Hoodwinked one and (nearly) all
Dan Meridor would be the last person to suspect of sympathizing with the Bank of Israel. He resigned his post of finance minister in 1997 when the prime minister Benjamin Netanyahu and governor of the Bank Jacob Frenkel reached some deal.
Dan Meridor would be the last person to suspect of sympathizing with the Bank of Israel. He resigned his post of finance minister in 1997 when the prime minister Benjamin Netanyahu and governor of the Bank Jacob Frenkel reached some deal. But last Sunday, he was the only one to abstain when the cabinet voted on the new monetary council. The others - all 17 - voted for the Sharon-Shalom proposition.
Meridor said at the cabinet meeting that it was important to preserve the independence of the central bank, and also important that the bank report fully on its activities, but in weighing the two, it was more important to preserve the independence. He added that the bank had indeed pursued erroneous policies for the years since 1996-97, but nevertheless, it was still important to maintain its independence, because we all know how politicized the government is, and therefore how wrong it would be to grant the government a majority, even a transparent one, in the monetary council.
Meridor was referring to the work of deception that this proposed law has accomplished. At the treasury, they say that three of the seven members of the council will be the governor's people, him and two deputies. But who said that these are "the governor's people"? The government appointed Avia Spivak as deputy whether David Klein liked it or not, and 20 years ago, the government appointed Yakir Plesner as deputy to then governor Moshe Mandelbaum.
It is also written in the bill that the prime minister and finance minister will appoint the three-member panel; a retired High Court judge, a president of a university and a businessman, whose job it will be to recommend a list of candidates for the monetary council, from which the government will choose four.
This is a disgraceful and transparent ruse. It will always be possible to find a "suitable" judge, a "sycophantic" university president and "chummy" businessman, who will draw up a "made-to-order" list. What does Shalom think? That we were born yesterday? In other words, this "compromise" proposal fixes the political control of the treasury on the monetary council, that is, on the interest rate - and there is the disaster for the economy.
Meridor almost voted against, but in the end abstained because the prime minister promised that the bill will pass to the ministerial committee on constitutional matters, and that if there is a difference of opinion, the bill will come back to the cabinet for a compulsory further vote, so there is still hope.
Aside from the major points of dispute, Klein took a different tack in the public campaign. He told the government ministers that he received the new bill only two hours earlier and therefore, he was unable to respond to it. But the ministers wanted to hear his reasons against the matter (which Klein has in abundance) and Tsippi Livni really wanted him to make his understanding clear for all. But Klein answered that he had not yet studied the material. It is quite scandalous that a bill is proposed in such haste, only two hours before it is debated, but the governor managed to enrage the ministers with his silence. He gave them no good argument for voting against the bill - and there's the rub.