Latest / Boots on the Ground / The Cost of Living: An Economist's Plan for Housing, Mortgages & Prices with Ronen Budnero ep 48

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The Cost of Living: An Economist's Plan for Housing, Mortgages & Prices with Ronen Budnero ep 48 · Boots on the Ground

0:00
SPEAKER_00: Welcome to another episode of Boots on the Ground, where we discuss Israel's wars, politics, and identity.
0:06
SPEAKER_00: In this episode, I'm joined by Ronin Budnehro, number seven on the Amcha Israelist, an economist who worked for many years at the Treasury.
0:14
SPEAKER_00: We're going to talk about the economy in this one.
0:16
SPEAKER_00: But first, I want to say thank you to our partners here at the Jerusalem Media Group and our sponsors, BeTheirIsrael.com.
0:22
SPEAKER_00: For all your events in Israel, BeTheirIsrael.com provides live streaming services so all your families and friends around the world can join you virtually.
0:30
SPEAKER_00: And remember to like, share, and subscribe so you could keep seeing more of our great content.
0:35
SPEAKER_00: Welcome to the show, Ronan.
0:37
SPEAKER_00: Thank you very much for having me.
0:38
SPEAKER_00: So before we get into the numbers and economics and prices and all the markets and fun stuff, tell the listeners a little about yourself.
0:46
SPEAKER_00: We all know who I am, we know where I'm coming from.
0:48
SPEAKER_00: It's an honor to have you here on my show.
0:50
SPEAKER_00: Thank you very much.
0:51
SPEAKER_00: Who are you?
0:52
SPEAKER_00: What motivates you, and why the hell are you trying to get into politics?
0:56
SPEAKER_00: Got it.
0:58
SPEAKER_01: So I'm 36 years old, father of two, um, almost 800 uh days in the military, in the war, in the reservist, yeah, in the current war.
1:10
SPEAKER_01: Um deputy battalion commander in my uh in my battalion.
1:16
SPEAKER_01: And also I worked almost three years in the Ministry of Finance, as you said.
1:21
SPEAKER_01: Um afterward, I worked almost four years, no, even more, four to five years in uh VC, uh Venture Capital, as we all know.
1:29
SPEAKER_01: Uh, and afterwards in a private equity firm.
1:33
SPEAKER_01: Um, but during the war uh and having my kids, uh, you know, all the decisions are being re-evaluated uh in life.
1:43
SPEAKER_00: Priorities in life.
1:44
SPEAKER_01: Yeah, exactly.
1:45
SPEAKER_01: Um and during the war, I understood that I want to make a better Israel a better place for my kids.
1:52
SPEAKER_01: Uh, that I don't really fully trust the politicians that we have today currently are trying to re- being re-elected.
2:00
SPEAKER_01: Um and if you recall, we most of us, or almost all of us, said that we wanted to clean up the table, uh, get a clean new uh slate.
2:10
SPEAKER_00: We've said that on this show many times that all 120 need to be replaced.
2:14
SPEAKER_01: Exactly, the all 120 should be replaced.
2:18
SPEAKER_01: Um and it was sitting in my mind, you know, and I I did the work that I needed in order to get into the politics, even though I thought that it would be much later in my life if if it would happen.
2:32
SPEAKER_01: Um but the current situation just brought me to a place that I decided that enough is enough, this is the right moment.
2:41
SPEAKER_01: Uh when I saw that I'm with the right group of people, um, with all the other great members of Amcha Israel, um, Offer, Yusuf, Natalie, Lali, Flair, um Gino, Aviv, everyone, you know.
2:58
SPEAKER_01: Uh I could keep doing the name of the.
3:01
SPEAKER_01: Yeah, Sigal, everyone.
3:03
SPEAKER_01: Uh basically the the old list are non-politicians.
3:07
SPEAKER_01: It's um it's it's a moral saying that we are promoting and believing in, that we are not politicians.
3:17
SPEAKER_01: We are going to bring something new new into the system, and we want to start from scratch and build again the country and provide a new solutions and new mindset for politics uh itself and also for the country.
3:34
SPEAKER_01: Uh meaning that we want to change the the the way that things are being managed and spoken in the Knesset.
3:41
SPEAKER_01: We're not bringing the same old politicians of uh just saying um those are bad, those are those sucks, and you know.
3:50
SPEAKER_01: But actually bringing new ideas and ideology, a real ideology of uh the right wing and go forward with it.
3:59
SPEAKER_00: And I think that's shown in the campaign that the parties run, where all the other campaigns are either trying to scare their voters into voting for them because oh no, the other side is the boogeyman and evil, and you have to therefore vote for us, or talk about the personalities like, oh, he's gonna do this or that, but there's a lot of darkness, a lot of fear.
4:18
SPEAKER_00: Instead of saying this is what's good, and presenting a pasar, the campaign that Am Kha Israel has run has been all about this is who we are, this is what we believe in, and if you support us, vote for us.
4:30
SPEAKER_00: If this is what you want to see happen, like the videos you're making, you're not attacking your political opponents, you're just presenting structured arguments.
