Olmert Blinked First

Bar-On must be a "bad" finance minister, the treasurer who guards the coffers. For only thus will the unions, the industrialists, the Knesset members and all the other pressure groups understand that they must rein in their demands.

Finance Minister Roni Bar-On is angry. He did not like the "Hanukkah candle-lighting" meeting with Ran Erez, chairman of the Secondary School Teachers Association. Throughout the day, he tried to torpedo it, but when he understood that Ehud Olmert intended to hold it anyway, he announced that he would not be able to attend, "due to prior commitments." Bar-On also made sure that no one else involved in the negotiations with the teachers would attend - not the treasury's budget director, Kobi Haber, not its wage director, Eli Cohen, nor Menachem Cohen, the deputy director general of the Education Ministry.

Bar-On understands that if Olmert becomes involved in the negotiations, that will be the end of the finance minister. Olmert will turn him into a pathetic figure, a lame duck.

Erez, in contrast, very much wanted the meeting. He knows that the staff of the Prime Minister's Office is guided by Olmert's standings in popularity polls; Israel's economy and the state of the budget bother it less. Therefore, he believes that he will be able to extract from Olmert what he has not been able to extract from Bar-On and Education Minister Yuli Tamir.

Unfortunately, Olmert blinked first. He was unable to withstand the pressure from the teachers and from the politicians who demanded his involvement. Granted, he stressed that this was not a negotiating session, but a "pedagogic" discussion about the importance of education. But Erez, upon leaving the meeting, said: "The prime minister's goodwill must be translated into the language of deeds, and we will determine our steps accordingly."

Yesterday, the teachers held a demonstration to demand that Olmert immediately take an active role in the negotiations. They know that he is the weak link; he is not built to be the "bad cop." He likes to slap people on the shoulder, laugh, enjoy himself and reach expensive compromises. Erez also knows that Olmert intervened during the negotiations with Israel Teachers Union Chairman Yossi Wasserman and substantially increased the sums that had earlier been agreed on with treasury professionals. They had agreed to a 22.5 percent raise, but Olmert raised it to 26 percent. The professionals had agreed that a teacher's starting salary would be NIS 5,000 a month; Olmert raised this to NIS 5,300.

Treasury officials were furious, but at the time, Olmert was both prime minister and finance minister. Now, however, he is "only" prime minister. Therefore, if he intervenes, or even continues to declare that "the teachers are right," Bar-On will explode.

Bar-On has also made some mistakes. He erred when he declared on TV last Saturday night that the prime minister is entitled to intervene in the negotiations "at the last minute" - because who will decide when "the last minute" has arrived? He thereby opened the door to the premier's intervention with his own hands.

Bar-On also erred by speaking of the 2008 budget as "a budget of [good] tidings, not [evil] decrees." It seems he failed to understand that when the other side hears about "tidings," it immediately doubles or triples its demands. He should have adopted the opposite tactic, explaining, as Joseph did to Pharaoh in the Bible, that we are now in the midst of "seven good years," but we must prepare for the "seven bad years" that will follow. He should have talked about cutting the education and defense budgets and demanded streamlining and reforms in the public sector, which suffers from excess manpower and duplication.

Bar-On must be a "bad" finance minister, the treasurer who guards the coffers. For only thus will the unions, the industrialists, the Knesset members and all the other pressure groups understand that they must rein in their demands. Then, instead of asking for more, they would focus on averting the evil decrees and preserving what they have.

That would give the negotiations with the teachers and the university lecturers a completely new direction. Erez would understand that "there is no one to talk to" and would therefore have to reach a reasonable compromise. The lecturers would similarly understand that they cannot demand a fantastic 45-percent raise when the finance minister is talking about cutbacks and streamlining. Thus the strikes would be shorter and more reasonable, and the economy would benefit.

The finance minister would also benefit from such a situation. After all, the public is not stupid. It would understand that this is a serious finance minister who is guarding the public coffers. It would see a flourishing, stable economy, with unemployment declining over the years. And therefore, when his term ended, the general public would understand that the "evil finance minister" had really been a good finance minister.