The government's judicial reforms will damage Israel's economy and cause losses that amount to the entire budget of the country's welfare ministry and half of its health ministry, Israel Economic Association president Yossi Shpigel said at a debate in the Knesset Finance Committee on the reform's effect on the economy.
Shpigel added that he was "astounded" that nearly every academic economist in the country signed a letter a few weeks ago warning against the reform's economic implications. Never had he seen such consensus amongst economists, including from the US, Shpigel said.
Israel's debt
According to Shpigel, Israel's debt is currently approximately one trillion shekels; a lowering in the country's credit rating due to the reform would cause it to pay more interest on the debt, to an amount that would reach the equivalent of the welfare ministry's entire budget.
In addition, Israel's high-tech sector could shrink by 10% due to the reform, according to Shpigel. This would cost the country in income the equivalent of half of the health ministry's budget.
A representative from the high-tech sector added that its shrinking would first and foremost harm minority populations, as the first hi-tech workers to be laid off will be those that employers worked harder to employ – mostly from the haredi and Arab sectors.
The debate was held at the request of the committee's opposition MKs. The MKs complained to committee chairman MK Moshe Gafni that no representatives from the finance or economy ministries attended the discussion, despite being invited.