Benjamin Netanyahu’s declaration on Friday, just days before the election, that Israel needs to “organize an alternative economic system” to prepare for potential banking sanctions was widely mocked online as a lapse in judgment. But people who have worked alongside the prime minister in senior economic roles say the idea should not be dismissed as an offhand remark.

“He is genuinely thinking about this,” Prof. Avi Simhon, head of the National Economic Council and Netanyahu’s economic adviser, told Calcalist. Simhon neither distanced himself from the statement nor played down its significance.

Another senior figure who has been close to Netanyahu since the early stages of his career offered a more nuanced interpretation. He…