Sunday, 31 July 2011
What is the Answer to the Tent City Protests?
The phenomenon of oversupply and lack of demand seen in the rest of the world has not taken place in Israel, with prices somehow remaining fairly constant over the time that the bottom has dropped out of the market elsewhere. This means that Israelis, who have also suffered significant financial hardships over the period of the economic downturn, are not enjoying any relief from lower house prices. This fact extends itself into the rental market where rentals for ordinary apartments cost a great deal, and add to the financial woes of the average Israeli citizen. After experiencing price rises on a range of goods and services without commensurate increases in earnings, the Israeli consumer has eventually decided that he cannot tolerate the situation any further, and has spilled out onto the street in protest. The main target of the protest has been the inflated prices that citizens are required to pay for housing. Tent cities have sprung up in the central areas of many Israeli towns and cities, and protestors are sleeping on the street to demonstrate against the government for not paying sufficient attention to providing cheaper housing options.
In the 13 years since I moved to Israel, house prices have increased dramatically. Somehow the Israeli housing market has not seen the same ups and downs that have been evident in other markets. An apartment that cost approximately 800,000 Shekels back in 1998 will cost around 1.2 million Shekels today, an increase of 50%. Admittedly, there were years in which house prices did drop. Overall, however, the increase in the price of housing and of rentals has outstripped inflation by some distance. The reason for this comes from a number of different sources.
The most obvious issue driving house prices, is the fact that land in Israel is scarce. The entire area of the State of Israel is approximately 20,000 square kilometres, a similar size to the US state of New Jersey. Even the land that we have is not secure, with continuing demands by the Palestinians for Israel to relinquish further land claimed by them for a Palestinian state. With so little land available, it is inevitable that this will contribute to higher land prices. Attempts to build higher to use land more intensively have also not helped much to reduce the land cost element of the cost of property.
Along with the lack of supply, demand for property in Israel seems to be ever-increasing. Some of it is being fuelled by the upper classes who are not sensitive to the economic downturn, and who are constantly searching for bigger, better and more ostentatious properties. This is particularly true of the Israeli nouveau riche, some of them hi-tech and Internet millionaires. Demand is also being driven by Jews from outside of Israel who are looking for a piece of the Holy Land to use as a holiday pad. This demand has increased in recent years, and has contributed to parts of Jerusalem turning into ghost neighbourhoods with holiday apartments remaining empty between holiday visits. In addition, with approximately 20 years having passed since the gates of the former Soviet Union opened to allow Jews to leave for a new life in Israel, we are now seeing the effects of the children of these immigrants leaving the nest. A surprisingly high number of these new immigrants have succeeded in buying their own homes over the years, and now their children wish to emulate this example as they set out on their own paths. I recently attended an interesting seminar which showed that this generation will be driving demand for property and other major expense items for some time in the future.
All of this does not look optimistic for the man in the street. Israeli unemployment is currently at an all-time low of approximately 5.7%. For the economists amongst us, this means that Israel is nearing full employment, a situation where all those who wish to work are working. The problem is that this is not helping to reduce poverty. Salaries have remained so low despite increasing inflation, that Israel is increasingly becoming a nation of working poor (see my blog A Country of Working Poor). Most of those who are inhabiting the tent cities across Israel are not unemployed and homeless. The vast majority have jobs and homes, but are finding it impossible to keep making the rent or mortgage payments despite long working hours. For many people, the cost of keeping a roof over their heads is costing 50% and more from the money they bring home each month. Surely, this is an intolerable situation.
More than a hundred thousand people took to the streets last night in towns and cities from Rosh Pina to Eilat to protest the lack of action on the part of the government. The slogan being shouted at these protests is "an entire generation demands social justice". The feeling is that the government is pandering to the Israeli tycoons at the expense of the man in the street. This has enabled the tycoons to build and live in luxury developments which are under construction across Tel Aviv. Some of these sites have become targets for the protest0rs. The government has been unable to express what they have done so far to provide more affordable housing for young couples and lower income earners. The prime minister has been unwilling to come out to meet the protestors on the streets. This is contributing, not only to the feeling that the prime minister has done nothing, but also to the feeling that the government is unwilling to do anything to fix this situation.
