-- February 29, 2012- The Connection Between the Rise in Gas Prices and the End of the Army Exemption for the Extremely Religious

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Israel Update
A Daily Analysis
By Marc Schulman

February 29, 2012- The Connection Between the Rise in Gas Prices and the End of the Army Exemption for the Extremely Religious

What is the connection between tonight's rise in the price of gasoline in Israel, and the likelihood of the Tal Law, (or an equivalent law to continue the exemption for Haredim serving in the IDF) passing? In my opinion a great deal. The Haredim are convinced that nothing is going to change. I believe they are wrong.

Tonight the price of gas in Israel is going up to 8 shekels/liter, that works out to be $8 a gallon, an exceedingly high price. This price rise is, of course, a function of the rising price of oil in the world. These concerns are mostly due to fear about what will happen in Iran. However, more than half of the price of gas in Israel is due to taxes. The current price hike has brought about calls to cut back on taxes. One of the last summ
er's protest leaders warned that the next set of protests might not be peaceful.

Now, to bring the story back to my opening question... This afternoon Yair Lapid posted a statement on his Facebook feed attacking the rise in the price of gas. Lapid added that this increase makes people upset twice. First, Israelis feel that seemingly more and more money is being taken from them. That might be ok, if the additional money was going to health and education. Unfortunately, it's not. Here is the second source of aggravation. The additional taxes are going to unknown places that politicians choose. Lapid does not say "Haredim", but that is of course the implication.

Slowly, but surely, the dots are being connected. Israelis are rightly upset at the prices they pay, for which there are two major causes: 1) The monopoly pricing that many companies charge (especially on food), and 2) The high level of taxation. Needless to say, a great deal of tax money does go toward defense. However, the portion of taxes (and that amount is an unknown number) that goes to the Haredim is a clear target. As a result, earmarking of those additional tax funds are now tied, in the public mindset, to the renewal of the Tal Law. No one really believes the Haredim will go into the army. However, I believe that the end of the Tal Law will provide the impetus for a showdown on this issue. The public response will be: While we cannot force you to go in the army, if you do not, you will not get any support from the state.

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