Treasury officials lash out at Fischer

In scathing attack, BoI head called "big-shot who comes from abroad and sets us conditions."

Stanley Fischer nice 88 248 (photo credit: Ariel Jerozolimski)
Stanley Fischer nice 88 248
(photo credit: Ariel Jerozolimski)
Senior Treasury officials have launched an unprecedented, scathing attack on Bank of Israel (BoI) Governor Stanley Fischer, Army Radio reported on Sunday. In a meeting of the Treasury management last week, officials reportedly blasted Fischer's conditions for continuing his tenure as BoI head. Among the conditions are that Fischer be given flexibility to determine Bank of Israel salaries and that the BoI Supervisory Department be consolidated with the Finance Ministry's Supervisor of Capital Markets Division. "There's no limit to his cheek," the officials were quoted as saying by the radio station. "This big-shot comes from abroad and sets us conditions. If he doesn't want to continue, he doesn't need to. He shouldn't do us any favors." "Every two days he convenes a press conference so that everyone should praise him. Interest rates, unemployment, the Integrated Index, foreign currencies, bonds - every day, they appear in the media," continued the rant. "He complains about infinite leaks, but he doesn't shut his mouth himself. Everyone in the media idolizes him, but we come off badly." The Treasury officials accused Fischer of acting contrary to law by instructing the BoI to buy government bonds in the stock market. "We offered a solution, but the Bank of Israel told us not to intervene," the officials reportedly said, adding that "they have come up with a grandiose plan" which won't help the economy. Former finance minister Yaacov Neeman, an associate of Fischer, told Army Radio that were he still finance minister he would have fired the officials. "If I was finance minister today, anyone one who spoke like that would find himself out," said Neeman. Other close associates of the Bank of Israel governor said the criticism stemmed from "jealousy" of his recent successes, Army Radio reported. The Finance Ministry insisted that the remarks did not reflect the opinion of Finance Minister Ronnie Bar-On and said that Fischer had made a "decisive contribution" to the Israeli economy. In a statement, the Finance Ministry went on to say that "the good cooperation between the finance minister and the Bank of Israel governor, and between the ministry and the Bank of Israel, have doubled the government's strength in dealing with the global crisis and its ability to take effective measures to bolster the Israeli economy. We must continue to act in order to strengthen this bond." "Even if there are professional disagreements, the way to solve them is by cooperation and dialogue, not through leaks like this morning," the statement continued. "The finance minister views the anonymous remarks against the Bank of Israel governor as a blow to the ministry." Finance Ministry Director-General Yoram Ariav also dismissed the harsh criticism of Fischer. "I encourage professional disagreements, but there is no place for expressions of this nature," he told Army Radio. "The governor is an asset to Israel, and the cooperation between him and the Treasury is good and productive. There aren't many governors like him in the world." Ariav said Israel was currently in the midst of a global crisis and that Finance Ministry officials "don't have the luxury" of spending time on "such nonsense."