Lapid: State has 'monstrous overdraft,' cuts necessary

Finance Minister Yair Lapid came into his position just a few days ago and already on Saturday presented his financial forecast for the coming year. “The picture that is slowly coming to light is much worse than I had anticipated.” He said that it was time to deal with the “overdraft” and emphasized that he would spend the first year on the job in decreasing the deficit.

“This is what I am going to do," Lapid said. "I will give it everything I’ve got. We will work hard, we will close gaps and decrease expenditures; we will close gaps even in painful places. It will be hard, it will be stressful, but there is also a benefit to this: If we do it now, it will not be for long.”

Related stories:

• Treasury advises Lapid to raise taxes
• Feb. budget deficit totals NIS 4.3B
• Fischer: Interest rate gap can't get too big
  

In a letter that he sent to his supporters via email, Lapid wrote, “Forget words like ‘defecit,’ or ‘fiscal crisis.’ I will make it a lot simpler: I came to do some remodeling, but I found that our account is in ‘overdraft.’ How much of an overdraft? Monstrous – a horrible crisis which is growing.

"How did it happen? As with all overdrafts: They wasted a lot of money that they didn’t have, the money they expected to receive didn’t come in and they made commitments that they should not have made.”

From the words of Lapid, it becomes apparent that he prefers to decrease the deficit via cutting the budget. Opposition Chair Shelly Yachimovich criticized this approach in a speech last week in the Knesset, calling instead, for an increase of corporation tax.

“This government highlights the differences between two constituencies (the satiated and the needy) in a manner that is the sharpest and most painful possible. You are a leadership of satiation, of the rich. You are physically part of the people, but having trouble understanding who the people are.

"The four of you: Netanyahu, Lapid, Bennett, and Livni – come from privileged families and never fought to make ends meet. You are all capitalists,” Yachimovich said. 

'The job – to go where it is difficult'

In contrast to the words of his predecessor Yuval Steinitz, who expressed pride in leaving Lapid with an economy that was booming and stable, Lapid said that it was again revealed to the Israeli public that “they always know what they are talking about."

"Already for a few years, they have been trying to convince them that the situation is good, and the public keeps saying, it is not right, it cannot be. Things are bad for the public, bad for everyone they know, they earn okay, but cannot live on it month to month, they have no chance of buying an apartment.”

Lapid and Steinitz  (Photo: Ido Erez)

Lapid said he would prefer to focus on “things that are happier,” than deal with the deficit, “but I believe that my job is to go precisely where things are difficult. The problem was created because they took giant loans and had a big party, instead of managing responsible economics. I am not going to make this same mistake," he emphasized.

Lapid and Steinitz (Photo: Ido Erez)

"He who feels that in the next year his situation gets worse, needs to know it is temporary, the more absolute our actions now, the more we will be able to do in the next year – more decreases in the cost of living, in education, in assistance to small businesses, in equality of the burden, in decreasing the cost of living (yes, I know I listed cost of living twice, it was not by chance),” Lapid continued.

Lapid noted that in a meeting with Finance Ministry staffers he said, “The discussion should not be on policy, but on vision. When you know what your vision is, the policy is already naturally derived from it. My vision is for an economy with the working man at its center, what we call the ‘middle class.’”

He presented his full vision to senior staffers as such: the development of an economy which places education at its center, that is supported by human capital, and provides citizens with the ability to live honorably, with the opportunity for employment.

“If you can work but do not want to, the job of the country is to show you that it is really not worth your while.”

In a reference to the Haredi public, Lapid emphasized that the doors are open to them.

“Everyone who tries to tell you that we are going to take advantage of the situation to disinherit or deprive you, is wrong and is speaking in a way that creates hate and fear which we must face together.

This is a government without religious parties, but this is in no way a government that is against Haredim. We are offering you a new contract.”

• Follow Ynetnews on Facebook and Twitter