For house protests, read class war­fare

The Jewish Chronicle - - World News -

ON THE face of it, Is­rael’s econ­omy has never been in such a good state. Un­em­ploy­ment is at an all-time low at 5.7 per cent, the gross do­mes­tic prod­uct grew last year by 4.5 per cent, the shekel is strong, trade is boom­ing, Is­raeli com­pa­nies are traded on Nas­daq and for­eign cor­po­ra­tions are snap­ping up lo­cal com­pa­nies. And now nat­u­ral gas finds in the Mediter­ranean are promis­ing en­ergy in­de­pen­dence and a new ex­port mar­ket.

So why have tens of thou­sands of mid­dle-class Is­raelis taken to the streets in re­cent weeks, com­plain­ing that they can­not af­ford to live in the coun­try? The ini­tial mo­tive was the price of hous­ing, which has spiked due to the boom­ing econ­omy and low in­ter­est rates, and the lack of new, affordable homes. But the price of new flats and rentals is only part of the story.

Much of the boom has been con­cen­trated in a rel­a­tively small layer of high-salary earn­ers and a much smaller num­ber of fam­i­lies who are ma­jor share-hold­ers in the cor­po­ra­tions that have taken ad­van­tage of the rapid pri­vati­sa­tion in the Is­raeli econ­omy in re­cent years. Fis­cal re­forms have re­duced taxes mainly for cor­po­ra­tions and those in higher in­come bands. Mean­while, the av­er­age earner con­tin­ues to pay tax rates frozen at their his­tor­i­cally high lev­els.

The av­er­age in­come of mid­dle­class Is­raeli fam­ily is around £2,500 a month, which is lower than the av­er­age fam­ily’s ex­pen­di­ture. Some ar­gue that this means Is­raelis are be­ing greedy, seek­ing a life­style be­yond their means. The pro­test­ers are say­ing that if Is­rael had free child­care for un­der-three-year-olds, a bet­ter reg­u­lated hous­ing mar­ket and a more bal­anced tax bur­den, most peo­ple would not be trail­ing bank over­drafts.

It is not only a clas­sic ar­gu­ment over open­mar­ket cap­i­tal­ist econ­omy ver­sus so­cial democ­racy sys­tems.

The fact that most of the pro­test­ers are sec­u­lar and left-of-cen­tre means they also be­lieve that their tax money should not have to go to fi­nance set­tle­ments in the West Bank, high de­fence costs and ben­e­fits for a strictly-Ortho­dox com­mu­nity with a low av­er­age of par­tic­i­pa­tion in the work­force.

The “so­cial equal­ity” façade of the protests is al­ready start­ing to fall away and this is about to be­come a stan­dard Is­raeli squab­ble be­tween “spoilt Tel-Aviv left­ists” and “re­li­gious par­a­sites”.

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