Bibi not doing the math
Op-ed: Facts and figures are for losers, make no dent in prime minister's socioeconomic ideology
Whenever I find myself in the midst of a debate I have an overwhelming need for facts and figures; pension fund management fees are over the top. OK. But how much is that in percent form? The housing minister’s plan was “Atias’ victory over Trajtenberg”. Very well. Rather than teaching me who beat whom, I would like to see how much this victory is going to cost and preferably in the form of a concise pie chart.
Please show me the numbers – how much and when – and I’ll form my own opinion. Politicians and commentators, tycoons and talkbackers are all trying to outdo each other when it comes to phrasing feelings and clichés, but where’s the meat?
And so it transpired that I had acquired somewhat of a taste – some might call it a fetish – for reports that are based on reliable and credible data, preferably such that was garnered over a reasonable period of time, to make for some truly enjoyable reading.
Please do not take offence if I assume that you have not read the latest Oxfam report, which shows that nearly all developed economies in the past 20 years experienced a dramatic increase in inequality between the rich and the poor. This week, Calcalist published a comprehensive piece about the Oxfam report, including illuminating infographics that you might have overlooked due to more pressing matters such as Nathan Eshel and the recent sex scandal at the Prime Minister’s Office.
Trickle-down myth
The conclusion is clear: the Trickle-down theory just doesn’t trickle down. When governments give tycoons tax exemptions and benefits to generate wealth among all walks of society, they are in fact benefiting the rich alone.
And now let’s talk numbers.
In 1990-2010, inequality grew in nearly all G20 countries despite economic growth – in Russia it grew by 23%; in China by 13%; in Japan by 8%; in Germany by 4% and in Great Britain by 3.5%. Surprisingly, a handful of African countries, which could only dream of the kind of GNP that G20 members enjoy, were able to reduce inequality in the past several decades. The dispersion of poverty is mind-boggling: 1.3 billion people earn less than $1.25 a day. Over half of them live in the developed G20 countries.
Israel is too small to be included in the group of 20 but it has very similar figures. Calcalist reporter Shaul Amsterdamski discovered deep in the 113-page annual report of the State Revenue Administration (Calcalist, November 9, 2011) that inequality in Israel has grown at a higher rate than the country’s economic growth. The net income of Israel’s top 10 percent of the population in the past decade climbed 62% whereas the net income of its bottom 10 percent grew by only 15%. The proportion between the former – NIS 25,703 – and the latter – NIS889 was 29:1 by the end of 2010.
It is evident that the interested parties have no interest whatsoever in such disturbing facts and figures, and perhaps it is naïve to expect those who voice their opinion on whatever to remember this when they argue in favor of tax benefits and exemptions for tycoons. Maybe next time someone tries to push forward the trickle-down theory we should politely suggest he first familiarize himself with the right reports .
The long-time champion of the theory in Israel is of course no other than Prime Minister Benjamin Netanyahu, who with unwavering faith has enforced the tax policies which have ballooned inequality beyond any measure of growth. Facts and figures are for losers, not for Netanyahu. The Oxfam report, like others published over the past year, makes no dent in his ideology. After relegating the Trajtenberg report to the social dustbin, he couldn’t give a flying Oxfam.
This op-ed was originally published in Hebrew by Calcalist
