Rattling the Cage: Starving the 'fat man' to death

Why, during these years of fast-growing prosperity, have Israeli governments, allowed essential services to relentlessly deteriorate?

By LARRY DERFNER
December 19, 2007 20:05
larry derfner 88

larry derfner 88. (photo credit: )

 
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Remember a few years ago when Binyamin Netanyahu, then the finance minister, gave that enormously successful chalk talk to Israelis about the "fat man" and the "thin man" of the economy? The fat man, he explained, was the public sector - the government bureaucracy, welfare, all the stuff that's paid for by the taxpayers. The thin man was the private sector - big business, small business, start-ups, the wealth that Israelis create with their own money. In Netanyahu's analogy, the thin man, the private sector, was the productive one in the economy, and it was carrying the fat man, the burdensome public sector, on its back. By now the fat man had grown so heavy that he was weighing the thin man down. The answer was to put the fat man on a diet - feed him less in taxes so his spending, his size, would shrink - leaving the thin man with a lighter load and enabling him to move ahead faster, to create wealth faster. The result, Netanyahu promised, would be a richer Israel. It turned out Netanyahu was right. He didn't introduce this policy to Israel - it had been the creed of the Finance Ministry for a long time - but he put it into practice with an evangelist's zeal. When the annual growth rate went up and stayed up, this economic school of thought - once known as Thatcherism or Reaganomics - swept the country. It is now our unchallenged economic philosophy, regardless of which party runs the government. Today Israel has one of the fastest-growing economies in the world. Overall, Israelis are richer than they've ever been, and, barring a long war or worldwide depression, they're probably going to keep getting richer. BUT WHILE people here have been making a lot more money, something strange has been going on: Israeli education, health care, police protection, and aid to the "truly needy" is getting worse. Even though this society can afford to improve the vital public services that individuals depend on, these vital services are deteriorating. You see it in the schools, in the standard test scores of Israeli pupils, which have gotten closer to those of pupils in the Third World than to those of pupils in the First. You see it in the worsening condition of Israeli hospitals, already among the most overcrowded in the West. You see it in the cost of medicine and medical care, which is growing beyond the reach of more and more Israelis. This deterioration in basic public services - how Israeli society is getting poorer even though so many individual Israelis are getting richer - can also be seen in the anemic police force's helplessness against rising violent crime. It can be seen in the way Israel remains utterly backward in providing wheelchair access to public places and public transportation. And in the way old people without a lot of savings or well-off children are forced to live. A couple of weeks ago a relative of mine, a social worker who aids the elderly poor in one of Israel's wealthiest municipalities, told me her boss just informed the staff of the latest in the never-ending cutbacks in services. From now on, my relative said, she and her colleagues would have less money to give their clients for such things as remodeling their homes for wheelchair accessibility. Gotta get government off the taxpayer's back, don't we? Gotta put that fat man on a diet. We just recovered from a two-month strike by junior high and high school teachers that was fought not only over salaries, but over the worsening overcrowding in classrooms and the continual shortening of the school day. Tell me - why do the teachers have to go on strike for two months before the Finance Ministry will agree to spend the money so Israeli kids can study in decent conditions for a decent amount of time? Why, during these years of fast-growing national prosperity, have Israeli governments, led by the Finance Ministry, allowed classrooms to swell with pupils and school hours to dwindle? Probably the most vivid illustration of Israel's societal poverty amid individual wealth came during the Second Lebanon War last year, when local and national government simply broke down under the shelling of the North. It was private charities and volunteers who helped those hundreds of thousands of old, sick, poor people stuck in those bomb shelters; the most that government agencies could do was shnorr money from the rich to give to the poor, because they had no budget, no money from the taxpayers, to deal with such a challenge. NOW WE'RE hearing about a new brain drain, about unprecedentedly large numbers of top young Israeli academics going abroad, often for good, to do research at much better pay and with much better resources. Meanwhile, back at home, senior lecturers at universities have been on strike now for nearly two months because the Finance Ministry insists on keeping their salaries stagnant. Is there a connection here? In this country, more and more adults can buy their kids all the i-Pods and MP-whatevers in the world - yet they can't give their kids a good education, the kind they themselves received even though their own parents weren't rich and neither was Israel in those days. These same prosperous Israeli adults can buy their now-aged parents all sorts of fancy gifts from abroad - but they would have to mortgage their homes to buy them the kind of life-saving drugs that elderly people in most Western countries receive at minimal cost. Middle-class Israelis can build big homes and fill them with expensive furniture - but outside, the streets have gotten much more dangerous than ever and the police are overwhelmed. In terms of national wealth, Israel has become a Western country - and its most talented young people, frustrated at home, are leaving for the West by the thousands. In the last couple of years, especially in the last couple of months, we should have finally gotten a clear picture of the identity of the Israeli public sector - of who the fat man of the economy is, who it is that's riding our back, weighing us down. The fat man, it turns out, is the education of our children, the health and safety of our families, the future of our society. And just look how thin he's become. The diet must be working.

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