Your Investments: Locusts are a sign - Let us be free

Here come the locusts. If anyone needed a reminder to start their Pessah cleaning, the infiltration of millions of the eighth-plague star should sound the “cleaning bell.” While my son, who loves scaring various female family members with his plastic cockroach, eagerly awaits the locusts’ arrival in Jerusalem so that he can really get a good scream from his mother, most of us would rather that they get blown out to sea.

The locusts help remind us that we are all celebrating the fact that we have gone from being slaves to being a free people. In Gemara Tractate Pessahim 10:5, the Mishna says: “Man is obligated to view himself as if he himself left Egypt.” In other words, we must internalize the fact that we were once slaves, but now we are free. There is nothing like a few million locusts to help us recreate the sensation.

Unfortunately, while we may live in a democracy, we are not so free. When looking at things economically, we the people continue to serve the very people we elected. The direct opposite of the way it’s supposed to be. How are we serving our elected representatives? By continually paying higher taxes, so that they can go ahead and spend on money on frivolous projects without properly understanding that it’s not their money. It’s OUR money.

Jerusalem of Gold

A case in point is the Jerusalem Municipality. We continually hear how well-run the budget is in the capital and that the city has won national awards for a disciplined budget. Can someone explain to me why the city raised the arnona (municipal tax) significantly this year? After all, in 2012 it was raised by over 3 percent, and this year it moved up by a similar number. Throw in the fact that the city has been doing a better job of collecting this tax and the city’s coffers are swelling. Where is this money going? Do any of us think that our streets are cleaner? Are there more parking places? One of the areas that the city is focusing on is cultural activities.

They are planning events throughout neighborhoods all year long. Sounds great, no? Does the city really need to spend NIS 200,000 to close off Emek Refaim Street for a five-hour street party that will bring 15,000 to 20,000 participants? Can’t the city bring in corporate sponsors and create a partnership between neighborhoods and business? The city wouldn’t have to pay a dime, the public would be treated to a great party and corporations would be able to publicize that they are fulfilling their civic duty, as well as advertising to a huge captive audience. Plenty of companies would sign up as sponsors. It’s a win-win situation for everyone.

National scene

There is no reason that this corporate-neighborhood partnership shouldn’t be the way forward all over Israel. Should the government really be in the business of party planning? By getting out of places they have no reason to be in the first place, governments, municipal and national, would need a lot less money to run, thus allowing us to keep more of OUR money.

It’s almost comical that Jerusalem claims to want to encourage both business and young families to move in, yet they tax them into oblivion. I have a smallish office downtown, and with what my business needs to pay in municipal taxes, I could hire a part-time employee. Not exactly encouraging new business! Where are the calls from our newly elected officials to let us keep more of our hard-earned money? Unfortunately their ideas of helping out the middle class actually end up costing the middle class more money in the long run. Margaret Thatcher one said: “The problem with socialism is that eventually you run out of other people’s money to spend.” I am very worried that as Europe is proving her to be correct in her analysis, we are heading down the same path.

In order for us to be truly free and independent, we need the release of the shackles of taxation that are holding back the economy nationally and each one of us personally.

aaron@lighthousecapital.co.il Aaron Katsman is a licensed financial adviser in Israel and the United States who helps people with US investment accounts.