Trajtenberg Committee member rejects criticism of report

C'tee member says Trajtenberg report is not a repackaging of unimplemented government policies.

October 7, 2011 01:30
2 minute read.
Trajtenberg Committee 'Rothschild Team'

Trajtenberg Committee 'Rothschild Team' 311 . (photo credit: Moshe Milner/GPO)

A senior member of the Trajtenberg Committee on socioeconomic change rejected criticism Thursday that its final report is a repackaging of unimplemented government policies.

“The difference between this committee and previous committees is that ours has macroeconomic support and the backing of the [Treasury] budgets department,” Dr. Yoram Gabbai said at a briefing to the Federation of Israeli Chambers of Commerce.

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The Trajtenberg Report, which aims to resolve deep-seated socioeconomic grievances aired
by summer-long public protests, is expected to be put to a cabinet vote on Sunday.

Gabbai stressed throughout Thursday’s meeting that the committee had played its role and that it was now up to the politicians and bureaucrats to ensure the report is implemented.

Gabbai, a former head of the Finance Ministry’s revenue department, responded to allegations from senior members of the business sector who said the committee had focused mainly on solutions for the lower class.

“We didn’t prepare a report aimed just at the weaker strata of Israeli society,” he said. “That would be a matter for another committee. The Trajtenberg Committee made universal recommendations, although the emphasis was on working families with small children, and we needed to act within the budgetary framework.”

“This was the best report possible from the perspective of universal benefit,” he added.

The business officials with whom Gabbai met were most bothered by the report’s recommendation to raise the company tax to 25 percent next year, with one calling it “populism” that would damage economic growth.

Gabbai admitted that “there is a price to pay” for the tax hike, but he said the committee could not have proposed the far-reaching changes it did without taking such necessary steps.

Gabbai addressed each of the four areas of the report: housing, social services, the cost of living and taxation.

Regarding the cost of living, he justified the report’s recommendation that import tariffs be removed, saying it would boost competition.

“The prices of clothing, shoes, home wares and furniture have been dropping because those industries have competition,” he said. “The only way to maintain and develop competition is through the removal of import duties. If there is no competition, as is the case in the food industry, the futile game begins in which industry regulators try to find who is to blame for the high prices.”

Gabbai also addressed the involvement of the protest movement’s leaders in the committee’s deliberations.

Although they had been consulted, he said, many of the demonstrators hold almost revolutionary ideals that were hard to reconcile with the work of the committee, which was working on pragmatic solutions.

“We believe that fundamental change can be made while playing within the rules, while some of the protest leaders want to change those rules altogether,” Gabbai said.

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