13. In 1939, the British government created a ceiling of 10,000 Jewish immigrants per year into Palestine, with an additional allotment of 25,000 possible entries. It is true that in 1945, President Harry Truman requested a U.S. government investigation of treatment of Jewish displaced persons, many of whom were in facilities overseen by the U.S. Army. “The resulting report chronicled shocking mistreatment of the already abused refugees and recommended that the gates of Palestine be opened wide for resettlement,” writes Leonard Dinnerstein in America and the Survivors of the Holocaust (New York: Columbia University Press, 1986). After several unsuccessful attempts to persuade Great Britain to admit the Jews into Palestine, Truman asked Congress to pass a law to bring a number of these refugees to the States.
While Truman’s bill became law in 1948, the year of Israel’s founding, a group of legislators, led by Nevada senator Pat McCarran, manipulated the drafting of the bill’s language so that it actually had the effect of discriminating against Eastern European Jews. Ultimately, historian Leonard Dinnerstein estimates, only about 16 percent of those issued visas as displaced persons between July 1948 and June 1952 were Jewish. “Thus McCarran’s numerous tricks and ploys were effective,” notes Dinnerstein. “Jews who might otherwise have chosen the United States as their place of resettlement went to Israel.”
14. The document can be found at http://www.jewishvirtuallibrary .org/jsource/History/Dec_of_Indep.html.
15. Interview with David McWilliams, Irish economist and author of The Pope’s Children, March 2009.
16. This is not to suggest that there are not ethnic tensions among this very diverse country. Deep friction erupted between European Holocaust refugees and Jews from the Arab world as far back as the state’s founding. Sammy Smooha, today a world-renowned sociologist at the University of Haifa, was, like Reuven Agassi, an Iraqi Jewish immigrant who spent part of his childhood in a transit tent. “We were told not to speak Arabic, but we didn’t know Hebrew. Everything was strange. My father went from being a railroad official in Baghdad to an unskilled nobody. We suffered a terrible loss of identity. Looking back, I’d call it cultural repression. Behind their lofty ideals of ‘one people,’ they [the Jews of European origin] were acting superior, paternalistic.” Quoted in Donna Rosenthal, The Israelis: Ordinary People in an Extraordinary Land (New York: Free Press, 2005), p. 116.
CHAPTER 8
. The Diaspora: Stealing Airplanes
1. Fred Vogelstein, “The Cisco Kid Rides Again,” Fortune, July 26, 2004; http://money.cnn.com/magazines/fortune/fortune_archive/2004/07/26/377145/index.htm; and interview with Michael Laor, founder of Cisco Systems Development Center in Israel, February 2009.
2. Marguerite Reardon, “Cisco Router Makes Guinness World Records,” July 1, 2004, CNET News, http://news.cnet.com/Cisco-router -makes-Guinness-World-Records/2100-1033_3-5254291.html?tag=nefd .top; retrieved January 2009.
3. Vogelstein, “The Cisco Kid Rides Again.”
4. Marguerite Reardon, “Cisco Sees Momentum in Sales of Key Router,” TechRepublic, December 6, 2004, http://articles.techrepublic .com.com/5100-22_11-5479086.html; and Cisco, press release, “Growth of Video Service Delivery Drives Sales of Cisco CRS-1, the World’s Most Powerful Routing Platform, to Double in Nine Months,” April 1, 2008, http://newsroom.cisco.com/dlls/2008/prod_040108c.html.
5. Interview with Yoav Samet, Cisco’s corporate business development manager in Israel, Central/Eastern Europe, and Russia/CIS, January 2009.
6. Interview with Yoav Samet.
7. Richard Devane, “The Dynamics of Diaspora Networks: Lessons of Experience,” in Diaspora Networks and the International Migration Skills, edited by Yevgeny Kuznetsov (Washington, D.C.: World Bank Publications, 2006), pp. 59–67. The quote is from p. 60.
8. Jenny Johnston, “The New Argonauts: An Interview with AnnaLee Saxenian,” July 2006, GBN Global Business Network, http://thenewar gonauts.com/GBNinterview.pdf?aid=37652.
9. The information in this passage is drawn from Anthony David, The Sky Is the Limit: Al Schwimmer, the Founder of the Israeli Aircraft Industry (Tel Aviv: Schocken Books, 2008; in Hebrew); and the interview with Shimon Peres. Regarding the accounts of Peres and Schwimmer flying over the Arctic tundra and Schwimmer’s meeting with Ben-Gurion in the United States, see also Shimon Peres, David’s Sling (New York: Random House, 1970).
CHAPTER 9
. The Buffett Test
1. Interview with Yoelle Maarek, former director, Google’s R & D Center in Haifa, Israel, January 2009.
2. Joel Leyden, “Microsoft Bill Gates Takes Google, Terrorism War to Israel,” Israel News Agency, 2006, http://www.israelnewsagency.com/microsoftgoogleisraelseo581030.html; retrieved November 2008.
