of what happened at the individual level is provided by the case of “Ron,” a 19-year-old officer in the IDF. He was one of the hostages seized while on duty, which involved facilitating the movement of goods between the Gaza Strip and Israel, fostering positive relations with local traders. Despite not being required to work on a specific Saturday, he opted to stay at the base, a common practice for a handful of soldiers during weekends and holidays. His mother states, “The day took a dire turn at 6:30 a.m. when Ron’s text message alerted us to what he initially perceived as a missile attack. It was, however, a barrage of bombings, grenade explosions, and other alarming sounds. Ron’s subsequent phone call reflected palpable fear and a growing sense of abnormality. His messages took a more distressing turn when he mentioned the presence of terrorists within the base, instilling an ominous certainty of his fate. After an agonising four to five hours, we received videos posted by Hamas on social media, offering a surprising glimmer of hope. These recordings showcased Ron appearing unharmed, which offered relief. They meticulously documented his journey from abduction to his presence in the Gaza Strip. While the assurance that he had been taken alive provided solace, his current status remained uncertain. Our pressing concern was securing his inhaler to manage his severe asthma. We engaged with organisations like the Red Cross and sought any available assistance to ensure his vital medical needs were met.^[54]”

The situation of the hostages remains uncertain, with Hamas’ spokesperson Abu Ubaida stating that hostages will be executed if Israel continues its offensives in Gaza.^[55] While Israel has increased its airstrikes on Gaza to exert pressure on Hamas, experts suggest that negotiations are likely the most viable means to secure their freedom. Notably, two elderly Israeli women were released on October 23, following the earlier release of an Israeli-American mother and daughter on October 20. In both cases, Qatari officials played a mediating role. Israel finds itself faced with the challenge of both pursuing hostage negotiations and pressing ahead with its offensive.  Senior military officials,  in an interview with The Guardian, have highlighted the difficulty of any military rescue operation.^[56]

The Israeli government has been working with the American and Qatari governments, which are aiding in mediating the release of hostages. Lt. Col. (Res.) Maurice Hirsch, former head of the military prosecution in Judea and Samari, notes, “In examining Hamas’ approach to hostage releases, it’s crucial to acknowledge their use of innocent civilians as human shields, a tactic frequently involving the concealment of rocket launchers and weapon stockpiles within civilian areas. Notably, the release of hostages is being conducted incrementally. Hamas spokesperson Abu Obeida has made it explicit that in the event of an Israeli ground operation in Gaza, they intend to initiate executions of all the hostages, a deeply serious matter. This underscores the necessity for the international community to comprehend their intentions, raising the possibility of witnessing distressing live executions of Israeli hostages, which would inevitably draw unsettling parallels with the actions of ISIS. Furthermore, there are indications that the officially reported figures by Israel regarding the number of hostages held by Hamas may not be entirely accurate, suggesting the potential existence of more hostages than currently disclosed. In their attempts to improve their image, Hamas released some hostages, but they still hold many others, including women and children. There’s no distinction between Hamas and ISIS, regardless of whether they release terrorists or hostages bit by bit.^[57]

Rami Igra emphasised^[58] “The Israeli public no longer responds to hostage-related pressures. Hamas, however, clung to outdated strategies, using hostages to manipulate the Israeli government. However, there isn’t any precise information about the hostages available. Nevertheless, efforts are underway to gather intelligence and mount rescue operations. As the Israeli army continues its manoeuvres in the Gaza Strip, tactical opportunities are anticipated to secure the release of many, if not all, of the abducted individuals.”

Israel’s Retaliation and The End Game

Iron Sword, the IDF thrust into Gaza, was initiated by first focusing (as reported) on Hamas infrastructure which has offensive capabilities.^[59] Prime Minister Netanyahu invoked Article 40 of the Basic Law, officially declaring a state of war.^[60] An emergency war cabinet was assembled, which included former Defense Minister Benny Gantz, albeit his prior declarations of not entering a coalition with Netanyahu.^[61] Opposition leader Yair Lapid was also extended an invitation to join the cabinet, although he has yet to respond due to unmet conditions for his participation.^[62] Prime Minister Netanyahu, addressing the nation after the war cabinet’s formation, emphasised the government’s unwavering commitment to eliminating the Hamas threat “from the face of the Earth.” Idan Roll, former Deputy Foreign Minister and Knesset Member representing the Yesh Atid party, noted that Israelis have a unique trait of unity during crises to safeguard the nation.^[63] As previous mistakes are acknowledged and rectified, the Israeli populace has for the moment set aside “political differences to ensure effective management and leadership during this war.” As for Lapid’s absence from the emergency cabinet, inclusion hinges on future developments and the necessity for “experienced figures in pivotal ministries, aiming to create an agile decision-making body.” 

Prime Minister Netanyahu has stated the objective of eliminating both the political and military leadership of Hamas in Gaza. There was an initial delay in the IDF ground offensive to allow the United States to deploy air defence assets to protect U.S. troops stationed in the Middle East,^[64] even as the Israeli Air Force continued airstrikes on targets in Gaza, particularly in the northern region where most Hamas assets are considered concentrated. Civilians in the Northern region, as has by now been widely reported, were ordered to relocate for their own safety.^[65] Regardless, the current death toll in Gaza has surpassed 8,000 and will rise further.^[66]

Attempting to act as both supporter and voice of conscience, U.S. President Joe Biden and other high-ranking officials have made wartime visits to Israel. Biden has expressed unwavering support for Jerusalem in its effort to defeat Hamas and conveyed the message that Israel is not alone in the battle.^[67] He pledged American assistance as the conflict continues, including the possibility of sophisticated weaponry.^[68] Any assistance comes on top of the USD 3.8 billion in military aid presently (as reported) delivered annually.^[69]  

The firm U.S. stance in support of Israel comes at a time when Washington’s influence in the Middle East faces challenges, particularly from China’s growing presence in the region. To maintain its relevance as a key regional actor, Washington must engage in a manner that is relevant to the moment, hence its outward emphasis upon military might. Former Deputy Foreign Minister and Israeli Ambassador to the U.S., Danny Ayalon, concurred with the assessment that U.S. engagement in the region has been diminishing. However, he viewed President Biden’s visit to Israel as “not only a show of solidarity but also a strategic move to sustain a presence in the Middle East. The support for Israel is not just a matter of emotions or morals for the United States but a calculated decision to protect its strategic interests. As the sole democracy in the Middle East, Israel plays a pivotal role in promoting democratic values in the region, which is critical for confronting cruelty and dictatorship. The U.S.’s backing of Israel serves as a deterrent to potential adversaries in the region”.^[70]

Regardless of such staunch support, Israel faces a multitude of challenges as the conflict persists. Certainly among the most urgent is preventing other members of the so-called ‘axis of resistance’ from entering the war. There have been numerous provocative actions emanating from Southern Lebanon, for instance, where Hezbollah, another proxy of Iran, holds sway. An alarming succession of incidents has drawn concern and forced IDF response.^[71]  

