Our Finance Minister Is a Weak Man

Yuval Steinitz might be able to stay in the treasury, but he's diminished the power of the Finance Ministry forever.

Some days it's just not worth going into the office, especially on the first one of the week. That's exactly the kind of Black Sunday - the Israeli Monday - that was waiting for Finance Minister Yuval Steinitz yesterday.

It began with the front page of Haaretz, with Amir Oren reporting on State Comptroller Micha Lindenstrauss' intention to call for the finance minister and Interior Minister Eli Yishai to resign their positions over the Carmel forest fire disaster; and it continued with the High Court of Justice going against Steinitz and in favor of appointing Moshe Asher to head the Tax Authority, rather than Steinitz's own pick for the post, Moshe Terry.

Yuval Steinitz - Michal Fattal
Michal Fattal

Even if Steinitz manages to keep his job and the cabinet rejects the High Court's recommendation on Asher, it is clear that both these developments have profoundly weakened his position. Starting yesterday, we have a finance minister of diminished power.

When it comes to the Tax Authority, he will presumably be forced to deal with a top official who does not trust him, and whom he did not want. That's no way to run a tax system. The burden of proof is on Steinitz; he has no alternative but to work with Asher and give him the tools he needs to succeed. The agency has been through too many scandals, too much choppy water: Steinitz does not have the privilege of sapping its strength now.

But that problem will be moot if the greater danger facing Steinitz is realized. Lindenstrauss presumably will determine that Steinitz exceeded his authority and went against cabinet resolutions when he held up funding allocations to the Fire and Rescue Services and conditioned the release of the state funds on the implementation of reforms in the agency.

Using the state budget as a whip to push through reforms and changes in governmental bodies is standard operating procedure for the treasury in general, and the budget division in particular. In Israel's extortionist, might-makes-right political arena, keeping the keys to the state coffers has become the Finance Ministry's main modus operandi.

Yesterday, Steinitz, or someone speaking on his behalf, called the comptroller's presumed decision "completely absurd, a bizarre decision, total stupidity that has no precedent in Israel or abroad and shows a basic lack of understanding of the role of the finance minister."

He apparently has no intention of stepping down - not immediately, anyway, and not under these circumstances.

Even if he wins out, the imminent report on the Carmel fire will strip him, and his successors, of the power to advance economic policy in government ministries and other agencies.

The question of whether the finance minister's job is to carry out policy or merely act as treasurer is one for the academics. In the meantime, there are too many governmental bodies in Israel that can only be shaken up and prodded into action or efficiency through control of their cash flow. Government bodies will always claim a lack of resources, insufficient funds for whatever it is they need, and it will always be the treasury that is standing on their oxygen tubes.

It's easy to blame all the ills of any state office on the Finance Ministry, and the state comptroller's report on the Carmel fire will only increase the use of such tactics: Every government agency or local authority will now see fit to claim that human lives depend on the regular flow of funds from the treasury, all the while compiling a paper trail that can be produced if and when the time comes, to prove that the Finance Ministry failed to cough up the money it demanded.

The treasury stands to lose one key policy tool, while the agencies and local governments will gain two - CYA plausible deniability, and the ability to wave the comptroller's report. It might not save lives, but it certainly won't save Israel's deteriorating government-management culture.