In an upscale Tel Aviv neighbourhood – the kind filled with joggers, beach bars and hotels that attract wealthy holidaymakers – Tahli Engel, formerly of Melbourne, tells a story you hear a lot in Israel, and it captures one of the most important, but least understood, perspectives emerging from the wars triggered by October 7. “Life in Melbourne, absolutely, was very good,” she says from her living room. But after October 7, 2023, she and her family began to notice “the changes”, as she calls them. The subtle hostility. The growing discomfort with displaying one’s Jewish identity. “I can live a very Jewish life here,” she says. “I can be very proud of that, and I don’t need to censor anything that I’m saying. I felt a lot of censorship happening – not just being Jewish, but the fact that I’d been living in Israel.” Tahli Engel, formerly of Melbourne, tells a story you hear a lot in Israel. Here’s what’s significant about that statement: Tahli and her husband David weren’t fleeing persecution in any traditional sense. Australia isn’t remotely Nazi Germany.
They loved Australia and thought about staying for good. And yet – and this is the part we need to understand – they felt a compulsion to return to Israel, to a country in the midst of a catastrophic war. There were many reasons, of course – lifestyle and work opportunities chief among them – but the essence of it all is that her family, somehow, felt safer and stronger here. Let’s be as clear as possible: a quiet but profound shift in the global Jewish consciousness appears to be taking place, one that appears to be reshaping Israel, its diaspora, and which is driven by numerous converging forces that define this moment. The first is paradoxical. Overall immigration to Israel is actually down since October 7, 2023 – just 21,500 people arrived in the 12 months since September 2024 compared with 32,000 in 2023 and 47,000 in 2022. Fewer people are coming, but Australians are driving the cohort that is: their numbers are up 23 per cent, according to the Israel Aliyah Centre, and 87 per cent of the emigres are young adults aged between 18 and 34.
These aren’t refugees. They’re millennials and Gen Z professionals making a bet about where they can live as fully expressed Jews in the 21st century. Americans are doing the same. So are the British, the Canadians, the French. In other words, citizens from countries where government policy or civil discourse has been hostile enough to Israel or the local Jewish community. Hillel Weinstein, a former university student in Melbourne who moved to Israel last year, puts it bluntly: “I’d see encampments and huge signs saying ‘Free Palestine’ all over university property. I’m like, if this is where I’m studying, this is not a place that I want to be at.” Here, he walks the streets feeling “as safe as I’ve ever been. A lot of people have moved from around the globe to Israel, especially because they just don’t feel safe where they are”. Consider the irony for a moment. Young Jews are fleeing ostensibly peaceful Western democracies for a country that just fought a multi-front war and endured the sight of buildings being toppled by Iranian hypersonic missiles, because they feel more secure walking the streets of Tel Aviv than Brunswick or Newtown.
There’s a profound lesson to be drawn from that about the nature of 21st-century anti-Semitism and the failure of Western institutions to address it. Alon Cassuto, chief executive of the Zionist Federation of Australia, puts it this way: “October 7 changed something deep within our community. For some, it strengthened the pull towards Israel and the longing to live among our own people in our own land.” Call it identity politics at its most primal. Cassuto goes further: “It is impossible to ignore the rise in anti-Semitism in Australia has also left its mark, forcing many to question where they feel most secure and most at home.” The second force is a matter of resilience. Everyone expected Israel’s economy to crater during two years of relentless wars on multiple fronts. Yet it didn’t, not even close. And the reason why reveals something fascinating about modern economies and the countries that stand to thrive in an age of deepening disruption.
Elise Brezis, professor of economics at Bar Ilan University and the head of the Israeli Macroeconomic Forum, explains it like this: Despite 300,000 reservists being called up to fight, despite productivity shocks, a fall in consumption, the displacement of residents and increased welfare payments to assist them, Israel’s economy remains hardy. How? The answer is hi-tech. Israel’s IT sector – its defence, cyber, research and development industry, accounting for 20 per cent of GDP — adapted seamlessly. Workers who weren’t deployed to the war effort worked double shifts. Those at the front, mostly in non-combat roles, worked remotely during their downtime. Geographically, the areas most affected were the north and south of Israel, bombarded as they were by missile attacks from Hamas and Hezbollah – but not the centre of the country, home to the vital organs of industry. “What you have in the north and the south is nice, but it’s peanuts. So of course we had a reduction in output, but almost nothing, GDP per capita went down maybe 1 per cent. What’s 1 per cent?” Brezis says.
