Netanyahu teaches Israel a lesson on Keynesian economics - opinion

If there are a few individuals who believe that Netanyahu deserves to die, they should be dealt with by the law enforcement authorities as harshly as the law permits.

Prime Minister Benjamin Netanyahu speaks on July 15, 2020 (photo credit: KOBI GIDEON/GPO)
Prime Minister Benjamin Netanyahu speaks on July 15, 2020
(photo credit: KOBI GIDEON/GPO)
Last week, after his announcement regarding a generous gift of NIS 750-3,000 for all Israeli households was met with critical reactions from almost every conceivable direction, our prime minister decided that it was time to give us a lecture on Keynesian economics.
Keynesian economics, developed by the British economist John Maynard Keynes during the 1930s in an attempt to confront the economic consequences of the Great Depression, is an economic theory of total spending in the economy and its effects on output and inflation. Keynes advocated increased government expenditures and lower taxes to stimulate demand and pull the global economy out of the depression.
Subsequently, Keynesian economics was used to advocate the idea that optimal economic performance could be achieved – and economic slumps prevented – by influencing aggregate demand through active stabilization and economic intervention policies by the government.
In many respects Keynesian economics is the exact opposite of today’s neoliberal economic theories which are based on the notion that natural economic forces and mild government incentives are all that is needed to solve economic crises. Thus, it is very strange that Prime Minister Benjamin Netanyahu should use Keynesian economics to justify what he had decided to do to try to pacify an angry public, including parts of his own political base, in an attempt to reverse recent shifts in public opinion against him.
Netanyahu explained that by distributing cash, people would have money to spend – preferably on Israeli products – and thus the economy would be given a boost. But even if Netanyahu has unexpectedly turned into an advocate of Keynesian economics, his reading of the current situation seems far removed from what is actually going on.
First of all, if he were really attentive to the distress of that part of the population that is suffering most in the current situation, he would understand that while they are certainly going to use part of the money they will be receiving to purchase food and other basic necessities, most of it will be used to pay rent, taxes, electricity, water and communications bills, and to cover debts to the banks and other moneylenders.
Furthermore, the reason the economy has suddenly slowed down is not the result of a periodic downturn of the economic cycle, but the result of an overly hysterical reaction by the government to a pandemic, for which there is currently neither a vaccine nor a cure, which led to the shutdown of whole sectors in the economy, resulting in mass unemployment, bankruptcies and widespread personal and social distress.
It is the government that has willy-nilly generated the slump, leading right-wing libertarians to demand that the government simply keep its “dirty” hands off the economy, even if it means that hundreds or even thousands of persons will die of the coronavirus, while advocates of responsible government demand that the government (i.e., the prime minister) stop improvising and reacting from its guts, and establish a proper decision-making and implementation apparatus.
Under these circumstances Netanyahu’s handouts are nothing but a temporary palliative, the only long-term effect of which will be to increase our national debt, which has already rocketed to unprecedented dimensions.
In short, the magician Bibi seems to have lost it, or perhaps his magic has been revealed as deception.
NETANYAHU IS not the only politician who tried to give us a rather problematic lesson last week. Public Security Minister Amir Ohana is another. The lesson he tried to give us was in the field of recent history. Following the stormy demonstration outside the Prime Minister’s Residence in Jerusalem last Wednesday, Ohana stated that the incitement against Netanyahu is “overflowing” and that “the so-called incitement before Rabin’s murder pales in comparison.” Ohana should know better.
Certainly the harsh criticism of Netanyahu these days has on a few occasions spilled over into verbal threats on his life and the lives of his immediate family members by some of those who have lost all hope. These threats, posted on social media, with the names of those responsible for them attached, are certainly to be condemned in the strongest terms, and have been followed up by the police. No threat to his or his family’s lives can be ignored. The Shin Bet (Israel Security Agency) will never forget how it lost a prime minister 25 years ago.
However, it should be pointed out that the context of the incitement today is very different from that of 25 years ago. In the case of Rabin, there allegedly were various rabbis who declared that din rodef applied to him, implying that he could be killed for agreeing to sign the Oslo Accords with the Palestinians and hand over parts of the Land of Israel to them. The incitement by right-wing politicians at the time did not call for Rabin’s assassination, but by calling Rabin a traitor, or suggesting that he was engaged in an act of treason, provided those who listened to the said rabbis (including one Yigal Amir) with “proof” that Rabin was indeed guilty of acts that justified his death (at least according to some alleged interpretations of the Halacha). Needless to say, none of the rabbis who allegedly ruled that din rodef applied to Rabin was tried or punished in any way.
In Netanyahu’s case no one accuses him of treason, and no rabbi has declared him deserving of death. Netanyahu’s opponents – including myself – point out that a person who after lengthy investigation has been indicted on charges of bribery, fraud and breach of trust, and who is currently standing trial, is not worthy of serving as prime minister (even though the law permits it), and that only after standing trial, if found innocent on all counts, should be allowed to return to politics.
We also accuse Netanyahu of lying, being a serial breaker of political promises and agreements, and now also of incompetence in managing the medical and economic aspects of the coronavirus crisis, incompetence that has led to a good deal of superfluous suffering and distress.
If there are a few individuals who believe that Netanyahu deserves to die for all the reasons enumerated above, they should be dealt with by the law enforcement authorities as harshly as the law permits. However, none of this justifies the claim – made by none other than the public security minister – that what is said today about Netanyahu makes the “so-called” incitement against Rabin look pale. There is no historical or even moral justification for such a statement. The problem is that Ohana is a serious man, and one who is sufficiently popular in his own party, so that many might take what he says at face value.
Incidentally, the Yitzhak Rabin Center issued the following rather sarcastic statement in reaction to what Ohana said: “It is encouraging to discover that after 25 years a senior Likud minister admits that there was incitement that led to the murder of the late prime minister Rabin.” Well, not exactly – only “so-called incitement.” Not much reason to rejoice.