The Bottom Line / Is the State Being Mean to the Katif Evacuees?

"The state is neglecting the evacuees from Gush Katif," was the title of the petition signed by a number of leading left-wing personalities, including Amos Oz, David Grossman, and Shulamit Aloni. In this manner the arch-doves expressed the feeling evident in the street that the Gush Katif evacuees have been deserted, and that the compensation the state offered them isn't enough to fund their financial rehabilitation.

The public's feelings, naturally affected by the guilt they feel after forcing 1,800 families from their homes, have reached the Knesset. Sixty-two Knesset members signed a bill to amend the evacuation/compensation law, at an extra cost ranging from NIS 3 billion to NIS 7 billion.

Naturally, the bill's proponents Uri Ariel and Avigdor Yitzhaki say the figures are inflated, which is the treasury's way of quashing a proposal it dislikes. But the truth is that the treasury wasn't behind those assessments, it was the Disengagement Administration (Sela).

In addition, just one of the proposal's items assured full retirement terms for any evacuee above age 46, which alone costs NIS 2 billion. Anybody who understands anything about actuarial costs knows that NIS 2 billion is not an inflated estimate.

Has the state really abandoned the evacuees from Gush Katif? They say it has - mainly when it comes to the 700 businessmen from the region. The state is compensating them fairly for the value of their businesses in the Gaza Strip, they say. But, they argue, there is a vast gap between what their businesses were worth there, and what they'd be worth elsewhere in Israel.

In other words, they argue that the fair value for their businesses is not enough to open comparable businesses in Israel.

Now, the state offered each of the 700 the choice among two alternative forms of compensation. The financial avenue was payment of the full value of the business, according to its profits - and any assumptions regarding profit were skewed in favor of the businessman. There is no dispute that people given their full profits and then some were adequately compensated.

The problem is that only about 30 percent of businessmen chose that avenue. The rest will therefore have to settle for the other avenue, based on assets. Why didn't they choose the first option? Because their businesses were losing money. Absent profits, the businessmen were offered compensation based on the value of their assets. Again, valuations were skewed in their favor.

For instance, the government compensated land based on the land values in Ashkelon's industrial zone, not according to the practically nonexistent value of land in Gaza. And the evacuees received compensation even though these business owners took their equipment with them, or sold it to Palestinians (as happened with the greenhouses).

Also, the state is offering grants equivalent to tens of percent of the compensation amount, to help build a new business. According to Sela's own calculations, and those of the Agriculture Ministry, the grants and compensation together rose beyond the cost of a whole new greenhouse, though the greenhouses in the Strip had not been new.

Other businessmen were also offered grants, free land, and exemptions from arnona municipal tax for ten years if they agreed to build their business in the industrial zone by Netivot.

Why, then, do the evacuee businessmen complain that they can't rebuild their businesses? There are apparently two answers.

One, which arises openly in conversation with the evacuees, is that the large proportion of businesses ostensibly operating in the red in Gaza had been misrepresenting their condition for tax purposes. That is why the new legislative proposal suggests a third avenue for compensation, based on the price of a new business inside Israel, irrespective of whether the original business was making money or not.

As for the second answer, Uri Ariel told TheMarker, "It's true that they paid more than the value of a greenhouse in Israel, but that doesn't restore the livelihood the evacuees had. In the Strip they had cheap Palestinian labor, cheap water, and didn't need to heat the greenhouses. Now they don't have all that and their livelihood is hurt."

In his words, he admits to a bitter truism about Gaza: Most of the businesses there had no real right to exist. They were based on land they got for free, water given almost without any charge, cheap Palestinian labor, and an almost absolute holiday from tax. Most of the businesses survived on subsidies from the state and cheap Arab labor, and now they expect the state to continue to give them the same conditions in the real world.

This is also the reason why offers of free land and a ten-year tax break don't satisfy them: Without the cheap Arab labor, the sewing shops of Erez cannot subsist, and to Israel's regret, it can't supply free Palestinians anymore.