A Self-defeating Protest

The protesters need to be calling for 'Trajtenberg first,' says Shahar Cohen, the youngest member. of the committee that formulated the report.

Oren Majar
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Oren Majar

Shahar Cohen, the youngest person on Prof. Manuel Trajtenberg's 15-member committee for social and economic change, isn't an academic or a public servant. The head of strategic planning at HP-Indigo, he was appointed to the committee partly due to his lengthy stint at the non-profit organization Nova, which helps other non-profits function like businesses. He also was appointed due to his young age, 33.

"People say to me, 'This report is pretty good, but what effect will it have?' When I explain that a family with two children will be getting an extra NIS 600 a month they are amazed. When I explain the measures proposed for addressing economic concentration, integrating ultra-Orthodox Jews into the workforce and other issues, people then ask me, 'So why do the social protest leaders oppose the report? What more do they want?'"

Shahar Cohen. Credit: Hadar Cohen

Were you surprised by the reactions to the report?

"I was disappointed. Half an hour before the report was released to the public, there were headlines already expressing disappointment - even before anyone had thoroughly read it. It's no secret that parts of the media have an agenda. They said the report would quickly be forgotten in September [due to the Palestinian Authority's campaign for United Nations membership], and that Prime Minister Netanyahu would just 'dissolve' it. Well, nothing happened in September and the prime minister wants the report to be adopted in full.

"The report essentially became the 2012 budget; it is the basis for the entire social budget the protest leaders are discussing. It reflects a change in priorities, but does not call for increasing the state budget. I find it very troubling that a report with so many good intentions, and which could change Israel's priorities, is going to hell because of the social protest leaders.

"The present situation is truly absurd. [National Student Union head] Itzik Shmuli is joining forces with the Histadrut labor federation head [Ofer Eini], who represents trade unions whose members earn scandalously high salaries; Daphni Leef is making deals with rabbis and sectorial parties; and Regev Kontas has written on Facebook something like 'The most important thing to do is to just "dissolve" the report.' All we need now is to hear that Stav Shaffir has formed an alliance with some tycoon, and that will be the end of this social protest movement."

While the Trajtenberg Committee was meeting, a self-appointed committee, headed by Prof. Avia Spivak and Prof. Yossi Yonah, was meeting in parallel. This alternative committee is calling for more far-reaching measures than the Trajtenberg Committee. Could it be that the latter did not really address society's needs?

"I, too, would like to boost the social and health budget by NIS 15 billion. I, too, would like to see salaries that would attract better teachers and much higher unemployment and disability allowances. But who is going to fund all this in a country where the top two deciles pay 82 percent of all income tax revenue, while the bottom five deciles pay no income tax at all, and the marginal tax on monthly salaries of more than NIS 40,000 is 60 percent? Deciles four to eight? Weren't they the ones protesting in the first place?

"The social protest leaders are saying, 'Raise taxes because we want a welfare state.' They want to increase the government's share in public expenditures. But who is going to pay for all this? The ninth decile [second from the top] is not affluent. Families in that income bracket earn NIS 25,000 a month. We have to realize that if we want a welfare state, we have to increase taxes. That is what Yossi Yonah is saying, too. But where will the money come from? From higher taxes on the middle class?"

To what extent has the work of the Spivak-Yonah committee influenced your committee?

"It increased our awareness about the problems. As a representative of the general public, I wanted to hear other opinions; I didn't want the public to be dependent solely on us. In fact, we even invited the Spivak-Yonah committee to present their conclusions [to us] so we could exchange ideas, but they never came. In the vast majority of instances, I did not find their proposals any better than ours."

You were a member of the subcommittee on social services. What do you believe are its most significant recommendations?

"In our report, we focused on the most important fiscal allocations. We concentrated on early childhood education, on massive subsidies for construction of day care centers, on two tax credits for working fathers, on subcontracted workers, on larger payments for single mothers.

"For instance, the section on ultra-Orthodox employment could set in motion a genuine revolution if it is implemented. The most positive aspect of that section is that it does not take a coercive approach; that is why many pragmatic-minded members of the Haredi community were prepared to endorse the report. They also realize that the present situation simply cannot continue. More aggressive measures would have led them to close the door in the secular public's face.

"After all, we could have demanded that that they be drafted and that the Tal Law be dropped. Or we could have recommended that the National Insurance allowance be canceled beginning with the third child. Many Israelis may be demanding this, but we must remember that the Haredi community is ultimately poor. We must make them want to work for a living.

"And that is what the report is doing: It is proposing training and education programs, and making working more attractive. How? By limiting state-funded yeshiva tuition to five years. Only 10 percent of yeshiva students - namely, only the outstanding students - would receive tuition funding after reaching the limit. The other 90 percent will thus be more motivated to go out and work."

One sector that has deteriorated more than any other is health care, but your subcommittee hardly touched it. Why?