4:38
SPEAKER_00: Again, for any of our listeners who want and can understand the Hebrew, you can follow Ronin Budnirva on Instagram where he puts up videos or 10 videos a day explaining the economic policies and plans that we live in, and it's excellent material.
4:51
SPEAKER_00: But it's all presenting policy and positions that need to change or and how to change them without saying the other side is wrong, just presenting your side and saying a very positive campaign, which is the first thing that brought me to the party that I wanted to join and say, This is who I want to be a part of.
5:08
SPEAKER_00: I'm sick of being afraid of everything else and what not to vote for.
5:12
SPEAKER_00: Give me a good, give me a yes, not a no.
5:14
SPEAKER_01: We want to show the ope.
5:15
SPEAKER_01: We want to present the the public, the ope that we got in Israel.
5:21
SPEAKER_01: And we are not saying that Israel is bad.
5:23
SPEAKER_01: Israel is in a great place, but it could be much, much more greater.
5:27
SPEAKER_00: Amazing.
5:28
SPEAKER_00: So let's get now, let's get into the economics of it.
5:31
SPEAKER_00: What is how do you see it?
5:33
SPEAKER_00: I see, I know the party views that econom that our education system feeds our economy, our economy feeds our defense, our defense protects everything, and it's a circle.
5:42
SPEAKER_00: They all feed each other.
5:43
SPEAKER_00: You described it just perfect.
5:46
SPEAKER_01: This is thank you.
5:48
SPEAKER_01: No, I'm not getting it.
5:49
SPEAKER_00: Maybe I'll be the spokesperson for the party in the next election.
5:52
SPEAKER_00: You're full fit for that.
5:54
SPEAKER_00: So the idea being now is that now that we have that structure worked out, our economic indicators show that we're in a pretty good place, even after three years, in spite of three years of war, our economy is doing really well.
6:07
SPEAKER_00: Yeah.
6:08
SPEAKER_00: It's doing really well.
6:09
SPEAKER_00: Again, that doesn't always trickle down though, to you and I at the bottom of the ladder.
6:14
SPEAKER_00: And while the economically on a on a gross level is doing great, on a my on on an individual level, there's a lot of struggle here.
6:22
SPEAKER_01: This is the main point, probably, um, that you know, the money that we are getting as a country, and we are a very rich country, but at the end, like you said, it's not getting to the bottom.
6:33
SPEAKER_01: Okay, uh everything stuck is getting stuck in the in the government and in the system.
6:39
SPEAKER_01: And instead of us getting good services uh on health, on education, as you mentioned, um on everything, basically, right?
6:50
SPEAKER_01: It's it it is stuck on other places, and our main um problem I I would say with the current politicians is that there were too much uh in interest of one or two sectors and the rest of us, the rest of Israel, the rest of Am Kha Israel, uh were left out.
7:13
SPEAKER_00: Ronan, we talk about the cost of living a lot in Israel.
7:17
SPEAKER_00: We talk about the cost of living and it being very high.
7:21
SPEAKER_00: One of the main pieces of our cost of living is mortgages.
7:23
SPEAKER_00: When you want to buy a house, a mortgage costs a lot of money today.
7:27
SPEAKER_00: I thank God personally had the common sense 15 years ago when I bought my home to buy a Kavo, a um flat a flat rate mortgage.
7:36
SPEAKER_00: At the time it was kind of high.
7:38
SPEAKER_00: It's now one of the lowest mortgages.
7:39
SPEAKER_00: My my friends and siblings at the time you nailed it, were a little bit weird like that.
7:45
SPEAKER_00: I said, listen, no, I want to know that this is what I'm paying.
7:47
SPEAKER_00: It's something that you brought from the US.
7:50
SPEAKER_00: It's something that's a very American way of thinking of mortgages.
7:54
SPEAKER_00: I also brought down a very large chunk saved money and saved and saved and saved for years to put down a large chunk of uh of a down payment.
8:02
SPEAKER_00: I saved a lot of money, had a very simple and very modest wedding, and took a lot of the wedding gifts, and all the money always was to finance that down payment so that I can have a very manageable mortgage.
8:12
SPEAKER_00: Great.
8:13
SPEAKER_01: It's I recognize that I am not the norm in Israel.
8:16
SPEAKER_00: There are a few of us still out here.
8:18
SPEAKER_00: Yeah.
8:19
SPEAKER_00: But when we look at mortgages today, that's a huge chunk of the cost of living.
8:23
SPEAKER_00: The rates are sky high, the amount of money you need for a down payment is astronomical.
8:28
SPEAKER_00: You can't afford to save enough money for the down payment because you have to pay such high rents.
8:35
SPEAKER_00: What can be done to lower the cost of living in general?
8:38
SPEAKER_00: When we'll talk about consumer goods and supermarkets, we'll talk about it separately.
8:42
SPEAKER_00: Let's focus for a minute on mortgages and the real estate markets.
8:47
SPEAKER_01: So let's take the two main problems that we have today uh on housing.
