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'The middle class will no longer be silent.' Summer's social protest Photo: Moti Kimchi
'The middle class will no longer be silent.' Summer's social protest Photo: Moti Kimchi
 
 

Funding for yeshivot or research?

Just say it loud and clear: New road in Samaria or light rail in Tel-Aviv? Economics means you can’t have it all. Calcalist publisher's address at Calcalist's 2013 Forecasts conference

Yoel Esteron, Calcalist
Published: 12.27.12, 07:16 / Israel Business

Some people truly believe that Israel can grow and thrive economically even while the Israeli-Palestinian dispute is ablaze, threatening to set fire to the entire region, with no diplomatic solution even remotely at hand.

 

I believe this is not only a grave mistake but also the folly of hubris.

 

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If the next government of Israel follows in the footsteps of the outgoing administration, meaning it throws to the wind all chances of reigniting any reconciliatory process with the Palestinians and other Middle East neighbors – Israel will suffer fiercer exclusion and isolation than ever before.

 

The sour note emanating from the unfortunate confrontation with the Obama administration on the way to its second term and the head-on collision à la Lieberman with Europe will take their toll in 2013, and not just in the form of unflattering headlines in the New York Times or the Guardian.

 

There is a real risk to our exports, foreign investments and access to foreign tenders as well as to our business with the international community at large, so much so that our macro figures may take a hit, including those of next year's promised growth.

 

Some believe that we can have it all. They seem think that the government can carve off a juicy hunk of funding for the army but also fill its $4 billion fiscal deficit abyss forecasted for next year.

 

They believe that Israel can develop its infrastructures and improve education and schooling at the same time, and while we're at it – abolish social inequality. They want to eat their budgetary cake and have it too.

 

That is, without trimming so much as an iota off the behemoth budgets for settlements and the ultra-Orthodox sector.

 

Sorry, no can do.

 

It might work for election campaign speeches but it ain't how the real world works, because when it comes to economics you can’t have it all for everyone. There're only so many resources to go around.

 

It's okay to believe that the Judea and Samaria settlement enterprise outweighs other national priorities. So just say it out loud and clear and pave yet another road in Samaria instead of the light rail in Tel Aviv.

 

It's also okay to believe that yeshiva students immersed in the aura of the Torah are more important than all the rest of us. So just say it out loud and clear and we'll nix research budgets for the sake of yet more funding for yeshivot and kollelim.

 

But just don’t try to tell me they can all fit snuggly into the tight budgetary bundle.

 

War over Israel

Whoever declares that we can have it all is either willing to lie for the sake of the State, as former Prime Minister Yitzhak Shamir professedly did, a cynic who is willing to say whatever sounds best, or just a fraud.

 

Either way, this isn't economics – it's deception.

 

Some people believe the social protest has died out. They see the polls and say, "Well, if the protest didn't bring down the government, why should I care what happens with it?"

 

I don't assume to know how the social protest will affect the results of the upcoming elections, but there's a chance we'll see a rekindling of the protest next year, perhaps in a more violent form, fueled by the rage and frustration of Israelis who work hard, serve in the army and dutifully pay their taxes.

 

My personal forecast for 2013 is this: The middle class will no longer be silent and docile, especially not after the expected tax hikes and reduced benefits come tumbling down on its head. Because they will, regardless of who becomes minister of Finance.

 

Some people believe that high-tech will continue to be our ever-faithful growth engine. "Look at all the cushioned exits Israeli companies made this year. Look at how high-tech continues to gild our export figures," they say.

 

Israeli entrepreneurship and high-tech exits will continue to galvanize us next year as well. But pay heed to warnings from the high-tech captains, who caution that without the appropriate funding of research and higher sciences education, Israel's high-tech will capsize and sink, if not now then in the next few years.

 

Next year, Israel will be at war. Perhaps not the kind of war we physically fear and surely not a new war. This will be a war not between Israelis and Palestinians, but among Israelis themselves. A war over Israel – its values, boundaries, aspirations and future.

 

Even after the elections are over, we will still have to answer the most important question: What kind of Israel do we wish to live in, what kind of Israel do we wish for ourselves, and to what lengths are we willing to go to realize our wish?

 

Yoel Esteron is the publisher of the Calcalist business daily

 

 

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