The old joke goes something like this. "Don't pee in the pool," a lifeguard bellows at a swimmer. The swimmer is offended: "Everybody does it." "True," says the lifeguard, "but not from the diving board."

Tzachi Hanegbi climbed up to the top of the high diving board, clutching a megaphone.

He stood tall and looked about him. He lifted the megaphone and roared: Quiet, everybody! Everybody pipe down and pay attention. I am about to cast my water into the pool. Now shut up and watch.

The indictment filed this week against Knesset member Tzachi Hanegbi, accusing him of dozens of political appointments, would probably never have happened if he hadn't made a point of turning what everybody does on the quiet, into a statement.

Most officials try to play down the jobs they arrange for the boys; Hanegbi ran two ads in the Likud party paper, boasting that he was the king of political appointments.

The vet

Hanegbi is a seasoned veteran of the political and legal battlefields. One affair after another has been nipping at his heels for years, but he's always landed on his feet and forged on.

The present charges aren't the first he's faced, and he isn't about to give up his job as chairman of the Knesset's Foreign Affairs and Security Committee over them.

If you look at the court' record in similar cases, and Hanegbi's past, you realize there's no hurry to write his epitaph. The upshot has tended to be that the public's sensitivity crumble some more, and nobody notices the difference between white, gray, pewter and black as night.

Hanegbi insisted not only on political appointments, but on flair: huge amounts of them, and brazenly. The thing is, thousands of highly-placed officials spend their days peeing into the public's pool. Some do it inside the pool while doing the breast-stroke, others from the side.

One could argue which do more damage but the end result is that the pool is fouled. Wherever you turn in the public service you find more and more crony appointments, nepotism, and slime.

The watchdog

A few days ago the State Comptroller published astonishing figures on the extent of nepotism in government monopolies. The report attracted gasps of horror for a few minutes, and was promptly forgotten. A month ago the comptroller published a report on political appointments at the Ministry of Industry and Trade, when Olmert was its minister. That report ebbed within days.

In his last report, the comptroller exposed a highly intriguing appointment. At the start of 2004, attorney Lilach Nehemia - then the life partner of the man who is today Israel's finance minister, Abraham Hirchson - was named deputy CEO of the Small Businesses Authority. Her appointment was made without tender, which is a violation of law, and she had no qualifications whatsoever for the job.

One would think that the parties involved would find the report highly embarrassing, but one would be wrong. It was just another  report, which won headlines that nobody cares about.

The Israeli public tends to view political appointments, of cronies, friends and their friends, as a sort of gossip. They figure there's nothing to be done about it anyway, and the only question is who's involved; they are greedily curious about who advanced whose interests and why.

And the macroeconomic cancer

Nobody thinks of nepotism and cronyism as a macroeconomic disease holding back the economy. But it is a cancer that is spreading from the public sector to the private one, and preventing true development of the labor market.

A labor market crushed by cronyism has little room for incentives to excellence and achievement. The incentive to learn and advance is also low.

Each year American magazine publish rankings of the best universities interest rate hike the U.S., partly based on the average pay that their graduates achieve. Young people know they can aspire to something if they get into these universities and excel at their studies.

And here? Pay depends  much on familial or political contacts. And everybody knows that when a mediocrity is appointed to a job, he'll appoint mediocrities to serve under him, who will then appoint even worse mediocrities under them.

"Psst. Give my kid/cousin/wife's sister in law's neighbor a job and I'll scratch your back too," thousands of top people in Israel whisper to one another, and the public shows no sign of caring. The courts don't know how to handle it and mediocrity and corruption strike deep roots.

Unlike interest rates, taxation, the deficit or even achievements in education, the actual damage caused by the rampant nepotism and cronyism to the labor market is hard to quantify. We become accustomed to mediocrity, inefficiency and helplessness. We don't ask how it is, that in a nation so blessed with great minds and talents, our results are so pathetic.