Next Tuesday Finance Minister Benjamin Netanyahu will present the 2006 budget to the government, and it will be passed. True, the Labor ministers will oppose it, but who is counting Labor ministers? In any event, it is a budget devoid of revolutions or big clauses, but still one that preserves a reasonable deficit in an election year - that, too, is something.
The important part of the economic policy is not the budget, but rather the Economic Arrangements Law that is a very comprehensive piece of legislation containing many reforms to streamline the economy and increase competition, with the goal of stimulating growth, reducing unemployment, combating poverty and raising the standard of living for all of us.
The problem is that the Economic Arrangements Law is a red rag in the eyes of many Knesset members. They abhor it and want to cancel it - or at least limit its scope. They view the law as "undemocratic." Knesset Speaker Reuven Rivlin calls it the "Knesset Cancellation Law," which allows the transfer of dozens of reforms at one fell swoop without the Knesset having time to closely examine them and to understand and consider the public good. And after all, we know the Knesset members are interested only in the public good and never give in to political pressures, central committee members, big trade unions or other outside interests.
The Supreme Court also leveled harsh criticism at the law, stating that it did not befit "a democratic process ... [it] makes exhaustive in-depth debate difficult and harms the status of the legislature."
Even so, an examination of the reforms this law has promoted in the past 20 years shows that there were some excellent ones. They changed the economy for the better - even saved it. The first Economic Arrangements Law (1985) determined that the Bank of Israel could no longer print money at the treasury's behest - a small change that halted hyperinflation. In the early 1990s, the law facilitated the opening of the Israeli marketplace to competitive imports from Southeast Asia, a move thanks to which we can now buy shirts for NIS 20 and televisions for NIS 900, instead of double or quadruple these sums in the past.
The Economic Arrangements Law removed the obstacles facing the telecommunications revolution. Without this law there would be no competition in the cellular telephone sector and the price of international phone calls would have remained at emergency-use-only levels. The Israel Defense Forces was switched over to a contributory pension system thanks only to this law. The gasoline and natural gas markets were opened to competition via a clause in this law.
The transition from welfare to work was implemented totally with the aid of the Economic Arrangements Law, and it is responsible for the public's ability to purchase nonprescription drugs from stores other than pharmacies. Reforms in the electricity and real estate sectors, and the splitting of the oil refineries were all part of this law - and this is only a very partial list.
This law is not enacted in the dead of night, but it is passed swiftly and efficiently, all at once, with the approach of the next fiscal year. If MKs really want to delve into the various reforms, why are they going on a three-month recess just now?
The unjust criticism leveled by the Supreme Court justices against this law is based on a theory that is light years away from reality. True, it is possible that a few MKs would like a long, exacting legislative process, but 90 percent of them are not interested in this, but rather in power. They want the wealthy businessmen, the members of the big trade unions and members of their party's central committees to visit them, to pressure them, to beg and plead, and then they will feel important and desired and will increase their political power.
It is possible to talk nicely and go on forever about the harm to the legislative authority, without bringing one shred of proof. The reality, however, is that without the Economic Arrangements Law, we would still be treading water in the shallows of a backward and noncompetitive economy. The MKs would emasculate, distort and prevent most of the reforms, and we would all be paying the price: living in a poorer economy, with a lower standard of living and higher levels of unemployment. Is that the goal of the law's opponents?
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