Tourism collapsed and restaurants closed, but these are not prime movers of GDP. “Philosophically, it’s important – hotels, restaurants. But has it affected the economy? The answer is no.” Here’s the lesson: In a knowledge economy, resilience comes from having a workforce that can operate anywhere, anytime. Israel’s vaunted hi-tech sector – established over decades with the help of policy choices targeting education, immigration and capital markets – essentially built a war-proof economy. Its debt-to-GDP ratio rose during the war from 60 to 70 per cent — still below that of France and the US, both over 100 per cent. Employment remained high, despite hundreds of thousands of reservists leaving their jobs to defend the country. In a labour force of four million the impact was minimal; the jobless rate was already well below 4 per cent before the first rocket was fired on October 7. As professor Zvi Eckstein, a former deputy governor at the Bank of Israel, explains: “Israel is very conservative with supporting unemployed people. The economy has a very good macro structure which helped it go through a very long war.”
Translation: Israel built economic shock absorbers before it needed them. The third force is diplomatic – and it’s potentially the most consequential. Yes, Israel’s global standing has taken a battering. Jeremy Issacharoff, Israel’s former ambassador to Germany, doesn’t sugarcoat it. But he also says now is not the time for the world to continue isolating Israel, not when prospective normalisation of diplomatic ties can be pursued to expand the Abraham Accords. “If Saudi Arabia comes in, it could bring Indonesia into the frame – this could be a very great measure of stability in the region,” he says. “But we’ll need the support of our friends and allies – and that’s something Australia should keep in mind. It’s of vital strategic interest to Australia and like-minded countries.” That’s because the October 7 attacks, in part, were an attempt by Hamas and Iran to derail precisely this historic normalisation between Israel and the Sunni Arab world.
Israel’s prospective treaty with Saudi Arabia, and the potential for that to strengthen Hamas’ opponents in the Palestinian Authority, threatened to undermine Iran and its proxy in Gaza. This, Issacharoff says, is arguably why Hamas launched its barbaric assault in the first place. And it’s why history is facing a pivot point now that Israel’s hostages have been returned: If Israel can emerge from this war with expanded Abraham Accords – Saudi Arabia, perhaps Indonesia, and potentially a post-Assad Syria – it will represent “the ultimate defeat of Hamas”, as Issacharoff puts it. It would mean Hamas destroyed itself trying to stop the very thing that ends up happening anyway. And that leads us to another important question hanging over Israel: Benjamin Netanyahu. Love him or loathe him – and Israelis are sharply divided – he faces elections in 12 months. Israeli commentator Amit Segal suggested in his weekly newsletter that the Prime Minister might call early elections – Netanyahu insists he won’t – if he can campaign on an economic rebound and diplomatic breakthroughs with the Arab and Muslim worlds — achievements that would “distract from his failure of October 7 and the public anger directed at him during the war”.
In any event, we are witnessing the emergence of a different type of Israel. A place seen by global Jews, particularly young ones, not as a refuge of last resort, but one where they can be fully themselves. A country with a war-tested, knowledge-based economy that proved more resilient than anyone expected. And, potentially – if the diplomacy succeeds – the anchor of a broader realignment of the Middle East that could finally bring the regional stability that has eluded it for 75 years. And perhaps this is all best captured by Engel, the granddaughter of four Holocaust survivors, all of whom adored Australia and the embrace it offered them. Her grandfather would often say: “A Holocaust could not happen again as long as we have Israel.” Engel says: “That has continued to mean a lot more to me as we’ve lived here, and as we’ve gone through this October 7experience. The freedom to just be here and be unapologetically me, and unapologetically us.” And that’s not running away but running towards something – a distinction that stands to shape Israel’s next chapter, and the Jewish people’s story, in ways that are only just beginning to become apparent.
Source: Compiled by APN from media reports