'Israel must manage economy responsibly'

Netanyahu says Israel must maintain responsibility in face of European crisis, rebuffs MK attempt to expand budget expenditures.

By NADAV SHEMER
Money 311 (photo credit: Bloomberg)
Money 311
(photo credit: Bloomberg)
Netanyahu on Sunday rebuffed proposals from MKs that would expand budget expenditures, saying Israel could not afford such moves amid the widening euro-zone debt crisis.
“Thanks to the responsible management of the Israeli economy, today we are not part of this crisis,” he said at the beginning of the weekly cabinet meeting. ”We must continue this responsible management. This means that we will need to reject with an iron fist populist draft legislation – both from the coalition and from the opposition.
“We have no privilege or space to put our achievements at risk. While this is true at any stage, it is especially true in the face of such great upheaval in the regional and global economies and, potentially, the Israeli economy as well.”
Shortly after Netanyahu spoke, the cabinet passed Defense Minister Ehud Barak’s proposal to grant NIS 100,000 to 1,800 widows of IDF reserve soldiers killed in action from 1948 to 1998. Barak called the moment “the closing of a moral and ethical debt to bereaved families.”
In his comments at the beginning of the meeting, Netanyahu said the pressure on Israel’s security needs caused by turmoil in the Middle East only added to the difficulty of maintaining the economy during the European debt crisis.
“While we will need to find the appropriate balance between these two needs, there is certainly no place here to run amok with the budget with all sorts of proposals,” he said. “This will require much responsibility and sagacity. I am certain that we will be both responsible and sagacious in meeting these two needs.”
Netanyahu said he had spoken over the weekend with Spanish Prime Minister-elect Mariano Rajoy, Italian Prime Minister Mario Monti and Greek Prime Minister Lucas Papademos. He said all three leaders had expressed their desire to improve and strengthen ties with Israel, adding that “the shadow of the severe economic crisis” loomed over their conversations.
Spain, Italy and Greece have been at the center of Europe’s debt crisis, which is now seriously threatening the euro zone’s future. On Sunday, Italian newspaper La Stampa reported that the International Monetary Fund is preparing a 600-billion-euro loan for Italy in the event its debt crisis worsens. UK Chancellor of the Exchequer George Osborne said Sunday in a TV interview that London is preparing contingency plans for the euro zone’s possible collapse.