Uncle Sam’s bigger brother

Sometimes, when discussing the US-Israeli relations, we need to see the broader picture. Things like the Palestinian conflict are just a minor issue in relation to the economy. As most of the English Readers of this blog [this was originally posted in Hebrew, sorry for Hebrew links, but use Google Translate] may not know. Israel had a major crisis around 1985, banks collapsed and were bought by the government. Then, in order to save the economy, our late minister of treasury, Yitzhak Modaey, along with the former prime minister, Shimon Peres, had an initiative. Their plan was to save the economy by a what the former Attorney General (and supreme court justice) Yitzhak Zamir called a historic mistake. Our Omnibus Statute was meant to save the economy by amending a few statutes and giving the government a way to deal with the crisis. The statute was a mean to implement emergency policies in order to save the economy. Along the years, though, the government used the omnibus law, which passed from year to year, as a mean to implement reforms and force economic policies without a real debate about them.

When time came, a petition against the law was submitted to the supreme court as the “Quantity became Quality” (playing on justice Aharon Barak‘s words in HCJ 3267/97 Rubinstein v. The Poultry Farmers Union). The Poultry Farmers petitioned to the supreme court, stating, amongst other things, that there was no real discussion and debate about the Omnibus Statute that year, and while justice Dorit Beinish refrained from striking the statute, she warned the parliament before the quantity becomes quality:

Indeed, this is a legislation process that makes a sufficient and deep discussion hard, and which tempers the decisionmakers in parliament and government ability to gather an established opinion. Let us remind that one of the purposes in the Parliament’s regulation about legislation processes is to allow the parliament members to gather their opinion about every legislation that stands against them (…) and it’s hard to see how the legislation process in the Omnibus Statute allows that purpose” (HCJ 4899/03 Poultry Farmers Union v. The Israeli Government)

Twenty-three years later, and our big Uncle Sam has the same issues. Because of historic mistakes that were caused by a capitalist policy to encourage consuming, Mortgage Banks collapsed since they incenticised high risk loans, as a chain reaction, the US stock indices fell and billions of theoretical dollars were lost. Not too much later, the US Government decided to nationalise several banks and an FBI inquiry regarding AIG’s conduct began.

Right, Israel’s bank crisis of 1985 began because banks loaned people money in order to purchase the ever rising bank shares, which drove the bank shares even higher, until one day people understood that it was worth nothing. Billions of theoretical Shekels were lost. But the same mistake was made in t he US in the mortgage market. Allowing bubbled loans and leverage of real-estate was what made the real estate market bloom, till it exploded.

Well, like in Israel, fast legislation processes were needed. However, the Congress first rejected the Wall-Street Bailout, which caused a major decline in stock indices. Therefore, gently, the government formalised a more serious plan that imploded from the original three pages to one hundred and ten, and then to four hundred and fifty one. 451 pages of tax reforms that most likely will never be read and will cause tax exemption for wooden arrows for children.

And if we’re still with the great Uncle Sam, I am quite troubled by the great endeavours burned in order to assist the Israeli government implement Biometric Identification. This time, our minister of internal affairs Meir Sheetrit, claims that Israeli citizens will not be required a US visa if the biometric database will be approved. The subtext, of course is “if the biometric database will be approved and conveyed to the US authorities”, since without that, the US government has no mean to confirm their identity. What Sheetrit forgot to tell us, being a minister with formal micro-biology education (which the government thought was relevant when they approved his offer for biometric IDs), is that Biometric Passports are easy to fake or copying in a manner that allows Identity theft.

But Sheetrit won’t be blurred by the facts when he will be speaking in front of the Knesset about the biometric identity statute. He’ll explain to the parliament members that the government already signed an agreement with HP to issue the IDs and that the US insists that we have such a database. Our Knesset Members, being so reasonable and have to consider every proposal, will do the right thing and vote seriously, of course. And that’s only if the Omnibus statute won’t be the statute that approves the Biometric Database.

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