Likud defends price cut measures

Peretz: Cuts are gov't trying to defraud public; NGOs call on parliament to overhaul its economic philosophy.

February 15, 2011 05:08
3 minute read.
Amir Peretz

311_ amir peretz. (photo credit: Ariel Jerozolimski/The Jerusalem Post))


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The Knesset continued to debate price increases on Monday, a day after Prime Minister Binyamin Netanyahu’s plan to reduce fuel costs went into effect.

While Likud lawmakers, including the prime minister, were quick to praise the government’s response to rising costs of living, opposition MKs joined with other coalition parties in continuing to criticize what they described as insufficient measures to help the middle and lower classes.

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Treasury officials told members of the Knesset’s Finance Committee that the government’s plans to fund cuts to the prices of gasoline, water and public transportation would be funded by some combination of three options: temporarily canceling income tax cuts for the wealthy, delaying plans to reduce corporate taxes, and across-the-board cuts to government ministries.

During the often-stormy meeting, Meretz chairman Haim Oron read out the names of Likud legislators who, although members of the Finance Committee, were absent from Monday’s debate. Of the ruling party’s members, only one – MK Tzion Pinyan – was present during the hearing.

Other coalition representatives, including committee chairman MK Moshe Gafni (United Torah Judaism) and MK Amnon Cohen (Shas), were openly critical of the government’s response to and even its role in creating the rising prices. Cohen told Treasury director-general Haim Shani that the powerful Knesset committee would not approve the proposed across-the-board cut to government ministries, and that the Finance Ministry must find other sources of funding.

The criticism against the proposed cuts to government ministries continued to generate criticism throughout the day.

“An across-the-board cut will only continue to harm the weaker sectors – it is a matter of political cowardice,” opposition chairwoman Tzipi Livni said during a meeting held with local government representatives later in the day.

During Labors’ weekly faction meeting, the lawmakers were even more forceful, attacking not just the cuts, but also Netanyahu’s package deal that was supposed to relieve some of the pressure on consumers.

MK Amir Peretz described the prime minister’s price breaks as “an attempt to defraud the public,” and said that the struggle against the rising cost of living should be coordinated among the relevant social organizations, including the Histadrut labor federation.

But during Likud’s faction meeting, Netanyahu told MKs that “Israel relies on its economic stability; Israel is an island of economic stability,” and thanked his faction members for speaking in support of the administration’s price-cut package.

Outside the Knesset, social rights activist Tami Molad told The Jerusalem Post that the emergency measures to tackle sharp rises in the costs of basic commodities are merely a band aid covering the real socioeconomic issues facing the country.

Molad was one of many social rights activists from a large group of NGOs that participated in a one-day symposium called to protest the government’s approach to the economy.

Those present at Monday’s gathering included representatives of the Association for Civil Rights in Israel; Rabbis for Human Rights; Osim Shinui (Making Change); Shatil, the social rights branch of the New Israel Fund; the Israel Center for Social Justice; the Black Panther movement; and the Social- Economic Academy, a nonprofit organization that discusses economic, social and environmental issues.

“The prime minister’s press conference on Thursday did not address the basic problems such as housing, rising education costs and the disappearing middle class,” Molad said, explaining that the NGOs are calling for the government to entirely overhaul its economic philosophy.

“Israel’s economy is booming, but the people are not benefiting,” she continued. “Netanyahu does not see the citizens of this country, he only looks at the big picture. There are so many people who are working but who cannot make ends meet. The social and economic gaps between people are getting bigger and bigger.”

Molad said that a host of social rights groups and activists planned to demonstrate near the Tel Aviv Museum on Rehov Shaul Hamelech at 7 p.m. on Tuesday night, to show their discontent for the government’s economic approach.

“At the moment, all we see is that reducing the cost of gasoline and water will come at the cost of budgets allocated to education, housing and welfare,” she said. “In the end, the average citizen will still pay more and end up with less.”

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