Economic Ties Between Israel and Massachusetts: a Potential Bright Spot in a Bleak Economy

by Daniel E. Levenson, ALM

February 14, 2011

David Goodtree is a man on a mission, and it’s a mission that has the potential to bring great economic benefit to both the Commonwealth of Massachusetts and the State of Israel. It is also a mission that an increasing number of people are beginning to believe in, including Massachusetts Governor Deval Patrick, who recently announced that he would lead a trade mission to Great Britain and Israel this March.

Perhaps it shouldn’t be so surprising after all that there is interest among business and political leaders when it comes to improving Massachusetts-Israel connections - once you look at the numbers, it’s not hard to see that important business ties already exist between industry here in Massachusetts and the Jewish State across a range of areas, including high-tech, bio-tech and medical devices. Asked for his thoughts on the governor’s decision to make Israel one of the first places he will visit in his second term, Mr. Goodtree was enthusiastic, writing in an email that "The Governor's trip will shine a spotlight on business growth opportunities between Massachusetts and Israel. The foundation is strong, but there is a lot more potential, for the benefit of both economies. Other states are aggressively pursuing Israeli innovation as a way to grow their economies. The Governor's high-level delegation will be aiming to position Massachusetts as the ideal first-choice for Israeli businesses ready to establish their American beach heads. I think they will make a pretty good case."

Mr. Goodtree, who has been deeply involved as a lay leader in the Boston Jewish community for a number of years, said that he has been working hard to educate the citizens of the Commonwealth about the importance of these economic connections. He recently gave a presentation for the Jewish National Fund in Boston, in which he was able to demonstrate to the audience, both qualitatively and quantitatively, some of the ways in which Israeli innovation is already having a significant impact on the Massachusetts economy. He did this by talking about the general appeal that the Boston area has for Israelis looking to relocate to the United States, as well as sharing some of the results of a study commissioned by Combined Jewish Philanthropies, entitled “The Massachusetts-Israel Economic Relationship.” He pointed out that in the study’s executive summary (which was carried out by Stax, Inc.) it was noted that in 2009, Israeli companies had had a significant impact on the Massachusetts economy, including “$2.4  billion in direct revenue generated in Massachusetts,” as well as that “…nearly 6,000 Massachusetts-based employees work in these companies and the firms which service them, including real estate, legal and financial corporations.” These kinds of benefits are significant and something to which business, civic and political leaders in Massachusetts should pay attention, and Mr. Goodtree made a compelling case that leaders in Massachusetts should be paying more attention to these numbers.

Looking more broadly, it is worth noting that there are groups, such as the New England Israel Business Council, which are also working to improve ties, and they’ve managed to gain the support of high-profile companies and institutions including the University of Massachusetts at Boston, Genzyme and CreditSuisse, to name a few. Looking at the NEIBC website, it is clear that the sponsors of their events are investing resources in building bridges of cooperation and innovation between Massachusetts and Israel both because there is money to be made and science to be advanced.

One example that seems particularly relevant is an event which was held at the Museum of Science last December with the goal of highlighting innovative work being done on electric cars in Israel. This event, which was held under the auspices of the NEIBC and co-sponsored by a variety of different Jewish organizations and consuls general, along with law firm Mintz Levin, brought Israeli entrepreneur Shai Agassi to Boston to talk about how the company he founded, Better Place, is working to eliminate dependence on oil and to create a whole new way of thinking about energy use and transportation. One of the things that makes Mr. Agassi’s approach to solving the problems of oil dependence so intriguing is his holistic approach. He is looking at the issues surrounding the creation of a reliable electric car not merely from the perspective of how to engineer a better vehicle,  although this is surely one of his goals. No, Mr. Agassi seems intent on transforming how society thinks about and interacts with transportation systems. This seems like a very exciting example of just one Israeli technological innovation which could open up new avenues for economic development around the world, including within Massachusetts, because it not only holds out the promise of a return on related economic investments, but fires the imagination as well.

It is this kind of creative innovation and cross-fertilization that Mr. Goodtree hopes to encourage, although he admits that doing so will require a lot of effort when it comes to educating people about the potential advantages that exist in this sort of collaboration. He pointed out during a recent conversation, for example, that there are likely many people living in the state who know very little about the climate of innovation and creativity in Israel,  let alone have a sense of the  kind of benefits this relationship has brought to Massachusetts. “This is not a Jewish issue … it’s about economics,” Mr. Goodtree said during the same conversation, adding, “This is about taking Israel and putting it into the issues that other people care about.”

Other states have already been working to establish economic ties with Israel, including California and Georgia, two states which have the advantage of having direct flights between their own major cities and Tel Aviv, and both of which have worked to foster closer business and academic ties with the Jewish State. California has been especially active in building and maintaining such ties, with members of the California State Assembly taking the time to visit Israel to help develop such relationships. One such politician, Assemblyman Bob Blumenfeld notes on his own website that “Since 1996, California has exported nearly $12 billion in manufacturing goods to Israel and received over $130 million for investments in enterprises.” Given the current state of our national economy, it would seem that leaders in business, government and academia in the Commonwealth would be wise to learn from California’s example.

While the average person may often feel far removed from events happening half a world away in the Middle East, there is no question that the people of Massachusetts are certainly concerned about the health and well-being of their  local and regional economies. The work that Mr. Goodtree, CJP and groups such as the New England Israel Business Council are doing represent a bright spot in an otherwise currently  bleak economic landscape, and Governor Patrick’s decision to undertake this trip to Israel, accompanied by other leaders in government and business, can only add much-needed fuel to the Massachusetts economy.

Copyright The New Vilna Review 2011