But the assault on the reforms paid off at the ballot box. Labor held its ground largely by taking the votes of lower-income Israelis who had heretofore voted for the Right. The Sephardi Orthodox Shas Party, which prides itself on sucking the system dry for its yeshivas, won 12 seats. A new Pensioners Party, which stood for a massive increase in entitlements and a rollback on reform, came out of nowhere to win 7 seats.
With Olmert needing all of them, you can bet Netanyahu’s hard work will be thrown away as the new prime minister buys the votes he needs with more expenditures and higher taxes.
Behind this isn’t just the desire of the Histadrut and other power bases to maintain their control. It is rather a national dependence on free money that has infected all of Israeli society.
By free money, I mean the flow of foreign economic aid and private contributions that, while intended to help the country, helped subsidize the corruption and failure that have plagued the country’s government and economy, and much of its institutions.
Just as much as the burden of war, it is this that has driven hundreds of thousands of Israelis to immigrate to places where more economic freedom exists, such as the United States and even Germany.
For all the talk of the growing disparity between rich and poor in Israel, the answer to this problem isn’t redistribution of the money of the well off but the creation of more wealth. But what Israel’s political class doesn’t seem to understand is that the creation of wealth requires policies that foster capitalism, not patronage.
Despite the tremendous pool of human talent and ingenuity that built a nation from nothing and defended it bravely against overwhelming odds, Israel has also become a shameless welfare state on steroids, with bank “overdrafts” not just a common item of personal debt, but a metaphor for the whole country.
And the truth is, all of us who love it have over the years become its “enablers,” as we helped pour money into the hands of its unscrupulous politicians.
This is not to say that contributions that go directly to pay for causes, such as the absorption of immigrants or investment in bonds, are wrong. Far from it. But we must recognize that Israel’s addiction to failed social-welfare economics and entitlement binges are harmful to its heath and ultimately to its security. And it’s time for those of us who care about its fate to say so.
People who don’t live there have no right to dictate security policies. But if Israeli voters prefer a country in which failure is subsidized and achievement penalized, they should not expect anyone else to pay for it.