Smotrich says Lapid’s criticism of legal reforms amounts to support for BDS

Lapid hits back: ‘I was fighting BDS when Smotrich was still a hilltop youth activist’; says there is widespread agreement legal plan will take serious economic toll

Carrie Keller-Lynn is a political and legal correspondent for The Times of Israel

Opposition leader and head of the Yesh Atid party MK Yair Lapid speaks during a faction meeting at the Knesset in Jerusalem, on January 23, 2023. (Yonatan Sindel/Flash90)
Opposition leader and head of the Yesh Atid party MK Yair Lapid speaks during a faction meeting at the Knesset in Jerusalem, on January 23, 2023. (Yonatan Sindel/Flash90)

Finance Minister Bezalel Smotrich on Monday accused Opposition Leader Yair Lapid of lending a hand to the Boycott, Divestment, and Sanctions (BDS) movement against Israel, because Lapid has slammed the government’s sweeping judicial reform plan as spooking investors away from Israel’s economy.

Referring to a TikTok video that Lapid created in which he said that investors will choose to send their money to Singapore over an Israel with a weakened rule of law, Smotrich said Lapid was hurting Israel’s economy.

“I want to turn to you, Yair,” Smotrich said at the outset of his Religious Zionism party’s Knesset faction meeting. “You are a former prime minister and finance minister — what happened to you? Don’t you have a drop of responsibility? Have you become a supporter of BDS?”

Lapid hit back at his own Yesh Atid faction’s meeting, saying that he “was fighting BDS when Smotrich was still a hilltop youth activist,” referring to Smotrich’s past as a rabble-rousing settlement activist. “I suggest he use terms for which he understands the meaning,” the opposition leader added.

Religious Zionism has been a key leader, alongside Justice Minister Yariv Levin, in pushing the new right-wing, far-right, and religious government’s judicial reform platform. Prime Minister Benjamin Netanyahu and supporters say the plan to increase political power at the expense of the judiciary will restore balance in the face of an activist Supreme Court. Lapid and fellow opposition party leaders have decried the reforms as undermining democracy and endangering civil liberties.

Last week, leading economists, former Bank of Israel and economic advisers appointed by Netanyahu, high-tech entrepreneurs, and investors expressed their concerns that the perceived erosion of rule of law would hurt Israel’s economy, drive away customers and investors, and threaten Israel’s credit rating.

Lapid reiterated this line, saying on Monday that the “price” of judicial reform would be citizens’ livelihoods.

“Even those who support this legislation should know — it has a price,” the Yesh Atid leader said. “It will harm our livelihoods. It will raise the cost of living. It will turn Israel into a less competitive and less efficient economy. That’s the price. Anyone who claims otherwise is simply lying.”

Netanyahu held a special press conference last week to address economic concerns, claiming that the reforms would strengthen the economy by removing excess legal processes, but failed to delineate how. Similarly, the reforms do not yet contain provisions to help unstick many of the legal headaches for businesses, including adding judges to speed up court proceedings.

Finance Minister Bezalel Smotrich leads his Religious Zionism faction’s meeting at the Knesset, January 23, 2023. (Yonatan Sindel/Flash90)

Smotrich’s fellow coalition party leader Aryeh Deri similarly struck out at Lapid as supporting BDS. Deri, who leads the ultra-Orthodox Shas party, was fired from his two ministerial posts last week, after the High Court of Justice ruled his appointments “unreasonable in the extreme,” in light of his tax fraud convictions.

“It doesn’t happen to me often that I quote Yair Lapid. ‘Be an opposition to the government — but do not be an opposition to the state,'” Deri said at the start of Shas’s Knesset faction meeting. Lapid famously used this phrase to attack Netanyahu’s political bloc, which politically fought Lapid on issues of ideological congruence.

“Fight the government, do not destroy the State of Israel. You are now doing things like the worst of our rivals, [those who support] BDS and their friends around the world, who are harming Israel’s economy and the status of the country,” Deri said.

The Shas leader claimed that he has “not heard any more argument as to why Yariv Levin’s reform harms the economy,” seemingly ignoring public letters and op-eds penned by senior economists. “I actually hear other statements. Excessive legal involvement harms the economy,” Deri added, in allusion to Netanyahu’s press conference.

Shas leader Aryeh Deri during a Shas party meeting at the Knesset on January 23, 2023. (Yonatan Sindel/ Flash90)

Citing public warnings from economists and former government officials, Lapid said that “there is no serious professional who thinks otherwise,” about the economic ramifications of the government’s judicial reform plan.

“Against all of the professionals, there are only two people who say the opposite: one is a criminal defendant, the other a convicted felon. Prime Minister Netanyahu, and the dismissed minister, Aryeh Deri,” the opposition leader added.

“They are the only people who say that the legislation will not harm the economy, and look, what a wonder, they are also the people for whom this legislation will benefit the most personally.”

Benny Gantz, who leads the opposition’s National Unity party, renewed his offer to Netanyahu and Levin to set up a cross-Knesset working group to draft a reform garnering both coalition and opposition support.

Gantz called on them to “stop” and said, “Let’s reach a reform that will strengthen us via broad agreement.” Other than saying he would up the proposed threshold for the Knesset to override the Supreme Court invalidation of a law from the reform bill’s 61 to 80 of the Knesset’s 120 MKs, Gantz has yet to publicly share a concrete proposal.

Lapid earlier this month approached President Isaac Herzog about forming an independent panel to propose a “balanced” judicial reforms.

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