Analysis

Which Tycoon Is Going to Win the Israel Election?

Akirov, Mozes, Adelson or Maimon: Behind every party in the race hides a Mr. Moneybags who contributes funds or effort to the cause. Here’s the lineup

Benjamin Netanyahu with Sheldon Adelson and Dr. Miriam Adelson at a ceremony at Ariel University, June 28, 2017.
Moti Milrod

On April 9, Israelis exercising their right to vote will find paper slips at the polls with familiar party names – Likud, Yesh Atid, Kulanu, Labor, United Torah Judaism, Meretz and others such as newcomers Hosen L’Yisrael and Hayamin Hehadash.

But when it comes to economic and social policy, the names don’t tell the real story. Israelis are going to vote for a tycoon. Every party has its own tycoon. In politics, the guy with the money is generally the guy whose opinion matters, and therefore the tycoons, more than Knesset members and party leaders, will be the ones setting their parties’ economic platforms. Thus, in the name of transparency, perhaps the Central Voting Committee should be publicizing the names of the tycoons behind each party along with other party information that appears in the voting booths.

Gantz and Akirov

Property developer Alfred Akirov, as was revealed earlier this week, is Hosen L’Yisrael leader Benny Gantz’s main financier, having given him a 2 million shekel ($552,000) bank guarantee, currently the accepted means of donating to politicians in Israel nowadays, and thus buying their loyalty.

This isn’t the first time that Akirov has donated to a party he believes can influence the government and its economic policy. He’s been doing so consistently for the past 30 years. In the past he donated to Labor, and was on friendly terms with Shimon Peres. When Ehud Olmert was Jerusalem’s mayor and later industry minister, Akron built massive projects in Jerusalem and bought paintings by Olmert’s wife Aliza. When Olmert became prime minister and was later suspected of bribe taking, Akirov paid hush money to Olmert’s bureau chief, Shula Zaken.

Where's the money? 
Israeli political candidates and the businessmen backing them

There were times when Akirov balanced his risk by donating to two major parties at the same time, Labor and Likud – an accepted practice for some tycoons in the past. People thinking of voting for Hosen L’Yisrael need to know – Akirov is a property developer, but he’s primarily the representative of Israel’s major tycoons, a position he chose for himself. He represents their worldview, including the argument that big money-political ties are legitimate and welcome.

If Akirov represents Israel’s private monopolies, then former Histadrut chairman Avi Nissenkorn, who joined Hosen L’Yisrael earlier this week, will be the representative of the government monopolies such as the Israel Electric Corporation, the ports, the Israel Airports Authority and the other entities with powerful unions organized under the Histadrut, all of which are capable of paralyzing Israel with their labor strikes.

Kahlon and Maimon

Koby Maimon, whose fortune lies in natural gas and real estate, is the official backer of Finance Minister Moshe Kahlon, the leader of Kulanu. Despite his campaign declarations that he would fight Israel’s natural gas monopoly, from the moment Kahlon took up the Finance Ministry post he announced that Maimon was a personal friend, and therefore he couldn’t get involved with anything having to do with the natural gas sector.

Kahlon’s dependence on Maimon is clear: Even though Kahlon is fighting for his political life, as polls show his party hovering at the minimum number of votes to make it into the Knesset, he hasn’t stated that he’ll break from Maimon and tackle the gas monopoly during his next term, as he did with the cellular monopoly. Such a process could have restored his political reputation and brought him valuable votes, but he hasn’t done it.

Lapid and Mozes

Yesh Atid chairman Yair Lapid worked for years as a journalist at Yedioth Ahronoth, owned by businessman Arnon Mozes, and from the moment he entered politics he enjoyed flattering press coverage from his former employer. But more importantly, over the past few years he’s been meeting with Mozes in secretive locations.

This is three types of concealment – the locations chosen are neither Mozes nor Lapid’s offices. Second, they concealed the meetings by not listing them in their calendars. Third, and most crucially, Lapid has refused to say what the meetings addressed.

What we do know: Mozes is currently a suspect in Case 2000, in which Prime Minister Benjamin Netanyahu allegedly offered to weaken Yedioth’s main competition, free newspaper Israel Hayom, in exchange for more flattering coverage. Recordings in the hands of police indicate that Mozes would regularly meet top politicians and discuss bribes that would allegedly include positive coverage for the politician in exchange for something of financial benefit for Mozes.