Unfortunately, there are no simple answers to this serious and far-reaching problem. Many respected market watchers are predicting a significant drop in Israeli home prices in the near future. The problem is that it would take some time for rental prices to follow any correction, and I have my doubts that rental prices would fall in any significant way. I remain highly doubtful that a drop in house prices is on the horizon at all. Any action that the government may take now to provide lower cost housing is likely to take years until it comes to market. So what can the government do in response to this protest?
While the protest is focused on rising house prices, it is really about the general increases in the cost of living, while incomes remain static. The first step to fix this has already been taken by the government when they decided to freeze the fuel price increase that was set for tonight. The decision to hold fuel prices steady is likely to have a significant knock-on effect by holding the prices of many other items steady. The next step is to increase earnings to level the playing field. Starting with the doctors who are fully justified in their strikes for better pay over the past three months, public sector and private sector workers need a bigger pay cheque to allow them to balance the budget at the end of each month. In tandem with this, longer-term measures should be put in place to provide sufficient lower-cost housing for those who simply cannot afford to pay the prices in the current market. Failure to act quickly and decisively risks financial ruin for many families. The future of the government could easily rest upon its ability to react to this problem.
Monday, 25 July 2011
Diaspora Jewish Leaders Have a Responsibility Towards Israel
Davis' language was clearly designed to be provocative and emotional when using the "a" word, something that we have seen Israel's enemies do a great deal of in recent times. By invoking the comparison with the South African apartheid regime, there is an attempt to relegate Israel to the gutters of politics and throw it into the category of the worst and most oppressive political regimes. Even Davis' attempt to clarify his point by saying that this apartheid state arises by virtue of the fact that the minority is being governed by the majority, does not serve to rescue him from his unforgiveable crime against the State of Israel and her citizens.
If anybody amongst the UK Jewish leadership should understand what apartheid really is, it should be Mick Davis. After all, he grew up in apartheid South Africa before moving onto the UK scene. I remember Mick Davis when he studied at Rhodes University in Grahamstown, where I grew up. He stood out then, not only because of his substantial physical frame, but also as a Jewish leader who identified closely with Judaism and Jewish causes. This was somewhat different from many of the Jewish students studying at the university at that time, who did not identify with their Jewish roots. It is interesting that Davis has chosen to invoke the apartheid theme to criticise the Israeli government's current direction, even though there is really no link at all between the Israeli situation and apartheid. The truth is that this comparison is highly inappropriate and does not fit Israel in any way, even if it was true that the majority was governing the minority (it is not true). I have not seen the Jordanian government accused of apartheid because the minority Hashemites rule over the majority. I have not seen the Syrian government accused of apartheid because the minority Hashemites are in power. The administration of George W. Bush was not accused of apartheid because it took power despite the fact that Al Gore scored half a million more votes across America than he did. Even if the minority does rule over the majority, this fact does not automatically turn the government into an apartheid administration.
Israel finds itself in times which are substantially different from the early years of her existence. Israel was founded in the aftermath of the Holocaust, and has provided a refuge for many a Jew who has had nowhere else in the world to go. Despite this fact, Israel relied heavily on help and assistance from Jews in the Diaspora for her survival. These days, the equilibrium has shifted to the point that Israel is no longer as reliant on the Jews in the Diaspora as she was in the earlier days. In fact, in the current times, the Jews in the Diaspora rely more on Israel in order to fight the scourge of anti-Semitism that is being experienced in so many different countries. Davis' derogatory statements about Israel must surely place further pressure and risk on the Jews in his UK constituency, and provide ammunition for the enemies of Israel and the Jewish people. This point was not lost on Mick Davis as he commented on the fact the British Jews feel that they cannot voice their criticisms of Israel for fear of their ideas being used by Israel's enemies. So why has he felt it appropriate to make these unwarranted and unjust accusations against Israel?
