Netanyahu and Lapid Have Tarnished Israel’s Economic Standing

The real question regarding the Bank of Israel controversy isn’t who needs the Turkel Committee, but rather, why is its authority so limited?

Aner Shalev
Aner Shalev
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Aner Shalev
Aner Shalev

Lately, it has become fashionable to blame Turkel. Who needs him and his committee? Back in the glory days before the Turkel Committee was created, officials were appointed without too much rummaging through their past. Really, there’s no need to be petty. Since when does one always have to pay at the duty free shop? And why should a complaint of sexual harassment, or some other unethical behavior, which caused a work stoppage at Deutsche Bank, sink an otherwise brilliant appointment by the prime minister and the finance minister?

Politicians as well as journalists and analysts feel pangs of longing for the good old days in Israel, when proximity to the throne was more important than honesty and ethics. To get ahead, one needed to scheme and squabble; abiding by the rules was not high on the list of priorities. How is it that Turkelism has exiled us from that paradise of old, and come to rule our lives?

But the truth is that the Turkel Committee did not disqualify any of the candidates nominated to serve as Bank of Israel governor. Both the candidates took themselves out of the running, and apparently they had good reasons to do so.

Professor Jacob Frenkel refused to divulge the details of his duty free mishap, and now it’s clear why: the story finally released by authorities in Hong Kong is much more serious than his version. It’s also reasonable to assume that Professor Leiderman, who seemed eager to take the reigns as Bank of Israel governor, would not have taken himself out of the race had the complaints filed against him been exaggerated.

The real question isn’t who needs the Turkel Committee, but rather, why is its authority so limited? Are honesty and integrity required only in candidates for the seven senior security and economic positions that the committee oversees? What’s the subtext here? Are all the other high-ranking officials in Israel given a green light when it comes to unethical behavior or even sexual harassment, because no one will check them out during the appointments process? Shouldn’t the same moral integrity be expected of government ministers?

Senior government officials, the equivalent of ministers, in the United States have to go through confirmations hearings as well. For instance, the hearings for Secretary of Defense Chuck Hagel were long and drawn out, and required many clarifications on his part. Serious consideration should be given to adopting the American model in Israel. Is it really logical that the Bank of Israel governor should be subject to the thorough checks and hearings with the Turkel Committee, but the finance minister is appointed at the whim of the prime minister, without any kind of investigation? Why are the standards required of the IDF chief of staff more stringent than those required of the defense minister, who presides over the chief of staff?

Frenkel and Leiderman should not be granted immunity just because they took their hats out of the ring. Can a man arrested and convicted of theft be allowed to serve as the chairperson of the Tel Aviv University board of rustees? Especially after failing to report the arrest to the Turkel Committee? Shouldn’t complaints of sexual harassment be investigated under any circumstances? Or is it that the Bank of Israel governor isn’t allowed to engage in sexual harassment, but the head economist of Bank Hapoalim is?

Netanyahu and Lapid have come out of these two failed appointments bruised and battered. The process of finding a new Bank of Israel governor should have started six months ago, just as Professor Stanley Fischer announced his upcoming retirement. Putting the matter off until the last minute (as our prime minster tends to do), Netanyahu’s opposition to Dr. Karnit Flug (the candidate recommended by both Fischer and Lapid) and Lapid’s weakness on the matter have created an embarrassing farce, which has tarnished Israel’s economic standing throughout the world. What needs to happen now, to remedy the situation, is the appointment of Dr. Flug, as fast as possible. Lapid must insist on her, but it’s doubtful if the finance minister, who has become Netanyahu’s puppy, is capable of doing so.

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