On Sunday, Heritage Minister Amichai Eliyahu (Otzma Yehudit) sharply attacked Bank of Israel Governor Prof. Amir Yaron in an interview with Kol Barama radio: “He tarnishes the reputation of the State of Israel and harms the country’s credit rating. He should have been kicked down all the stairs. This is a barbarian. It is inconceivable that government officials go against the government,” Eliyahu said.
You may recall my report from May 22, when Labor and Welfare Committee Chairman MK Israel Eichler (UTJ) blasted the Governor of the Bank of Israel Amir Yaron for his repeated raising of interest rates which had zero impact on the country’s inflation, while middle- and lower-class families are being oppressed by their ballooning mortgage payments.
“Yeshiva students show me the interest rate on their mortgage and it’s horrible,” Eichler told Kikar Hashabbat. He said Governor Yaron “Raised the interest rates and didn’t stop the inflation – in my opinion, he must resign.”
On May 22, the Bank of Israel raised interest rates for the tenth time since April 2022, to 4.75%. The prime interest reached 6.25%. The move raised the monthly mortgage payments of thousands of already struggling Israeli families by as much as NIS 1,000 ($280). At the heart of the move is an effort to curb inflation, but the best it has achieved so far was 0.20% last week, which may or may not stick. Israelis’ buying power is diminishing while their debts increase.
But there was more. About two months ago, Diaspora Minister Amichai Chikli attacked the bank governor: “I am very sorry for the behavior of the Governor of the Bank of Israel, as soon as he went to CNN and spoke there, he harmed Israel’s economy.”
Chikli explained: “When you come and say that there will be darkness over light if the [judicial] reform passes, certainly if you say it on foreign networks, the prediction you say is the prediction you make. Here, too, these warnings should be said emphatically, but in closed meetings. I think the governor is wrong, the governor is sabotaging Israel’s economy. His move is more political than economic. He serves the elites and not the citizens of Israel. There is an economic elite and a security elite here that worked together to thwart the reform.”
The attacks on Minister Eliyahu began within the opposition. Prime Minister Benjamin Netanyahu declared: “I strongly condemn the words of Minister Amichai Eliyahu against the Governor of the Bank of Israel, a dedicated public servant who does his job faithfully for the benefit of Israel’s economy and the citizens of Israel.”
Finance Minister Bezalel Smotrich declared: “The against the Governor is inappropriate. Even if there is a legitimate criticism, it must be concrete and respectful. As finance minister, I give my complete support to the governor to continue to carry out his professional work running the monetary policy with complete independence for the benefit of Israel’s economy.”
Interior and Health Minister Moshe Arbel (Shas) said: “The blatant and inappropriate words that Minister Amichai Eliyahu uttered against the Governor of the Bank of Israel are out of place. The independence of the Governor of the Bank of Israel and his duty to present economic forecasts independently are a cornerstone of the economic resilience of the State of Israel. I call on Minister Eliyahu to retract his words.”
While he didn’t exactly retract his word in response to the brouhaha, Minister Eliyahu later declared that he said them before drinking his morning coffee.
God bless you, Amichai Eliyahu, you have the same directness and fearlessness of the greatest Sephardi rabbis, including your father, may he live long and prosper, Rabbi Shmuel Eliyahu, Chief Rabbi of Tsfat. Don’t let them shut you up!
