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Parshat Bechukotai: BDS – Does It Really Work? Should We Be Worried?

One of the persistent “demands” of the anti-Israel protests on many college campuses has been for their schools to participate in the BDS Movement – Boycott Divestment and Sanctions against Israel. Their goal is to isolate Israel and make it a pariah state unless it bends to their policies which would most likely result in its destruction as a nation. Yeah, it’s one of those no-win situations and giving in to blackmail is generally not a good idea. The blackmailers are seldom satisfied and will just demand more.  

But let’s leave aside these demands (why any institution takes demands of petulant students seriously is another issue) as well as the blatant hypocrisy of these people who raise no such issue with other nations who behave much worse than Israel and have committed terrible atrocities. The simple issue is this: Boycotts – do they work? Boycott pressure – is it really so powerful that it can crush or change the course of companies and even nations? 

Um, actually… no. At least according to Ivo Welch, a bit of an expert on these matters as professor of finance and economics at the Anderson Graduate School of Management at the University of California, Los Angeles in his op-ed piece in The New York Times back in 2015 when I first raised this issue. In his article he is not even addressing BDS but was reacting to Stanford University’s decision to divest from coal-mining companies. 

Tonight, the 20,000 students at Stanford will sleep more soundly. Earlier this week, a group called “Fossil Free Stanford” persuaded the university’s endowment to divest its stock holdings from coal-mining companies. The world will be a better place. 

Except that it won’t be. Individual divestments, either as economic or symbolic pressure, have never succeeded in getting companies or countries to change…

But didn’t a similar boycott force South Africa in the 1980s to abandon apartheid? Unfortunately not. In an academic study, my co-authors and I found that the announcement of divestment from South Africa, not only by universities but also by state pension funds, had no discernible effect on the valuation of companies that were being divested, either short-term or long-term. We looked hard for evidence linking boycotts and sanctions to the value of the South Africa’s currency, stock market and economy. Nothing.

In retrospect, our evidence should not be surprising. For each investor and business that withdrew, there were others standing by ready to step in.

And that last line is the kicker. Let’s face it, businesses are primarily in the business of making money and not making the world a better place. Yes corporations like to tout their ethics-cred by publicizing how they are eco-friendly and may even donate a percentage of their proceeds to their favourite cause. But the bottom line is that this is not what drives their bottom line. Profits do. So if there is a good investment out there, when one investor pulls out, another will come along and fill the vacuum. 

If divestment really drove down fossil-fuel stock prices, then there would be plenty of other investors ready, able and willing to step in to buy their shares, now trading for just a little cheaper than they otherwise would.

In a more recent piece on the BDS movement directly from earlier this year in the Washington Post, the issue of its impact was addressed.

From the start of BDS’s efforts almost two decades ago until right before the war, Israel’s economy grew. Dany Bahar, an economist and associate professor at Brown University’s Watson Institute, said in a phone interview that “it’s very likely that it has had zero effect” on the country’s economy. In a 2018 Brookings Institution analysis, he and co-author Natan Sachs found that Israel’s economy is resistant to boycotts because it specializes in exports that are difficult to source elsewhere, such as advanced technologies and the intermediate goods used in the production of other goods, both of which are difficult to boycott.

So chalk this up to yet another one of the many and varied attempts to doom Israel and the Jewish nation that have not succeeded for thousands of years. It simply doesn’t hold water and is having no discernible negative ramifications on Israel’s growth.

And in case there is a teeny bit part of you that might begin to believe their scary forecasts for Israel, keep in mind the words that God told Avraham in His first prophecy and promise to him when he was told to go to the Land of Canaan which would later become Eretz Yisrael: “Those who bless you, I shall bless. And those who choose to curse you, I shall curse.”

God spelled out a very clear formula for economic prosperity to those who wish to partner with His Chosen People. Bless Israel and you shall receive Blessings. Curse and Boycott Israel and you shall receive Curses. You think it’s an accident that the most prosperous nations are the ones who have the friendliest relations with Israel and Jews in general? It never has been an accident and it never will. God’s promises are rock-solid and forever.  

Boycott, Divest and Sanction all you want. You are only hurting yourself by doing so. The surest way to economic ruin is to boycott Israel and the Jewish people.

Your black cards can make you Money
So you hide them when you’re able
In the land of Milk and Honey
You must put them on the table
-Steely Dan

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