Taking stock / A dictatorial blitz against a weak government - Haaretz

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Tue., August 14, 2007 Av 30, 5767

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Taking stock / A dictatorial blitz against a weak government

By Guy Rolnik

How do you describe more than a hundred heroic, breakthrough reforms on a single page?

No, that's not the start of a tedious treasury joke. It's an actual challenge, and the Finance Ministry, which is behind most structural reforms in Israel, managed to pull it off.

The table of contents at the start of the Budget Reforms book that the ministry presented to the cabinet last week gives the same page number for every reform in every single ministry and sector: page 3.

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A typo? If so, it's an indicative, symptomatic one.

The most important economic reforms pursued in Israel are effected through belligerent, dictatorial blitzes that showcase the country's lack of governance. This is roughly how it goes.

The treasury's budget department (henceforth, "the Haberites," named after budget director Kobi Haber) comes up with structural reforms, from the dramatic to the humdrum, touching every sector in the land: energy, water, cellular phones, television, Internet, small businesses, foreign trade, employment, education, tenders, religious councils, housing, local government, interior, transport, agriculture, environment, security and so on.

Some are coordinated with the relevant ministries or agencies, but most reflect the Haberites' opinions, even after they have failed to persuade the relevant ministries or agencies.

Next, the Haberites target the main obstacle blocking execution of the reform, namely, the government.

A few days before the cabinet convenes to approve the state budget for the coming year, they submit the Budget Reforms book, generally 150 to 250 pages long, which briefly describes the structural reforms the treasury proposes. Each reform gets two or three pages.

Then the cabinet meets (in this case, yesterday) to discuss and possibly approve the national budget and the roughly 150 structural reforms.

Discuss? No, it is a haggle-fest between the Haberites and the ministers.

Each minister will, insofar as his skills allow, battle for extra money and against the reforms that touch him, while the Haberites brandish the sword of budget cuts at his jugular.

Some of the Haberite reforms are red herrings that will die with barely a flounder on the beach. The fresh new minnows just proposed will founder first, followed by old ones that have already swum through the Prime Minister's Office, though they may well return in the next fiscal year.

After the debate ends, in the wee hours, the Haberites will cross off the cabinet they just rolled over and dash from the cabinet meeting to the Knesset. And now the real show begins.

At the Knesset, they face three opponents: ministers who ostensibly approved the reforms but actually oppose them; Knesset members whose only commitment is to themselves, and whose ministers don't support the reforms anyway; and last but not least, the Boris Krasnys, who pull the parliamentarians' strings.

The Krasnys are the lobbyists who push, stop, change or endlessly delay economic reforms at the bidding of economic powerhouses.

Boris Krasny himself is one of the most seasoned lobbyists in the country, but he's just a symbol.

Dozens of lobbyists ply the market of structural reforms. Some aren't even perceived as lobbyists, but as distinguished lawyers or businessmen.

Krasny himself hasn't been to the Knesset for ages. He has people to do that, while he closes deals from his Tel Aviv office.

The final word on which reforms will live or die is uttered during free-for-alls in Knesset committees, which are the second place where true governance is absent.

That is where coalition ministers and MKs show their true colors - in opposition to the treasury. Sometimes the MKs are totally ignorant about the subjects on which they make decisions, and the only ones who know how to maneuver in this barren landscape are the lobbyists.

The Haberites never negotiate directly with the Krasnys: The MKs do it.

The result is that most reforms aren't birthed through open, professional and democratic debate, but rather through indirect war between the Haberites and the Krasnys, with neither disclosing their true hand and both declaring victory.

The only real way to stop the annual Haberite blitz is to stop most reforms. But some of the most important changes in the last 20 years were born of these violent, anti-democratic blitzes.

It is no wonder that ministers often see themselves as union chairmen representing the workers at the economic bodies under their control, or that MKs have difficulty perceiving or understanding long-term economic processes.

Our leaders have to serve political machines and are more vulnerable than the Haberites, who aren't elected.

But this method perpetuates the absence of governance and perhaps legitimizes the cynicism and irresponsibility of the nation's leadership.

If the treasury initiates most of the reforms, then the ministers and officials supposed to execute them feel no sense of proud ownership.

Moreover, the method often winds up compromising the planned reforms, giving the Krasnys more power and making our leaders even more cynical and less able to govern in the years to come.

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