Lt. Col. (Res.) Sarit Zehavi, the founder of the Alma Research and Education Center, articulated this concern. “Hezbollah’s arsenal of rockets surpasses that of Hamas by a magnitude of ten,” he states. “Israel’s military forces are prepared for a multi-front engagement, which encompasses the potential theatres of Lebanon and Syria, all aimed at safeguarding the nation. The mobilisation of hundreds of thousands of Israeli reservists has been initiated to provide security. However, the sustainability of this situation remains a critical question. Should a ceasefire be declared while Hezbollah retains its capabilities, the risk of a scenario akin to that experienced in the southern front looms large.”^[72] Hezbollah’s Deputy Chief, Naim Qassem, has issued a warning, stating, “Hezbollah knows its duty well and is fully prepared,” and indicates that they will join the fight “when the time for action arrives.”^[73]

While the precise intentions and nature of Hezbollah’s involvement remain unclear, Dr. Raz Zimmt suggests, “Iran is committed to supporting Hamas. While there has been some limited engagement of other proxies in northern Israel, we have yet to witness a full-scale mobilisation of all resistance members by Iran to support Hamas. This may be because Iran believes that Hamas can withstand Israel with its current level of support, potentially involving Hezbollah in later stages. If Israel launches a ground offensive, there is the potential for increased engagement from pro-Iranian militias in Syria, western Iraq, and other regions.” The chances of Iran engaging in a full-scale conflict directly with Israel will be low as it majorly prefers fighting the war through its proxies. The Commander-in-Chief of Iran’s Islamic Revolutionary Guard Corps (IRGC) also issued a warning that if Israel launches a ground offensive in Gaza, they would turn into a “graveyard.”^[74]

Ultimately, even as the shape of the war remains unclear, as does the strategy for engaging in battle, there persist questions regarding the endgame in Gaza and Israel’s apparent lack of a comprehensive post-invasion strategy. President Biden has voiced similar apprehensions and has drawn parallels with past U.S. experiences, such as the aftermath of 9/11.^[75] Israel now faces the challenge of developing an effective governance strategy for the region or formulating an exit plan outlining the future of Gaza after the conflict’s conclusion. 

The IDF has initiated limited ground operations involving troops and tanks to target specific military sites within Gaza. These operations are perceived as preliminary steps towards a potential Gaza siege aimed at locating and rescuing hostages. Notably, one IDF soldier previously held captive by Hamas was freed during these ground actions^[76], indicating the military’s intent to conduct more extensive operations to secure additional hostages through these limited ground incursions before implementing a complete siege of Gaza.

The Israeli public opinion towards the complete Gaza siege is also shifting. Almost half of the respondents expressed a preference for caution, as revealed in a recent poll conducted for the Israeli newspaper Maariv^[77]. When asked whether the military should swiftly initiate a large-scale ground offensive, 29% voiced support for immediate action, while 49% favoured a more measured approach, and 22% remained indecisive. This marked a notable change from a poll conducted on October 19, where 65% of respondents backed a ground offensive, albeit without specifying the timing. Maariv suggested that the current emphasis on hostage-related developments significantly influenced this shift in public opinion. The Israeli public probably wants the government to secure the hostages and ensure safety before the siege of Gaza or the attack on Hamas continues.      

The complexity of the conflict is further exacerbated by the fact that a significant portion of Hamas’ infrastructure is concealed within intricate tunnel networks whose full extent remains largely unknown. Dr. Daphné Richemond-Barak, a specialist in subterranean warfare at Reichman University, in an interview with the BBC, echoed these concerns, noting that the tunnels inside Gaza frequently employed by Hamas are well-appointed to “accommodate prolonged occupancy. They feature essential amenities such as electricity, lighting, and rail tracks, facilitating smoother movement and extended stays.”^[78]

Hence, while there may be a strong desire to assert control over Gaza and reshape its political landscape, Brig. Gen. (Res.) Yosef Kuperwasser, former head of the Research Division at the Israel Defense Forces’ Intelligence Corps points out the complexities of prolonged engagement, stating, “Controlling Gaza is not our preference; we are not inclined to manage daily matters like sewage, water supply, and economic issues.” ^[79]Nonetheless, former Deputy National Security Advisor Dr. Eran Lerman holds a different view, suggesting that there could be “a push to reinstate or potentially rebuild an Israeli presence in the area.  

The endgame therefore remains uncertain, even as the ground offensive appears in motion. Whether Israeli forces ultimately will revert to the status quo that prevailed before the 2005 Gaza disengagement is a matter yet to be determined. In the end, Professor Dan Schueftan, former advisor to Prime Ministers Yitzhak Rabin and Ariel Sharon, warns against an extended Gaza invasion and advocates a more proactive approach focused on “neutralising Hamas’ offensive capabilities. This approach,” he assesses, “should also consider the group’s use of civilians as human shields, complicating targeted actions without collateral damage. Furthermore, regarding the West Bank, the two-state solution is considered unviable. The prevailing sentiment, similar to Gaza, suggests that without Israeli presence, hostile factions would seize control. Granting them sovereignty would jeopardise Israeli security, as their primary objective is to cause harm. To avert the mistake of providing them with resources and weaponry, a more proactive security approach is needed”.^[80]     

Conclusion

The Israeli government faces the challenge of maintaining the legitimacy of its actions against Hamas while also prioritising the release of hostages. The recent Hamas attack appears to be a deliberate attempt to provoke Israeli retaliation in Gaza, potentially causing harm to innocent civilians. Hamas may be counting on such actions to wear down Israel and gain international sympathy, possibly paving the way for its recognition as an independent state. 

However, it’s essential to recognize that merely targeting Hamas’s military wing through a ground offensive will not fully neutralise the organisation. A significant part of Hamas’s political structure operates from foreign nations like Turkey and Qatar, making it necessary to strangle its financial resources and economic capacities for complete isolation. In Western countries, there is a tendency to distinguish between the political and military wings of Hamas, engaging with the former while outlawing the latter which can be deceptive.

One vital lesson learned from dealing with Hamas, an organisation committed to Israel’s annihilation, is that economic incentives alone are insufficient. Dealing with such groups requires a more comprehensive approach, and their stated positions should not be taken at face value. Following the October 7 attacks, it appears that even Israel’s long-standing strategy of isolating the Palestinian cause to foster Middle East relations has faltered, as the impact on ordinary Israeli citizens has become evident. Relying solely on technical intelligence and substantial firepower to control the armed threat is no longer a viable option. Israel needs to move past its policy of division and control aimed at weakening the Palestinians and instead formulate a comprehensive approach for addressing radical factions. Furthermore, the government needs to formulate a clear post-Gaza seizure policy to prevent the rise of new radical factions in the vacuum following the potential destruction of Hamas.

