Tuesday, September 18, 2007

Israel's Economy Working

I recall arguing with my charedi cousins while I was in Israel about 5 years ago for the proposed cuts by Netanyahu, which I argued would turn around the Israeli economy - helping everyone more in the long run, including charedim. R' Gil posts today about the subject:
The Orthodox Jewish world, in particular the Charedi world, has been up in arms for a few years about the Israeli government's cutting financial benefits for welfare and similar services (e.g., link). Here is another perspective on what these cuts and other financial reforms have done to save Israel's economy from collapse: Believing in Miracles by Daniel Doron:
As the governor of the Bank of Israel, Stanley Fischer, told us: "The Israeli economy is now into its fifth year of rapid growth, of around 5 percent per year, with inflation that has averaged less than 2 percent per annum, and a large balance of payments surplus — a result of disciplined budgetary and monetary policy, structural reforms carried out over the last two decades that have integrated the Israeli economy into the world's markets, and especially of a vibrant and innovative private sector."
It is interesting to note that upon seeing the successes of Netanyahu's policies, the Olmert government (even with Amir Peretz in a prominent role) has simply renamed the policies while keeping all of them intact in order to avoid giving the credit to Netanyahu, though few if any don't see right through it. The impact Netanyahu has had on Israel's long-term growth has quietly been incredible.


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