"Professionally, I deal with strategy, which means prioritization. We focused on education and social services, major topics that were the very heart of the social protest. In addition, as we were meeting, the physicians and the residents were negotiating with the health care system. Our subcommittee also avoided the issue of children aged 9 and up because two education reforms - Oz Letmura and Ofek Hadash - were achieved through negotiations with the teachers. We didn't want to get in the way."

Services in parallel

Since you are on Nova's board of directors, people were expecting you to advocate reforms regarding NGOs. Yet your report barely mentions this. Why?

"I was not the Trajtenberg Committee's representative for NGOs. If I represented anyone, I would say it was younger Israelis. I believe there was room for true NGO representation. Although during the first two weeks of the committee's work, joint sessions were held with representatives of the NGO sector. NGOs are involved in many fields related to the committee's work, from social services to housing; in fact, some are even monopolies. So ultimately we did address NGOs.

"This is an entire world that needs to be addressed in depth, and NGOs were not the heart of the social protest. Although the Trajtenberg Committee did address the needs of society's weakest elements, it chose not to concentrate on the relationship between NGOs and the government, except with regard to the privatization of social services. On that matter, the committee recommended creating a special team.

"At Nova, we worked with NGOs that suffered due to poorly run privatization - for example, rehabilitation centers or workshops that employ the disabled. Granted, these workshops save the state a considerable amount of money, but the present arrangement places an onerous burden on the NGOs. Not all social services should necessarily be run by the government; some can be outsourced, if it's done carefully. The Trajtenberg Committee addressed this when it recommended that more thought be given to such matters as quality of service, monitoring and regulation."

Have NGOs become stronger or weaker in the wake of the social protest?

"They were bypassed. For decades, they journeyed in the wilderness, exhausting themselves going from conference to conference and from government agency to government agency, fighting for every budget. Suddenly, along comes a group of young people championing the weak. Ultimately, the NGOs will be around after the protest has died down, but their voices must be heard more loudly in decision-making processes. I wanted to involve representatives in the committee's deliberations, and we allocated them more time and weight than any other external body.

"Some of the issues that were raised, such as socially responsible businesses and ways to fund NGOs, appear in the final report. Topics such as NGO taxation are complex matters, and the committee decided that the best place to deal with them would be a forum with NGOs and think tanks, outside the committee. Employers' taxes and VAT refunds, subjects I raised with the head of the Tax Authority, were not the focus of the taxation subcommittee, which addressed issues that were just as pressing.

"One of the greatest achievements of the social protest was that it made people more involved and more aware of social distress. It detached them from TV programs like 'Kochav Nolad' ["A Star Is Born"] and forced them to see society's various economic and social injustices. I hope that more people will now want to volunteer and be involved. The moment you open your eyes and realize you have been dealing with trivialities, it is hard to go back to your previous patterns. Some of the energy released during the social protest already has been channeled toward NGOs in the form of donations and volunteerism."

Needed: A tailwind

The road to making the Trajtenberg recommendations part of the state budget is a long one. Do you fear that once the government allocates money for social programs, pressure groups might find a way to channel that money for their own purposes?

"If the goal is to implement the report in full, then it needs a tailwind. The report can actually become the 2012 budget, and it is the public's responsibility to see that it is implemented in full, without any deals for sectorial political parties."

What do you have to say to the people who took part in the most recent Saturday night protest, two weeks ago?

"That was the first demonstration that I did not participate in. I say, 'Demonstrate for the report's implementation. Demonstrate for "Trajtenberg first."' The report is only a beginning. As Prof. Trajtenberg stated, it is only the first part of the book's introduction. People have to keep protesting, but those who are denouncing the report are actually serving the interests of the pressure groups that want to concentrate only on some of its recommendations.

"It is unfortunate that the central demand of the protest leaders that Saturday night was to increase the state budget. I wonder how many of the demonstrators understand that they will have to pay the bill somewhere down the line, and that the ones who will benefit are the well-connected whom the masses set out to protest against. I am frustrated that the protest leaders fail to take into account two major obstructions to social justice: the large trade unions' power, and the low rate of participation in the workforce of some sectors of Israeli society. These burdens are being shouldered by the middle class - through prices at supermarkets, electricity bills, and endless welfare necessitated by generations of poverty."

You come from the business sector, while many of the committee's other members are from the public sector. Did you discover another world out there? Did you see a difference in approach?

"I discovered a world with different rules. In politics, as opposed to business, populist considerations sometimes outweigh professional ones. For example, the decision to raise the ceiling on National Insurance and health taxes [intended to raise taxes paid by the rich] ended up leading many high earners to create shell companies to serve as tax shelters.

"I was happy to see that the committee avoided ineffective populist recommendations such as lowering VAT, which only would have meant higher profits for merchants. Beyond that, I was pleasantly surprised by the professionalism of the senior government employees, both in the Finance Ministry and in the Prime Minister's Office."

Does that mean you might consider becoming a government employee?

"Well, it certainly got me thinking that I would find myself there in the long run. In the short run, it is still hard for me to think about having to deal with all the populist considerations."