The Bottom Line / And the Winner Is: The Customer

The insurance sector alleged not only would the reform result in higher premiums, but even worse, owners of expensive cars in the center of the country would pay less, at the expense of less well-off car owners in outlying areas.

1. Compulsory insurance. Anyone who listens to the radio these days hears the insurance companies' advertisements, trying to persuade car owners to buy compulsory car insurance from them. This follows years in which we were accustomed to a cartel-like market with a single, uniform premium and no competition.

But in 2003, after a lengthy battle against the insurance companies, Avner, the compulsory insurance conglomerate, was shut down and the market was opened to competition. The insurance company executives tried to frighten us. Naturally, they used "social" arguments, saying that not only would the reform result in higher premiums, but even worse, owners of expensive cars in the center of the country would pay less, at the expense of less well-off car owners in outlying areas. How heart-rending.

But it turns out they were putting one over on us: Everyone now pays less. Suddenly, it is possible to pay the premium in 12 installments, with no interest. Suddenly, careful drivers who have not been involved in accidents receive discounts. The companies have begun to pursue us, the customers, and the supervisor of insurance publishes rates on the Internet, so that it is possible to see who is cheaper, and who offers better payment terms. The public is saving huge sums - and the insurance company executives are keeping quiet.

2. The ports. When the port reform took effect, it was promptly lambasted by opponents of the market economy, who claimed that it was unnecessary. They argued that even though the three ports had been separated, they would not compete against each other, but would continue to coordinate their activities. Moreover, their unions would still be united under the Histadrut.

Since then, less than three months have passed. But lo and behold: On May 1, the shipping companies canceled the "overcrowding surcharge" they had slapped on Ashdod Port, thanks to an improvement in the port's service, produced by recruiting additional workers and allowing additional overtime hours in order to shorten the lines of waiting ships. Port Chairwoman Iris Stark said that emphasis must be placed on improving service.

A few days ago, the Jubilee Port was inaugurated in Ashdod. This is Israel's first computerized container port, and it will cut the waiting time for ships by 60 percent over the coming year. To operate the port, Ashdod Port hired some 100 new employees.

And Haifa Port was quick to react: It held its first customers' meeting. Port Director General Amos Uzani presented potential customers with a package of benefits, including the ability to find out in real time, via the Internet, exactly where their container is and where the ship they await is. A union official told the meeting that the union's goal is to improve service.

This is the spirit that has begun to infuse the ports: the spirit of competition. The workers understand that the better the service they offer, the more ships will dock at their port, giving them more work, and therefore more income. So what do opponents of the reform think now, dinosaurs of the Labor Party? What do Isaac Herzog and Ephraim Sneh think now?

3. Tax reform. Finance Minister Benjamin Netanyahu is now planning an additional tax cut. He intends to cut the corporate tax rate to 24 percent and the highest marginal income tax rate to 44 percent within five years. To finance these cuts, he will raise the capital gains tax.

Netanyahu has no choice in this matter. In the rest of the world, corporate and income tax rates are lower, and if we want investments, we cannot lag behind. In this case as well, competition is at work: Those who do not react in time are left behind, outside the global economic game. And it's cold outside.