NEW YORK — Finance Minister Bezalel Smotrich told Citibank executives in New York on Tuesday that the “noise” surrounding the government’s effort to overhaul the judiciary will “settle down in the near future” and that the coalition will adopt a compromise agreement that Israel’s “mainstream” will be able to live with.
The remarks represented a rare admission by a senior government official that the controversial, far-reaching legislation being advanced in the Knesset will be toned down by the time it reaches its final readings.
Leading economists in Israel and abroad have warned that the legislative package aimed at radically curtailing the High Court of Justice’s power risks harming the country’s financial sector, arguing that weakened democracy will make the Jewish state a riskier place for investment. Leading Israeli tech executives have already pulled tens of millions of dollars from local banks and the shekel has taken a hit, depreciating by two percent against the US dollar after the first bill in the overhaul package was passed through a first reading earlier this month.
Smotrich used the Tuesday meeting to assure Citibank executives that the Israeli economy is stable and will rebound.
“We will calm down the markets. We will calm down the economy,” Smotrich told the bank’s leadership in Hebrew remarks through a translator that were shared with the press. “I really think that investment in Israel today is one of the safest investments one could make.”
During the meeting, the sides also discussed the impact of the recent collapse of Silicon Valley Bank and Signature Bank, investment opportunities in Israeli technology and other economic issues, according to a readout from Smotrich’s office.
“Israel’s economy is strong, stable and relatively easy to manage in times of crisis,” Smotrich told the Citibank executives.
Smotrich did not name the Citibank officials in the meeting, but the bank’s CEO Jane Fraser did not appear in the photos released by his office. Leading the Citibank delegation appeared to be Neil Corney, the CEO of Citibank in Israel. Citibank did not immediately respond to a request for comment.
The meeting was one of only a handful Smotrich has been able to secure since arriving in the US on Sunday. US government officials, representatives from the International Monetary Fund, the US Chamber of Commerce and dozens of Jewish groups across the political spectrum have refused to meet with him after he called to wipe out the Palestinian town of Huwara earlier this month. The finance minister has since apologized.
Smotrich spoke at the Israel Bonds conference on Sunday and visited the US Holocaust Museum and the Israeli Embassy in Washington on Monday.
He arrived in New York on Monday evening and made an unannounced visit to the Ohel Chabad-Lubavitch, the resting place of Rabbi Menachem Mendel Schneerson, the spiritual leader of the Chabad movement.
שר האוצר בצלאל סמוטריץ' המקיים בימים אלו סבב פגישות בארה"ב, הגיע הלילה לציונו הקדוש של הרבי מליובאוויטש, בשכונת קווינס. pic.twitter.com/IgSjL6Clxa
— לוי נוישטט – levi noishtat (@levi_noishtat) March 14, 2023
Smotrich appeared to have organized the visit with a member of the Chabad community from Israel, without coordinating with the movement’s leadership in New York.
Protesters opposed to the government’s judicial overhaul and the far-right minister caught wind of Smotrich’s planned visit shortly beforehand and staged a small rally against his appearance in New York.
However, the demonstrators believed Smotrich was going to visit Chabad’s World Headquarters, located next to Schneerson’s former residence. The headquarters are in the borough of Brooklyn, while the Ohel is in Queens.
The demonstrators representing a protest group of Israeli expats in New York, and other groups of mainly left-wing US Jews, gathered outside the headquarters and were greeted by Chabad community members with hot drinks.
Rain can't stop New Yorkers from making sure racist fascists like Bezalel Smotrich know they are not welcome in our city.
— Jews for Racial & Economic Justice (@JFREJNYC) March 14, 2023
Smotrich’s spokesman said the minister plans to meet other Jewish community leaders while in New York, but did not provide further details.
The Orthodox Union and the right-wing Zionist Organization of America are the only Jewish organizations that have publicly confirmed their willingness to meet with Smotrich.
The finance minister met earlier Tuesday in New York with ZOA President Morton Klein, and the latter said that the two discussed removing the so-called grandchild clause in the Law of Return.
The clause allows anyone with at least one Jewish grandparent to immigrate freely to Israel so long as they do not practice another religion. Many immigrants to Israel, particularly but not only from the former Soviet Union, obtain citizenship under this aspect of the Law of Return.
“We talked about how we have to get rid of the grandchild clause,” Klein told The Times of Israel, arguing that the provision has led to a gradual shrinking of Israel’s Jewish population.
“He was very serious about that and expressed his fear that we’re losing Israel as a Jewish state,” Klein said.
The religious coalition parties — the ultra-Orthodox United Torah Judaism and Shas, and the national religious Otzma Yehudit, Noam and Religious Zionism — argue that since many of the people immigrating to Israel under this clause are not Jewish according to Orthodox interpretations of Jewish law, it weakens the “Jewish character” of the state.
Opposition lawmakers, including Orthodox ones, have come out fiercely against changing the Law of Return, and the Likud party has resisted the move, pushing instead for at least a more nuanced amendment. Mainstream Jewish organizations in the US and elsewhere abroad have warned that removing the grandchild clause risks upending Israel’s ties with Diaspora Jewry.
The ZOA president said he also discussed the government’s judicial overhaul efforts with Smotrich and that the two were in agreement about the need for reform. However, Klein said he told Smotrich that he disagrees with the legislation the coalition is seeking to pass that would allow the Knesset to override Supreme Court decisions with a simple majority of 61 MKs.
“I told him I thought it should be 65 MKs,” Klein says, noting that Smotrich was noncommittal in response.
The ZOA president met with Smotrich privately in New York, and the group’s board will be meeting with the finance minister in the city Wednesday.