Policy-makers in Jerusalem want us to believe that the new tax hikes and budget cuts were formulated out of pure economic necessity, after the best brains sat down together and unequivocally concluded that the money has to come from raising VAT, an across-the-board budget cut, a tax on the wealthy, and a tax on smokers. Just before publishing the measures, Prime Minister Benjamin Netanyahu made sure that "Globes" readers would read that he is "strengthening the National Economics Council advisory committee ahead of drawing up an economic plan". For this purpose, he appointed new members to the committee, including even former National Labor Court President Steve Adler. If the defender of Israel's workers, Judge Adler, is among Netanyahu's economic advisers, we can relax.
In practice, Israel's state budget is not really drawn up by advisory committees or even in the grey rooms of the Ministry of Finance's Budget Department. It is easy to complain about the "Treasury boys", but at the end of the day, they only move the blanket from one side to the other, according to the known rules of the game, on the basis of the good old order. This order divides the population into four groups: the poor, the middle class, the rich, and the haredim (ultra-orthodox).
They try to avoid touching the rich (and the companies tax), whether because of an ideology that says they create the growth that ultimately trickles down to the rest of the people; or because of the need to benefit a sector that knows how to return a favor, or because of the fact that there are far fewer rich than poor, so that it doesn’t how much taxes are raised for the rich - salvation will not come from them.
The haredim are not touched. Period. Netanyahu made this clear just last week. The haredim will continue to fill the world of welfare payments, support, and give aways, while being absent from the world of work, the army, and civil society. An entire population does not go to work, and therefore does not pay taxes, while the productive population pays more and receives less in exchange. It receives less health, less education, less welfare, and less of everything.
We are thus left with the poor and the middle class. Although they represent the majority, they are not the majority of interests in the Knesset. A secular Likud minister will prefer to strengthen the budget for "traditional study", and send pupils on tours of Hebron before he will send haredi pupils to civics classes or job training of any kind. The Yisrael Beitenu ministers opposed raising the minimum wage, even though many of their voters would have benefited from the measure.
Even Labor Party chairwoman MK Shelly Yachimovich shows signs that she may be part of the old order. She took the trouble to criticize the work of the Plesner Committee on equality of the burden, saying that she would handle matters with the haredim through "agreement". In other words, Yachimovich needs the haredim on her side in a future coalition, if there is one, no less than she needs your vote. How does this fit together? In the world of the good old order, it is a great fit. There is no connection between your vote at the ballot box and what happens in the Knesset tomorrow.
All that is no left is to smoke less (it's bad for your health anyway), fill up your gas tank less (it's bad for the environment), and die sooner (to make things easier for the welfare services). But the next time you use your credit card and pay more VAT, remember that this was not a decree from on high, or a pure economic policy. It was the policy of political deals of deputy ministers of nothing at all and Tzachi Hanegbi for home front defense. The home front is actually just fine; it's just that the nose cannot stand the stench.
Published by Globes [online], Israel business news - www.globes-online.com - on July 25, 2012
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