8:53
SPEAKER_01: Um let's focus on the first one and then the second one.
8:56
SPEAKER_01: The first one is the main point that up until now everybody that were everyone that was trying to fix the market was um going from the side of the demand, was trying to solve the problem from the demand side.
9:12
SPEAKER_01: I mean, uh Michir Mattara uh and Michir Lamishtaken.
9:16
SPEAKER_00: Um they created a bunch of the lottery for uh the lotteries for cheap housing and there were all these government programs that provided uh small access to a group of people to housing actually.
9:31
SPEAKER_01: Some most of them are actually having the ability to even pay the first uh down payment.
9:38
SPEAKER_01: And if not, you're pushing more people who before couldn't into this pool.
9:44
SPEAKER_01: Okay?
9:44
SPEAKER_01: So you're increasing the demand actually.
9:46
SPEAKER_01: Exactly.
9:46
SPEAKER_01: You're just increasing the demand and you're subsidized the uh real estate um entrepreneurs, uh, you know, the the those who are the developers, exactly.
9:58
SPEAKER_01: Um it's not gonna work.
10:02
SPEAKER_01: What we need to do is uh fix not the demand, the supply.
10:07
SPEAKER_01: How you do it?
10:08
SPEAKER_01: I'll I'll give you two really you know um quick or not not sure if quick, but the the right solutions.
10:18
SPEAKER_01: The right solutions.
10:19
SPEAKER_01: The first one, uh we've got Remi, uh the Israeli Lands Authority.
10:23
SPEAKER_01: Yeah, exactly.
10:25
SPEAKER_01: Um we need to do a reform over there um to get a better prices getting out from this monopoly.
10:32
SPEAKER_01: It's basically a monopoly that uh the country owns, and they need to free more lands faster and broader.
10:41
SPEAKER_01: Um like I mean much many more uh much more off the land and also in a lower prices, because when the entrepreneur buys it and then brings the developer, and you know, we have uh supply chain.
10:58
SPEAKER_01: Everyone is vertical.
10:59
SPEAKER_00: The vertical of construction.
11:00
SPEAKER_01: Yeah, everyone wants to get is cut, and eventually we are going to buy this house, we are paying all these cuts.
11:09
SPEAKER_00: So just to give a little bit of background, because this is the field I come from, Remy, the Israel Lands Authority, owns all the land, basically owns all the land in Israel.
11:18
SPEAKER_00: All the land in Israel.
11:19
SPEAKER_00: All the all the undeveloped land in Israel is owned by this one authority, and they market the land to developers.
11:24
SPEAKER_00: You either lease it or actually buy it.
11:27
SPEAKER_00: Buy it.
11:27
SPEAKER_00: But they they market it for argument's sake, very slowly over a long period of time.
11:33
SPEAKER_00: The sale process or the lease process is very complicated and takes long.
11:37
SPEAKER_00: And basically, the the three elements, there's three pieces.
11:40
SPEAKER_00: When you buy an apartment, the price includes three things the cost of the land, the course of the cost of construction, and taxes.
11:47
SPEAKER_00: That's what goes into it.
11:49
SPEAKER_00: So if you to affect the supply, to lower the price on the supply side and increase supply, you need to work on all three of those verticals.
11:57
SPEAKER_01: And also freeing more land.
11:59
SPEAKER_01: You know, if there's much more land to build more houses, we'll see the the supply goes up.
12:05
SPEAKER_01: And of course, when the supply meets more less demand, the prices are going down.
12:11
SPEAKER_01: Exactly.
12:12
SPEAKER_01: Eventually.
12:13
SPEAKER_01: Eventually.
12:13
SPEAKER_01: It's not something that would happen.
12:15
SPEAKER_01: We've got to say that the housing uh market, it's not something that you can fix in one year or two years.
12:20
SPEAKER_01: If someone says that is either a liar or you'll fill the fill the gap.
12:27
SPEAKER_01: Um but this is very ignorant.
12:32
SPEAKER_01: Um and the second thing that we need to do um after we spoke about REMI is also let's say you are a developer, your entrepreneur wants to build build a building, okay?
12:45
SPEAKER_01: A hundred uh apartments.
12:47
SPEAKER_01: The time that goes between once you have an idea and you actually bought the land and you are going through uh through the REMI uh I say it committees and you something I've experienced myself.
13:01
SPEAKER_01: Yeah, and you and you got the land up until I, as a buyer, actually get the keys is between 12 to 13 years.
13:10
SPEAKER_01: You heard what I said 12 to 13 years since once you bought the land to an actual apartment that I can get inside.
13:21
SPEAKER_00: All the planning regulations, as as someone who's attempted to develop in Israel, now more than once.
13:27
SPEAKER_00: So we need to the process is it's too long.
13:32
SPEAKER_00: I'm not even sure that's the word, but it's it's astronomically impossible.
13:35
SPEAKER_00: It takes approximately ten years from once you start until you have a building permit in your hand for anything of any significance.
13:43
SPEAKER_00: And then on top of that, you have about three years of construction.
13:46
SPEAKER_00: Exactly.
