Analysis

Lapid's Budget: Cake for the Wealthy, Bitter Pills for the Rest

Lapid's budget only favors those with connections. The rest of the population should take to the streets again.

The budget submitted by Finance Minister Yair Lapid is frightening in the way it imposes new burdens on those without connections. It contains new taxes and fees, targets housewives and eliminates planned funding for a longer school day. Instead of making use of the crisis to generate funds from millionaire retirees, instead of streamlining a public sector that spends tens of billions of shekels unnecessarily, Lapid is coming down hard on the weak working folk.

If Lapid's predecessor, Yuval Steinitz, had submitted such a budget, the media representing those with connections would have ripped it apart and a new wave of social justice protests would have erupted. But the new finance minister is "our Yair," a former media personality himself, so everything is cool. The budget constitutes a violent assault on anyone without connections. It doesn’t deal with those who have gorged themselves or those half million individuals with old-line tenure and pension benefits. It doesn't deal with the friends of Ofer Eini, the Histadrut labor federation chief, or those others who benefit from the public and private monopolies. The banks will continue to live high off the hog while simple housewives pays stiff taxes.

If the public only knew how much corruption, idleness and ossification there are in parts of a public sector meant to serve the underprivileged it would take to the streets over this budget. Instead of finding the necessary spending cuts among those very wealthy with their giant vested pensions, from other money pots and from NIS 150 billion in wasted spending, they are going after the common citizen.

Economists at the Finance Ministry's budget division know well where to find those tens of billions of shekels that the budget needs but they are taking the easy route with taxes and fees and other cruel impositions on the little guy.So for example, now that foreign tourists will have to pay value added tax on their accommodations, every service provider in the tourism sector, most of whom are not well connected, is going to feel the effect of price increases, but imposing VAT on the sector is easy.

So what's the difference between Lapid's budget and those submitted over the past decade? Across-the-board spending cuts, tax increases and zero assurance of reforms of services for the average citizen? Lapid gave in to those with connections. The budget will hit health care, single parents, weaker populations that lack tenure or job security. The huge state budget deficit was an opportunity to really carry out a revolution, but instead, we've gotten nothing at all.

But Histadrut Chairman Ofer Eini is satisfied with Lapid's budget. It means that 2.5 million workers and millions of consumers and taxpayers that are invisible to Eini got the raw deal and will continue to get it in the future. But there are also half a million other Israelis with connections who are pleased with the budget—those in banking, real estate, the security establishment, monopoly corporations, government suppliers, lawyers and their advisers. And of course the super-rich.

Alon Ron
Reuters