The defense system abounds with conceptual fixations. Sometimes it operates
on inertia alone, and thinking in other directions is very difficult for it.
"After elections, we won't be able to avoid a substantial cut to the defense
budget", says Israeli Treasury Minister Yuval Steinitz in a special
interview with IsraelDefense.
Amir Rapaport
http://www.israeldefense.com/?CategoryID=483&ArticleID=1866

"After the Israeli general elections, the Israeli defense budget will be cut
dramatically," states Treasury Minister Yuval Steinitz. "We would have no
choice but to cut around three billion NIS off the budget," he says.

Q: Regardless of the government we would have?
Steinitz: "Regardless of the specific line-up of the government or the
ministers. Some things are inevitable."

Q: Do you think that the defense system has an excessively strong influence
over decisions concerning budgets?

Steinitz:"I think it has an influence, certainly with regard to the
structural aspect of how the decision is made, as the Prime Minister is,
eventually, the person in charge of national defense. In some way he is
conceived as directly responsible for defense, more than for the state of
health or education. At the Prime Minister's chambers and its environment,
defense-related discussions with the heads of the defense system are
conducted all the time, more frequently than discussions concerning
education or transport, so, quite naturally, the defense system has a better
access to the Prime Minister and greater influence over his environment.

Q: You are discussing cuts to the defense budget after the elections,
despite all of the revolutionary changes taking place around the Middle
East?

Steinitz: "Yes. It is, after all, a question of proportions. If we had not
appropriated increments in previous years, than everything that's happening
would have required increments. As we had already appropriated major
increments that were used for building up our conventional power and prepare
for the eventuality of a major military confrontation – now we have to
restrain. It is a cut that should have been made this year, but let no one
have any illusions – we will not have a budget in 2013 without a cut in
defense."

"We Need Missiles"

The interview with Minister Steinitz was conducted in his chambers in
Jerusalem, during the stormy days leading to the coming elections, and
before the beginning of operation "Pillar of Defense."

When Steinitz, a doctor of philosophy, speaks about defense matters, he has
a rather unusual history behind him. He began his public activity at the
extreme left of the Israeli political map – in the Peace Now movement, and
as a Member of Knesset on behalf of the Likud he was, for many years, a
member of the Knesset Foreign Affairs and Defense Committee – and even
chaired the Committee in the previous Knesset. Dr. Steinitz headed a
parliamentary commission of inquiry which investigated Israeli intelligence
failures regarding Libya and Iran (Israeli intelligence was unaware of the
Libyan nuclear project until the late Muammar Gaddafi relinquished it of his
own will in 2003).

As someone who did not have a long military career (Steinitz spent his
military service as a trooper with the Golani infantry brigade), Steinitz
often reflects out-of-the ordinary defense views. For example, as Chairman
of the Knesset Foreign Affairs and Defense Committee he consistently
recommended that Israel acquire long range precision missiles. His
recommendation was never accepted.

"Beyond the budget cut in 2013, the defense system must revise its
priorities," says Steinitz. "Less money should be appropriated for certain
projects such as the Namer APC, and more massive investments should be made
in the development and acquisition of tactical missiles, to help the IAF
return fire. Tactical missiles can help the IAF in closing fire cycles. We
should also develop our seaborne firepower. Missile firepower is needed even
more because today we can see how the missile threat imposed on Israel has
worsened.

We need alternative firepower from the air and from the sea (like the LORA
rocket developed by IAI, which the Israeli military does not purchase), and
gas masks. I believe that as far as home front defense is concerned, this is
the most vital need."

Q: What you are claiming, in fact, is that we should actually call off the
Namer project?

Steinitz: "Yes, it is no secret that I opposed the Namer program, as I think
it is a waste of funds for nothing. It may have been appropriate 10-20 years
ago, or 15 years ago, to develop and manufacture a heavy APC – but not
today. We have entered an era where we develop electronic protection
systems, like the avionics systems - protective suits – that aircraft have,
or the systems that ships have – we now manufacture for tanks. I refer to
systems like the 'Trophy' by Rafael or the 'Iron Fist' by Israel Military
Industries. So we have advanced and reached the point where we are capable
of developing radar and surveillance systems, and automatic hardkill
systems, electronic protection systems with automatic hard-kill systems that
provide full spectrum protection that is lighter and relatively cheaper than
heavy armor (taking into account all of the various costs involved,
including engines) and more effective. So going back to heavy armor, when it
seems to me like a fatal mistake. There are many other people within the
defense system, even former generals, including very senior commanders in
the IDF land arm, who believe it is a mistake."

Q: So how come you have not succeeded in stopping it? Apparently, minister
Moshe (Bogie) Ya'alon, a former chief of staff, also opposes the Namer?