3. Quote from a transcript of a documentary film interview conducted by the American Israel Public Affairs Committee (AIPAC) in 2007, provided to the authors.
4. Dan Senor is an investor in Vringo.
5. Interview with Alice Schroeder, author of The Snowball, 2008.
6. Uzi Rubin, “Hizballah’s Rocket Campaign Against Northern Israel: A Preliminary Report,” Jerusalem Issue Brief, vol. 6, no. 10 (August 31, 2006), http://www.jcpa.org/brief/brief006-10.htm.
7. Interview with Eitan Wertheimer, chairman of the board of Iscar, January 2009.
8. Dov Frohman with Robert Howard, Leadership the Hard Way: Why Leadership Can’t Be Taught—and How You Can Learn It Anyway (San Francisco: Jossey-Bass, 2008), pp. 1–16. All quotes from Frohman in this passage come from this book.
9. Interviews in this passage with senior Intel executive were on background, December 2008.
10. Interview with Eitan Wertheimer.
CHAPTER 10
. Yozma: The Match
1. Jennifer Friedlin, “Woman on a Mission,” Jerusalem Post, April 20, 1997.
2. Interview with Orna Berry, partner in Gemini Israel Funds, and chairperson of several Gemini portfolio companies, January 2009.
3. Interview with Jon Medved, CEO and board member, Vringo, May 2008.
4. Interview with Yigal Erlich, founder, chairman, and managing partner of the Yozma Group, May 2008.
5. Gil Avnimelech and Morris Tuebal, “Venture Capital Policy in Israel: A Comparative Analysis and Lessons for Other Countries,” research paper, Hebrew University School of Business Administration and School of Economics, October 2002, p. 17.
6. The information about BIRD’s founding is from an interview with Ed Mlavsky, chairman and founding partner of Gemini Israel Funds, December 2008.
7. BIRD (Israel-U.S. Binational Industrial Research and Development Foundation), “BIRD Foundation to Invest $9 Million in 12 Advanced Development Projects in Life Sciences, Energy, Communications, Software and Nanotechnology,” http://www.birdf.com/_Uploads/255BOG08PREng.pdf.
8. Dan Breznitz, Innovation of the State (New Haven: Yale University Press, 2007), p. 60.
9. Ed Mlavsky in a PowerPoint slide presentation to Wharton MBA students, 2008.
10. Interview with Jon Medved.
11. Interview with Yigal Erlich.
12. Ibid.
13. Interview with Orna Berry.
14. Yossi Sela, managing partner, Gemini Venture Funds, http://www.gemini.co.il/?p=TeamMember&CategoryID=161&MemberId=197.
15. Interview with Erel Margalit.
16. David McWilliams, “Ireland Inc. Gets Innovated,” Sunday Business Post On-Line, December 21, 2008, http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=DAVID+McWilliams-qqqs=commentandanalysis-qqqid=38312-qqqx=1.asp; retrieved January 2009.
17. Interview with Tal Keinan, cofounder of KCPS, May and December 2008.
18. Interview with Ron Dermer, former economic attaché, Embassy of Israel in United States, and senior adviser to Prime Minister Benjamin Netanyahu, September 2008.
19. Interview with Benjamin Netanyahu, prime minister of Israel, December 2008.
CHAPTER 11
. Betrayal and Opportunity
Epigraph: Quoted in Julie Ball, “Israel’s Bo
oming Hi-Tech Industry,” BBC News, October 6, 2008, http://news.bbc.co.uk/2/hi/business/7654780.stm; retrieved January 2009.
1. John Kao, Innovation Nation (New York: Free Press, 2007).
2. Michael Bar-Zohar, Shimon Peres: The Biography (New York: Random House, 2007). p. 223. Also Reuters, “Peres Biography: Israel, France Had Secret Pact to Produce Nuclear Weapons,” May 30, 2007.
3. Michael M. Laskier, “Israel and Algeria amid French Colonialism and the Arab-Israeli Conflict, 1954–1978,” Israel Studies, June 2, 2001, pp. 1–32, http://muse.jhu.edu/journals/israel_studies/v006/6.2laskier.html; retrieved September 2008.
4. De Gaulle quoted in Alexis Berg and Dominique Vidal, “De Gaulle’s Lonely Predictions,” Le Monde Diplomatique, June 2007, http://monde diplo.com/2007/06/10degaulle; retrieved September, 2008.
5. Quoted in Berg and Vidal, “De Gaulle’s Lonely Predictions.”
6. “Israel’s Fugitive Flotilla,” Time, January 12, 1970, http://www.time.com/time/magazine/article/0,9171,942140,00.html.
