24 July 12 13:47–After a stormy debate, the Knesset Finance Committee today passed the government’s new deficit target of 3% of GDP for 2013, up from the previous target of 1.5%.

Minister of Finance Yuval Steinitz, who attended the meeting, said, “Despite the higher deficit target, we will have to cut the 2013 budget and raise taxes.”

In support of the higher deficit target, Finance Committee chairman MK Moshe Gafni (United Torah Judaism) said, “The Israeli economy is strong, but the middle class is suffering and there are serious social problems. Economic stability is important, but social stability is equally important.”

Gafni added, “There is a serious problem in Israel’s economic conduct. The economy is strong but it does not trickle down to the people. I am not sure that Governor of the Bank of Israel Prof. Stanley Fischer’s position of setting the deficit target at 2.5% of GDP is correct, but I respect him. Ahead of the 2013 budget, I warn that social stability is as important as economic stability. We must not repeat the mistakes that led to the social crisis.”…Read More>>

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