Steinitz: "It is all very nice that everyone is against it, but under the
pressure exerted by the defense system, there was only one minister who
voted against – me. Now the project is already under way. Commitments were
made vis-à-vis the US (General Dynamics manufactures the hull of the APC at
its own facilities, on account of US FMS funds) as well as vis-à-vis Israeli
labor and now it is hard to stop – although this is what we should have
done."

Q: What about the Merkava tank? Do you think that this project should be
stopped as well?

Steinitz: "No. The Merkava is a different story, but the Namer is an example
of the irresponsible conduct of the defense system, which says to itself:
'we will always be able to obtain the resources'."

Q: So how would you explain the fact that the IAF opposes long-range
precision missiles, just like they had opposed the Arrow and Iron Dome
systems in the past?

Steinitz: "The defense system abounds with conceptual fixations. Sometimes
it operates on inertia alone, and thinking in other directions is very
difficult for it. Precision guided munitions, the development of UAVs as
well as the development of the Iron Dome system were all things that the
defense system opposed. They were forced upon it and we are lucky that they
were. That is why I say that with regard to this issue, too, which is
critical, Arab missiles are still less accurate but already have their own
advantages. Today, Hezbollah can close a fire cycle (they lack intelligence
sources like satellites) or Syria can close a fire cycle opposite IDF bases
faster than we can, as launching a missile from an aircraft takes longer
than a ground-based or a seaborne launch. This must be revised profoundly
and a new scale of priorities must be specified."

Q: Do you think it appropriate that a state like Israel should have three
major defense industries?

Steinitz: "First of all, yes. I think this model works and works nicely.
Admittedly, around the world you witness processes of industries unifying
and merging – in the US it has been going on for decades. In Israel,
however, there are three major government corporations and one privately
owned, successful corporation – Elbit, and it works. The state of the
defense industries is relatively good. They are true world leaders in terms
of their accomplishments – in such fields as satellites, missiles (even
though this particular advantage is not fully utilized), active protection,
surface vessels – the BARAK missile system was the world's first active
defense system for surface vessels. Their accomplishments are impressive
across the entire canvas – UAV development, antitank missiles. The rapid
development of the Iron Dome system within about three years was a truly
remarkable achievement.

"These industries are successful exporters, too, despite the severe
restrictions. Some of the major markets are closed to them: the Arab world,
the Iranians, the Saudis, the Libyans – these defense markets are not open
to us, but are open to the US, to Russia and to the UK. The Chinese market
is also closed because of the relations with the US, and even in other
countries it is more difficult, so the success of our defense exports is
truly amazing."

Q: And they make a significant contribution to the economy?

Steinitz: "Yes, yes. I am not among those who think that we should have only
one defense industry, as I believe that internal competition – although it
is not entirely free as we have the Research & Development Directorate and
the Ministry of Defense – is important and beneficial. Even if it happens
that three Israeli industries compete for the same tender abroad. I do not
think that the government corporations should be merged."

The Trend: Cyber

Q:Is there a significant investment in the cyber warfare worlds, or is it
all just talk?

Steinitz: "We had been involved in this field even before the cyber warfare
bureau was established, and the Treasury has a part in the cyber defense
effort. We have a system for identifying and repelling cyber attacks that
has been operating effectively. Now we want to develop a doctrine through
the cyber warfare bureau."

Q: What worries you more – the developments in Egypt or the Iranian bomb?

Steinitz: Look, these things are difficult to rate. The Iranian bomb is an
existential threat imposed on us, on the Middle East and on the entire
world. It is really a threat whose enormity and importance cannot be
overrated, and I think the Prime Minister conducted a very sophisticated and
successful international campaign on this issue. Because of his efforts, the
issue of the Iranian bomb is currently on the table and the world can no
longer ignore it.

"Today, with the sanctions imposed on Iran, the operations of the finance
ministries are coordinated, we are monitoring it. For the first time ever,
the Iranian economy is on the brink of collapse – and that has happened only
in the last year. Two or three more years like that, and it will not last.
At this time, however, it is not enough, so the military option must remain
on the table and in the air. I think Israel should do almost anything to
stop the Iranian bomb. The question is, of course, how to do it properly and
effectively – and here there are disputes regarding the methods or the
timetables, the extent of coordination with international parties – whether
we should wait for them or not.

"As far as Egypt is concerned, I must say I had not envisioned this
particular scenario. However, as Chairman of the Knesset Foreign Affairs and
Defense Committee, I was the only one, throughout the political and military
establishment, who said that Egypt was building up its military strength and
that one day it could be directed at Israel and be deployed to the Sinai. I
never thought it would come in the form of a revolution by the Muslim
Brotherhood, yet I said that as far as Egypt's military capability is
concerned – it should be taken into consideration in our military
preparations and deployment".