Opinion |

Bringing Down Bibi: Fixing the Economy Isn't Going to Do It

Finance Minister Moshe Kahlon expected to ride to power on reforms and has accomplished much. Why are his poll standings sub-basement?

David Rosenberg
David Rosenberg
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Israeli Prime Minister Benjamin Netanyahu and Israeli Finance Minister Moshe Kahlon attend the weekly cabinet meeting at the Prime Minister's office in Jerusalem December 24, 2017
Israeli Prime Minister Benjamin Netanyahu and Israeli Finance Minister Moshe Kahlon attend the weekly cabinet meeting at the Prime Minister's office in Jerusalem December 24, 2017Credit: \ AMIR COHEN/ REUTERS
David Rosenberg
David Rosenberg

“Prime Minister Moshe Kahlon.” There was a time when that looked like a intriguing possibility, and for Israel’s center and center-left, a pleasing one: a principled politician and a rare voice of reasonableness in a government driven by a rightist ideology.

More than Yesh Atid leader Yair Lapid or Labor chairman Avi Gabbay, Kahlon was the man who could break Netanyahu’s grip on the voters, and the way he would do that was to deliver the economic goods to ordinary Israelis. He wouldn’t have to take sides on the Palestinian issue or fight the culture wars. Give them lower housing prices, cut their taxes and break the power of the cartels, and hard-pressed Israeli consumers/voters would reward Kahlon and his Kulanu Party.

There’s still some talk here and there about Kahlon as prime minister material, but there’s little basis for it.

Kahlon scored big in the 2015 elections campaigning as the candidate who had brought down cellphone charges in 2012 by taking on the telco cartels when he was communications minister. He was expected to work his magic on soaring housing prices and the banking cartel. Voters gave him with 10 Knesset seats, making his new party Kulanu the second-largest in the coalition and vaulting him to the finance minister’s job.

But polls since then have been less kind. An average of them from 2015 to the present indicates that if elections were held now, Kulanu would get just seven seats, a figure that hasn’t improved even as Kahlon has delivered on what he’s promised.

The same day that Kahlon was getting ready to rack up his latest achievement – a reform of the electricity monopoly after more than 20 years of failed efforts -- a poll by Walla! gave Kulanu just six Knesset seats. That would leave it tied as the No. 4 partner in the coalition with Yisrael Beiteinu, a party’s who’s main claim to these days is a wide-ranging police investigation into corruption by party leaders. What happened?

It’s not just electricity reform: Kahlon has also been behind a drive to insert more competition into the banking industry, and he has cut taxes while increasing government social spending. His flagship campaign to turn the tide on rising housing prices is finally having an effect: they have started to go down in the last several months. The economy is growing smartly, unemployment is at record lows and wages are rising. Israeli consumers are spending on cars and travel like never before.

More than that, Kahlon’s career is the kind that should endear him to voters. He came from a hardscrabble background, and many of his ideas about how to solve problems defied the wisdom of economists.

When it was clear housing prices were really falling, Kahlon was quick to celebrate his victory, not only over the housing market but over the professional doubters: “At first, everyone said it was impossible . To all the skeptics who attacked us and said that it is impossible, it is time to come to terms with the new reality.”

No good deed

Not all the reforms Kahlon has undertaken have been perfect, certainly not the one in electricity. The turnaround in housing prices is perhaps too fresh for most voters to appreciate it and the effects of banking reform haven’t kicked in.

Maybe the rewards due a politician who’s accomplished what he said he would will arrive. Although with the likelihood of elections no later than early next year, Kahlon doesn’t have a lot of time for voters to learn to appreciate him.

Alas, I predict that they won’t.

Kahlon thought he won his initial electoral success in 2015 by campaigning on the story of ordinary Israelis crushed by powerful cartels and labor unions, endemic corruption, ineffective government and rapacious tycoons.

He wasn't the only politician who responded to the middle class Israelis pouring into the street in the summer of 2011: not a few, including Netanyahu, panicked. But with hindsight, Kahlon was just the flavor of the month.

Certainly parts of that narrative are true, but ordinary Israelis were actually doing well, even in 2011, as the data for the economy show. Israel had and still has too many poor, but they are disproportionately Haredim and Arabs who don’t cast their votes on pocketbook issues. Meanwhile, the dirty secret of soaring home prices is that people who already own a home were quite happy to see the value of their equity rising.

When Israelis give thought to the economy (which isn’t often, after so many years of virtually uninterrupted growth), they give the credit to the prime minister. They aren’t looking for change.

As it turns out, the 2011 protests weren’t the start of a revolution in Israeli politics and economics. They were more a form of street entertainment than a real protest, and when the public got bored, the protests evaporated.

To them, Kahlon also was a form of entertainment. That is not to say he isn’t a serious and dedicated politician. But the 10 mandates Kulanu won in 2015 was due to Kahlon being a new and different face rather than a vote for someone who could rescue a suffering Israel. The election before Naftali Bennett was the new face and before that it was Yair Lapid.

Like every other politician Kahlon has worked assiduously to promote his achievements. But the fact is, by the standards of someone in elected office, he is low-key, shunning inflammatory statements or grandstanding on issues of the day. Even if he had a base, he’s not the kind of politician who could inspire it.

Alas, short of finding himself on the wrong side the prison bars, Bibi’s here to stay, and the idea that the center/center-left can win by wielding the pocketbook isn’t going to work.



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