A few months after he took up the office of prime minister, Benjamin Netanyahu declared that "they say without peace the foreign investors will run away and the economy will collapse. I say that within a year we'll be back to 6 percent growth - and more - and within a decade Israel will be one of the five richest countries in the world in terms of per capita production." But instead of 6 percent growth, Netanyahu got only 2-3 percent growth, and instead of prosperity, unemployment grew, and instead of fifth place, we deteriorated to 25th. So maybe, after all, there's a connection between peace and the economy.
This week the treasury released some worrisome figures. In the last two years, since the outbreak of the intifada, the economy has lost NIS 50 billion as a result of the drastic drop in growth, and next year we can expect a record-breaking 300,000 unemployed. Investments will continue to shrink, and consumption will drop, as standards of living decline. So, another NIS 8.7 billion has to be cut from the budget, to prevent an immediate financial crisis.
Two years ago most commentators were explaining that the reason for the recession was the high-tech crisis and the world recession. Now it's clear that the main reason for the crisis is the war in the territories and the terror attacks. First it was only tourism, but very quickly the crisis spread to every sector of the economy. Nothing has been spared its effects.
For the first time in the history of economic crises in Israel, no stratum has escaped the sword. This time, it's not only the poor who are harmed, but the wealthy are also paying more taxes and earning a lot less. Businesses are closing, companies are collapsing, shops are empty. Wage-earners are taking home less money and those who don't work are getting lower unemployment benefits. Taxi drivers don't have enough passengers so they have to drive 12 hours a day to survive - and the factory managers have been fired. Even the Israel Electric Corp. workers will have to give up some of their free electricity.
But while the economy is almost in free-fall, there are certain groups who will never let it open a parachute. No economic plan will work, only a political plan to end the war. But listening to the settlers and their political representatives in the Knesset and government, it's clear they have no intention of giving up even the tiniest, most isolated settlement. It doesn't matter to them if Yasser Arafat suddenly turns into a Zionist patriot or if Ahmed Yassin converts to Judaism. As far as they are concerned, God gave them the territories, and if by chance there are 2-3 million Arabs living there, then we will continue fighting generation after generation - or until the messiah comes.
The ideological settlers are a tiny minority, but they have managed to drag every Israeli government into investing tens of billions of shekels in the territories, flattening hills, carving tunnels, building bridges, paving roads, subsidizing ostentatious villas and cottages - and all from the one and only coffer that is shrinking by the day. There are no miracles in economics. What goes there does not reach here, for infrastructure, jobs, development towns. The settlers won't allow the majority to reach negotiations, the war and terror will continue, the GDP will continue to decline, and good people will simply get fed up and leave the country.
The only alternative to this situation is in the hands of the Labor Party. If it continues serving Sharon in the government, its fate is sealed, and so is ours. But it can do something - quit the government and start persuading the public there is an alternative to the situation, that the settlers are the main obstacle to negotiations and an agreement that will bring life and hope; that the security and economic burden of the settlements is impossible to bear any longer, because it reaches into every household and the mood of each and everyone one of us. If the Labor Party were to do that, there would still be hope for the country.
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