Solving the country’s budget problems, though painful at first, would ultimately
benefit the middle class, Finance Minister Yair Lapid promised on Monday, after
a week-long silence.
Meanwhile, opposition MKs accused Lapid of detachment
and alienation from the real middle class.
“I’m not prepared for us to
turn into Greece or Cyprus on my watch,” Lapid wrote in a lengthy Facebook post,
saying that covering the country’s NIS 30 billion “overdraft” would require
“On the other hand, if we don’t preserve the middle
class, the economy will stop and the overdraft will grow more and more. That’s
also the truth and that will also not happen on my watch,” he
Though the 2013 budget deficit is projected at NIS 30b., Lapid
does not have to eliminate the whole thing to meet the 3 percent deficit target;
he needs only to reduce it by about NIS 19b. Of that, about NIS 13b. must come
from cuts, but the rest can be a combination of reduced spending and increased
“The beginning may be difficult, but with time, the people who
hold the whole nation on their backs will discover that they are no longer the
ATM that the state goes to every time there’s a problem,” he wrote.
his Facebook post, Lapid described one 37-year-old Ricki Cohen, a prototypical
Israeli middle class woman whose economic situation the Finance Ministry should
work to improve. Mrs. Cohen, of Hadera, and her husband, a low-level
employee at a hi-tech company, earn a combined NIS 20,000 a month to support
their three children.
“We sit here day after day talking about balancing
the budget, but our job isn’t to balance Excel spreadsheets, rather it’s to help
Mrs. Cohen,” Lapid wrote. “It’s because of people like her that this nation
Lapid said that the state should consider the education it
provides Mrs. Cohen’s children (which he said should include longer
school days), the quality of services at government offices, ineffective police
and lack of competition in the financial sector. He lamented the health system
he said was crumbling, the lack of a unified public transportation payment
system and the fact the Cohen children were considering whether they even wanted
to live in Israel when they grew up.
Though the Cohens have an apartment
and travel abroad every other year, Lapid said, they would not be able to afford
buying an apartment for one of their kids when they grew up.
Ministry should work to increase Mrs. Cohen’s quality of life and reduce her
cost of living, he continued.
According to a 2012 Bank of Israel report,
prices of goods and services such as housing, food, electricity, gas, and water
increased faster than income for the middle class between 2007 and
Labor faction chairman Isaac Herzog accused Lapid of overshooting
in his estimation of the middle class’s income.
“There are many more Mrs.
Cohens who make only NIS 5,000 and together with their husbands bring in maybe
NIS 10,000. They do not contribute any less to the country, send their children
to the army and barely survive,” Herzog said.
“Wake up, finance minister.
This is where the middle class is found,” he said.
According to Herzog,
Lapid will take away child allotments (paid monthly by the National Insurance
Institute), which balance middle class families’ incomes.
The Bank of
Israel defines the middle class as those earning 75-125% of median income. A
study in late 2012 calculated the medium income at NIS 6,655 per month, meaning
a two-income family making more than NIS 16,638, as the Cohens do, would be
solidly in upper middle class territory, defined as 125%- 200% of medium
Meretz chairwoman Zehava Gal-On mocked Lapid for “not yet
understanding that he is no longer a columnist in Yediot Aharonot and that his
job isn’t about writing long posts on Facebook.”
“The finance minister
still has no idea whothe Israeli middle class is,” Gal-On said, adding that
those who make NIS 20,000 are in the top 20%, financially.
miserable Facebook post, Lapid showed his ignorance and condescension over the
middle class, and even over the Finance Ministry economists, whom he described
as surprised [to hear about Mrs. Cohen],” she added.
“Worst of all, he
didn’t say one world about priorities or the weaker sectors or even the lower
80% [of earners], who will be the first to pay the price of the finance minister’s alienation and condescension.”
MK Esawi Freige, also
of Meretz, weighed in as well.
“I feel sorry for Lapid voters who are in
in the middle class and woke up to the finance minister’s Facebook status this
morning,” he said.
“Lapid made it clear who he’s working for today: The
top 20% of wealthy people in Israel society. Not for an imaginary Mrs. Cohen in
Hadera, but for Mrs. Levy in Ramat Hasharon and Mrs. Berkowitz in Ramat
Apparently, an income of NIS 20,000 isn’t a lot of money for Yair
Lapid and his millionaire friends.”
Freige said a family making NIS
20,000 is not in the middle class, because NIS 10,000 after taxes is the average
monthly income for an Israeli family, and most workers earn up to NIS 6,000 per
“These are Mr. Mahmid from Umm el-Fahm and Mrs. Attias from
Beersheba. They are bearing the country on their shoulders and collapsing under
the weight. They pay taxes, their children don’t have a chance of buying a home,
and they are afraid of the future,” Freige added.
The Meretz MK called
for Lapid to “get out of his bubble” and meet people from different population
groups, as opposed to just his “rich friends from north Tel Aviv.”
Shas MK Eli Yishai responded to Lapid's post with a sarcastic statement congratulating him for managing to eradicate the issue of poverty, within two weeks of his appointment, in order to deal with the up-and-coming needy populations, namely those earning NIS 20,000 a month.
For those millions of people, who constitute populations that do not earn this kind of money, Yishai said, "they will not be ignored, allowing a blind eye to be turned against them, without a solution to the problem - this will only worsen it."
Torah Judaism MK Moshe Gafni said “Israel received a finance minister detached
from the holiness of the holiday – which he desecrated by posting a message
during the holiday – and from his need to take care of the entire
“Lapid should learn more about his job before releasing empty
slogans,” Gafni added.