Netanyahu Against the World: Cut Taxes

This is a guest post from http://www.israelnewsletter.com/

For the first time in months we have a real proposal that will help extricate Israel from the economic crisis. Instead of another proposal calling for spending billions of taxpayer dollars to build bridges that aren’t needed, PM wannabe Benjamin Netanyahu, has called for a comprehensive overhaul in the tax code calling for steep cuts in both personal and more importantly corporate income taxes.
Finally we have someone who understands that if citizens can keep more of there money, they can then invest, spend and save it according to their needs. The problem with all these other proposals is that with big time increases in government spending you end up taking money from individuals and they have less to create new wealth.
According to Globes: “Netanyahu said, “Over the course of four years, we will lower the top personal tax rate from today’s 46% to a level of 35%, and we will lower the top corporate tax rate from 27% to only 18%.”
Netanyahu added, “The tax cut will be spread over the entire term, and lead to everyone paying about 20% less than what they pay today”.
He also called for more privatization of government held monopolies like the electric, and water companies as well the ports.
With the world on fast track to socialism, it’s so refreshing to hear a leader speak with common sense, and a firm knowledge of what will actually save the economy.
I know that certain newly sworn in presidents believe that we all need to suffer in order to fix the economic issues that we all face, and that ‘greed’ was what caused all these problems, but ‘greed’ is what powers the economy forward. It’s not a bad thing but a good thing. the greed that Netanyahu talks about is about letting you and I keep more of what we earn, incentivize us to make more so that w can better our lives. Is that Greed? The fact is that as personal incomes rise, so do donations to charities. It appears that there is a correlation between making more and giving more. That doesn’t sound much like greed to me, and that’s the kind of personal sacrifice that should be encouraged.

Tzipi Livni on Leadership

Busy criticizing Bibi Netanyahu and the Moshe Feiglin fiasco, PM wannabe Tzipi Livni shed some light on her definition of leadership. In an article in the JPost, she says, "Kadima will choose the best list and I guarantee I won't pull any tricks or move anyone," Livni said. "Leadership means doing what you believe in regardless of what is written in the newspapers."

Hum.... Sort of like wanting to attack Gaza, after doing nothing as Foreign Minister.

BTW- Tzipi, what do YOU beleive in?

Is It Win at All Costs for Netanyahu?

The Bibi haters are out in full force today, charging that PM hopeful Benjamin Netanyahu has thrown his 'free-market' principles to the wind and will do/say anything to get elected.

Nehemia Shtrasler writes in Haaretz: "It will be interesting to see where else Benjamin Netanyahu goes in his eager pursuit of voters' hearts. He wants so badly to sit in the prime minister's chair that he is even willing to scrap his entire economic worldview and masquerade as Histadrut chairman Ofer Eini."

He says that Netanyahu has given up his ideology in order to get elected. Calling for a broad pension safety net, increasing child allowances and a large increase in government spending, Bibi has basically moved his policies to be in line with those of national labor chairman Ofer Eini.

I am not a big fan of Shtrasler but he does make some good points. Instead of calling for more spending and basically abandonding budgetary discipline, Netanyahu should be out there championing lower taxes, and incentivizing entrepreneurship. After all, the real engine to economic growth is not bailing out billionaires, but it's by encouraging small and and mid-size business creation.

As for the pension safety net, Shtrasler is correct on the facts but wrong on the safety net. He says, " He knows that this "safety net" is a regressive, antisocial policy that no other country has adopted. And who knows better than he that the people have not lost anything in the provident funds, but have in fact earned a profit? From 2003 through 2007, these funds posted a very nice profit - 66 percent. Only this year have there been a loss - 20 percent. In other words, the gains far exceed the losses. So why should we be transferring money to people who made a profit?"

No question that much of this discussion is based on zero facts. Most pensions increased handsomely since Bibi opened up the system. I am not for a broad safety-net. We need to follow the Chilean pension model. Chile faced a bankrupt pension system, and they decided to privatize the system by allowing people to have individual savings accounts. But for those approaching retirement they were given a choice. Accept the new system or you could take a guaranteed pension from the government. Basically a safety net for those close to retiring. That's exactly what we should do here in Israel. For those 5 years away from retirement, give them the choice of accepting a guaranteed government pension, or letting it ride in a private account.

This is the kind of policy we need Netanyahu to speak about. We don't need him encouraging building a road or bridge that no one needs.

Israeli PM Hopefuls and Economic Policy

The Israeli business daily Calcalist (sorry but article in only in Hebrew) has a really interesting article today. The paper posted various economic questiopns to the 3 Israeli Prime Minister hopefuls, Ehud Barak, Tzipi Livni and Benjamin Netanyahu.