13:47
SPEAKER_00: So yes.
13:47
SPEAKER_00: And that's and that's if everything goes smoothly and there aren't problems along the way.
13:51
SPEAKER_01: If you don't have uh, I don't know, something buried under underneath the the land or a road need to go.
13:57
SPEAKER_01: I don't know.
13:57
SPEAKER_01: You know, so many other problems that come up.
14:00
SPEAKER_01: Yeah.
14:01
SPEAKER_01: Uh so we need to take this time and make it shorter.
14:04
SPEAKER_01: I think in that in the US it's uh it's it all depends, but we're not comparing to the United States.
14:09
SPEAKER_00: Let's not even go there.
14:10
SPEAKER_00: The United States is is light years ahead of us of planning.
14:14
SPEAKER_00: But so give me a give me a specific policy that would make those that would shorten that 10-year period.
14:21
SPEAKER_01: But I would say that we need a one uh stop shop, in a sense.
14:26
SPEAKER_01: Okay.
14:26
SPEAKER_01: You know, that you as a developer, you don't need to go to through so many different offices in order to get uh uh the permits that you need.
14:36
SPEAKER_01: Okay.
14:36
SPEAKER_01: For example, but there are more more jobs to do on that area um in order to fix and get more job done in order to make it shorter and faster, in order us to get more apartments uh on the market.
14:50
SPEAKER_01: And the mortgage process.
14:52
SPEAKER_01: Exactly.
14:53
SPEAKER_01: Um about the mortgage process, um it takes us to something else that we as a party talks about, uh, about the status of those who serve.
15:05
SPEAKER_01: Once you serve, I want you to get the the fruits, the the milk and honey that Israel has to offer.
15:13
SPEAKER_01: Okay, I want you to get those uh uh discounts that it the country offers on mortgages.
15:21
SPEAKER_01: Uh the parameters today are favoring those who are not serving, okay?
15:29
SPEAKER_01: Uh those who are not probably even uh share with us the the tax um burden burden.
15:37
SPEAKER_01: Yeah.
15:38
SPEAKER_01: Um so we want to shift it to those who serve.
15:42
SPEAKER_01: What it means that today parameters are if I got it right.
15:48
SPEAKER_01: Uh today's parameters are having uh for just for example, okay.
15:53
SPEAKER_01: I'll give you two examples which uh um are covering the most uh of the weight of for getting this discount is how many brothers do you have and how many kids do you have?
16:06
SPEAKER_01: How many siblings and how many children?
16:08
SPEAKER_01: Exactly.
16:09
SPEAKER_01: Um and I would say that probably most of those who serve today, uh, and we know we know the numbers, don't have many siblings and not many kids.
16:19
SPEAKER_01: Okay?
16:19
SPEAKER_00: You're saying the discounted mortgages that are offered by the state or by the bank?
16:25
SPEAKER_00: No, by the state.
16:26
SPEAKER_00: By the state.
16:27
SPEAKER_00: Yeah.
16:28
SPEAKER_00: So discounted mortgages offered by the state, one of the big weighted parameters is the number of siblings you have, the number of children you have.
16:34
SPEAKER_00: Exactly.
16:36
SPEAKER_01: Not mentioning those lottery that we we spoke before, that also favoring those with more children from larger families.
16:42
SPEAKER_01: Exactly.
16:43
SPEAKER_01: Um so we need to change the parameters so that those who serve would be first in line.
16:49
SPEAKER_01: Afterwards, let's check other things.
16:51
SPEAKER_01: I I don't mind.
16:52
SPEAKER_01: Uh we can we can speak about it.
16:54
SPEAKER_01: Okay, we can argue which parameters should be inside, which uh which one is not, but the main is you serve.
17:01
SPEAKER_01: Once you serve, let's let's see what goes uh afterwards.
17:07
SPEAKER_01: Um so this is basically the situation that we're trying to solve and provide more uh options to those serve in order to get those um discounts and other things that the country offers today.
17:25
SPEAKER_01: Some of those uh benefits that we see today, around 16 points of benefits, it's uh so many different points, uh we would just cancel.
17:37
SPEAKER_01: Okay, there there is no uh no sense of having them.
17:43
SPEAKER_01: And the others we would just shift it to those who serve and also share with us the market, you know, we're in the the working force, uh and not also um not only serve.
17:56
SPEAKER_00: Okay, so again, so just to summarize, we'll talk about the housing, the housing.
18:00
SPEAKER_00: Just to summarize the party's position to lower the cost of housing is to focus more on the supply side and less on the demand side.
18:07
SPEAKER_00: Because again, when supply meets demand, that's when prices start coming down.
18:11
SPEAKER_00: So the first piece would be to reform the Israel Lands Authority to free up more land at faster and cheaper.
18:17
SPEAKER_00: Because that's one of the that's the first piece of the cost of housing.
18:21
SPEAKER_00: The second part of it would be to shift the way that the government backed mortgage, the government subsidized mortgages, instead of being based on parameters that are size of family or things like that, would be based pure morally it would be based firstly around whether you've served the country or not.
