As Mitt and Ann Romney flew to Poland on the last leg of their international “charm offensive” designed to prove his foreign policy chops, they left behind both Palestinians and Jews who were completely offended.
At the closed, private fundraiser for Americans living in Israel, which netted him $1 million in donations, Romney characterized the Israeli economy thusly, “As you come here and you see the GDP per capita, for instance, in Israel, which is about $21,000, and compare that with the GDP per capita just across the areas managed by the Palestinian authority, which is more like $10,000, you notice such a dramatically stark difference in economic vitality.” Romney said he began noticing the “enormous disparities” during his time as a business man and drew upon the 1998 book The Wealth and Poverty of Nations by David Landes to explain why some nations do better than others. “He syas if you could learn anything from the economic history of the world, it’s this: Culture makes all the difference. And as I come here, and I look out over this city and consider the accomplishments of the people of this nation, I recognize the power of at least culture and a few other things.”
A “few other things”? Oh, like maybe what happens to a people when their homes and businesses are bulldozed to make room for “settlements”? Or maybe when their farms are cut in half to build roads between those “settlements”? Or how about when their centuries-old olive groves are cut down because some kids used them for cover to throw rocks at settlers’ cars on those roads? And how about that little practice of the Israelis of closing crossings between the West Bank and Israel if the Palestinians in Gaza do something aggressive, thereby cutting off Palestinians from their minimum wage service jobs? Did he notice those factors?
And how did his comments tick off some Israelis? Well, did you hear the one about the Jewish banker…..or maybe it was the Jewish media tycoon who controls all of Hollywood and the mainstream media….or maybe the Jewish business owner who “jewed” his customers out of a fair deal? The Christian church interpreted Christ’s ejection of the moneylenders from the Temple as a denunciation of moneylending, and so they banned moneylending by Christians. Problem was, it was impossible to run a nation or an economy without credit and banking, so the Christians decided that Jews could be moneylenders and bankers. Then, they got really pissy about how much money they owed. Kings routinely called for purging of Jewish ghettoes just to clear their credit accounts. And no one was pleased when they figured out that one family, the Rothschilds, had banks in so many nations that every war on European soil was being financed on both sides by the same family. Didn’t matter who won or lost the battles, the Rothschilds won the wars.
To this day, you will find nasty comments strewn across the news site comment streams condemning Jews as money-grubbing New World Order conspirators who want to take over the planet. And Romney played right into that stereotype with his “Jewish culture” makes Israel economically stronger than those Arabs over there on the other side of the barbed wire and metal fences.
And it doesn’t help his case that the recession finally hit Israel.
Israel had been pretty much immune to the worst effects of the global recession until it became apparent that with the rest of the world in deep economic doodoo, orders for Israeli products would decline. Exports account for 40% of Israel’s economy.
As Romney left Israel, the cabinet was voting 20-9 in favor of a new austerity budget with tax hikes to address the shrinking Israeli economy. Israelis have been protesting the state of Israel’s economy for around a year now, the high cost of housing, the limited number of companies controlling so much of the basics of life, the shrinking opportunities for young people. The country is facing deficits and a rising national debt. Prime Minister Netanyahu called the new budget measures “a responsible step to protect the Israeli economy and jobs for its citizens.” Two of the coalition partners, the ultra-Orthodox Shas and the centrist Independence parties, opposed the measures.
Israel’s income tax rates range from 10% to 48%. Under the new budget, the taxes on incomes over $2,198 a month would see their taxes raised by 1% and those over $16,525 a month would have their rates raised by 2% beginning in 2013.
The VAT, value added tax, will also rise, from 16% to 17% on August 1. That one could be the most objectionable because it will impact already strained household budgets. VATs are taxed assessed against a product at every stage of its production. The taxes are based on the difference between the cost of the materials and the price charged when the product goes to the next stage. Hence, when an aluminum mining firm sells the ore to a refiner, a tax is added; when the refiner presses the aluminum into sheets, a tax is added; when it goes to a can manufacturer, and is molded into a can, a tax is added; and when that can is sold to a soda manufacturer, a tax is added, then all the steps to manufacture the soda and put it in the cans adds to the final cost of the beverage and the final VAT assessed on it. The VAT is a sales tax that is stepped into the final cost to the consumer and collected from each processor of the component parts of a product.
Then, there are the budget cuts. Each ministry (the equivalent of our cabinet departments) will have to cut 5% from their operating budgets and the tax collectors are going to aggressively go after tax dodgers. Last week, Finance Minister Yuval Steinitz ordered an immediate hike in taxes on beer and cigarettes. It is expected that these measures will add $3.56 billion to the nation’s revenues.
Netanyahu is justifying these actions by claiming that Europe didn’t act fast enough to deal with the recession and caused its own double-dips and depressions. He vows that these measures will end the recession and save the Israeli economy and Israeli jobs. His welfare minister, Moshe Kahlon, disagreed, saying the increase in the VAT is going to harm families who avoid the increase in income tax, but have incomes so low that even a single percentage point increase in VAT will cost them their “chicken and vegetables.”
It would seem that in a global economy where the whole world is tied together, having that Jewish culture isn’t a guarantee of economic immunity.
Mitt Romney: open mouth, remove silver spoon, insert foot up to knee. Even when he sticks to the script, as he did in Jerusalem when promising to move the American embassy, he manages to tick someone off.