Analysis: A few diamonds in a lot of rough

Experts warn: Trajtenberg C'tee recommendations might not have gone far enough to really address country’s wide-ranging social problems.

By RUTH EGLASH
Prof. Manuel Trajtenberg (photo credit: Mark Neiman / GPO)
Prof. Manuel Trajtenberg
(photo credit: Mark Neiman / GPO)
While the social protest movement’s leaders were quick on Monday night to dismiss or sharply criticize recommendations laid by Professor Manuel Trajtenberg, head of the government-appointed committee for socio-economic change, experts said, following the televised press conference, that there were some hidden benefits that could go a long way to improving life in Israel.
At the same time, however, they warned that the committee – a response to two months of on-going protests throughout Israel that had hundreds of thousands of people taking to the streets calling for better living conditions – might not have gone far enough to really address the country’s wide-ranging social problems.
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“I would say that the recommendations are two thirds of a cup full,” quipped Bar-Ilan University political science Professor Sam Lehman-Wilzig, who has authored two books on social protests in Israel.
“There is a huge amount of recommendations in the report, but overall the approach is very general. The problems that they found are so many and so diverse that they seem to have realized they will not be able to fix it with a shotgun.”
Lehman-Wilzig added however that there are some minor but significant recommendations that will not cost the government too deeply but could go far toward improving the quality of life. He cautioned though that just because the recommendations had been made, it does not necessarily mean they will be carried through into reality – that depends on whether the social protest movement can keep up its pressure.
“It seems like the government is willing to implement most of these recommendations, but obviously there are some that, for political and economic or even social reasons, might not pan out,” he said, adding “for every winner, there is a loser. For example, increasing competition for dairy products could wipe out the country’s small farmers.”
Among the solutions suggested by Trajtenberg that Lehman-Wilzig noted would not cost the government too highly is one that could affect thousands of foreigners that own holiday homes here.
For apartments that are not permanently occupied, Trajtenberg recommends doubling the “arnona,” or city tax, in order to entice landlords to rent out the space or sell up.
“If this happens, then it will automatically lower prices in the housing market,” points out the professor.
Another change that could have significant implications is the demand for the government to lay out each year its social goals, alongside its economic strategy, a practice already in place.
“If the social goals must be set out, then we will be able to compare the economic and social aims, and that will ensure that future governments have their feet held up to the fire,” said Lehman- Wilzig.
“We always knew that these recommendations would not be revolutionary,” commented Hebrew University economics Professor Michael Beenstock.
“Of course, we did not hear all the fine details yet, but I really thought it would be a little more innovative than it seems.”
While the recommendations do deal with important matters like integrating haredim into the labor market and making the public sector more answerable to its clients, Beenstock said that the report appeared “too philosophical” and very “disappointing.”
“While I need some more time to explore the report fully, my grandmother used to say ‘if I can’t understand it straight away, then it’s probably nonsense!’” he added.
Despite the criticism, Beenstock did highlight Trajtenberg’s plan to invest some NIS 30 billion over the next five years on addressing social issues such as housing, education and addressing the economic gaps between rich and poor.
“Apart from reducing the defense budget, which will probably amount to a two or three billion shekel a year reduction, there will also be higher taxation of those who are better off and basically, somehow, the richer members of society will pay for this,” he said.
However, Beenstock highlighted that the recommendations did not mark a huge departure from Prime Minister Binyamin Netanyahu’s overall economic philosophy.
“Housing, which was the centerpiece of the protest movement, receives very shallow treatment from Trajtenberg,” said the professor.
“Last week, we had the report [from the Committee on Strengthening Market Competitiveness] on monopolies and that was a very serious and thorough report with some really hard thinking. From what I have sampled so far from Trajtenberg, it seems to be very shallow and superficial. It’s a great shame.”