About the author: Ratnadeep Chakraborty, a project intern with Mantraya, is currently pursuing his Master’s in International Relations from Guru Nanak Dev University and is the co-founder of an independent media company that covers the spheres of strategic affairs called The Honest Critique. This Special Report has been published as part of Mantraya’s ongoing “Fragility, Conflict, and Peace Building” projects. Views expressed in this Special Report are the Author’s and do not represent Mantraya’s position on the issue. All Mantraya publications are peer-reviewed

Source: This article was published by Mantraya

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END NOTES

^[1] Olivia B Waxman, “How the Yom Kippur War Changed Israel.” Time, 11 October 2023, https://time.com/6322802/yom-kippur-war-israel-history/.

^[2] “Hamas’s Attack was the Bloodiest in Israel’s History.” The Economist, 12 October 2023, https://www.economist.com/briefing/2023/10/12/hamass-attack-was-the-bloodiest-in-israels-history.

^[3] Ronen Bergman, and Patrick Kingsley. “How Israel’s Feared Security Services Failed to Stop Hamas’s Attack,” The New York Times, 10 October 2023, https://www.nytimes.com/2023/10/10/world/middleeast/israel-gaza-security-failure.html.

^[4] Nicolas Pelham, “Hamas’s Deadly ‘Phantom’: The Man Behind the Attacks,” The Economist, 20 October 2023, https://www.economist.com/1843/2023/10/20/hamass-deadly-phantom-the-man-behind-the-attacks.

^[5] “Israeli Top Court Suspends Palestinian Evictions in Sheikh Jarrah.” Al Jazeera, 1 March 2022, https://www.aljazeera.com/news/2022/3/1/israeli-top-court-suspends-palestinian-evictions-in-sheikh-jarrah.

^[6] Grant Rumley, “Israel Normalization Negotiations and the U.S.-Saudi Defense Relationship.” The Washington Institute for Near East Policy, 25 September 2023, https://www.washingtoninstitute.org/policy-analysis/israel-normalization-negotiations-and-us-saudi-defense-relationship.

^[7] Bruce Hoffman, “Israel’s War with Hamas: What to Know,” Council on Foreign Relations, 9 October 2023, https://www.cfr.org/in-brief/israels-war-hamas-what-know.

^[8] E-Interview with Capt. (Res.) Alex Grinberg, former IDF Intelligence Research Department, Jerusalem, Israel,13 October 2023.

^[9] Kali Robinson, “What Is Hamas?”, Council on Foreign Relations, 9 October 2023,https://www.cfr.org/backgrounder/what-hamas.

^[10] G. Dore and D. Diker, “Iran, Hezbollah, Hamas and the Global Jihad: A New Conflict Paradigm for the West,” Jerusalem Centre for Public Affairs, 2007.

^[11] M. Hatina, “Islam and Salvation in Palestine: The Islamic Jihad Movement,” Tel Aviv University, 2009.

^[12] International Crisis Group, “Radical Islam in Gaza,”, viewed April 2011, https://www.crisisgroup.org/middle-east-north-africa/eastern-mediterranean/israelpalestine/radical-islam-gaza

^[13] David Maggs, “The History, Politics and Ideology of Hamas,” published on 17 June 2011, https://www.e-ir.info/2011/06/17/the-history-politics-and-ideology-of-hamas/.

^[14] Conal Urquart, Ian Black, and Mark Tran, “Hamas Takes Control of Gaza,” The Guardian, 15 June 2007,https://www.theguardian.com/world/2007/jun/15/israel4.

^[15]  Kali Robinson, “What Is Hamas?”

^[16] Aaron Boxerman, “Qatar Raises Annual Aid to Gaza to $360 Million,” The Times of Israel, 31 January 2021, https://www.timesofisrael.com/qatar-raises-annual-aid-to-gaza-to-360-million/.

^[17] Maren Koss, “Flexible Resistance: How Hezbollah and Hamas Are Mending Ties,” Carnegie Middle East Center, 11 July 2018, https://carnegie-mec.org/2018/07/11/flexible-resistance-how-hezbollah-and-hamas-are-mending-ties-pub-76782.

^[18] Elior Levy, “Iran’s $100 Million Aid to Hamas and Islamic Jihad,” Ynet News, 3 August 2018,https://www.ynetnews.com/articles/0,7340,L-5321985,00.html.

^[19] Elçin Poyrazlar, “Why Israel-Hamas is Erdoğan’s New ‘Mission Impossible’,” Politico, 13 October 2023,https://www.politico.eu/article/recep-tayyip-erdogan-turkey-israel-hamas-war-palestine-diplomacy/.

^[20] E-Interview with Dr. Raz Zimmt, Research Associate at the Alliance Center for Iranian Studies, Tel Aviv, Israel , 23 October 23 2023.

^[21]E-Interview with Capt. (Res.) Alex Grinberg, former IDF Intelligence Research Department, Jerusalem, Israel,  13 October 2023. 

^[22] Joshua Berlinger, “The ‘Gaza Metro’: The Mysterious Subterranean Tunnel Network Used by Hamas,” CNN, 19 October 2023. https://edition.cnn.com/2023/10/15/middleeast/hamas-tunnels-gaza-intl/index.html.

^[23]E-Interview with Shlomi Eldar, Journalist and Film Director, Jerusalem, Israel,  19 October 2023.

^[24] Mary Habeck, “Al-Qa`ida and Hamas: The Limits of Salafi-Jihadi Pragmatism.” CTC Sentinel 3, no. 2 (February 2010), https://ctc.westpoint.edu/wp-content/uploads/2010/08/CTCSentinel-Vol3Iss2-art2.pdf.

^[25] Sylvain Keller, “Reflecting on International Terrorism after the Hamas Attacks on Israel.” E-International Relations, 17 October 2023. https://www.e-ir.info/2023/10/17/reflecting-on-international-terrorism-after-the-hamas-attacks-on-israel/.

^[26] Graeme Wood. “Hamas Is Not ISIS.” The Atlantic, 27 October 2023.https://www.theatlantic.com/ideas/archive/2023/10/hamas-isis-war-in-gaza/675786/.

^[27] Nimrod Hurvitz, “Hamas, ISIS – What’s the Difference?”, 19 December 2018. Accessed from https://www.ynet.co.il/article/5428426.

^[28]  E-Interview with Ksenia Svetlova, former member of the Israeli Knesset, Jerusalem, Israel, 1 November 2023.

^[29] Isabel Debre and Michael Biesecker, “Israeli Survivors Recount Terror at music festival, where Hamas militants killed at least 260.” The Associated Press, 10 October 2023. Accessed at https://apnews.com/article/israel-palestinians-gaza-hamas-music-festival-6a55aae2375944f10ecc4c52d05f2ffe.

^[30]   E-Interview withNatalie Sanandaji, survivor of Nova Music Festival, Israel, 12 October 2023.

^[31] Muhammad Darwish, Nic Robertson, Artemis Moshtaghian, Amir Tal, and Ivana Kottasová, “Children Found ‘Butchered’ in Israeli Kibbutz, IDF Says, as Horror of Hamas’ Attacks Near Border Begins to Emerge,” CNN, 13 October 2023, https://edition.cnn.com/2023/10/10/middleeast/israel-kibbutzim-kfar-aza-beeri-urim-hamas-attack-intl/index.html.

