Israeli Thatcherism

The value of Finance Minister Yair Lapid's proposal to impose an especially high tax on luxury items is more declarative than financial. A higher tax on luxury vehicles and foreign cigars will add a mere half billion shekels to the state coffers. What is half a billion compared with the enormous deficit, 80 times that size? But declaring such a tax means launching an economic war, and therein lies its true value.

So, what is the right economic policy? I don't want to see the defense budget cut (beside the retirement benefits), and I don't want to see the education budget cut. My hope is that the state will eventually give land on the periphery of the country away for almost nothing to anyone who wants to build a home. I don't understand who would ever think to cut the budgets pertaining to the country's scientific developments — the state's existence depends on the quality of our scientific developments.

I may have lost my economic way about a decade ago, but I always supported the Israeli Thatcherism as it manifested itself in the economic policies of then-Finance Minister Benjamin Netanyahu and his right hand man, Professor Yaron Zelekha.

It is not easy to ward off a public that is coming at you with legitimate demands. It is not easy to ward off protesting disabled citizens, or the Histadrut labor federation that is debilitating the country with general strikes, or a single mother who marches from Dimona to Jerusalem carrying an Israeli flag.

But the tough measures taken back then are exactly what saved Israel from meeting the same terrible fate as Greece, Spain or Cyprus. And if the protests are renewed now — adjusted to the current situation and the slightly different economic ills of our time — we must support the tough austerity measures even if the public throws rotten eggs at Netanyahu and Lapid.

In my assessment, if the current government survives its entire term, within two years Lapid and Netanyahu will have accomplished their national goals, and will be able to loosen the belt. The public, when going to the polls to elect the next Knesset, will thank them for their austerity measures that will have ultimately brought the country prosperity.

But as far as I am concerned, and not in the best political interest of the politicians, if the shortsighted public decides to punish them for the austerity measures before reaping the benefits — it will spell defeat for the party, but a victory for the country.

When the founder of our state, then-Prime Minister David Ben-Gurion declared far-reaching austerity measures for the first time, his party lost six of its 46 MKs within 18 months. The seats went to the rival party, the bourgeois party that promised immediate economic welfare. Netanyahu himself ended up heading a tiny 12-seat party thanks to his Thatcherite policy as finance minister under former Prime Minister Ariel Sharon.

But just as you can't win a war with soldiers who have desk jobs, but only with trained fighters, so in economic matters you can't save a country from a Greece-Cyprus-Spain fate by handing out benefits that you can't afford, like Opposition leader Shelly Yachimovich and her cohorts are suggesting. Winners are the ones who carry the burden, pay a painful price, and don't try to suck up to the voters.

Will Netanyahu go back to being the old Netanyahu? Will Lapid follow his lead-

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