Israelis wake up again in the middle of the night to the sound of air raid sirens and run to safe rooms and shelters. Thousands of people have been injured or displaced in shelling attacks. Tens of thousands have given up their homes and their jobs to work beyond the military reserve. Schools are closed. Many people are stranded abroad because regular flight service to Israel has been suspended.
However, almost a week after the Iran war, the situation in Israel is interesting, unlike the one prevalent in America and the countries of the Persian Gulf – which the latter countries have also been. hit by Iranian missiles and drones. A poll published on March 4 showed that more than 80 percent The Israelis supported the attack on Iran. Media coverage has been unashamedly pro-war. Unlike other stock markets in the world, the Tel Aviv Stock Exchange it was contributed in the early days of the conflict. The shekel has strengthened against the dollar. If the war goes well, it’s not hard to imagine Prime Minister Benjamin Netanyahu, whose coalition has been winning the polls for years, heading to victory in the general election later this year.
Israelis wake up again in the middle of the night to the sound of air raid sirens and run to safe rooms and shelters. Thousands of people have been injured or displaced in shelling attacks. Tens of thousands have given up their homes and their jobs to work beyond the military reserve. Schools are closed. Many people are stranded abroad because regular flight service to Israel has been suspended.
However, almost a week after the Iran war, the situation in Israel is interesting, unlike the one prevalent in America and the countries of the Persian Gulf – which the latter countries have also been. hit by Iranian missiles and drones. A poll published on March 4 showed that more than 80 percent The Israelis supported the attack on Iran. Media coverage has been unashamedly pro-war. Unlike other stock markets in the world, the Tel Aviv Stock Exchange it was contributed in the early days of the conflict. The shekel has strengthened against the dollar. If the war goes well, it’s not hard to imagine Prime Minister Benjamin Netanyahu, whose coalition has been winning the polls for years, heading to victory in the general election later this year.
One reason, of course, is that the Israelis are used to missile warfare, having recently endured nearly two years of attacks coming from different directions from Hamas, Hezbollah, Iran, and the Houthis. Adults have become fascinated with frequent visits to safe rooms, and even children have come to see it as a normal part of life. Within days of the war, Tel Aviv’s cafes were once again filled with guards. Frequent air raid alerts will not turn public opinion against war.
But the biggest reason has to do with the consensus among Israelis that the attack on Iran is well underway and that the war will be short and that Israel will emerge victorious. Loss of life and damage to property will be prevented, and any disruption caused by war will be short-lived. In the end, something like a New Middle East could emerge, or at least an old Middle East without the threat of Iran hanging over it, which from Israel’s perspective, would be an improvement.
The question is whether the Israelis are too optimistic, rightly so if there are anythe country is destined for hard times ahead. A small country with an economy that relies heavily on reservists to fill the ranks of the army, Israel has traditionally favored short, decisive wars. Today, its population and economy are large enough to sustain less protracted conflict than in the past, but Israel is still recovering from the two-year war in Gaza and remains on a war footing even after a ceasefire in October.
A short campaign, on the scale of the 12-day war that Israel (later joined by the US) fought with Iran in June 2025, would certainly have been manageable. After firing a barrage of missiles and drones at Israel in the first two days of the war, Iran’s attacks have slowed considerably, and their targeting and timing appear to be more diffuse. This may be because Iran is increasingly unable to sustain a coordinated attack and/or because it is reducing its arsenal of missiles and launchers.
But it is also possible that Iran is holding its largest and most dangerous missiles in storage as part of a shutdown strategy. It seems increasingly clear that Iran believes that a steady drip, drip of missiles, drones, and casualties—along with economic paralysis and rising oil prices—will force Israel and the United States to end the war on something close to its terms. And that is the scenario that an An unnamed Israeli defense official spoke of Sunday: “Trump spoke about four weeks. We are also preparing for at least a month.”
In that case, the most immediate threat to Israel is that its air defense system will be activated short run on interceptors. The government does not disclose information on reserves or production levels, but it seems unlikely that Netanyahu convince The White House started a war with Israel without preparation.
On the other hand, press releases (denied at the time by Israel) during the final days of the June 2025 war he cited US officials as saying Israel’s stockpiles of missiles were running dangerously low. Israeli arms manufacturers have ramped up production over the past two years, but the factories are slow and expensive, and nearly eight months have passed since the last missile war. In the first days of the current war, Israeli Defense Ministry officials he asked them to make weapons to increase the production of interceptors and other weapons. What this means is that the fighting will continue longer than Israel expected.
The US contributes to Israel’s air defense, too, but here the evidence is more solid that Washington lacks the means to sustain a long-term conflict.
Another challenge is the economy. Over the past two decades, Israel has shown remarkable courage in the face of constant war. The campaign in June, for example, caused the GDP to decrease by an annual rate of 4.3 percent in the second quarter, but came back strong in the third quarter. Material damage from missile attacks is less of an issue than lockdowns that cripple business operations and the loss of workers as workers are called away for tax savings. Even after the Home Command of the army reduced restrictions on Thursday to allow more businesses to reopen, the war is costing Israel’s $550 billion economy about $1.6 billion a week. The increased military expenses amounting to 3.2 billion dollars per week, and another 970 million dollars in estimated war damages.
The defense budget, which has remained high despite the ceasefire in Gaza due to the need to restore the stockpile of weapons and continue the refugee movement, is being prepared. it increased further to fight the Iran war. More than 100,000 reservists have been called up for this campaign, tripling the number of reservists in uniform. The warplanes, bombs and missiles are very expensive, and Israel has been using them at an alarming rate since the start of the war in Gaza.
Finally, there is the real danger that a long-term war will further weakening Israel’s position in the United States. Unlike Israel, Israelis do not like war The American public and most importantly for US President Donald Trump come under criticism and many in his MAGA base. Israel’s war with Hamas has turned much of the Democratic Party against Israel and created divisions among Republicans, who were previously pro-Israel. The latest Gallup poll shows that for the first time, more Americans pity with Palestinians and Israelis. There is already talk in MAGA circles that Israel dragged the United States into a war with Iran.
If the fighting goes badly or turns into the kind of perpetual war that Trump promised he would avoid, Israel may find itself blamed, and its standing in the United States will fall further. Netanyahu has done nothing to challenge the theory, perhaps because it increases his chances of declaring himself as a world leader in the big league, able to influence even the president of the United States.
It is too early to say for sure how the war will affect Netanyahu’s chances of re-election in October. If Trump decides that the conflict is too costly for him politically at home and ends it early, it may be on terms that keep the hard-line regime in Tehran in check. Netanyahu is already under fire for failing to crack down on Hamas in Gaza during two years of war. Such a conclusion to the war in Iran could hurt him politically. On the other hand, a protracted conflict could do serious damage to Israel’s economy before any benefits materialize.
For now, the prevailing wisdom in Israel remains that the war will be short and decisive, and that the economic cost will be contained and any losses will be compensated when the fighting is over. That explains why the Tel Aviv Stock Exchange it was contributed in the first week of fighting while the rest of the world’s financial markets fluctuated.
