Deficit and defeat

The rise and fall of Israeli politicians is the theme of Friday’s news coverage, with former foreign minister Avigdor Liberman’s trial taking top billing alongside the return of Aryeh Deri to the leadership of Shas.

Israel Hayom runs a front-page story about the country’s local currency rating dropping because Finance Minister Yair Lapid has yet to propose or pass a budget for the coming year. Part of the reason for the first downgrade in 20 years, it says, is that Lapid proposed increasing the deficit to NIS 50 billion, the largest in Israeli history. The paper reports that Prime Minister Benjamin Netanyahu was unaware of the proposal, and that he desperately tried to contact outgoing Bank of Israel Governor Stanley Fischer over the phone to make heads or tails of the situation.

Because the remainder of the article about credit agencies and local and foreign currency ratings is as esoteric as the terms themselves, Israel Hayom offers a handy list of definitions along the side, topped by the paper’s bottom line: “Yellow card [to Lapid].”

Hezi Sternlicht comments that the credit agencies’ shot across Lapid’s bow was something Fischer and Netanyahu should have done already. The consequence is that Israel will have to pay more interest on government loans, which — before the local currency rating dropped — equaled NIS 129 billion last year, he says, which amounted to “approximately the Defense Ministry and National Insurance Institute put together.”

“Lapid’s game is dangerous,” continues Sternlicht. “He has been zigzagging a long time on the issue of a high deficit. It’s a problematic message for a minister that doesn’t know how to deal with the important things.

“The incoming finance minister said that he would not treat the middle class like an ATM,” he writes, but increasing the deficit and promising cuts the year after will do just that, and worse.

Maariv leads off with the announcement that Deri, previously convicted of bribery, is once again the sole leader of the ultra-Orthodox Shas party. According to the report, the party’s spiritual leader Rav Ovadia Yosef summoned Shas’s ruling triumvirate — Deri, Eli Yishai and Ariel Atias — and said that, henceforth, Deri will be the sole leader of the Sephardic movement. Yishai has been appointed head of Shas’s educational institutions, and Atias was made chairman of the party’s Knesset faction, the paper reports.

“I thank Eli Yishai for navigating the ship in a stormy sea with talent and good taste,” Maariv quotes Deri as saying. “I don’t see any power in this and I am not rejoicing. I will make every effort for love and brotherhood to prevail. We will be a combative opposition with Atias [in the Knesset], and Yishai will lend a new spirit to the educational institutions.”

According to party sources quoted by Maariv, however, Yishai’s and Atias’s reactions to the decision were written on their faces. “Yishai exited Rav Ovadia’s house disappointed,” they said. “Deri, however, left content, because he got what he wanted.”

Behind closed doors, Yishai, the party leader for the better part of a decade, was quoted as saying of Yosef, “Why has the rabbi done this to me?”

Although Yedioth Ahronoth places a teaser on its front page for Arabic media reports about increased Israeli military activity on Lebanon’s border, the article is buried on Page 11. “The IDF is operating over the border with Lebanon,” it cites the Lebanese press as saying. The reports indicated that Israeli planes flew low over southern Lebanon and that Israeli foot soldiers crossed the border into the Shebaa Farms region.

The paper’s lead story is instead about former deputy foreign minister Danny Ayalon’s appearance in court on Thursday, as the prosecution’s star witness in the trial against his ex-boss, Avigdor Liberman. Ayalon testified that Liberman crookedly appointed the ambassador to Latvia, as charged in the breach-of-trust case.

Ayalon dismissed charges that he was testifying against Liberman to spite the man who dismissed him from the Yisrael Beytenu party, saying, according to Haaretz: “It had no bearing, this trial is justice and right; this is truth, this is not connected whatsoever to my political future.”

“I have no conflict with Liberman and I do not act out of vengeance. I am even prepared to shake his hand right now,” Ayalon said, to which Liberman burst out: “Heaven forfend! I don’t shake hands with cheaters and liars!”

Ayalon mentioned in court that he remembered Liberman asking for Ze’ev Ben Aryeh to fill the ambassadorship not once — as stated in the charge sheet — but rather “Liberman spoke to him about Ben Aryeh’s appointment twice,” Haaretz reports. It adds that Ayalon said that he was not surprised when his boss asked him to nominate Ben Aryeh for the Latvia post, because “Liberman was involved in appointing senior officials like ambassadors.”

Shimon Shiffer writes in Yedioth Ahronoth that, considering Ayalon didn’t step forward to testify against Liberman until after he was booted from Yisrael Beytenu, “it would appear as though Ayalon had one truth before Liberman dismissed him and a second truth afterward.”

“It should have been that despite the injury that he suffered because of Liberman, his deputy [Ayalon] would show a certain restraint. But up until the decision not to include him in the Knesset list, he didn’t find any fault or transgression that required him to demonstrate ‘good citizenship,’ as [Ayalon] called it, and go to the police,” he writes.