Israel is currently in a state of emergency. The war caused immense suffering and damage to the country, with economists estimating that the war could cost more than NIS 100 billion, and that each day of fighting costs about NIS <> billion. This is a huge burden for a country that entered the war with a high national debt.
The government has a duty to act responsibly and urgently to reduce its other spending. If the government does not cut its spending, we will encounter a massive increase in the national debt. This will have catastrophic consequences for the economy. First, it will hurt public investment, which will reduce economic opportunities for individuals and families.
Secondly, it will limit financial flexibility to deal with future crises. Third, it will raise interest rates, which will make it harder for businesses and people to borrow money. This will reduce investment and spending, which will slow down the economy even more. It will also harm Israel's credit rating, which will affect its international position and influence.
Security forces in Sderot during an iron sword war, photo: AP
Business owners know that in tough times you have to cut costs, and they've already done that. Many have lowered wages and sent employees on unpaid leave. Some even closed their businesses or diverted their businesses entirely to support the war effort. They made these sacrifices for survival and for the country.
Wasted precious resources
Politicians, on the other hand, neglected the issue for a long time, then began fighting and petty politics about how and where to cut spending. They wasted precious time and resources arguing around secondary issues, instead of focusing on the real problems and solutions. Politicians demonstrate a lack of leadership and responsibility, and fail to represent the interests and needs of the people who elected them.
Instead of starting the discussion about cutting expenses through political disagreements, Knesset members and ministers should start by reducing their salaries. They need to lead by example. Once they cut their salaries, it will be easier for them to demand a cut in spending from government ministries and bureaucrats. It will also show the public that they are serious about handling the crisis, and that they are willing to share the burden and pain. It will also demonstrate appropriate humility for this period.
During the Yom Kippur War, Knesset members froze their salaries. I searched in the hope of finding ministers and Knesset members who propose similar behavior, or at least cut their salaries, but the last mention I found of politicians' salaries was in January 2023, when they raised their salaries by 5.1% (and this after they tried to raise it by 12.5%).
It is shocking and incomprehensible that no public representative offered to reduce his salary during this period. I call on all politicians to publicly declare that they support a 15% reduction in the salaries of ministers and Knesset members for the next 12 months. This is the least they can do to show some humility, solidarity and empathy with the hundreds of thousands of Israelis who are suffering.
Be proactive
Every Knesset member should initiate and support this proposal. This is the time for politicians to show the people of Israel that they are willing to sacrifice for the common good. We must demand that ministers and MKs cut their salaries now.
The writer was the founder and CEO of Peninsula Group
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