18:40
SPEAKER_00: Exactly.
18:41
SPEAKER_00: Exactly.
18:42
SPEAKER_00: And was there any and that those are the two major pieces that will affect the supply side?
18:47
SPEAKER_00: Exactly.
18:47
SPEAKER_00: It would take some time, but eventually it would be we'll get there.
18:51
SPEAKER_00: Okay.
18:51
SPEAKER_00: So now let's move on to the to the rest of the economy.
18:54
SPEAKER_00: Yeah.
18:54
SPEAKER_00: The consumer side of the economy.
18:56
SPEAKER_00: The cost of products in the supermarkets have gone up for the most part.
19:00
SPEAKER_00: Very few prices have come down.
19:02
SPEAKER_00: The price of consumer goods, anything you buy in a store, the prices have either stagnated or gone up.
19:08
SPEAKER_00: Prices have not really calmed down.
19:10
SPEAKER_00: We haven't seen an increased level of competition in the market overall.
19:14
SPEAKER_00: And was we recognize that we're a very small economy.
19:17
SPEAKER_00: We're a very small market, and we operate almost as an island market.
19:21
SPEAKER_00: Right?
19:21
SPEAKER_00: So there isn't necessarily room for massive competition across the board.
19:26
SPEAKER_00: What can we do today on a policy level?
19:29
SPEAKER_00: What policies can we change in one government that will start will start, not saying finish, will start to have an effect on where prices are going without endangering our small island market economy from imploding in on itself?
19:44
SPEAKER_01: So I'll I'll I'll start with with the idea and then I'll give you the solution that is already they tried to implement it, but eventually they just uh left it with two people who are trying to solve the problem and it's not really serious.
20:00
SPEAKER_01: So the main thing is taking care of the uh overloading of regulation in the country.
20:10
SPEAKER_01: Um some of it is historically based.
20:13
SPEAKER_01: Uh we can we can go on the uh history of Israel of uh you know building the country and what it uh led us and the fact that we need to needed to be uh um centralized.
20:27
SPEAKER_01: Right.
20:28
SPEAKER_00: Something we've spoken about on this show many times.
20:30
SPEAKER_00: And the country founded in 1948, it needed to be a planned economy.
20:36
SPEAKER_00: Exactly.
20:37
SPEAKER_00: A Soviet-style in order to build the country.
20:40
SPEAKER_00: There was nothing here to start from scratch and build it up.
20:43
SPEAKER_01: So some of it is historically based, and some of it is based on you know um forces that are unnatural.
20:51
SPEAKER_01: They're not the market forces.
20:53
SPEAKER_01: Um called special interest groups.
20:56
SPEAKER_01: Exactly.
20:56
SPEAKER_01: The lobbyists and you know the special interest groups.
20:59
SPEAKER_01: That's what we call them in America.
21:00
SPEAKER_01: Amazing.
21:01
SPEAKER_01: Um so we need to dissolve it, I think it's the right word.
21:08
SPEAKER_01: Um and how you do it.
21:09
SPEAKER_01: I I don't want to put more regulation in order to uh dissolve those monopolies.
21:15
SPEAKER_01: It's not my intention.
21:17
SPEAKER_01: What I want to do is actually the opposite.
21:20
SPEAKER_01: I want to take down some of the regulations that we have today in order to put more uh competition into the market.
21:28
SPEAKER_01: I'll give you one nice uh example that I've read just this week.
21:32
SPEAKER_01: Um there is a fish food company from Germany that already uh left us a year ago.
21:42
SPEAKER_01: This is the main uh food company in the world, you know, the the biggest, the cheapest, the the best company uh um on uh the materials wise, you know, um the best food you can provide.
21:56
SPEAKER_01: And they stopped marketing in Israel, they made all of the International standards, the European, the American, they are German.
22:07
SPEAKER_01: And they were was asked by our Ministry of Agriculture to provide documents and to go through tests here in Israel in order to show that they don't contain beef products inside.
22:24
SPEAKER_01: They already did it before in Europe and in the US.
22:28
SPEAKER_01: And they have the papers to show.
22:30
SPEAKER_01: But of course, the Israeli agriculture ministry said, no, it's not good for us.
22:37
SPEAKER_01: We want you to pay here in Israel, go through our system, and to prove us.
22:44
SPEAKER_01: And where does it meet us?
22:46
SPEAKER_01: Okay, me and you.
22:47
SPEAKER_01: Eventually on Saturday night, do eat Haime.
22:51
SPEAKER_01: I don't know, uh Salmon, whatever.
22:54
SPEAKER_01: Any any fish, right?
22:56
SPEAKER_01: Right.
22:56
SPEAKER_01: Um, and we have many fishes that are being grown here in Israel.
23:01
SPEAKER_01: But today, I hear after, when they chose, you know, like you said, we are a small market.
23:06
SPEAKER_01: Okay, Israel is not that big uh in the world.
23:09
SPEAKER_01: And this type of company, when they sell all over Europe and all over the US, they don't really need to fight over a seven million people market, which you know, also the fish market is even smaller, probably.