^[32] Sumanti Sen, “Hamas Terrorist Allegedly Kills Woman and Her Boyfriend at Israel Rave, Sends Video to the Man’s Mom,” Hindustan Times, 12 October 2023, https://www.hindustantimes.com/world-news/hamas-terrorist-allegedly-kills-woman-and-her-boyfriend-at-israel-rave-sends-video-to-the-mans-mom-101697073753540.html.

^[33]    E-Interview with Adele Raemer, survivor of Hamas terror attack, Sderot, Israel, 13 October 2023.

^[34] E-Interview with A (name changed), former journalist, Tel Aviv, Israel, 10 October 2023.

^[35] E-interview with Dov Golombovitch, holocaust survivor who experienced the Hamas attacks, Tel Aviv, Israel, 19 October 2023.

^[36] “Israel at war: What happened on day 23?” The Jerusalem Post, 29 October 2023. https://www.jpost.com/arab-israeli-conflict/2023-10-29/live-updates-770654.

^[37] Ronen Bergman and Patrick Kingsley.

^[38]E-Interview with Rami Igra, former head of Mossad’s Hostages and MIA Unit, Israel, 1 November 2023.

^[39] Ronen Bergman, Mark Mazzetti, and Maria Abi-Habib, “Hubris and Missed Signals as Hamas Readied Attack,” The New York Times, 30 October 2023, A1.

^[40] Isabel Debre and Michael Biesecker.

^[41] E-Interview with Dr. Eran Lerman, former Deputy National Security Advisor, Jerusalem, Israel, 11 October 2023.

^[42] E-Interview with Amit Halevi, Member of Israeli Knesset, Jerusalem, Israel, 24 October 2023.

^[43]Jeffrey Sonnenfeld, Dan Raviv, and Steven Tian, “Five Lessons for the U.S. and the World From the Hamas Invasion of Israel,” Time, 10 October 2023, https://time.com/6322097/lessons-from-hamas-invasion-israel/.

^[44] Bruce Hoffman, “Understanding Hamas’s Genocidal Ideology,” The Atlantic, 10 October 2023,https://www.theatlantic.com/international/archive/2023/10/hamas-covenant-israel-attack-war-genocide/675602/.

^[45]  E-Interview with Micky Aharonson, former head of the foreign relations directorate of the Israeli National Security Council, Jerusalem, Israel, 21 October 2023.

^[46] Samia Nakhoul and Jonathan Saul, “How Hamas Duped Israel as it Planned Devastating Attack,”Reuters, 10 October 2023, https://www.reuters.com/world/middle-east/how-israel-was-duped-hamas-planned-devastating-assault-2023-10-08/.

^[47]  E-Interview with Yael Medina, survivor of Hamas terror attack, Moshav Netiv Haasara, Israel, 26 October 2023.

^[48] “Israel Reopens Gaza Border Crossing, Despite Ongoing Riots,” The Times of Israel, 28 September 2023,https://www.timesofisrael.com/israel-to-reopen-gaza-border-crossing-despite-ongoing-riots/.

^[49]E-Interview with Amit Halevi, Member of Israeli Knesset, Jerusalem, Israel, 24 October 2023.

^[50] E-Interview with Dr. Ely Karmon,senior research scholar at the International Institute for Counter-Terrorism, Herzliya, Israel,  7 October 2023.

^[51] Graeme Wood, “Hamas’s Hostage-Taking Handbook Says to ‘Kill the Difficult Ones’ and Use Hostages as ‘Human Shields’,” The Atlantic, 19 October 2023, https://www.theatlantic.com/ideas/archive/2023/10/hamas-hostage-taking-manual/675691/.

^[52] Ibid

^[53] E-Interview with Nitsana Darshan-Leitner, founder of Shurat HaDin–Israel Law Center, Ramat Gan, Israel, 19 October 2023.

^[54] E-Interview with Maayan, mother of missing IDF soldier, Israel, 15 October 2023.

^[55] “Hamas Says Will Kill Hostages if Israeli Attacks on Gaza Civilians Continue,” Al Jazeera, 10 October 2023, https://www.aljazeera.com/news/2023/10/10/hamas-says-will-kill-hostages-if-israeli-attacks-on-gaza-civilians-continue.

^[56] Jason Burke, “Two Israeli Hostages Released as Efforts Intensify to Free People Held by Hamas,” The Guardian, 23 October 2023, https://www.theguardian.com/world/2023/oct/23/efforts-to-free-gaza-hostages-intensify-amid-reports-some-may-soon-be-released.

^[57] E-Interview with Lt. Col. (Res.) Maurice Hirsch, former head of the military prosecution in Judea and Samari, Israel, 24 October 2023.

^[58]E-Interview with Rami Igra, former head of Mossad’s Hostages and MIA Unit, Israel, 1 November 2023.

^[59] “IDF Strikes Hamas as Operation ‘Iron Swords’ Commences,” The Jerusalem Post, 7 October 2023,https://www.jpost.com/breaking-news/article-762075.

^[60] Lazar Berman, “Security Cabinet Confirms Israel at War, Can Undertake ‘Significant Military Activities’,” The Times of Israel, 8 October 2023, https://www.timesofisrael.com/liveblog_entry/security-cabinet-confirms-israel-at-war-can-undertake-significant-military-activities/.

^[61] Michael Hauser Tov, “Emergency Israeli Gov’t to Include Special War Cabinet for Hamas War,” Haaretz, 11 October 2023, https://www.haaretz.com/israel-news/2023-10-11/ty-article/.premium/netanyahu-and-gantz-agree-on-formation-of-emergency-govt-during-war-with-hamas/0000018b-1efe-d2fc-a59f-dfffa9fe0000.

^[62] Carrie Keller-Lynn, “Lapid Accuses Government of ‘Unpardonable Failure,’ Says Won’t Join Emergency Government,” The Times of Israel, 12 October 2023, https://www.timesofisrael.com/liveblog_entry/lapid-says-wont-join-problematic-emergency-government-but-hell-back-it-from-outside/.

^[63] E-Interview with Idan Roll, former Deputy Foreign Minister, Jerusalem, Israel, 19 October 2023.

^[64] Idrees Ali and Phil Stewart, “U.S. Sending Additional Air Defense Systems to Middle East, Pentagon Says,” Reuters, 22 October  2023, https://www.reuters.com/world/middle-east/us-sending-additional-air-defense-systems-middle-east-pentagon-2023-10-22/.

^[65] “IDF: Gaza Resident Says Hamas Preventing Evacuations; Thousands Return North,” The Times of Israel, 26 October 2023, https://www.timesofisrael.com/idf-gaza-resident-says-hamas-preventing-evacuations-thousands-return-north/.

