“I don’t like it, but agreements must be honored,” Benjamin Netanyahu said sadly this week, as he signed off on Arye Dery’s demand to eliminate value-added tax on public transport, water and electricity. You really have to feel sorry for the prime minister; it’s so traumatic for him to undermine the country’s economy. They’re forcing him to it, the poor guy.
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When I saw him in his pain, I felt as if someone else, a villain, had signed that despicable coalition agreement with Dery which Netanyahu is now compelled to honor. But then I remembered that Netanyahu is the one who signed it. I looked at his face, and I didn’t see his nose growing longer. In other words, it’s possible to keep pulling the wool over Israelis’ eyes again and again and still remain at the helm.
Netanyahu also forgot to tell us that in December 2014, at a conference sponsored by the business daily Globes, he announced, of his own free will, that if reelected prime minister he would work to eliminate VAT on staple products, because “that’s a benefit millions of people deserve. These are the most basic needs – bread, milk and eggs ... This step will lead to an immediate reduction in the prices of price-controlled products.”
In other words, this brilliant idea wasn’t Dery’s alone. It was also the brainchild of the economist Netanyahu – a full partner in the disaster.
Nor should we forget the role of Yesh Atid party chairman Yair Lapid in this story. The former finance minister pushed the idea of eliminating VAT on first homes – a damaging idea that, luckily for us, never came to fruition. But the moment one person plans to exempt apartments from VAT, the whole thing comes undone: Someone else proposes exempting staple products, a third person proposes exempting medicines, the fourth proposes diapers, and so on, with no end.
That’s the road to destroying the system of uniform VAT, which prevents distortions and impedes fraud. That’s the road to sliding into the huge mess that exists in Europe, which suffers from 1,000 different VAT rates.
At this point, it’s worth mentioning Energy Minister Yuval Steinitz, the only righteous man in Sodom, who voted in the cabinet against zero VAT and wasn’t afraid to say publicly that this was a “serious mistake,” adding, “During my time as finance minister, such a decision fell into the realm of ‘over my dead body.’” Current Finance Minister Moshe Kahlon, who voted in favor of zero VAT, should take note. He ought to be ashamed of himself.
Afterward, they distributed 300 million shekels ($77 million) to various coalition members, earmarked for items like improving security for setters in East Jerusalem, maintaining open areas of the West Bank, special grants for local councils in the West Bank, increased support for the ultra-Orthodox community and large sums for men’s yeshivas, woman’s yeshivas, Jewish studies, religious education, ritual baths and synagogues. And where do these millions come from? From cuts in education, health care, infrastructure and welfare. In other words, the periphery will pay the price, for the glory of Dery’s new appointment as minister for the periphery.
After that, the law to equalize the burden of military service was liquidated, becoming the law for evading any share of the burden. The mandate that ultra-Orthodox yeshiva students serve in the army was postponed to 2023, or in words, forever. And the goal is clear: to continue the unacceptable practice whereby the ultra-Orthodox don’t serve while secular people and religious Zionists shed their blood to defend the ultra-Orthodox and the state.
Then, to make ultra-Orthodox draft-dodging perfect, the stipends paid to yeshiva students were increased and government funding for yeshivas was raised, so that the ultra-Orthodox can both not do army service and also not work, but instead continue to live at the public’s expense – blatantly un-Jewish behavior. Moreover, budgetary support for ultra-Orthodox schools that don’t teach the core curriculum was restored, in order to encourage ignorance and illiteracy.
Thus the winners of the 2015-16 budget were the big lobbyists: the defense lobby, the settler lobby, the ultra-Orthodox lobby, the religious Zionist lobby, the agricultural lobby and the lobby for the big unions. And those who lost were the rest of Israel, whose traditional role was faithfully maintained: fully funding all the groups represented by these powerful lobbies, who make laughing stocks of us all.