23:22
SPEAKER_00: So when you compare seven million people in Israel, that's that's a city in America.
23:26
SPEAKER_00: Yeah, New Jersey.
23:27
SPEAKER_00: One city.
23:28
SPEAKER_00: Uh I guess.
23:29
SPEAKER_00: It's a city.
23:29
SPEAKER_00: It's a no the New York City is bigger than seven million people.
23:33
SPEAKER_01: Okay.
23:34
SPEAKER_01: Um so you see, we we just lost in this in in that competition, and I don't know why it was implemented, you know.
23:43
SPEAKER_01: Uh not sure.
23:43
SPEAKER_01: Is there an Israeli uh company that provides uh fish food?
23:48
SPEAKER_01: I don't know.
23:49
SPEAKER_01: Uh uh things that are need needed to be asked.
23:53
SPEAKER_01: And if you got all those regulations that are already met in other great, you know, Western uh countries, why do we need to go through through this same thing over here and pay more money in order to get it?
24:08
SPEAKER_01: And eventually we are losing from that because those fishermen, uh those who are growing fishes, would probably need to pay a bit more now, right, to get the other uh supplements.
24:20
unknown: Right.
24:20
SPEAKER_00: So they either have to find a more expensive option, yeah.
24:24
SPEAKER_00: Or import it themselves and they go through the process.
24:27
SPEAKER_01: Exactly.
24:28
SPEAKER_01: And we all lose from that.
24:31
SPEAKER_01: So I would say that there are two things that we need to do.
24:35
SPEAKER_01: First of all, we got the what's good for Europe, goods for Israel.
24:40
SPEAKER_01: Okay.
24:40
SPEAKER_01: We need to uh broaden it on more products.
24:45
SPEAKER_01: Uh and on the other hand, as I said, we have the regulation authority that was all already created.
24:53
SPEAKER_01: Okay, it's all already established.
24:55
SPEAKER_01: But uh it started from 10 people, I think it was, and got to two people right now who cannot really do the job that we expect them to do.
25:04
SPEAKER_01: Uh to cut to cut regulation and to see where there are some um quarks.
25:12
SPEAKER_00: Quarks.
25:13
SPEAKER_00: Well, there was basically to give to give to give my listeners the backstory in a previous government they created the the regulation authority, which is almost like an Israeli version of Doge.
25:24
SPEAKER_00: It's true.
25:25
SPEAKER_00: Which is it was set up to find regulation that was either unnecessary, duplicate, triplicate, and to start canceling the regulation.
25:33
SPEAKER_00: When the authority was created, it was ten people.
25:36
SPEAKER_01: Was more people, more regulations.
25:38
SPEAKER_00: More people with more with more budgets to actually go and find the regulation, cancel it.
25:41
SPEAKER_00: And now there's currently two people.
25:43
SPEAKER_01: Just the whole authority.
25:45
SPEAKER_01: The CEO and his secretary.
25:47
SPEAKER_00: Yeah.
25:47
SPEAKER_00: It's now two people looking at the entire national regulation system to try and find these inefficiencies and duplicates.
25:54
SPEAKER_00: True.
25:55
SPEAKER_00: And it's not working.
25:56
SPEAKER_00: Uh no, I don't think anyone thinks it would work.
25:58
SPEAKER_01: And we need to give them more power to enforce it harder and to get regulations out of the system.
26:05
SPEAKER_01: Uh those who are coming from the history, as you said, and those who are coming from the lobbies.
26:10
SPEAKER_01: So those are probably the two main points that once you start with them, you would start to see um the prices are going um a bit lower.
26:22
SPEAKER_01: And also you'll see more uh variety of products on the market.
26:27
SPEAKER_01: Um you're you wouldn't get just, I don't know, uh Wysotsky.
26:31
SPEAKER_01: Umly Vysotsky T.
26:33
SPEAKER_00: You'll have the other imported versions which can compete in it and keep prices down, yeah.
26:37
SPEAKER_00: And quality up.
26:38
SPEAKER_00: Exactly.
26:39
SPEAKER_00: Like we saw in the competition.
26:41
SPEAKER_00: Quality goes up and prices come down.
26:43
SPEAKER_01: Exactly.
26:44
SPEAKER_01: Like we saw on the um butter market, right?
26:47
SPEAKER_01: You know, that was closed.
26:49
SPEAKER_01: We had a fixed price that wasn't really um worth it for for TNU, the main uh producer here in Israel for butter.
27:00
SPEAKER_01: So they just you know they just dropped it.
27:02
SPEAKER_01: They stopped making it.
27:04
SPEAKER_01: Yeah, because it's not cost effective for them.
27:06
SPEAKER_01: And once we took the the fixed prices out of the system, a regulation basically, right?
27:13
SPEAKER_01: And we also opened the market for importing.
27:17
SPEAKER_01: We saw so many different um brands, brands of butter that are coming into Israel.