^[66] “IDF Conducts Raid in Gaza, Rescues Woman Soldier Kidnapped by Hamas on October 7.” Haaretz, 30 October 2023. Accessed October 30, 2023, https://www.haaretz.com/israel-news/2023-10-30/ty-article-live/idf-attacks-in-syria-following-rocket-launches-antisemitic-riots-in-russian-airport/0000018b-7df0-d4a8-a3cf-fdf9c8530000.

^[67] Shannon K. Crawford, “Biden’s Visit to Israel Yields No Quick Fixes: ANALYSIS,” ABC News, 19 October 2023, https://abcnews.go.com/International/bidens-visit-israel-yields-quick-fixes-analysis/story?id=104101845.

^[68] Jeff Seldin, “US Security Aid to Israel to Arrive in Coming Days,” VOA News, 08 October 2023,https://www.voanews.com/a/us-to-send-carrier-strike-group-to-mediterranean-in-support-of-israel/7301975.html.

^[69] Emma Green, “Why Does the United States Give So Much Money to Israel?,” The Atlantic, 15 September 2016, https://www.theatlantic.com/international/archive/2016/09/united-states-israel-memorandum-of-understanding-military-aid/500192/.

^[70] E-Interview with Danny Ayalon, former deputy foreign minister, Jerusalem, Israel, 19 October 2023.

^[71] “IDF Ready for Ground Maneuver; Intense Airstrikes on Gaza Overnight; More Hezbollah Targets Taken Out,” Israel Hayom, Published on 10 October 2023, https://www.israelhayom.com/2023/10/10/israel-strikes-hamas-the-latest-on-the-gaza-war/.

^[72] Lt. Col. (Res.) Sarit Zehavi,  founder of Alma Research and Education Center, Dolev, Israel, 12 October 2023.

^[73] Melissa Koenig, “Hezbollah Says It’s ‘Fully Prepared’ to Join Hamas in War with Israel,” New York Post, 13 October 2023, https://nypost.com/2023/10/13/hezbollah-says-its-fully-prepared-to-join-hamas-in-war-with-israel/.

^[74] Maziar Motamedi, “Iran Warns Israel of Regional Escalation if Gaza Ground Offensive Launched,” Al Jazeera, 15 October 2023, https://www.aljazeera.com/news/2023/10/15/iran-warns-israel-of-regional-escalation-if-gaza-ground-offensive-launched.

^[75] Aamer Madhani and Colleen Long. “President Biden Wraps up his Visit to Wartime Israel With a Warning Against Being ‘Consumed’ by Rage.” AP News, 19 October 2023. https://apnews.com/article/joe-biden-israel-hamas-gaza-palestinians-a85cb682fdc61b80285cf4ab354354ce

^[76] “Israeli soldier freed in Gaza during ground operation, Israeli army says.” Reuters, 30 October 2023.https://www.reuters.com/world/middle-east/israeli-soldier-freed-gaza-during-ground-operation-israeli-army-says-2023-10-30/.

^[77] Carroll, Rory. “Israelis hesitant over Gaza ground invasion amid hostage fears, poll shows.” The Guardian, 27 October 2023. https://www.theguardian.com/world/2023/oct/27/israelis-hesitant-over-gaza-ground-invasion-amid-hostage-fears-poll-shows.

^[78] David Gritten, “Israel Targets Hamas’s Labyrinth of Tunnels Under Gaza,” BBC News, 13 October 2023,https://www.bbc.com/news/world-middle-east-67097124.

^[79] E-Interview with Brig. Gen. (Res.) Yosef Kuperwasser, former head of the Research Division at IDF’s Intelligence Corps, Jerusalem, Israel, 10 October 2023.

^[80] E-Interview with Dan Schueftan, former advisor to Prime Ministers Yitzhak Rabin and Ariel Sharon, Haifa, Israel, 18 October 2023.

Joe Biden, in concert with American public opinion, soured on the long U.S. military disasters in Iraq and Afghanistan and finally withdrew U.S. forces from the two-decade disaster in Afghanistan, even though other prior presidents lacked the courage to carry out what was likely to be—and was—a messy exit. Yet one must not lose sight of the fact that the very experienced and effective president is a traditional foreign policy interventionist who believes that the United States should continue to lead the world through military actions and informal and formal security alliances, pledging to protect other countries.

In a recent speech, Biden reiterated his advocacy of an expansive global U.S. security umbrella: “American leadership is what holds the world together. American alliances are what keep us, America, safe. American values are what make us a partner that other nations want to work with. To put all that at risk if we walk away…, it’s just not worth it.” Echoing their leader, other U.S. officials claim that alliances are a bastion of a “rules-based international order.”

And recently, given Russian aggression against Ukraine, Chinese assertiveness in East Asia and the South China Sea, and Iranian and North Korean advancement of their missile and nuclear programs, other countries have flocked to attempt to take advantage of the U.S. government’s pledging taxpayer dollars to defend ever more countries or strengthen existing American alliance commitments. In the wake of the Russian invasion of Ukraine, Finland joined NATO, and Sweden is on the cusp of entering the alliance. With an assertive China in mind, Japan, South Korea, Australia, and the Philippines have enhanced alliance cooperation with the United States. Under the Abraham Accords, the United States agreed to sell high-tech weapons to Arab despots. Crown Prince Mohammed bin Salman, the effective ruler of Saudi Arabia, had implausibly begun to threaten to reorient the desert kingdom’s security relationship toward China, including arms purchases unless the United States signed a security agreement to defend Saudi Arabia if it was attacked. Finally, despite the United States providing more than $100 billion dollars in military, economic, and humanitarian aid to help Ukraine beat back Russia’s invasion, Ukraine’s President Volodymyr Zelenskyy is demanding NATO membership or that the United States and Europe develop an alternative security guarantee to assist the Ukrainians deal with the future threat from Russia.

Understandably, after the twin U.S. quagmires of Iraq and Afghanistan—just as happened after the debacle in Vietnam fifty years before—some on both the left and right in America are currently reluctant to pour tens of billions of dollars more into helping even informal U.S. allies fight wars. After all, these informal and formal alliances have been set up for the United States to defend other countries, not for other countries to defend the United States—especially given the vast discrepancy between American military capabilities and those of all other allies, particularly in the ability to project power. Thus, President Biden’s assertion that so many alliances enhance U.S. security is questionable; in fact, perhaps these commitments only increase dramatically the possibility that the United States could be dragged into unnecessary, non-strategic, and costly wars.

The huge destruction and replacement of war machinery and expenditure of expensive ammunition in a single war in Ukraine should make Americans ask if the United States, with a yawning $33 trillion national debt, is not overextending itself by pledging formally and informally to defend a growing plethora of countries worldwide. Today, assisting informal allies in two wars right now is straining the U.S. budget, much as the long brushfire wars in Iraq and Afghanistan added greatly to the existing mountain of American debt. In the future, if two formal treaty allies came under simultaneous attack in two different theaters, the United States would be required to respond to both—thus likely generating taxpayer-funded outflows that would make the huge expenditures in Ukraine pale in comparison.

