Prices are soaring, the middle class is eroding, the weaker sections are weakening even more - and the government is not doing enough to fight the wave of rising prices.
Compared to data a year ago, prices in Israel are 4% higher and apartment prices more than 16%.
These dramatic figures from the Central Bureau of Statistics were quite predictable, but they should light a bright red light for decision-makers, who these days boast impressive growth figures for the economy and low unemployment figures.
For the upper deciles this is not bad news: those who own an apartment, or even some apartments some of which are for rent, enjoy the rise in apartment prices that manages to compensate for the rising prices of products in the economy.
But what about the weaker classes and the middle class, who even before the wave of rising prices lived in austerity and scarcity, and barely closed the month?
For them any increase in the prices of food, fuel and other products, is very significant.
The real problem is of about a third of households, which have failed to purchase an apartment and live in rent.
They will experience the painful blow to their pockets in the coming months, because the rise in the price of apartments is usually ahead of the trends in the rental market, so that the peak in rental prices is probably still ahead of us.
When asked how the government intends to facilitate citizens in the current wave, Finance Minister Avigdor Lieberman replied that the rise in prices in Israel is relative to other countries, and that this is a global problem due to rising commodity prices, maritime transport and more.
Lieberman is right.
Inflation in the US is more than twice as high as in Israel (8.3% in the last year), and in Europe too it has skyrocketed and has already crossed the 7% threshold - but should this interest the ordinary citizen, who does not close the month because everything around him is rising?
Israel has entered the wave of price increases when the level of prices in the economy is about 20% higher than the OECD average, so its citizens' tolerance threshold for price increases is lower than that of EU or US citizens. But what is the government actually doing to ease the price wave? The fuel is half a shekel per liter, but it has already risen back and even crossed the 7 shekel threshold per liter - a record of eight years.
The government has also promised additional credit points for working parents and an increased work grant for low-wage earners - but in both cases, once the increase is approved, these are meager amounts that will not compensate for the surge in prices, let alone wage increases.
Price increases by categories,
At the same time, the state coffers are in surplus of more than NIS 30 billion since the beginning of the year.
This is an unprecedented continuum since the establishment of the state, with a budget surplus recorded in the first four months of the year.
The achievement is mainly due to the increase in tax collection, thanks in part to the booming Israeli high-tech.
But high-tech, presumably, will not continue to flourish forever, and the surplus is expected to diminish later this year.
Still, the government can afford to make it easier for the public - by lowering taxes and providing unique benefits to the middle class and the weaker sections.
Were we wrong?
Fixed!
If you found an error in the article, we'll be happy for you to share it with us