27:24
SPEAKER_01: Some of them are a higher price, some of uh some of them are lower prices, and we got all the vi variety, and we also started to think that um Tnuva was getting back into the the market because it was cost effective again for them to make butter.
27:37
SPEAKER_01: Yeah.
27:38
SPEAKER_00: All right.
27:39
SPEAKER_01: And we are not meeting it, uh missing uh, I don't know, uh, your wife wanted to create uh to bake a cake, or uh I wanted to bake a cake.
27:47
SPEAKER_01: You want to bake a cake, even better.
27:50
SPEAKER_01: Or just having uh butter on on your bread with on a sandwich, and you could actually get it.
27:55
SPEAKER_01: Uh and we don't get those uh point in time uh around, I don't know, some of the some of that is around the always around the holidays.
28:06
SPEAKER_00: There's no butter, there's no eggs, there's no there's always a shortage, man.
28:08
SPEAKER_01: Yeah, exactly.
28:09
SPEAKER_01: And now you're you're having it because the market is open and much much more comp competition got into the market.
28:18
SPEAKER_01: Uh so basically it would be the main points uh to start from, and of course, there are other points that we can uh do after.
28:29
SPEAKER_00: I want to touch on one last point before we get to the end of the show.
28:32
SPEAKER_00: Sure.
28:32
SPEAKER_00: We spoke about the housing market, we spoke about the consumer products market, we spoke about costs like that, lowering just the general cost of living.
28:41
SPEAKER_00: One problem we have here is we have a massive security expense.
28:45
SPEAKER_00: The reality is that our defense costs us an unproportionately large percent of our budget.
28:52
SPEAKER_00: And moving forward, our defense is going to be very expensive moving forward.
28:56
SPEAKER_00: That we have we're gonna need to increase the size of our army, which is expensive.
29:00
SPEAKER_00: Until then, we have to continue paying reservists.
29:03
SPEAKER_00: How do you see moving forward on an gross, on a macroeconomic level, being able to balance the security needs of the country with all of our other interests?
29:14
SPEAKER_00: How do you see that balance taking place on a macro governmental level so that we don't, as we're doing now, just borrow against our future?
29:23
SPEAKER_00: The moment all of those expenses, all of those expenses have been shifted to future generations.
29:30
SPEAKER_00: Yeah.
29:30
SPEAKER_00: Our children, even our grandchildren, will be paying off the enormous loans that we've taken to cover our current expenses.
29:37
SPEAKER_00: True.
29:37
SPEAKER_00: How can we shift our national priorities as on a budgetary level to make it so that we're not borrowing as much from our future?
29:47
SPEAKER_01: So today numbers show that we're around seven or eight percent of the um of the budget, of the country budget uh spending on defense.
29:58
SPEAKER_01: Yeah.
29:59
SPEAKER_01: Um, so eventually we would need would have to take it back down to around 5%, like it was.
30:06
SPEAKER_01: Okay.
30:06
SPEAKER_01: Uh I would remind you that there would be a point in time once we also get those who are not serving, okay, those uh um part of public that are not serving that would get into the serving system and into the army uh as well.
30:22
SPEAKER_01: Of course, it would be less reservists who are also not in their jobs, but also are in the army and getting paid from the country.
30:31
SPEAKER_01: So it's double way.
30:33
SPEAKER_00: They're not producing and they're costing the country money.
30:36
SPEAKER_00: Exactly.
30:37
SPEAKER_01: Uh so once we get it out of the system, uh also we would see this budget also going down.
30:45
SPEAKER_01: Um, but eventually there is uh I would say, you know, everyone would be would love to have uh, I don't know, a million soldiers and whatever.
30:53
SPEAKER_01: I'm not sure.
30:54
SPEAKER_01: Realistic.
30:55
SPEAKER_01: Yeah.
30:56
SPEAKER_01: Um eventually there is a fixed number of how many soldiers and tanks and whatever we need in order to protect the country.
31:03
SPEAKER_01: It's not growing as much as uh as fast as the country is growing.
31:08
SPEAKER_01: Okay, we have uh two percent uh some something around it of uh uh of the population growth.
31:14
SPEAKER_01: It's not what we need in the army.
31:16
SPEAKER_01: We had the the army is not expanding every year in uh two percent.
31:19
SPEAKER_00: Okay.
31:20
SPEAKER_01: Um so there is a fixed number that we need to right now to get back to.
31:26
SPEAKER_01: So we are spending a bit more, but eventually the numbers would go down and we would have around five percent of the budget going on uh on the defense.
31:38
SPEAKER_01: And uh as I said, we need to cut in the reservist days.
31:42
SPEAKER_01: It's obvious it's on the table also to expand the economics and also to spend less on those who are actually working in in the workforce.
31:51
SPEAKER_01: Um and we we did it before, okay?
31:56
SPEAKER_01: Uh the the budget was around five percent and it was okay.
32:00
SPEAKER_01: Uh and we saw that we can manage and work as a country and defend our ourselves.
32:06
SPEAKER_01: Um so I would I would say this is the main goal that we need to set uh to ourselves and also finishing the wars much faster.