After World War II, the United States accounted for 50 percent of global GDP; now it accounts for only about 15 percent. Yet the United States—to defend itself and fulfill its security commitments to all these countries—accounts for about 40 percent of global military spending. This is considerable American overstretch, especially when most of the countries the United States defends or is thinking about defending are wealthy, can afford to spend more on their defense but don’t because of the U.S. security umbrella, and could also band together against bigger threats such as China or Russia. Thus, the immense expense of aiding two informal allies during wartime now should make American taxpayers reevaluate alliance commitments and extensive overseas foreign military aid.

This article was also published in The National Interest

The Biden administration has designated Laura Daniel-Davis, formerly Principal Deputy Assistant Secretary for Land and Minerals Management, as Acting Deputy Secretary of the Interior Department. DOI Secretary Deb Haaland praised the appointment, but the people have room for doubt.

“Laura Daniel-Davis has the experience and qualifications to lead Interior’s lands and minerals agencies to tackle climate change,” said Earthjustice in a statement, “and we urge the full Senate to swiftly confirm her.” It didn’t happen.

The Senate Energy and Natural Resources Committee rendered a tie vote on the Biden pick. All Republicans opposed her and West Virginia Democrat Joe Manchin also had his doubts. The Senate failed to act and that forced a re-nomination.

With the recent move, Daniel-Davis, a former Deputy Chief of Staff to then-Representative Mark Udall of Colorado, has gained the post without full Senate confirmation. As American workers will recall, that is also the case with Julie Su, Joe Biden’s pick to run the Labor Department.

Several Democrats were wary of her, and the Senate never held a vote. Then on September 21, General Accountability Office lawyer Edda Emmanuelli Perez ruledthat “as the Deputy Secretary of Labor, Ms. Su may serve as Acting Secretary under section 552 until a successor is appointed,” because “The Vacancies Act’s time limitations do not apply to her service.”

All the Biden administration need do is hold off on a successor, and Julie Su runs the department without Senate confirmation. Taxpayers and workers will find it hard to square that with any form of accountability. For one thing, Julie Su is an anti-worker ideologue.

As California labor commissioner Su supported Assembly Bill 5, a frontal assault on workers’ independence. Primarily targeting independent truckers and rideshare drivers, AB-5 also limited freelance writers, photographers, and videographers to 35 submissions per publication, per year.

Asked in June if AB-5 was a good law, Su replied, “I don’t know what you mean.” As Californians know all too well, she is an administrator of fathomless incompetence.

Su headed California’s Labor and Workforce Development Agency (LWDA), which oversees the Employment Development Department (EDD) responsible for unemployment claims. On Su’s watch, the EDD sent more than $31 billion in fraudulent unemployment claims to California, out of state, and out of country.

According to USA Today, “the state approved more than $140 million for at least 20,000 prisoners.” Convicts who made fraudulent claims included convicted murderers Scott Peterson and Cary Stayner. Death row inmates accounted for at least 158 claims landing more than $420,000 in benefits.

Rapper Nuke Bizzle posted a video about the ease of ripping off EDD and scammers filed hundreds of fake claims, “including one in the name of California Sen. Dianne Feinstein.” While this massive fraud carried on unchecked, legitimate claimants waited months to collect the benefits they deserved.

Like Lenin scholar Saule Omarova, Biden’s nominee for Comptroller of the Currency, Julie Su shapes up as the worst possible pick. She gets to run the Labor Department without Senate confirmation, and the administration has now pulled off the same trick with Laura Daniel-Davis.

“This appointment is yet another example of this Administration disregarding Congress and elevating nominees when they are unable to get the bipartisan support needed for confirmation,” said a statement by Sen. Joe Manchin, chairman of the Energy and Natural Resources Committee. “Their insistence on ignoring the confirmation process to advance their agenda undermines the role of the Senate and should be troubling to everyone.”

Sen. Tom Barrasso (R-Wyo), the committee’s ranking member, called the appointment “a mistake” citing the administration’s “complete lack of interest or respect for affordable, available energy to the American people.” The basic problem is not hard to spot.

The federal bureaucracy, including the General Accountability Office, is not a branch of government. GAO general counsel Edda Emmanuelli Perez, former manager of “opportunity and inclusiveness” at the agency, is not a federal judge.

Perez is on record that “past nominations may disadvantage a newly inaugurated president by limiting the acting service period in the new administration.” Her ruling on Julie Su effectively voids the role of the U.S. Senate, which is a branch of government.

This ruse begs for a ruling from the Supreme Court and legislators need to get a case rolling. If not, incompetence and ideology will rule, and the people will be ever more distant from their government.

This article was also published in The American Spectator

By Luke Coffey

Since Russia invaded Ukraine for the second time in eight years, Russian troops have ravaged Ukraine’s cities, raped its women, and stolen its children. Russian missiles and Iranian drones strike Ukrainian cities daily, often hitting civilian targets. Russia is the aggressor. Ukraine is the victim.

For Americans who believe in respect for national borders, the primacy of national sovereignty, and the right to self-defense, support for Ukraine is natural. Ukrainians are not asking for, nor do they want, US troops to help them fight Russia. All they ask for is the resources required to give them a fighting chance.

Meanwhile, Russia is among America’s top geopolitical adversaries. As former Secretary of State and Hudson Distinguished Fellow Mike Pompeo said last week, a Russian victory “would be felt well beyond Ukraine’s borders, including by strengthening a Russia-China-Iran alliance that aims to weaken the US and our allies across the globe.”

As Congress debates additional support for Ukraine, detractors will spread false and misleading information. It is important to understand the facts.

Fact: The US is not writing “blank checks” to Ukraine, and most of the money allocated to help Ukraine never leaves the US.

Every dollar spent in support of Ukraine is authorized by Congress and used for a specific purpose. There has never been a “blank check” to Ukraine.

Approximately $70 billion of the aid authorized for Ukraine will never leave the US. Instead, it supports our world-leading defense industry and creates well-paid jobs across 38 states.

After witnessing the effectiveness of US military equipment in Ukraine, European countries alone have placed $90 billion in orders for American-made military hardware. This makes America safer and creates well paid jobs for Americans.

Fact: For a relatively modest amount of money, US aid helps Ukraine dismantle Russia’s armed forces without a single American firing a shot or being shot at.

Russia is a top geopolitical adversary of the United States, and a close ally of China, Iran, and North Korea.

Estimates vary, but up to 300,000 Russian troops have been killed or wounded in Ukraine. The original Russian invasion force from February 2022 has effectively ceased to exist.

Open source reporting has collected visual evidence that Russia has lost more than 12,900 major pieces of equipment in Ukraine by the time of this writing. Since this number is limited to visually confirmed losses, the actual number is likely far higher. 

These losses include: 2,439 main battle tanks, 1,026 armored fighting vehicles, 2,977 infantry fighting vehicles, 368 armored personnel carriers, 914 pieces of artillery, 201 multiple rocket launchers, 93 aircraft (including three strategic bombers), 132 helicopters, and likely thousands of other pieces of military hardware.

