Cutting the pie

Whose interests do we prefer when the national cake doesn’t expand as much as the appetite for bigger and bigger bites of it?

Iron Dome 311 (photo credit: REUTERS)
Iron Dome 311
(photo credit: REUTERS)
The latest batch of statistics, tossed onto our overheated socioeconomic griddle this past Tuesday, indicates a significant economic slowdown. It’s not entirely unexpected, considering the paroxysms gripping the global marketplace, but it’s very meaningful in our own context.
The bottom line is that we’re still growing – in fact more than most Western economies. The average Eurozone growth is just some 0.2 percent. Nevertheless, we’re growing at a slower pace than several months back, and far from the buoyant forecasts which kicked 2011 off.
According to figures released by the Central Bureau of Statistics, this year’s second quarter produced limited growth only, calculated at an annualized rate of 3.3%.
This is quite a sharp downturn from the 4.7% of the first quarter, to say nothing of the 7.4% of 2010’s final quarter.
It gets worse: There was a sharp rise in imports and a concomitant decline in exports, especially to North America (no doubt a byproduct of the economic travails there, which lower demands and make imports more expensive due to the diminished value of the dollar).
These are cogent reasons to switch on a host of red lights. Not only are exports down, but industrial output is declining steadily and tax revenues were a full 2% lower in the second quarter, as compared with the first.
And while the recessionary signs pile up, inflationary markers rise, too.
This obviously all but rules out a new interest rate hike, but low interest is no cure.
Whichever way we read the data, the indisputable conclusion is that the national cake is already smaller, and shrinking further. Put simply, this means that there’s less to divide, regardless of the shouts for the well-meaning “social justice” sparked off by what debuted as the rent-protest in Tel Aviv’s Rothschild Boulevard.
Footing the bills for the protesters’ spiraling demands – including, for instance, free education from age three-months through university – would necessitate mammoth cash outlays. Yet the incontrovertible fact of life is that our resources are dwindling, which is essentially what the slowdown tells us.
Some maneuvering is always possible, but there’s not a whole lot that shifting emphases alone can feasibly finance. True, freeing up public lands for construction isn’t expensive at first glance. But not selling public lands to the highest bidder eventually means less going into the public coffers, which contain our collective holdings. This reduces funds available to us all.
With a smaller cake to slice, priorities become key. But priorities are in the eye of the beholder – or in the vocal chords of the protester.
Underscoring the dilemmas inherent in giving in to the tent-protest movement are the demands of various Negev localities for immediate deployment in their vicinities of Iron Dome anti-rocket batteries. Recent attacks from Gaza have spawned renewed insistent clamor for the Iron Dome from Beersheba, Ashkelon and the Eshkol region.
The scientific achievement, which took the original Iron Dome concept from the drawing board to an operational multi-tested anti-missile system, is resounding.
It’s indeed another in a long line of feathers in the caps of Israel’s innovative researchers and defense industries.
The fly in our ointment, though, is the fact that while we have the technology, we frankly cannot afford it.
One single Iron Dome anti-missile missile costs $100,000. This makes the sticky issue of footing the bill inescapable. The popular mantra is that no price is too high to save lives, which – considered strictly on the moral plane – is undeniable. However, we need to keep in mind that it costs next to nothing to manufacture a Kassam, and that Hamas may have many scores of thousands of crude rockets stored in its arsenals.
Clearly, firing at any flying object from Gaza could wreak havoc with the IDF budget, which the Rothschild Boulevard protesters anyway want radically slashed.
This was a cruel enough quandary even before the first tent went up in central Tel Aviv. But now the predicament has intensified.
Whose interests do we prefer when the national cake doesn’t expand as much as the appetite for bigger and bigger bites of it? Food for thought.