Barak spent most of his time pleading for a greater role for government in the economy. From raising taxes, to ending budget discipline by advocating more and more government spending. He spoke about "piggish capitalism" and the need to end it, and a new focus on social and economic justice (Code words for Socialism?) I guess he knows about the evils of capitalism, buying a multi-million dollar apartment and making millions in speaking fees and as a large investor in an Israeli satellite company that went public. Hypocrite?

Livni, as she is capable of doing, basically said nothing. She spoke about the status quo and continuing need to grow the economy. She did blame the pension mess on Netanyahu. Funny didn't she vote for his reforms? Sounds a lot like her Lebanon fiasco. Blame the other guy even though you had responsibility in it.

Netanyahu basically, reiterated his calls fro lower taxes as the foundation to any economic recovery. He also stressed the need for education reform and said that he is the most qualified to lead this type of reform as he already led the economic reform that basically saved Israel from economic collapse. He also called for investing in infrastructure, roads and highways.

It's no secret that I am a fan of tax cuts and that we need much less government intrusion into our lives. Based on those principles it would seem at first glance that Netanyahu has the strongest economic policy.

Drop in Israeli Poverty: Experts Say It's Bad

Surprise, Surprise. A strong economy and low unemployment did more to lower poverty in Israel than years and years of welfare payments. Critics have continued to hammer at PM wannabe Bibi Netanyahu's economic policies, but once again we have hard evidence that they work. While Netanyahu was slammed for cutting welfare and other transfer payments to the poor, and said that the best way to get them moving upward economically was to cut taxes and produce a strong economy. Strong job growth would go much further in alleviating poverty than continued transfer payments.

Well the so-called 'protectors of the poor' cried and cried saying that we need more social justice and we need to increase child allowance payments, and increase unemployment benefits, otherwise we will have even larger poverty.

Wrong! It always amazes me that these elitists are always wrong. In today's eagerly awaited report on poverty, we see the number of poor declining. How could that be? Here's a thought: lower unemployment, meaning that some of the poor actually got jobs.

According to the Jpost: "According to the report, the economic quality of life for families across Israel improved from 2006 to 2007 meaning that in 2007, economic growth managed to reach the lower-income sector of society. "

Now the experts are warning about a return to higher poverty rates in '09 due to the economic slowdown. That may very well happen, but the solution is not to expand unemployment benefits. The solution is to cut taxes and encourage private sector economic expansion, as they are the ones who will create real jobs.

Municipal Election: Classic Story

Rewind 72 hours, the day before Israel's municipal election day. The campaign was in full gear. Candidates were spending every last second courting each and every vote. Everywhere you turned in Jerusalem was full of people handing out fliers about this candidate and why you shouldn't vote for the other candidate. I am sure that the same scenario played out in countless cities all over the country. Even former PM and current PM candidate Benjamin Netanyahu became my personal friend calling me 4 times on both my cell and house phone. Bibi has my cell number. Cool! Oh you mean he called everyone asking them to vote Likud, and it was only a tape of him? Bummer, I thought we were bonding.

Then there was Shachar Rubin. Who? No, not Shachar Pe'er the Israeli tennis star, Shachar Rubin. My dear wife starting getting phone calls from supporters of Shachar Rubin. The first call went something like this." Hello Mrs. Katsman, we just want to know that we can count on you to vote for Shachar. How many others in your household can we count on to vote for Shachar." To which my wife answered, " Who is Shachar?"

The she got another call on her cellphone a few hours later, reminding her to vote for Shachar.
On Tuesday morning as we were literally walking into our polling station to vote, she got a text message reminding her to vote for Shachar Rubin. the message said, " Shachar Rubin requests from you to vote today for the "RAK" party(Hebrew letters). The day is important for all of us and every vote counts." Then yesterday she got a thank you text message, thanking her for voting for Shachar and his 'Lev' party.

After speaking to a bunch of friends, including election maven Steve, and checking the election results, no one had ever heard of or new anything about our Shachar. Well last night my wife decided on doing a Google search on our friend. It turns out that he is the deputy mayor of............. Ness Tziona. We live in Jerusalem, and my wife has never set foot in Ness Tziona.

And the good news.............. Shachar is again deputry mayor!!!!!!!!!!

Israeli Election Update: Netanyahu Unifies Party

With the focus now off the US presidential elections, the Israeli elections for prime minister now take center stage. With about 3 months left until the vote, Likud head and former PM Benjamin Netanyahu has managed confound analysts by actually unifying his center-right Likud party. The big knock against Netanyahu in the past is that he isn't exactly a 'people-person' and alienates those close to him.

Well news over the last few days that former highly regraded Likud members such as Benny Begin( son of former PM Menachem Begin) as well as Dan Meridor have rejoined the Likud party has given Netanyahu a big boost.

If Netanyahu can succeed in convincing the electorate that he can actually get along and not 'tick-off' everyone, than his chances of a large victory will be greatly enhanced.