Ukraine has destroyed or damaged 16 ships and submarines, including the guided missile cruiser Moskva (previously the flagship of the Black Sea Fleet) and the submarine Rostov-on-Don. Their destruction supports broader US security objectives outside the Black Sea. For example, Russia has used both vessels to support Bashar al-Assad in Syria.

Fact: There has never been more accountability for US military assistance than what is available for Ukraine aid.

Soon after Russia’s invasion, the US government established the Ukraine Oversight Interagency Working Group. More than 160 officials across 20 federal oversight agencies monitor US aid to Ukraine.

To date, Congress has allocated $50 million for the inspectors general of the Department of Defense, Department of State, and the US Agency for International Development (USAID) to increase oversight through the working group.

The groups have completed dozens of reports, with dozens more in the works. According to the working group, “Investigations related to the Ukraine response have not yet substantiated significant waste, fraud, or abuse.”

The White House’s proposed Ukraine supplemental will add another $15 million to fund additional oversight activities. Among other things, this additional funding will allow the State Department’s Office of the Inspector General to “increase inspections and investigations beyond its 27 current and planned projects that span foreign assistance, management, and operational activities.”

Fact: Europe has spent more than the US on Ukraine aid. 

According to the Kiel Institute for the World Economy’s Ukraine aid tracker, total European commitments are now more than double those of the US after totaling all aid (military, economic, humanitarian, and refugee).

Twenty European countries have given more to Ukraine than the US as a percentage of GDP.

Fact: A victorious Ukraine means a safer Taiwan. 

The choice between security in Europe or security in the Indo-Pacific is a false dichotomy. In terms of US national interests, the two regions are intimately linked.

Russia is China’s junior partner. A weakened or defeated Russia means a weaker China. Beijing is watching how Western powers support Ukraine, so a strong and victorious Ukraine makes Taiwan stronger and deters Chinese aggression.

It’s no coincidence that earlier this year, Japanese Prime Minister Fumio Kishida visited Ukraine while Chinese President Xi Jinping visited Russia. During this visit, Xi told Vladimir Putin, “Now there are changes that haven’t happened in 100 years. When we are together, we drive these changes.”

In Kishida’s own words, “The security of the Indo-Pacific region cannot be separated from European security.”

Fact: European stability, which Russia is trying to undermine, affects the American worker.

North America and Europe account for approximately 48 percent of the global economy.

Europe is America’s largest source of foreign investment. In 2021, Europe accounted for $3.19 trillion out of a total of $4.98 trillion of foreign capital investment in the US, or about 64 percent.

The US and Europe are each other’s largest export markets. In 2022, 45 out of 50 states—including the largest single-state economy, California—exported more goods to Europe than to China.

Europe matters to the American heartland too. Arkansas, Kentucky, and Oklahoma each export five times more to Europe than China.

When Americans build something to be exported, that protects American jobs. European stability brings untold benefits to the US economy and, by extension, to the American worker. Aiding Ukraine helps preserve that stability.

Fact: The lessons the US learns from Ukraine will make America stronger in the Indo-Pacific.

Supporting Ukraine has exposed major shortcomings in the American defense industrial base, which the US is now addressing. Thankfully, these shortcomings were uncovered when America was not directly at war.

Deployment in Ukraine has tested American-made military hardware in a way that is impossible in peacetime. The US is learning what works, what doesn’t work, and how to make improvements. This prepares America for future warfare to a degree that is unachievable through exercises alone.

The US is replacing all the weapons it gives to Ukraine with newer, more effective systems.

As Taiwanese President Tsai Ing-wen said, “Russia’s invasion of Ukraine was a wake-up call to us all.” Because of their support for Ukraine, US allies and partners in East Asia are spending more on defense to better prepare for future threats.

Fact: The weapons the US is sending to Ukraine do not impact America’s ability to fight an Indo-Pacific conflict.

Guided Multiple Launch Rocket System (GMLRS) rockets, older AGM-88 and AGM-88E air to surface anti-radiation missiles, and AIM-7 and AIM-9M interceptors, which the US is sending to Ukraine, are either irrelevant to an Indo-Pacific fight or are expiring anyway.

The most effective way to use these weapons is to send them to Ukraine. The 10,000 Javelins or the 2,000 Stingers that the US has given to Ukraine will not be a determining factor in whether the US can deter a Chinese invasion of Taiwan. But they were the determining factor that allowed Ukraine to defend Kyiv in the beginning weeks of the war.

America’s weapons of choice in a conflict against China will be torpedoes, the AGM-158 JASSM and AGM-158C LRASM strike missiles, naval mines, and Tomahawk cruise missiles. None of these have been provided to Ukraine.

Fact: Because of lessons the US learned by arming Ukraine, Taiwan is receiving weapons sooner.

For the first time, the presidential drawdown authority (PDA), which has been used so effectively for Ukraine, is being used to arm Taiwan. Had the US not supported Ukraine, it is unlikely that Washington would have used the PDA to arm Taiwan.

Congress has authorized up to $1 billion in weapons for Taiwan using PDA.

In July 2023, the US announced a $345 million military aid package for Taiwan as part of the $1 billion in PDA approved by Congress.

Even though the lethal High Mobility Artillery Rocket System (HIMARS) is in high demand from US allies and partners, Taiwan’s order for additional HIMARS will now arrive one year earlier than planned because the US reprioritized the sale.

Fact: Iran and North Korea enable Russia to attack Ukraine. Russia supports Hamas. 

Some of America’s top adversaries, and the enemies of America’s closest allies and partners, have aligned with Russia.

By the end of 2022, Iran had provided more than 1,700 drones to Russia for use in Ukraine. Earlier this year, Moscow and Tehran agreed to start producing around 6,000 Iranian-designed drones in Russia. Meanwhile, Iran and its proxies are using the same drones to threaten Israel and attack US troops in the Middle East.

North Korea has reportedly delivered more than one million artillery rounds to Russia for use in Ukraine. There have also been reports that North Korea has provided ballistic missiles to Russia.

Russia regularly votes in the United Nations Security Council and General Assembly to protect Hamas—even as Hamas commits atrocities against Israel. In October, only weeks after the group’s terrorist attack against innocent Israeli civilians, Russia received a Hamas delegation in Moscow.

Fact: Ukraine is not a new “forever war.”

Not a single US service member is fighting against Russia in Ukraine. 

The US is not a belligerent in the conflict between Russia and Ukraine. 

Ukrainians are not asking for, nor do they want, US troops to help them fight Russia. All they ask for is resources, which the US is more than capable of providing.

Fact: The US is not engaged in a proxy war against Russia.

The definition of a proxy war is a war “fought by states acting at the instigation or on behalf of other states.”

The US has never instigated Ukrainians to fight. The US is not forcing the Ukrainians to fight on its behalf. The US is merely fulfilling Ukrainians’ requests for weapons and assistance as they fight a war of self-defense.

