Growth, yes, but what social justice?
Nine months have passed since the start of the Arab Spring, when a 26-year-old Tunisian fruit seller immolated himself in front of a municipal building highlighting his frustration with red tape and living standards.
Since then, Israel has looked on with curiosity and apprehension as Arab state after Arab state erupted in violence over surging food prices, high youth unemployment and lack of political rights.
Israel bucked the economic trend. Its output rose faster over the last year than any country other than Australia – which was boosted by insatiable Chinese demand for its natural resources.
Indeed, almost every Israeli indicator looked to be pointing in the right direction. Unemployment, measured by international standards, was just 6pc of the workforce. The Tel Aviv 100 index soared to record levels on the back of vast offshore natural gas discoveries. And the highly regarded governor of Israel's central bank, Stanley Fischer, was canvassed as the successor to Dominque Strauss-Kahn at the International Monetary Fund.
Israel looked to be a sea of calm and prosperity amid the turmoil.
But as the markets erupted in August amid concerns about stuttering growth, US debt and deficits and the eurozone's fiscal struggle, Israel experienced its own challenge. Beneath the veneer of wealth, prosperity and technological innovation, social and economic tensions were building.
Oligarchs have been able to operate with impunity
As in some Arab countries, food prices were at the core of the street protests – except in Israel it was the cost of cottage cheese, an Israeli staple, which lit a spark which would eventually involve 250,000 people across the Jewish state (one in every 30 Israelis).
The cottage cheese rebellion, which brought forth a tent city on Tel Aviv's Boulevard Rothschild, was the symptom of much wider concerns. Soaring property prices have made housing inaccessible to many young people in the large cities. As in Russia, economic power has increasingly concentrated in fewer hands, creating Israel's own class of oligarchs.
Since its earliest days, when much of the economy and many businesses were controlled by the socialist movement Histradut, Israel has been a country dominated by monopolies and cartels. Many of these enterprises and public utilities have been privatised. But as in the former Soviet Union state capitalism and socialism has been replaced by privatised monopolies controlled by oligarchs.
This group of plutocrats control the market for almost everything from mobile phones to nappies, from imported cars to cottage cheese and coffee. Over the decades they have been able to raise prices with impunity.
In fact the same OECD which has lauded Israel's growth also has a more disturbing statistic which challenges the nation's moral compass. Israel's 'gini coefficient', the standard measure used by economists worldwide to measure income inequality, is an estimated 20 per cent higher than its counterparts in the OECD. In only four countries within the OECD universe of 34-nations is the inequality greater.
An analysis by Citigroup, the New York bank, has found that the 10 largest business dynasties or oligarchs in Israel control 30 per cent of the shares quoted on the Tel Aviv exchange. This compares with 20 per cent in Germany, where families still control the big car manufacturers, and just 5pc in Britain.
The street protests and Benjamin Netanyahu's promise to tackle the monopolies and cartels and unleash competition is taking a toll on the business panjandrums.
Among the big losers on the Tel Aviv exchange has been Nochi Danker's IDB group. Through his quoted enterprises Discount and Door he controls mobile phone, retail, real estate and chemical companies across Israel. For good measure it also controls a block of 29.7m shares in Credit Suisse.
Another conglomerate, Delek, controlled by Yitzhak Tshuva, has interests ranging from insurance to energy. Both of these tycoons and several others have seen the value of their interests slashed by investors as a result both of the street protests against crony capitalism and the broader fall in global equity prices as fears of double dip recession across the globe have re-emerged.
Mr Netanyahu's response to the protests has been to establish an economic panel under the control of Professor Manuel Trajtenberg. Analysts expect it to focus on tougher regulation of key industries including cell phone groups, cable television companies and real estate giants.
Fears, however, that the government will not go far enough have led to the establishment of an alternative socio-economic group headed by Professor Avia Spivak, former deputy governor of the Bank of Israel, and embracing 60 leading academics and policymakers. At its launch, the Spivak group argued that economic policy is not just measured by GDP growth but needs to look at the phenomena of poor workers and lack of opportunity for young people. They are advocating radical change in the way businesses are run and controlled rather than tinkering around the edges.
Mercifully, Israel's cottage cheese revolt has so far been peaceful and the response has been a brisk public debate about the concentration of wealth and income disparities. But the jury is still out on whether the political classes have the willpower to challenge an economic order which is delivering output but not social justice.
Alex Brummer is City Editor of the Daily Mail