As Election Approaches, Israelis Demand Gov’t Curtail Cost of Living

‘When I go to sleep at night, I don’t think about war, I think about how I will pay my bills,’ protester says

Israelis gathered at Habima Square in the heart of Tel Aviv on Saturday, to protest the soaring cost of living, and in particular, of housing.

People from across the country attended the demonstration, demanding that the government act to improve the situation

Gal Shor, the organizer of the protest, a 32-year-old from south Tel Aviv, told The Media that something must be done, citing the city’s status as the most expensive in the world, according to the 2021 Worldwide Cost of Living report from the Economist Intelligence Unit.

He added that the fact that the national election has been set for November 1 is helping their protest to be heard by “the people on the top.”

“I think that this protest has much more power because we are heading to the election because the main subject of the election will be the cost of living and housing,” he said.

The parties and the Knesset members, continued Shor, “that won’t understand that this is the main issue, and that won’t relate to this, won’t continue [in office], and that will end their political careers.”

Dr. Yael Hadass, academic head of economics at the Raphael Recanati International School at Reichman University in Herzliya, told The Media Line the cost of living is a very big issue for voters indeed.

“The more painful the inflation is, [the greater the chance] people might change their mind regarding which party they trust to solve it,” she said.

Hila Iulius, from Karkur, south of Haifa, attended the demonstration with her husband and children because they can’t afford to buy their own home, she told The Media Line.

Hila Iulius and her son at the protest, Habima Square, Tel Aviv, Israel, July 2, 2022. (Shai Levene/The Media Line)

She said that she will vote in the election thinking about the issue of the cost of living. However, she does not know which party will improve the situation. She is disappointed with all of the current Knesset members and parties.

Tamir Barelko, the founder of “Tel Aviv Yekara Li,” which means both “Tel Aviv is expensive for me” and “Tel Aviv is dear to me” in Hebrew, a campaign to mobilize the protest on the issue, told The Media Line he feels that the government is finally getting the message.

The election is soon, he said, “and now everyone is listening. They understand that the cost of living is the most important topic and that people will vote based on it.

“That is why we keep talking about it. The politicians understand that they have no chance to be elected if they don’t bring solutions and answers for the citizens,” Barelko continued.

A month after they started their campaign, the government has taken some actions to lower the cost of living, he said.

“They lowered by 40% the cost for daycare over the summer. They also announced that they will provide easements on the [cost of] apartments for young people,” Barelko continued as he said this is just the beginning.

Tamir Barelko (R) and Yael Shany, directors of the “Tel Aviv Yekara Li” movement, at the protest, Habima Square, Tel Aviv, Israel, July 2, 2022. (Shai Levene/The Media Line)

Shor noted that security is usually the central topic in voters’ minds when they go to the polls. He said that while he recognizes the importance of the issue, the economic situation feels much more immediate for the average citizen.

“I and many people from all over the country don’t think about war every day,” he said. “First we need to pay the bills at the end of the month, to buy food at the supermarket, to travel to our workplace, we need gasoline.”

When I go to sleep at night, Shor continued, “I don’t think about war, I think about how I will pay my bills at the end of the month.”

Hadass attributed the recent sharp rise in prices to a combination of events related to the COVID-19 pandemic and the Ukraine war.

On one hand, the central banks in the US, Israel, and other countries have increased the money supply, which led to increased demand for goods and services, which led to an increase in prices over the past year, she explained.

On the other hand, she continued, both the pandemic and the Ukraine war led to disruptions in supply chains. Many intermediary goods were not produced on time and the shortages created an increase in the prices of manufactured goods.

The current rise of prices is more a global phenomenon than a local one, Hadass stressed.

Governments can take some measures locally to improve the situation, but the most effective measure that they can take is to promote peace [in Ukraine], she said.

“I do think that governments around the world should think very seriously about how to promote peace and stop the war, both to help those who are seriously hurt by the war but also to help the global economy,” Hadass said.

She added that political stability is a crucial prerequisite for a country to improve its economic situation.

“I think that a long-standing government is a must for the economic well-being of any country,” she said.

Women paint a sign that says in Hebrew “The people of Israel won’t vote” and “No trust in the system,” Habima Square, Tel Aviv, Israel, July 2, 2022. (Shai Levene/The Media Line)

Regarding real estate prices, Hadass cited research by Prof. Zvi Eckstein and others at the Aaron Institute for Economic Policy at Reichman University, in which they concluded that it is crucial to address many obstacles to construction processes that are in the hands of the state.

“This means that a stable government is a must to improve the situation in the real estate market, and of course in other markets as well,” Hadass said.

Stav Shem-Tov, a Jerusalem-born resident of Tel Aviv, told The Media Line that as the cost of living is an important issue that he will keep in mind while voting on November 1, the main thing for him is to choose a party that can create a stable government.

After the last few years, he said, “the most important thing is to vote for someone that will bring stability. It is crazy that we are going to the fifth election” in three-and-a-half years.

“Because so many parties have a lot of power in Israel, major problems like the cost of living and housing that concern most people are not dealt with. A more stable government that will agree more within itself could perhaps create the changes we need,” he continued.

He said it was absurd that he paid 14,000 shekels ($3,964) each month for a three-room apartment in the center of Tel Aviv, an apartment “which has tons of mold on the walls.

“Someone needs to wake up and do something,” Shem-Tov said.