Supporting Israel’s middle class

Contrary to the cries of the protesters, it is the government that is making real strides in making this country fairer.

July 26, 2012 00:01
3 minute read.
Social protests 370 DO NOT REUSE

Social protests 370. (photo credit: Michael Omer-Man)

This summer’s social protests do not have the same energy as last year’s. And not surprisingly.

Without a specific platform, it is hard to get people enthusiastic for another wave of mass demonstrations. “Social justice” is not going to come from those whose only articulated goal is the toppling of the government.

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Contrary to the cries of the protesters, it is the government that is making real strides in making this country fairer. This month, the Knesset passed the Economic Concentration Bill on its first reading.

This law is about opening the financial markets to greater competition – a step that will revolutionize the way we do business on every level. It will take years for a more competitive financial market to develop, but once the process has begun, there will be no stopping it.

Moreover, this bill restricts business groups with a pyramid structure. Today, almost all pension funds are invested in large-scale pyramid schemes, which by definition are risky. Banning two- and three-level pyramid schemes means greater transparency for our savings programs, less risk and more competition.

This increased competition has the potential to affect all aspects of the economy, leading to a palpable reduction in the cost of living – something every summer protester should support.

In my eyes, the Economic Concentration Bill is an example of the government fulfilling its role to make the conditions fairer and more conducive to the average person’s reaching his or her earning potential through hard work. The proposed law may not be perfect and may yet undergo some changes. But the principle is right and marks tremendous progress for Israel.

I am well aware that reducing the cost of living through increased market competition is not what the protest leaders had in mind when they called for government intervention. They wanted more government subsidies.

As someone who grew up in the Soviet Union, I have a natural aversion to big government. But beyond my personal experience, throughout Europe we see that big government is ultimately unaffordable (I am fond of Margaret Thatcher’s line, “The trouble with socialism is that eventually you run out of other people’s money”) and discourages people from taking full financial responsibility of their lives.

No one can argue with the protesters’ claims that the middle class has trouble making ends meet in spite of working full time and that housing is unaffordable.

But the answer is not more government subsidies. Instead it is good legislation that protects the little guy and allows for more competition to bring prices down.

Housing is a complex issue that cries out for reform.

For years, Yisrael Beytenu has been advancing policies to free up more government land for residential purposes, to have more building tenders, and to reduce the crushing bureaucracy involved in construction.

I have filed a High Court petition against the Housing Minister to introduce an earning-capacity criterion so that tax payers receive priority over those who live off of state subsidies. Some Haredi leaders see this as an attack on their community. But really it is simply giving the working middle class their fair dues.

If the protests took up the call for affordable housing through the policies mentioned above, we could reach a critical mass of support to push legislation through that could put home-ownership within reach for so many.

The summer protests have the potential to bring urgent issues to the top of the public agenda. Calls for big government will not bring us the financial security we seek. We need to continue in the path of the Concentration Bill, both giving people the support they need and removing any unnecessary obstacles to maximize their earning potential.

I, as a member of Knesset, would be heartened to see a successful summer protest. An informed and politically active public is good for democracy. Let’s move away from nebulous cries for change and concentrate on good legislation and together improve the lives of many.

The writer is a member of Knesset for Israel Beiteinu.

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