In a speech to the Knesset today following approval of his National Housing Committees Law, Prime Minister Benjamin Netanyahu castigated the tent protesters. "There is distress in Israel, but it should be solved in a responsible way. A wave of populism is sweeping the country. Our ability to meet social needs greatly depends on continued growth," he said.
Netanyahu was frequently heckled during his speech, including by MK Yoel Hasson (Kadima), who shouted, "Where have you been until now?"
"63 years ago, our GDP was the same as Egypt's, Syria's, and our neighbors whose populations were much larger," Netanyahu continued. Had we not increased our GDP per capita, we could not have met our economic burden, and therefore our economic vehicle is vital, and heaven forbid if, when seeking solutions and correcting the distortions that need correcting, we must not disable this vehicle. Then we'll be in far greater distress."
Netanyahu warned against deterioration in Israel's economy, which would result in conditions similar to those in debt-burdened European countries. "If what has happened in Europe happens to us, the damage we will suffer will be far greater than what has happened to them."
He also mentioned Israel's low unemployment rate compared with Western countries, saying, "At a time when unemployment is rising in Western economies, it is falling in Israel."
Netanyahu spoke proudly of the measures his government has instituted as part of the biennial 2011-12 budget. "We've invested NIS 7 billion in a multiyear plan that is bringing back people from the best universities in the world. We've invested almost NIS 30 billion in roads and railways - we're doing this. We've moved the IDF south to the Negev, we've invested NIS 17 billion in this. Officers, senior NCOs, families, 10,000 IDF personnel will hold up the Negev."
As for the issue of Israel's indirect taxes, against which the middle class is protesting, Netanyahu said, "There are Israeli citizens who are saying, 'OK, our salaries are rising and income per capita is rising, and yet, if I'm a working young couple with two children, it's hard for me to make ends meet.' The question is why?
"The answer is that we're not at Europe's price levels. There, most prices and many services cost less, even when taxes are lowered. The price Israeli citizens pay for basic goods in higher than in Western countries."
Netanyahu said that a lack of competition was the main reason for the high cost of living.
Published by Globes [online], Israel business news - www.globes-online.com - on August 3, 2011
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