The entwining of Israel’s economy with America’s began in earnest in the mid-1980s. At the time,Israel adopted a policy of austerity advocated by the economist Stanley Fischer as a solution to the country’s hyperinflation. (Fischer would go on to serve as the eighth governor of the Bank of Israel and as a vice chair of America’s Federal Reserve. He died on May 31 of this year.) Washington rewarded Tel Aviv with a free trade agreement, an injection of financial aid and a relinquishing of its claims to Israeli debts. This assistance allowed Israel to develop closer relations to American capital markets, which it did after the commencement of the “peace process” that led to the Oslo Accords in the early 1990s. In the years that followed, investment flows between the two countries increased significantly.

Boosted by the influx of skilled workers from the United States and Soviet Union, the 1990s also saw Israel carve out a role as a low-cost R&D lab within American capital’s wider division of labor. Israel’s information and communications technology (ICT), cybersecurity, defense, and biotech industries became especially robust thanks to these connections. With time, personnel movements between the two countries became increasingly bidirectional. The migration of Soviet-born Israelis like Ilya Sutskever to Silicon Valley — where he would go on to become chief scientist at OpenAI — is symptomatic of the latter development.

This created enduring economic bonds between Israeli and American capital. For instance, Santa Clara’s Intel has long been the largest private employer in Israel, where it employs roughly 10 percent of its global labor force and contributes 2 percent per annum to Israel’s GDP. In underwriting and purchasing Israel’s Eurobonds (i.e., sovereign debts denominated in a foreign currency), Western financial houses have also long been critical to the country’s public finances and macro stability.

This became all the more pronounced after October 7, 2023. Since then, Bank of America, Citi, Goldman Sachs, JPMorgan, Deutsche Bank, BNP Paribas, and Barclays have collectively brought US$19.4 billion worth of Israeli Eurobonds to market. Their success in marketing $5 billion worth of Eurobonds this past February allowed the interest rates attached to debts to stay within touching distance (+1.2 percent in the case of the five-year bonds and +1.35 percent in the case of the ten-year ones) of American treasuries of equivalent maturities. What is more, those same institutions also rank as leading underwriters of Israel’s shekel-denominated treasuries and among the most active investors in the secondary market where those debts are traded.

Around 75 to 80 percent of the venture capital backing Israel’s tech sector originates in the United States. And as of late spring 2025, 108 Israeli companies were traded on American public exchanges. Elbit Systems, one of Israel’s largest arms manufacturers, is one of the companies offering its shares. For nearly two decades, the company’s local affiliate has benefited from the patient capital offered by American mutual funds and asset managers like the Vanguard Group. This May, Elbit raised another $512 million from American investors via a new share offering.

America’s tech sector has also played a major role in the ongoing genocide. Amazon and Google, for instance, have both furnished Israel’s army and leading arms manufacturers with cloud services across the past twenty months.

Since October 2023, Google and Microsoft have also provided Israel’s army with their leading AI models, earning themselves public commendations from Colonel Racheli Dembinsky, the commander of the Israeli army’s Center of Computing and Information Systems Unit, in the process. Furthermore, capital from Silicon Valley has served to bolster the macroeconomic stability of the Israeli economy. The March 2025 acquisition of an Israeli cloud security firm (Wiz) for $32 billion by Alphabet, the parent holding company of Google, was the largest acquisition in the company’s history and a significant life raft to the Israeli economy.

But tech’s involvement in the genocide is not simply the result of the underlying bonds between America and Israel’s economies. It also a product of the businesses model of tech firms in the twenty-first century.

In recent years, tech has become increasingly dependent on states rather than private consumers to make profits. To varying degrees, Silicon Valley’s behemoths are all struggling to deal with three interrelated problems: competition from Chinese firms; concerns over the long-term viability of advertising and cloud rent streams; and worry that their enormous capital expenditures on AI infrastructure might not bear fruit.

In these conditions, most major firms have recognized that winning government contracts is an essential hedge against insecurity. Worrying about the prospect of profit-making in the civilian economy, American tech, like the United States’ private equity and venture capital industries, has also come to see defense and security as especially promising growth markets.

By contracting with the Israeli state, these tech firms are able to gain a source of revenue, an opportunity for field testing services and advertising service applications, and a means of staying in the Pentagon’s good graces. As the Marxist economist Rosa Luxemburg observed a century ago, militarism helps to bind the bourgeoisie to the capitalist state. In Gaza, militarism draws in finance capital via Israel’s billion-dollar orders from the Wall Street–owned General Dynamics, Lockheed Martin, and Northrop Grumman. But it also draws the support of a tech industry whose mantra just a decade ago was “Don’t Be Evil.”