It is the right of every Jew, Israeli or not, to disagree with the policies and actions followed by the Israeli government. After all, this government is only a collection of imperfect human beings, who do get things wrong on a frequent basis. Criticisms voiced by Jews in the Diaspora do, however, need to be carefully considered. The way in which criticisms are expressed should equally be given thought. At risk here is not only the safety of the State of Israel, but also the safety and well-being of Jews around the world. Expressing justified criticism could do irreparable damage, so how much more criticism that has no basis or justification.
Mick Davis may feel that Israel risks becoming an apartheid state (even though there is no evidence at all to support this concern). Expressing this in a public forum, in his capacity as a senior Jewish leader in the UK, is regrettable and wrong. This serves to weaken Israel's international standing, and place unnecessary pressure on Jews around the world. The time has come for Jewish leaders in the Diaspora to accept that they have a responsibility towards the State of Israel as the real protector of Jews around the world. In spite of all the good and positive things that he has achieved for himself and the Jewish community, Mick Davis has not fulfilled his responsibility on this occasion.
Sunday, 17 July 2011
Boycotts and Democracy
Over the 63 years of its existence, Israel has suffered a great deal from the effects of boycotts, which have been directed against Israel by those opposed to her continued existence. The most notable and widely reported of these boycotts has been the Arab boycott. This has not only been directed against Israel herself, but also against companies that have had links with or representation in Israel. It has been interesting to note how this boycott has been applied in a highly selective manner. Companies like Coca Cola, McDonald's, Apple and Microsoft have continued to sell their products in the Arab world, while still being widely represented in Israel.
It is one thing for enemies to call for boycotts to try to damage a country's economy, in an attempt to change the politics within that country or a region. It becomes quite another thing when those who are considered closer to the country, for example citizens of the country, use these tactics. It seems as if this was the moment when the Israeli government stepped in and decided that action needed to be taken against those calling for boycotts. There are those who argue that calling for a boycott is tantamount to treason, particularly for a country like Israel which already finds itself in a precarious situation. This is what prompted the government to step in, and to pass a law that makes it illegal to call for boycotts. More than this, the government has enacted that companies or individuals making such calls will be excluded from bidding on government tenders.
The controversy during the passage of the bill resulted in the final version being somewhat diluted from the original draft of the bill. Originally, it was recommended that it be a criminal offense to call for boycotts against Israel. By the time the law passed its final hearing, it was enacted that calling for boycotts would not be a criminal offense, but would rather be a civil offense. Although one cannot be arrested and charged by the state when calling for boycotts, it does mean that anybody who is the target of such boycott can sue the accused in a court of law, while not having to prove that actual damage was caused. The fine on those found guilty of this offense has been left to the court in question to rule upon.
Any controversy that was evident in and around the corridors of the Knesset during the time that the bill was in its draft form, have erupted into much greater levels of opposition since the bill was passed. The debate and controversy has focused upon whether such a bill is undemocratic. Is it a limitation on the freedom of speech of the individual to prevent him from calling for a boycott on the country in which he lives? Some highly respected legal opinions think that this is the case. Although Israeli State Attorney-General Yehuda Weinstein sees no conflict between the new law and freedom of speech, the legal adviser to the Knesset does not agree. Eyal Yanon issued an opinion which states that parts of the law "edge toward illegality and beyond". A group of 32 Israeli law professors and senior legal academics signed a petition to demonstrate their objection to the law on a legal basis. It is their view that it should be the right of all citizens to be able to say what they feel, and to take actions to support this including the call for boycotts on Israel. There is clearly more than simply a passing concern about the impact of the new law on Israeli democracy. This, in turn, causes much consternation as Israelis are extremely protective over the democratic nature of the state.
