Flug's stern parting message for Netanyahu

Amiram Barkat

You had better live up to your responsibility for the Bank of Israel's standing, outgoing governor Karnit Flug is telling the prime minister between the lines.

"Bibi, the responsibility is yours" - that's the parting message from outgoing Governor of the Bank of Israel Karnit Flug to Prime Minister Benjamin Netanyahu. She transmits it via the media, for lack of choice. Flug intended to impart her message in a face to face meeting scheduled at her initiative a few days ago. Only Netanyahu - as he has more than once done to Flug in the past - sought at the last moment to postpone the meeting to another time. Flug expected this and was ready with plan B: a letter that she had worked on for days, even weeks, perhaps ever since she learned, courtesy of Channel 2, that she would not be given a second term.

The letter needs to be read as the Bank of Israel's interest rate decisions are read. The central bank's independence is mentioned in the letter many times; the expression "professionalism" appears nine times; "political" appears just once.

The word "responsibility" doesn't appear at all, even though that's what the whole story is really about. "It's your responsibility," Flug is saying to Netanyahu, because the post of governor of the Bank of Israel is not like the chairmanship of the National Lottery, to which a crony can be appointed in a process that is a foregone conclusion. "It's your responsibility," Flug is saying to Netanyahu, because unless someone worthy of the task is appointed, and in a proper procedure, the rating agencies and the international economic organizations, which keep a close watch on how the Bank of Israel functions and its professional standards, will hold us to account. Moreover - and here Flug strays onto different territory - "the citizens of Israel in general" will hold Netanyahu to account for the consequences for the economy of an unworthy appointment. "Bibi, the responsibility is yours", Flug would have told Netanyahu face to face; "You can't evade the responsibility of appointing the next governor of the Bank of Israel the way you have evaded meetings with me."

"This is not the time for summing up", Flug writes to Netanyahu, and there are those who might interpret that as meaning that she has plenty to say and will settle accounts one day. She certainly has had a bellyful, but it is doubtful whether she will settle accounts. Flug is responsibility itself. She won't openly rebuke a prime minister, and won't hang dirty washing in public. She won't give off-the-record briefings, and even her ringing resignation notice was released on a Friday afternoon, the worst possible timing for raising storms and attracting public attention. But even if she didn't say it or write it, the rebuke is there, believe me.

This is not the time for summing up. It could be that in the end everything will be thrown in the air, the general election will be brought forward, and Flug may yet find herself asked to continue in her post temporarily for a good few months. This is not the time for summing up, but nevertheless it has to be said straight: Netanyahu and Kahlon have gained a great deal from Flug's responsible conduct, from her refusal to engage in the usual Jerusalem political power games and arm wrestling, from the broad playing field she allowed them and her insistence on maintaining its boundaries, which Netanyahu and Kahlon tried to breach, or at least stretch. The time for summing up will yet come, but it is doubtful whether anyone will really demand of Netanyahu that he should take responsibility and be held to account.

Published by Globes [online], Israel business news - www.globes-online.com - on July 8, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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