7. Stewart Wilson, Combat Aircraft Since 1945 (Fyshwick, Australia: Aerospace Publications, 2000), p. 77.
8. Ruud Deurenberg, “Israel Aircraft Industries and Lavi,” Jewish Virtual Library, January 26, 2009, http://www.jewishvirtuallibrary.org/jsource/Society_&_Culture/lavi.html.
9. James P. DeLoughry, “The United States and the Lavi,” Airpower Journal vol. 4, no. 3 (1990), pp. 34–44, http://www.fas.org/man/dod-101/sys/ac/row/3fal90.htm.
10. Interview with Yossi Gross, director and cofounder of TransPharma Medical, and founder of many medical-device start-ups, December 2008.
CHAPTER 12
. From Nose Cones to Geysers
1. Interview with Doug Wood, head of creative affairs, Animation Lab, May 2008.
2. Interview with Yuval Dotan (fictitious name), December 2008.
3. Manuel Trajtenberg and Gil Shiff, “Identification and Mobility of Israeli Patenting Inventors,” Discussion Paper No. 5-2008, Pinchas Sapir Center for Development, Tel Aviv University, April 2008.
4. John Russell, “Compugen Transforms Its Business,” Bio-ITWorld .com, October 17, 2005, http://www.bio-itworld.com/issues/2005/oct/bus-compugen?page:int=-1.
5. Interview with Ruti Alon, partner, Pitango Venture Capital, and chairperson, boards of BioControl, BrainsGate, and TransPharma Medical, December 2008.
CHAPTER 13
. The Sheikh’s Dilemma
1. Interview with Michael Porter, professor of economics, Harvard Business School, March 2009.
2. Rhoula Khalaf, “Dubai’s Ruler Has Big Ideas for His Little City-State,” Financial Times, May 3, 2007.
3. Michael Matley and Laura Dillon, “Dubai Strategy: Past, Present, Future,” Harvard Business School, February 27, 2007, p. 3.
4. Quoted in Assaf Gilad, “Silicon Wadi: Who Will Internet Entrepreneurs Turn to in Crisis?” Cataclist, September 19, 1998.
5. Saul Singer, “Superpower in Silicon Wadi,” Jerusalem Post, June 19, 1998.
6. Quoted in Steve Lohr, “Like J. P. Morgan, Warren Buffett Braves a Crisis,” New York Times, October 5, 2008.
7. Quoted in Eyal Marcus, “Israeli Start-ups Impress at TechCrunch50,” Globes Online, September 14, 2008.
8. James C. Collins and Jerry I. Porras, Built to Last: Successful Habits of Visionary Companies (New York: HarperCollins, 1997), pp. xix, 224.
9. Barbara W. Tuchman, Practicing History: Selected Essays (New York: Ballantine Books, 1982), quoted in Collins and Porras, Built to Last, p. xix.
10. Interview with Riad al-Allawi, Jordanian entrepreneur, March 2009.
11. Fadi Ghandour, in Stefan Theil, “Teaching Entrepreneurship in the Arab World,” Newsweek International, August 14, 2007; also available at http://www.gmfus.org/publications/article.cfm?id=332; retrieved March 2009.
12. Bernard Lewis, “Free at Last? The Arab World in the Twenty-first Century,” Foreign Affairs, March/April 2009. Similar observation has been made by Samuel Huntington.
13. Quoted in Christopher M. Davidson, Dubai: The Vulnerability of Success (New York: Columbia University Press, 2008), p. 166.
14. UNDP (United Nations Development Programme), The Arab Human Development Report, 2005: Towards the Rise of Women in the Arab World (New York: United Nations Publications, 2006).
15. Interview with Christopher M. Davidson, author of Dubai: The Vulnerability of Success, March 2009.
16. Quoted in Fannie F. Andrews, The Holy Land Under Mandate, vol. 2 (Boston: Houghton and Mifflin, 1931), p. 4.
17. Hagit Messer-Yaron, Capitalism and the Ivory Tower (Tel Aviv: Ministry of Defence Publishing, 2008), p. 82.
18. America-Israel Friendship League, “Facts About Israel and the U.S.,” http://www.aifl.org/html/web/resource_facts.html.
19. McKinsey & Company, “Perspective on the Middle East, North Africa and South Asia (MENASA) region,” July 2008. All of the data in this section comes from this study.
20. David Landes, The Wealth and Poverty of Nations (New York: Norton, 1999), pp. 412–13.
CHAPTER 14
. Threats to the Economic Miracle
1. Quoted in Joanna Chen, “The Chosen Stocks Rally,” Newsweek, March 14, 2009, http://www.newsweek.com/id/189283.
2. Amiram Cohen, “Kibbutz Industries Also Adopt Four-Day Workweek,” Haaretz, March 12, 2009, http://www.haaretz.com/hasen/spages/1070086.html.