If we take this scenario into the world of business for a moment, the rules seem clearer cut. It is acceptable to cause economic damage to competitors, so long as the actions taken are legal and within the realms of fair competitive action. It is unacceptable, however, to make calls for actions against the company for which you work, which may have a significant detrimental impact on the company. This is likely to be a firing offense. The rule is, that if you cannot live with the policies followed by your employer, you need to find employment elsewhere rather than try to militate from within to cause your company damage. Do the same rules not apply to the country in which you live? Should the state not have the right to demand some level of loyalty to be shown by those who enjoy the benefits that the state offers to its citizens? Should it not be an offense to bite the hand that feeds you, and protects you from the enemies of the world?
The effectiveness of calls for boycotts over the years is unclear. There are those who claim that the massive international boycotts applied against the apartheid government in South Africa were ultimately the catalyst that gave rise to democracy in that country. Boycotts applied against other countries, such as Iran, Iraq, Libya, Somalia, North Korea and countless other countries over the years, seem not to have produced the desired results. Boycotts have surely caused damage to these countries, but not in sufficient amounts to bring about the changes that were desired by the boycotters. Boycotts have undoubtedly caused damage to the Israeli economy over the years. They have also served to prove correct the famous idiom based on a quotation from Plato, that "necessity is the mother of invention". As a result of boycotts applied against her, Israel has developed her own capabilities and independence in so many industries that would otherwise not have been the case. In a perverse sort of way, Israel has probably gained more from boycotts than she has lost.
I find it difficult to understand how the law passed by the Knesset impinges on the democratic rights and freedom of expression available to Israelis. This is especially true when considering the fact that there is no criminal offense committed by those who transgress the new law. For me, the true test of our democracy and rights to freedom of speech is whether we are able to hold an open debate about our democracy without fear of retribution. In that sense, the boycott law has served to strengthen my faith in our democracy rather than weaken it. The process has proved that Arab members of Knesset have the right to make their opposition clear (as long as this is done within the rules by which Knesset debates are run), and a legal adviser employed by the Knesset is also entitled to publicly voice his opposition to a law passed by the same Knesset that pays his salary and feeds his children. Most important to me is the fact that those who think that they can enjoy the benefits of citizenship of the State of Israel, and also make public calls which will damage her economic and political well-being, will be forced to take responsibility for their actions in a court of law. This is true democracy in action.
Sunday, 10 July 2011
Why Turkey and Israel Still Wish to be Friends
In the space of one short year, the situation has changed quite dramatically. The demand for the apology over the deaths of its citizens has not been dropped by Turkey (yet). A dialogue has been taking place between the two countries over the past few weeks that indicates a serious intent to somehow find a way to get the diplomatic relations back on track. To some, it may seem strange that things can change so radically over the short space of 12 months. There are, however, a number of strong drivers behind each country's intention to repair the damaged relationship.
Turkey's relationship with Israel has been driven to a great extent by its relationships with other countries, particularly those in the west. Turkey has had a somewhat ambivalent relationship with the west. On the one hand, Turkey has been castigated by the west over its actions in northern Cyprus and has also been frustrated in its efforts to join the European Union over many years. On the other hand, Turkey has been an important ally for the USA and NATO in maintaining a military counter-balance to the Soviet Union and Warsaw Pact in former times. More recently, Turkey has provided the USA with assistance in countering the new threat from Afghanistan, Iraq and Iran. Like in days of old when the Ottomans were able to capitalise on the critical location of Constantinople as a bridge between east and west, so it is that the modern-day Turks are able to take advantage of their strategic location to good effect in order to create and maintain key relationships.
For Israel, relations with Turkey have an equal level of ambivalence. Turkey, with its population of over 70 million, is one of the largest countries in the Eastern Mediterranean. Although Turkey has no official state religion, over 97% of its citizens are Muslims. As a result, when it comes to matters relating to Israel in the international community, there is always a very good chance that Turkey will side with other Muslim countries in their opposition to Israel. It is notable that Turkey is not an Arab country. Despite their common religion, there are many cultural differences and clashes between Turkey and Middle Eastern Arab countries. It is these cracks which Israel has exploited to good effect in the past, to build economic, political and military relations with Turkey.
