Taking Stock / Don't turn back the clock
Good morning prime minister-designate,
At the time of this writing, the exit polls have not yet been announced. However, even if the real results surprise, it's a fair bet that the two biggest parties elected will be those that waved a civilian banner, an agenda of political solution, an agenda of getting out of the territories.
The government's economic policy for the next few years will be decided even before the next cabinet is sworn in, the moment a new finance minister is chosen as part of the coalition negotiations; the position must now be filled by someone who will do the job full-time, who sees economic work as his mission and political goal.
The Finance Ministry needs a professional and not a political wheeler-dealer who only wants a political power base from which to make political declarations. The Finance Ministry needs a minister committed only to creating a long-term, responsible economic strategy.
The Finance Ministry needs a minister with a modern economic perspective who can excite, convince and draw the public to him. The Finance Ministry needs a minister who can turn his back on the wealthy families and major economic lobbies, and believes competition and a free market were designed to serve the public at large and not just the well-heeled.
As these lines are written, projections are getting stronger that the Pensioners' Party will make it into the Knesset for the first time. This is no coincidence - it reflects a change in the public: Israel no longer votes only from "the gut" on hackneyed political matters, but also chooses ballot slips based on painful economic-civic matters.
The Bank of Israel published data just before the elections that found Israel's welfare subsidy policy has been cruel to the elderly in recent years compared to global norms.
Until now, the treasury was peopled by officials who led that economic policy. They know exactly why they adopted it - not because they believed in it, but because that was the easiest route to the results: The time has come to take the harder route.
The easy solution today for the elderly, disabled and ill is to raise spending. The budget surplus created in the past two years would allow that fairly easily, but that would be a historic error; weak populations must be dealt with, but there is one proper way to do that.
Now, after the campaign is over and the polls are closed, the truth must be told: The clock cannot be turned back, we cannot be dragged back to the age of stipends that encourage deserting the job market. Nor can we go back to rising deficits, increasing national debt and imposing new taxes - those things will not provide solutions to poverty; they will bring us to the next inevitable economic downcycle, which will put us back where we were four years ago: backs to the wall, indiscriminately cutting budgets.
We have a historic-economic opportunity to set the civilian-economic agenda. For the first time, there could be a majority of ministers seated around the cabinet table with a civilian agenda who understand that the economic model of occupation has failed, that the economic model of a big army and a small state has also failed
A multiyear program of budget cuts in the inflated defense sector, in the cash flow to the settlements and in the black holes of the public sector could redirect huge resources to social causes - we must not and need not increase the tax and government spending burden to deal with the huge gaps created in our society.
The last cabinet that was sworn in February 2003 faced a huge challenge. The economy was on the verge of economic crisis, financial markets here and abroad were blocked, the financial sector was vulnerable, and rapid and difficult measures were necessary to restore stability and return to growth.
But the challenge before the government that will now be formed is even greater: continue responsible economic policy, continue leading structural reform that has ground to a halt in the last year, cut the fat from the public sector - at a time of economic growth, without the sense of urgency and the feeling of emergency.
Most of Israel's leaders have won their glory through success in periods of crisis and emergency - now we need leadership that knows how to create responsible long-term economic policy, despite being in the midst of an upcycle in economic activity.