It's the economy, stupid!
After going through most of the other rationales for our new unity government and rejecting them, Caroline Glick argues that Prime Minister Netanyahu went to the unity government to preserve Israel's economy. Finally, there is an economic aspect to this decision. By bringing Kadima into his coalition, Netanyahu effectively ensured that his free market economic policies will be maintained and the socialist voices in Israeli politics will be marginalized for the next year or so. With France going socialist, Israel's Left, led by Labor Party leader and Marxist Shelly Yahimovich would have had more resonance in the public for its statist, deficit spending economic platform. Now Netanyahu got another year during which the public will see what those policies are doing to Europe and so make his economic arguments for him.It's an interesting argument, and I suggest that you read the whole thing.
Twelve hours after Caroline published that piece, Moody's downgraded Israel's banks' outlook. Wednesday morning's news was already full of talk of higher income taxes and VAT, but I am holding out hope that Netanyahu will instead cut spending. If taking Kadima into the government makes that happen, that's a positive development.
By the way, the markets have barely moved since Tuesday morning's announcement.
Labels: Binyamin Netanyahu, Knesset elections 2012, Shaul Mofaz
posted by Carl in Jerusalem @ 11:45 AM
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