Following numerous unsuccessful attempts on Turkey's part to gain entry to the Europe Union, the country's government decided to seek friendships elsewhere. This happened at a time when there was a huge upsurge in Islamic religious fundamentalism in Turkey, along with similar trends elsewhere in the Islamic world. This pushed Turkey's attentions eastward and southward towards its Islamic friends and neighbours. It has spent much time over the past few years building stronger ties with Syria, and particularly with Iran. This all seemed like a solid strategic step to take until the "Arab Spring" swept through the Middle East. Turkey has been forced to all but abandon its ties with Syria and, with it, its friendly links with Iran. Once again, Turkey is looking for friends. Under this set of circumstances, repairing its damaged links with Israel appear an attractive option. Not only is there a solid economic and political advantage for Turkey in bilateral links with Israel, there is also the important link that Israel has to the USA. This could, in turn, help to build bridges to other western countries. Closer links with Turkey could equally be an advantage for Israel. Turkey presents Israeli goods and services with an economic opportunity. In addition, Turkey could act as a bridge between Israel and the Islamic world.
Events over the past few months have weakened Turkey's position, and possibly forced the Turks to be more flexible in backing down from established positions in order to repair its relationship with Israel. The commission appointed by UN Secretary-General Ban Ki Moon to examine the events of the Gaza flotilla, is ready to report its findings. Former New Zealand prime minister Geoffrey Palmer and his colleagues on the commission have had access to a great deal of material, including video footage taken by both sides, which is connected to the events that took place on the Marvi Marmara. Palmer's report strongly supports Israel's rights under international law to defend her sea borders. Although criticising the IDF for excessive violence on the Marvi Marmara, Palmer does not support Turkey's demand for an apology from Israel. Palmer additionally praises Israel's internal investigation into the events as being independent and professional. On the contrary, Turkey's investigation is criticised for being politically motivated and unprofessional. The points in the report which do not support Turkey's claims and positions are effectively forcing Turkey to compromise to a greater degree than Israel in the negotiations to reach agreement.
It was hoped that the two sides would have reached agreement by the end of last week to allow Palmer to publish his report against the backdrop of two countries having reconciled. The agreement was not reached, and the publication of the report has been delayed in the hope that agreement can still be reached in the near future. The longer it takes to reach the agreement, the more likely it is that Turkey will be forced to compromise even further. For Turkey, not reaching agreement is probably less attractive than having to make the painful concessions necessary to reach the agreement.
Although I cannot envisage thousands of Israeli tourists filling Turkish holiday resorts in the near future as once was the case, this prospect does not seem very far away. Both countries have substantial interest to repair the damage done, and to renew their relationship to mutual advantage. I find it difficult to contemplate the possibility that either of the countries will not do almost all that is required to bring things back from the brink. Having said that, I believe that Turkey will be forced to back down from its demand for an apology. This will almost definitely not be delivered by Israel.
Sunday, 3 July 2011
Gaza Flotilla is Running Out of Wind
In the year that has followed the incidents of the 2010 flotilla, much has changed. In the days following the flotilla incident, the Turkish government withdrew its ambassador from Tel Aviv in a show of anger. Relations between Israel and Turkey went into freefall as military exercises were cancelled and Israeli tourism to Turkey all but evaporated. The reaction by the Turkish government was largely as a result of the support that it provided to the IHH, the main Turkish organisation that backed the flotilla. Now, more than 12 months later, the situation is very different. The report by the UN Secretary-General into the flotilla incident has confirmed that Israel and the IDF acted lawfully in preventing the flotilla from entering Gaza. Despite criticising the IDF for excessive use of force, this report is one of a number of events that have left Turkey isolated internationally. Another contributing factor to its isolation are the events in Syria over the past few months. Turkey has been forced to re-examine its relationship with Syria (and Iran) in light of the Arab spring uprisings. Rather than being in a situation to flex its muscles against Israel, Turkey is suddenly looking again for a way to normalise relations in order to find its way back into the international fold.