3. Interview with Benjamin Netanyahu, prime minister of Israel, December 2008.
4. Jennifer Evans, “Best Places to Work for Postdocs 2009,” The Scientist.com, vol. 23, no. 3, p. 47, http://www.the-scientist.com/bptw.
5. Interview with Dan Ben-David, Department of Economics, Tel Aviv University, June 2008.
6. Israel’s overall workforce participation level is 55 percent among adults, among the lowest in the West. The overall average is pulled down mainly by the extremely low workforce-participation levels of two minority groups: ultra-Orthodox Jews (40 percent participation) and Arab women (19 percent participation). These figures are cited in the Israel 2028 report, which recommends working to raise workforce participation rates of ultra-Orthodox Jews and Arab women to 55 percent and 50 percent, respectively, by 2028. U.S.-Israel Science and Technology Foundation, Israel 2028: Vision and Strategy for Economy and Society in a Global World, edited by David Brodet (n.p.: U.S.-Israel Science and Technology Foundation, March 2008).
7. Dan Ben-David, “The Moment of Truth,” Haaretz, February 6, 2007. Also reprinted with graphs on Dan Ben-David’s Web site: http://tau.ac.il/~danib/articles/MomentOfTruthEng.htm.
8. Helmi Kittani and Hanoch Marmari, “The Glass Wall,” Center for Jewish-Arab Economic Development, June 15, 2006, http://www.cjaed.org.il/Index.asp?ArticleID=269&CategoryID=147&Page=1.
9. Quoted in Yoav Stern, “Study: Israeli Arab Attitudes Toward Women Undergoing Change,” Haaretz, March 14, 2009, http://www.haaretz .com/hasen/spages/1008797.html.
10. U.S.-Israel Science and Technology Foundation, Israel 2028, p. 39.
11. Reut Institute, “Last Chance to Become an Economic Superpower,” March 5, 2009, http://reut-institute.org/en/Publication .aspx?PublicationId=3573.
12. Thomas Friedman speech at Reut Institute conference, Tel Aviv, June 2008.
Conclusion: Farmers of High Tech
1. Organisation for Economic Co-operation and Development (OECD) and European Patent Office, “Compendium of Patent Statistics,” 2008, http://www.oecd.org/dataoecd/5/19/37569377.pdf.
2. Interview with Antti Vilpponen, founder, ArcticStartup, January 2009.
3. Craig L. Pearce, “Follow the Leaders,” Wall Street Journal/MIT Sloan Management Review, July 7, 2008, http://sloanreview.mit.edu/business-insight/articles/2008/3/5034/follow-the-leaders/.
4. Quoted in Gallup, “Gallup Reveals the Formula for Innovation,” Gallup Management Journal, May 10, 2007, http://gmj.gallup.com/content/27514/Gallup-Reveals-the-Formula-for-%20Innovation.aspx.
5. Dov Frohman and Robert Howard, Leadership the Hard Way: Why Lea
dership Can’t be Taught—and How You Can Learn It Anyway (San Francisco: Jossey-Bass, 2008), p. 7.
6. Quoted in Ronald Bailey, “Post-Scarcity Prophet: Economist Paul Romer on Growth, Technological Change, and an Unlimited Human Future,” Reason Online, December 2001, http://www.reason.com/news/show/28243.html.
7. Ronald Bailey, “Post-Scarcity Prophet”; and Paul Romer, “Economic Growth,” both in The Concise Encyclopedia of Economics, edited by David R. Henderson (Indianapolis: Liberty Fund, 2007), http://www.stanford.edu/~promer/EconomicGrowth.pdf.
BIBLIOGRAPHY
PUBLISHED SOURCES
Abadi, Jacob. “Israel’s Quest for Normalization with Azerbaijan and the Muslim States of Central Asia.” Journal of Third World Studies, Fall 2002.
Agassi, Shai. “Tom Friedman’s Column.” The Long Tailpipe: Shai Agassi’s Blog, July 26, 2008, http://shaiagassi.typepad.com/.
Alamaro, Moshe. “The Economics of Peace.” Harvard Business Review, vol. 80, no. 11 (November 2002).
Andrews, Fannie F. The Holy Land Under Mandate. Vols. 1 and 2. Boston: Houghton and Mifflin, 1931.
Arlosoroff, Meirav. “Once Politicians Died Poor.” Haaretz, June 8, 2008.
Austin, Robert D., and Carl Stormer. “Miles Davis: Kind of Blue.” Harvard Business School Case 609-050, October 2008. Case Library, Harvard Business Publishing.
Avishai, Bernard. “Israel’s Future: Brainpower, High Tech, and Peace,” Harvard Business Review, November 1991.
Avnimelech, Gil, and Morris Teubal. “Venture Capital Policy in Israel: A Comparative Analysis and Lessons for Other Countries.” Research paper. Hebrew University School of Business Administration and School of Economics, October 2002.
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