'Israel's lack of acceptance to EU may be political'

Although Israel compares favorably with other OECD member nations, it has yet to be accepted to the international club of some 30 countries who have attained "developed" status, something which Israel's economy easily qualifies for.

By MATTHEW KRIEGER
April 26, 2007 10:15
2 minute read.

 
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Although Israel compares favorably with other OECD member nations, it has yet to be accepted to the international club of some 30 countries who have attained "developed" status, something which Israel's economy easily qualifies for. Over the last decade, Israel has been aiming to gain entry into the Organization for Economic Cooperation and Development but its efforts have been rebuffed due to "political decisions" within the organization, Ben-Gurion economist Prof. Avia Spivak said at a conference at the Van Leer Institute in Jerusalem earlier this month. At the gathering, which was part of a series of economic discussions organized by the institute, Spivak discussed the differences between the American model of economic policy and the European model among countries in the OECD, while simultaneously highlighting Israel's place among the member nations should it be accepted into the Paris-based international organization. Spivak noted that today there is prevailing tendency among economists to group OECD member nations in two categories - Anglo-Saxon countries and Continental European countries. "Anglo-Saxon countries tend to have lower taxes, more inequality between its rich and poor citizens and a strong belief that the only determining factor to realizing economic success is hard work, while European countries charge higher taxes, less inequality and a notion that luck plays a significant role in determining financial success," said Spivak. While no data was available regarding Israelis' belief in hard work or chance circumstances as determinants for success, Spivak noted that inequality here would be the fifth highest among Anglo-Saxon nations in the OECD should Israel be accepted, which is above the numbers of countries such as England, New Zealand and Ireland. Meanwhile, Israelis may pay significantly more taxes than Americans, however this number is just above the average for all OECD nations, and far below the amount of taxes citizens of Scandinavian countries such as Denmark and Sweden pay. Additionally, said Spivak, data highlights that citizens of Anglo-Saxon countries give less to charity than citizens of European countries, as both approach poverty with the same type of mentalities they take to financial success - "if someone is poor, it is most probably because he is not working hard enough," reasons the Anglo-Saxon approach, while Continental Europeans believe that poverty stems from "bad luck," a notion that leads them to give more to charities than English speakers. Since the mid-1990s, Israel has been seeking to join the OECD in order to position itself among developed economies and help attract international investment. Leading the push for acceptance has been Bank of Israel Governor Stanley Fischer, who has travelled to Germany, Japan and Holland over the last number of months in order to raise support for Israel's bid to become a full member of the OECD. In March, Fischer reduced his estimate for unemployment in Israel for 2007 from 8.1% to 7.5%, yet despite this decrease, the Manufacturers Association of Israel claimed late last month that the country was still far from the jobless rate of OECD countries and, according to Ohed Marani, chairman of the Association's economics committee, even if the country were to grow at 6.5% a year, it would take six years to reach the unemployment rate of developed countries. Israel also ranks below OECD countries in medical care indicators, said a report released by the non-profit Taub Center for Social Policy Research in January, with the government spending $1,953 on the health of each resident, 20% lower than in the OECD countries.

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