Under the circumstances, it came as no surprise when the Turkish government did not jump at the opportunity to support flotilla II. This also meant that the Turkish ports, which were used last year for the fleet to set sail from, had effectively been withdrawn from the flotilla's use. Other governments, most notably Ireland, Cyprus and France, have also come out with statements that withdraw their support from the flotilla. The decision by the flotilla to gather in Greece as an alternative, has proven to be fraught. Greece is going through its worst economic crisis in decades, and general strikes have crippled the country's ports. Not only has it been completely impossible for the flotilla's activities to squeeze a mention in the Greek press, they will need to be very lucky to find a way to set sail from Piraeus at all.
Buoyed by the support offered to its activities by the UN Secretary-General's report, the Israeli government has set about planning its response to the arrival of the next flotilla. The navy has been using its experience of flotilla I to work out a more precise plan of action to prevent flotilla II from nearing the coast of Gaza. There is a much clearer understanding of what may await the navy in the event that the ships reach the edge of Israeli territorial waters, and they have a plan to quietly guide the ships into the Israeli port of Ashdod without any loss of life, injuries or screaming international headlines.
The propaganda war has already begun, with Israeli intelligence announcing that those who are gathering in Greece are not only those with humanitarian objectives on their minds. A number of well-known names who have been involved in pro-Palestinian and anti-Israeli activities, have already been identified amongst the participants. Concerns have also been raised about cargo which has been loaded onto some of the ships, and some of it seems to have a militant rather than humanitarian purpose. Israel has been accused of sabotaging two of the vessels by damaging their propellers, and rendering them unable to sail. Unconfirmed reports have suggested that some Israeli lawyers have tied the flotilla up in legal red tape by issuing legal suits against the insurers of the flotilla, and the providers of satellite information to the flotilla's ships. It is hoped that this may result in these providers withdrawing their services from the flotilla, thereby preventing the fleet from being able to sail.
In the latest move, the Greek government has issued a legal order preventing the flotilla ships from leaving Greek ports. One ship that tried to defy the ban was firmly but politely escorted back to port by the Greek coastguard. It seems that it will now take a super-human effor to get this flotilla onto the high seas. The activists have vowed to set sail tomorrow with whichever vessels they can muster together. Even the most optimistic scenario does not show that this flotilla will be any sort of success story.
Perhaps this is the ultimate justice. One has to question the intentions of the 350 activists who finally gathered in Piraeus, after initial estimates that 1,500 would join this flotilla. Conditions in Gaza are far from ideal, but the situation is also not what is presented by the flotilla members. Recently, the deputy director of the Red Cross in Gaza was quoted as saying that there is no humanitarian crisis in Gaza. Although many people are dependent upon international aid, the aid is getting to the people who need it. This is in stark contrast to many other parts of the world where needy people are not getting access to the aid. One can, therefore, only assume that these activists have the intention of making a political statement against Israel rather than coming to truly help needy people. Under the circumstances, it is hardly surprising that the Israeli government will do all that it can not to allow these people to approach the coast of Gaza. If anybody is to address the real cause of the poverty and misery in Gaza, the protest would be directed at Hamas. For it is Hamas, more than the Israeli government, that truly has the well-being of the citizens of Gaza in their control.
It seems as though the flotilla may be thwarted if it cannot depart within the next two or three days. Mounting frustration on the part of the activists, caused by wasted time and dwindling funds, may ultimately prevent the sailing from going ahead. With the lack of real positive intention on the part of many of the flotilla participants, there will be few people mourning the death of this flotilla. Like any sovereign country, Israel has the right to protect her territorial waters from both the infiltration of weapons that are designed to murder her innocent civilians, and from those who wish to create heroes out of murderers. If this is all about humanitarian aid, Israel has already agreed to pass the humanitarian goods to the people in Gaza. The truth is that this is an attack on Israel hiding behind the guise of humanitarian aid. Under these circumstances, Israel will never allow these vessels near Gaza.