Broadcom VP Shlomo Markel: Put welfare money into education

Markel says during his tenure higher education, which yields skilled workers, productivity and then tax revenues – has fallen.

SHLOMO MARKEL broadcom vp 370 (photo credit: Courtesy)
SHLOMO MARKEL broadcom vp 370
(photo credit: Courtesy)
Tax money spent on welfare would be better spent on stronger education for the long-term health of the economy, Broadcom vice president Shlomo Markel told The Jerusalem Post Tuesday in an interview.
“As a private citizen, I don’t think the taxes should be primarily used for transfers,” he said, referring to wealth redistribution through taxes and benefits. “There are those that say transfers are important for welfare, for social ideals. I think helping the poor is important, but for there to be money, there must be sources...
The money needs to go to better education, and in my opinion it should start in middle school, or really in kindergarten.”
Since 2001, the outspoken Markel has headed the Israeli wing of US-based Broadcom, a Nasdaq-traded company with more than 10,000 employees and annual revenues of about $8 billion. The company has made 11 acquisitions in Israel and is always on the lookout for more, he said.
During his tenure, Markel said, the sources of economic growth – higher education, which yields skilled workers, productivity and then tax revenues – has fallen.
There have been decreases to the Chief Scientist’s Office, research and development and education in core subjects such as science, technology, engineering and math (STEM).
“I respect all the other subjects, but from the state’s perspective, these are the areas that create jobs,” he said.
The change is evident in the types of start-ups popping up: more mobile apps but fewer semiconductor businesses, which require a solid STEM education.
“I have no problem if people make and sell an app for a few million,” Markel said, but from a macro perspective, they don’t have the same investment resources into their acquisitions to help them flesh out their infrastructure and broaden their corporate expertise. “For the ones making the application, they sell and it’s done. There’s a problem with this change.”
Another problem is the difficulty in raising funds, he said, adding that part of the solution lies in Israel’s institutional investors.
“The institutions control trillions,” Markel said. But whereas the pension funds in California, for example, invest heavily in hi-tech, Israeli institutional investor seem to prefer to invest abroad. If they invested just 5 percent in Israeli hi-tech, they could both help boost local business and make a hefty profit, he said.
“We have to invest in the start-up nation so it won’t just be some book title,” Markel said.