We don’t know whether Mozes had any kind of deal with Lapid, but given their years-long relationship and the positive coverage for Lapid in Yedioth, as well as the secrecy surrounding the men’s meetings, there’s reason to fear that Lapid may be dependent on Mozes and is serving his interests.

Who’s with Gabbay?

It’s still not clear which tycoon is partnered with Avi Gabbay’s Labor Party at the moment. Gabbay used to be a businessman who worked with tycoons such as Haim Saban and Shaul Elovitch, when the latter was the controlling shareholder of Israeli telecommunications giant Bezeq. But when Gabbay entered politics, not only did he cut his ties to them, he launched a war against the gas monopoly and the army of tycoons profiting from it.

That was an unusual action. A senior businessman told TheMarker at the time that no small number of tycoons rescinded their long-standing support for the Labor Party in response. But that’s a partial picture, since behind Gabbay on Labor’s Knesset list is MK Itzik Shmueli, who is indeed partnered with tycoons. Shmueli has taken campaign donations from Nochi Dankner, formerly the chairman of Israel’s biggest conglomerate, IDB, and now serving jail time for stock fraud; and he’s been very warmly received by Mozes and Yedioth Ahronoth. He has also refrained from taking on issues that would put him in conflict with Israel’s major economic powers. Mozes also published Gabbay’s recent autobiography.

It may be that voters will find out which tycoon stands behind Labor and its shrinking influence only after the elections.

Netanyahu and Adelson

The main patron mentioned in conjunction with Prime Minister Benjamin Netanyahu is Jewish-American gambling baron Sheldon Adelson, owner of Israel Hayom, who recently extended his support to Hayamin Hehadash’s Naftali Bennett. But Adelson isn’t the only tycoon to benefit from Netanyahu’s policies.

The downfall of the tycoons who ruled Israel at the turn of the millennium is well-known – Nochi Dankner, Eliezer Fishman, Lev Leviev, Elovitch and others, all of whom built their empires using public money loaned by the capital markets and the banks, and all of whom saw their empires collapse when the public mood changed and their financing dried up. All, except for Israel’s biggest gas baron, Yitzhak Tshuva.

What’s not well known is that Tshuva nearly fell too. He was in arrears in paying off his bank debt, and the banks were demanding he find money he didn’t have. He, too, might have gone bankrupt, if Israel’s government hadn’t approved its plan for developing the country’s natural gas reserves right when it did. That plan enabled Tshuva’s Delek group to sign expensive natural gas contracts with the Israel Electric Corporation, securing its natural gas monopoly for years into the future, and saving Tshuva from financial straits.

Tshuva was quick to cash in with IPOs and selling off part of the Tamar and Leviathan natural gas reserves. In nearly all cases, the buyers were the public, and thus Tshuva completed one of the most astounding deals by a tycoon ever – he received the near-exclusive license to explore for “public” gas free of charge, he found it, and then he sold it back to the public at a price that everyone agrees is exorbitant.

But what does that have to do with Netanyahu and the Likud? Simple. Even though Netanyahu has avoided anything to do with the economy for the past seven years, he was the one who aggressively pushed for the gas plan, putting his entire political weight and his party behind it, and doing away with regulators who stood in his way, including former Antitrust Commissioner David Gilo. If once Netanyahu used to take on tycoons, such as via the cellular reform and the law on economic concentration, now he has switched sides, starting with his relationship with Elovitch that led to Case 4000 (Bezeq-Walla), through Tshuva and any others connected to Israel’s gas monopoly.

On the face of it, any Israeli citizen has the right to vote for a tycoon on April 9, along with a party and a party leader. But while the parties and Knesset members are fighting among themselves over ego and honor, even though their differences are minor, the tycoons are actually quite unified. They may each have a party, sometimes more than one, but their goals are identical: to ensure that Israel’s laws and regulations suit them and go on letting them maintain their privileged elite status. In everything that has to do with socioeconomics, the parties are nearly identical. Why? It’s simple. All the tycoons, from all the parties, want – and likely will receive – the same thing.