Dozens of economists and central banks in the US and Europe warn of the consequences of the legal reform. Now, they are joined by senior economists and former CEOs in the public service, who warn: the legal reform is expected to cause a serious crisis.
At the beginning of the week, 50 former CEOs of economic government ministries published a position paper against the plan of Prime Minister Benjamin Netanyahu and Minister of Justice Yariv Levin.
Among the CEOs are those who worked in the Netanyahu governments over the years.
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Netanyahu and Levin (archive), photo: Oren Ben Hakon
These economists are joined today (Friday) by senior women and men who served in positions at the level of CEO in the ministries and senior economists from Israel and the world, who express their deep concern in the face of the government's moves that "are expected to harm the independence of the justice system and the public service, and will cause unprecedented damage to the Israeli economy," it says In a letter to the Prime Minister.
Justice Minister Yariv Levin presents his revolution in the judicial system // Photo: Yoni Rickner
Among the signatories: Professor Nouriel Roubini who previously predicted the great economic crisis of 2008. It also reads: "Beyond the immediate effects of the government's moves, there is a serious concern that the weakening of the justice system will lead to long-term damage to the growth path of the economy and the quality of life of the residents of Israel. This assessment is based on Some of the most cited studies in economic research, including those of the Nobel Prize winner Douglas North, and of the most important economists in the world such as Andrey Shleifer and Daron Etcemoglu. These studies show that the existence of great political power in the hands of the ruling group, without strong balances and brakes, is a main cause of economic backwardness ".
"The studies show that without effective limits on the power of the government institutions, personal legislation increases and the bureaucratic apparatus weakens and becomes unprofessional. Not surprisingly, in recent years there has been an increase in the level of corruption in Hungary and Poland. The studies show that damage to the quality of the government institutions is almost irreversible. Institutional balance supports growth is subtle, and a deviation from it could be long-term, since harmful political and economic institutions tend to perpetuate themselves over many decades. Therefore, we strongly warn against the current initiatives of the coalition, which mean a fundamental change of the system of the regime in Israel and a danger to the future of the Israeli economy and economy."
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