Ukrainians are fighting a war of national survival. Russia invaded Ukraine, not the other way around. Russia is the aggressor and Ukraine is the victim.

If Russia stops fighting, the war will be over. If Ukraine stops fighting, Ukraine as it is known today will be over.

Fact: The US needs to provide both military and nonmilitary aid to achieve the greatest effect.

Some propose providing only one type of aid as a compromise with those who do not want to provide any aid to Ukraine. However, this proposal is a half measure and would yield disappointing results.

The Ukrainian military is not the only actor defending against Russia. As shown by Russia’s indiscriminate targeting of civilians with ballistic missiles and Iranian drones, the whole of Ukrainian society is at war.

The first year of Russia’s invasion eliminated almost 30 percent of Ukraine’s economy. Even so, Ukraine’s government and essential public services (law enforcement and first responders, diplomats, utility workers, etc.) need to function properly for the nation to remain on a total war footing.

US support needs to be broad in scope. Those who call for the US to give only military support fail to see the bigger picture in Ukraine.

Fact: Claims that US aid to Ukraine has cost “$900 per American household” and that the newly proposed aid package will add “over $1,000” to the tax burden of “every family of four in America” are wildly misleading.

These numbers are often used to mislead Americans into thinking that they are shouldering an unnecessary financial burden to help Ukraine amid economic difficulties and high inflation at home.

These numbers are misleading because federal income tax is not levied evenly across households.

In 2020, the most recent year for which data is available, the top 1 percent of earners paid 42.3 percent of all federal income tax. The bottom 50 percent of taxpayers (those making $42,184 or less) paid only 2.3 percent of all federal income tax.

Approximately 60 million tax returns reported income of $30,000 or less. The effective average tax rate for this group was 1.5 percent before any tax credits were applied.

By Thorsten Polleit

In the international fixed-income markets, interest rates are rising, and the decades-long trend of declining bond yields has undoubtedly been broken. On August 2, 2022, the ten-year United States Treasury yield was 0.5 percent; on October 9, 2023, it had risen to 4.8 percent. Long-term interest rates in Europe, Asia, and Latin America have also risen sharply. The key reason for the rise in capital market interest rates is the central banks’ interest rate hikes—a direct response to sky-high inflation (caused by the central banks themselves, following a huge increase in the quantity of money).

Initially, financial markets expected only a relatively short phase of increased interest rates. At the beginning of March 2022, the US long-term interest rate fell below the short-term yield—so the yield curve became “inverted,” a clear indication that investors expected short-term interest rates to be cut sooner rather than later.

However, since July 2023 at the latest, long-term interest rates have been rising strongly and unabatedly. Something very fundamental has presumably happened—investors are no longer willing to hold US government debt at ultra-low yields as before. Where did the change of heart come from?

Investors may have become increasingly aware of the enormous debt problem in the US, which investors had taken lightly for so long: Uncle Sam is sitting on a mountain of debt worth more than thirty-three trillion US dollars, which is equivalent to around 123 percent of US gross domestic product (GDP). Plus, the debt dynamic is relentless: by the end of the decade, the debt could reach fifty trillion US dollars. Previous large buyers of US debt—such as Japan, China, Brazil, Russia, and Saudi Arabia—are no longer interested. Who will buy the huge flood of new US government bonds intended to finance deficits of around 6 percent of GDP in the coming years?

It appears that the US administration has squandered a lot of investor confidence, not least by freezing Russia’s foreign reserves at the beginning of 2020. It has since become abundantly clear to many investors from non-Western countries that US investments carry a political risk for them. Therefore, anyone who holds US dollars or invests in US debt securities demands a higher interest rate. It’s not just the US feeling the effects of this interest rate shock; the rest of the world isn’t spared either. The increased credit costs will make life difficult or even unaffordable for many debtors—consumers and producers.

The result will be an economic slowdown, more likely even a recession because loan defaults are already increasing again and will likely dry up the credit market. The flow of new credit and money into the system will dwindle, and the demand for goods will decline. This will be particularly problematic for many highly indebted countries. The mountains of debt they have accumulated and continue to increase are the result of a so-called Ponzi scheme—named after its “inventor” Charles Ponzi, probably the greatest fraudster of his time.

The state Ponzi scheme goes like this: States go into debt, and when the debt comes due years later, the states pay it off by taking on new debt—increasing the existing debt load. Investors buy the government bonds because they assume that there will be investors in the future who will buy the newly issued government bonds. In turn, these future investors assume that, in the even more remote future, there will also be investors who will buy the new debt that will be issued then. So on and so forth. Of course, no one here expects actual repayment, and to be true, repayment of the debt is impossible.

Now, interest rates have fallen over the last four decades, and the fraudulent game has worked quite well—for the states and the special interest groups that seek to harness this game for their own purposes. States could easily accumulate more and more debt, and the debt that became due could be refinanced with loans at ever-lower interest rates. Now, however, the situation has changed dramatically.

As I said, interest rates are rising while debt is already very high, and there will probably be a rude awakening soon. Investors have to fear a deterioration in the debt sustainability of many countries—especially since the probability that any country will abandon their debt-accumulating spending is fairly low. So, the expectation that there will be investors willing to subscribe to newly issued bonds at relatively low interest rates will be disappointed in the future.

Then, it won’t be long before investors start to worry and panic—because they understand that the foreseeable increase in debt-related interest payments will crush many states’ finances. The painful truth is that there is no easy way out of a Ponzi scheme—at least none that would not demystify the national debt and all the lies and deception that go with it.

Maybe the bond markets will calm down again before things get explosive? Will US long-term interest rates find a new footing at, say, 5.5 to 6.0 percent? Will interest rates like in the 1980s—bond yields of more than 10 percent—return? The correct answer to these questions is of utmost importance for investment success.

In my opinion, an imminent end to the rise in interest rates on both sides of the Atlantic is rather likely. After all, officially measured inflation is already falling noticeably, and banks are putting the brakes on lending. The money supply in the major economies is already shrinking as a result of central bank interest rate increases, and the consequences of this shrinking will force economic activity to its knees. Then, once the economy contracts and mass unemployment hits like a tidal wave, it is very likely that interest rate increases will be reversed soon.

Moreover, it should also be borne in mind that the powerful “fiat money system”—the collusion of states, banks, major institutional investors, and large companies—will not be so easy to upset. Should the rise in interest rates become too strong from a political point of view, yet another deep dive into the bag of tricks can be expected. Central banks, for example, will start buying government bonds again, thereby fixing long-term and short-term interest rates at “reasonable” levels. Of course, all of these monetary policy tricks basically amount to one thing: paying off the outstanding bills with newly created money—or in other words, inflation policy.

That is the big lesson that can be drawn from the interest rate shock resulting from the Ponzi scheme in the debt markets: the systematic decline in the purchasing power of money, even if short-term relief is granted, is almost certain.

About the author: Dr. Thorsten Polleit is Chief Economist of Degussa and Honorary Professor at the University of Bayreuth. He also acts as an investment advisor.

Source: This article was published by the Mises Institute