Israeli Genocide Is a Bad Investment

Norway’s recent divestment from Israel Bonds is the latest piece of bad news for an Israeli economy that has nosedived during the war on Gaza — creating a huge opening for other divestment campaigns to hit Israel where it hurts and bring the war to an end.

Demonstrators take part in a march in support of Palestinians outside the parliament building in Oslo, Norway, on November 4, 2023. (Heiko Junge / NTB / AFP via Getty Images)

Norway’s $1.6 trillion oil fund has divested entirely from Israel Bonds, pulling what remained of its investments at the start of Israel’s genocidal war on Gaza.

By November 2023, Norges Bank Investment Management, which oversees the Norwegian Government Pension Fund Global, had withdrawn all of its nearly half a billion dollars’ worth of investments in Israel Bonds, citing “uncertainty in the market.”

Israel Bonds are money lent directly to Israel’s Treasury. Since their establishment in 1951, the sale of Israel Bonds has funneled billions of dollars into almost every sector of Israel’s economy. Like any material support for the Israeli government, Israel Bonds cannot be disentangled from nearly a century of ethnic cleansing and slaughter. The sale of Israel Bonds has funded and continues to fund the maintenance of an apartheid system over millions of Palestinians throughout historic Palestine, and the genocide being carried out against 2.3 million Palestinians in Gaza.

That’s why the Boycott, Divestment, and Sanctions (BDS) movement is targeting divestment from Israel Bonds as part of a larger strategy to build economic and political pressure for the Palestinian struggle to dismantle Israel’s apartheid regime.

The Norwegian Confederation of Trade Unions, representing hundreds of thousands of workers, officially endorsed BDS in 2017, and it has continuously put pressure on Norway’s financial institutions to stop funding Israeli apartheid. Norway’s sovereign wealth fund has already divested from a number of Israeli companies on human rights grounds, including in 2021, when it excluded two firms over their links to illegal Israeli settlements.

People of conscience in the United States have been organizing for decades around divestment from Israel Bonds. In the 1970s, thousands of Arab autoworkers in Detroit marched to demand United Auto Workers pull their hundreds of thousands of dollars in investments in Israel Bonds. Local activists in Minnesota have been organizing since 2006 to push their state to divest from Israel Bonds, which included suing the State Board of Investment in 2011.

Last year, rabbis affiliated with Jewish Voice for Peace (JVP) led a “Torah of divestment” action outside the hotel in New York City where Israel’s extremist finance minister, Bezalel Smotrich, was speaking at a fundraiser for Israel Bonds. And in recent weeks, local chapters of JVP have rallied at the Pennsylvania state capitol demanding divestment and disrupted an Israel Bonds fundraiser in Los Angeles.

The BDS movement has created a new vocabulary of effective international solidarity, directing pressure to end the complicity of governments, corporations, institutions, and individuals in financing Israeli apartheid. Now, at a time when the Israeli economy is reeling from five months of war, it’s time to escalate.

Israel’s Economy Is in Trouble

In the last quarter of 2023, Israel’s GDP plummeted nearly 20 percent. Consumer spending was down by a third, imports and exports shrunk, and government spending skyrocketed 88 percent. Earlier this month, Moody’s downgraded Israel’s credit rating for the first time in the country’s history, saying its economic outlook was “negative.” The Norwegian Pension Fund’s decision to entirely divest from Israel Bonds undoubtedly had an impact on Israel’s credit rating, regardless of whether it did so for any other reason than it was a poor investment.

Israel’s far-right government is managing an economic crisis, largely of its own making, by changing the subject to war on Palestinians.

Shortly after Moody’s issued its new rating, Smotrich lambasted the financial ratings agency for their “lack of confidence in the righteousness of [Israel’s] path in the face of its enemies.” Prime Minister Benjamin Netanyahu, meanwhile, has claimed that the rating will return to normal “once we win the war.”

Five months of war have shaken Israel’s economy, and investors are uneasy. This represents a critical opening for the movement for Palestinian liberation to push for divestment from Israel Bonds.

US state and local treasuries alone have invested $1.6 billion in Israel Bonds; Florida leads them with over $100 million in investments to date. That’s not including the countless universities, unions, corporations, and individuals across the United States who have also invested.

Cutting off the flow of all US dollars to Israel’s war chest is urgent. As we approach five months since the start of the genocide, the reality on the ground in Gaza is one of horror and devastation, the scale and scope of which most of us struggle to comprehend.

In north Gaza, where one in six children are suffering from acute malnutrition, Palestinians have resorted to grinding animal fodder and bird seed to make bread. Soon, they’ll run out of that, too.

In Khan Yunis, Gaza’s largest operating hospital has collapsed after a weeks-long siege by the Israeli military. Two hundred patients remain trapped inside the hospital, where electricity has been cut and basic supplies are running low. Eight people have already died due to lack of oxygen. In Rafah, Gaza’s southernmost city, the Israeli military is preparing for a ground invasion. The 1.5 million Palestinians forced to flee to Rafah are staring down the barrel of mass slaughter and displacement, having been forced as far south as they can go by the Israeli military’s relentless bombardment.

Millions of people across the United States want a cease-fire in Gaza. That is the direct result of the incredible pressure being exerted by the movement for Palestinian liberation. From here, people of conscience must use every tool to build pressure on the Israeli government. That means recognizing where the cracks are already forming and directing more targeted pressure at the institutions and individuals upholding Israeli apartheid. Demanding that our governments, universities, and community members stop funneling money directly into Israel’s war chest is a good place to start.