The financial crisis is hitting the Zionists hard. How is the Gaza war eating up Israel’s budget?
The Netanyahu government decided to launch the operation to capture Gaza City when Israel’s military budget was not up to the task. In this regard, the cabinet prepared a bill to increase the 2025 budget by $9 billion, which was approved in the first reading of the Knesset last week, but its finalization requires approval in two more readings. Importantly, the increase in the military budget was accompanied by a 3.35 percent reduction in the budget of other ministries, which means a decline in the provision of public services.
Another issue is that, according to a statement by the Israeli Ministry of Finance, these budget changes are equivalent to 1.5 percent of the regime’s gross domestic product, and therefore, the budget deficit will increase from the current 4.9 percent to 5.2 percent.[2] It was in this context that the ground operation in Gaza City began. However, at the very beginning, the Israeli Ministry of Defense concluded that even a $9 billion increase in its budget was not enough, and this would be very bad news for the regime’s economy.
According to a report published on Thursday (September 16), the Israeli military has requested an additional 20 billion shekels ($5.5 billion) to fund Operation Gideon 2, of which 8 billion shekels ($2.16 billion) are to be paid in 2025. This is despite the Finance Ministry saying that they may only be able to secure 4 billion shekels ($1.8 billion) of this amount this year.
The military’s new request suggests that the estimates for the operation’s costs were not realistic. In this regard, Esteban Klor, a professor of economics at the Hebrew University of Jerusalem, had estimated before the start of the operation that “implementing the plan to seize Gaza City could cost Israel about 100 billion shekels ($29.2 billion) – five percent of its GDP – and these costs may increase debt and reduce the quality of life of the Zionists.”