32:18
SPEAKER_01: Uh the main thing that Offer Offer Winter, our uh head of the party, uh uh is talking about is we we cannot drag ourselves almost three years in Lebanon, in Syria, in Iran.
32:33
SPEAKER_01: We just need to finish in Gaza, I forgot the main the main point.
32:38
SPEAKER_01: Uh we need to finish those um wars.
32:44
SPEAKER_01: It's not conflicts, okay?
32:46
SPEAKER_01: It's not conflict anymore, it's actually actual war.
32:49
SPEAKER_01: Uh and to actually something that you said and finish and not dragging ourselves uh and people like you and myself uh going 100 days of uh of serving as a reservist instead of working, actually something that uh put money into the um so everything would go the budget would not need to be as much.
33:14
SPEAKER_01: We won't need to pay for more fuel for our planes, for our tanks, um salaries for soldiers and you know all of that.
33:23
SPEAKER_01: Um so definitely we we need to to do this change and fast uh because I don't want my kids to pay my debt debt debt uh as much as I don't want to really pay my parents' debt.
33:39
SPEAKER_01: Okay, exactly.
33:40
SPEAKER_00: So to summarize, you'd want to say is we by lowering regulation, we increase productivity.
33:46
SPEAKER_00: So even though we're lowering the regulations, we're actually increasing the income from the existing taxes without raising taxes.
33:53
SPEAKER_01: More competition, more people are joining more small businesses and medium, yeah, getting into the market.
33:59
SPEAKER_00: More economic activity makes a wealthier country.
34:01
SPEAKER_00: At the same time, we finish the wars and therefore lower the expense, the overall expenses of our defense.
34:07
SPEAKER_00: True.
34:09
SPEAKER_00: Halovai.
34:10
SPEAKER_00: From your hope.
34:11
SPEAKER_00: I'm looking forward to the day when you're in charge and you can start putting these regul this policy into practice.
34:16
SPEAKER_00: Thank you very much.
34:17
SPEAKER_00: I have one last question.
34:19
SPEAKER_00: And while you think about it, I'm gonna have a message from our sponsors.
34:21
SPEAKER_00: But I want to ask you one thing.
34:23
SPEAKER_00: We're in election season, political opponents and rivals, and we've seen a very, very unpleasant um campaign of fear against our party and against what we believe in.
34:35
SPEAKER_00: Give me something optimistic.
34:36
SPEAKER_00: Give me a thought of optimism that shows that that really gives you a reason to believe that we're headed in a to a much brighter and much more prosperous future.
34:47
SPEAKER_00: And while you think about the answer, I want to say thank you to our partners at the Jerusalem Media Group and our sponsors, BeTheirIsrael.com.
34:54
SPEAKER_00: For all your events in Israel, BeTheirIsrael.com provides live streaming services so all your families and friends around the world can join you virtually.
35:02
SPEAKER_00: And remember to like, share, and subscribe.
35:04
SPEAKER_00: And most importantly, go out and vote.
35:07
SPEAKER_00: And while you tell us now, Ronan, what is your positive thought for our bright and prosperous future?
35:13
SPEAKER_01: So I would say that the main thing that I absolutely love in our uh group of people that come together uh in Amcha Israel is is that everyone are so optimistic.
35:27
SPEAKER_01: And where you said uh we see the uh campaign of uh fear of fear around uh around the you know all all around the media and where others try to show fear and to spread it out, we see potential for growth and for opportunities for the country.
35:52
SPEAKER_01: We don't see fear.
35:54
SPEAKER_01: Uh as someone said in the past few days, uh that he's afraid of sanctions and stuff.
36:01
SPEAKER_01: Uh we don't see the sanctions, we see the actual potential in in our market and the opportunities that we have.
36:09
SPEAKER_01: Uh it was about crypto, okay.
36:11
SPEAKER_01: Uh so we see we see the the opportunities, for example, in the crypto market to provide more fintech uh um solutions into the world economy that are growing from Israel.
36:27
SPEAKER_01: And this is what we need to push forward and not frighten the the crowd with sanctions and saying that crypto might be the solution, uh, for example.
36:37
SPEAKER_01: Uh so I love it that our people, our great people, that I've mentioned before here, talking about the opportunities, talking about providing a real hope and solutions for the public.
36:52
SPEAKER_01: And this is what we are going to bring to the next Knesset.
36:56
SPEAKER_01: I'm looking forward to it.
36:58
SPEAKER_01: Thank you very much.
36:58
SPEAKER_00: So remember, tomorrow on Election Day, or today if you're listening on Election Day, go out and vote.
37:04
SPEAKER_00: Vote for something.
37:06
SPEAKER_00: Don't vote against something.
37:07
SPEAKER_00: Vote for something that gives you hope and optimism for the future.
37:11
SPEAKER_00: In my case, that's Am Khay Israel, led by Ofra Winter.
37:15
SPEAKER_00: Thank you, Ronin, for joining us.
37:16
SPEAKER_00: Thank you very much for having me.
37:18
SPEAKER_00: And as always, I'm Israel Chai.