Thursday, July 12, 2007

Israel: Bad smells and fresh air

Israel: Bad smells and fresh air
Mar 8th 2007 | JERUSALEM
From The Economist print edition

Corruption in Israel has been growing, but more is being done about it too

REMEMBER those speeded-up films of fruit rotting that used to be so popular? Watching Israeli politics today feels eerily similar. Israelis had had quite enough with a series of corruption scandals involving the prime minister, finance minister and head of the tax authority, and sexual allegations against the president and the then minister of justice. But in the past few weeks their police chief resigned after a report on his mishandling of a criminal probe; a scandal instantly flowered around the appointment of his successor, who had been acquitted of corruption in the 1990s but admitted to disciplinary infractions; a new document surfaced detailing political favours granted by the prime minister, Ehud Olmert, when he was in a previous post; and a newly appointed tourism minister unwillingly stepped down after it emerged that she had lied about her academic qualifications.

Add this to a trickle of well-remembered scandals of recent years, such as the campaign-finance and bribery allegations that persistently swirled around the family of the previous prime minister, Ariel Sharon, and it is no surprise that Israel has steadily been slipping in the annual perceptions index maintained by Transparency International, a Berlin-based anti-corruption watchdog (see chart above). Some misty-eyed commentators hark back to the honest days of the 1970s, when the revelation that his wife held a few thousand dollars in a then-illegal overseas bank account was enough to make the prime minister, Yitzhak Rabin, resign. But is the putrefaction really worsening or are more people just noticing the smell?

Many think it is a bit of both. Yitzhak Zamir, a retired Supreme Court judge who recently headed a commission to draft tougher ethical rules for members of parliament, argues that as Israel has become less ideological, idealist and egalitarian than in its pioneering early days, politics has become more of a personal career and politicians abuse their positions more often. But at the same time, he says, once-sacred cows such as the army and the presidency are now under scrutiny, institutions like the courts and the state comptroller have grown stronger, and the public is “no longer willing to excuse leaders for improper behaviour”.

That is true not only of political but also of personal misdeeds. Among young Israeli women who have worked for them, philandering and harassment by many male politicians have long been an open secret. Now, however, they are more willing to go to the police with the complaints and more likely to be taken seriously.

There is also more noise about corruption than before. The current state comptroller, Micha Lindenstrauss, is not only an energetic sleuth, but less publicity-shy than his predecessors. This week he was under criticism for trying to put out an interim report on last summer's war in Lebanon, in what some see as an attempt to trump the commission of inquiry into the war that is due to report later this month.

Nonetheless, says Mr Zamir, the corruption needs to be fought “before Israel gets to the level of Latin America”. Among his commission's recommendations are giving the parliament's ethics committee powers to impose fines on miscreant legislators or bar them from certain jobs like committee chairmanships; forcing them to reveal when they have been approached by lobbyists; and further limiting the posts they can hold outside parliament while serving in it. All of these, he proudly points out, would leave Israeli legislators in some respects more constrained than many of their Western peers.

Some politicians, indeed, think that other institutions already have too much power. Mr Olmert's new justice minister (in place of the one convicted of indecent behaviour) is Daniel Friedmann. He is one of a small but vocal group of jurists who think the Supreme Court became too activist under Aharon Barak, the recently-retired chief justice, who ran his court under the banner “everything is justiciable” and wanted to strengthen checks and balances against politicians.

That has provoked a backlash among Mr Barak's allies, a left-right split among parliamentarians, and a noisier debate in the media. Dirty laundry Israel may have, but at least it is getting a thorough airing.

Copyright © 2007 The Economist Newspaper and The Economist Group. All rights reserved.

Anti Corruption Campaign Israel

Israel first in Middle East in battling corruption
By TheMarker and Reuters

Israel and the United Arab Emirates lead Middle Eastern countries in the fight against corruption and enacting laws that benefit business, according to a World Bank report.

The study, released Tuesday, measures factors such as controlling corruption, government accountability, political stability, press freedom and the absence of violence.

However, the bank's latest Worldwide Governance Indicators study of 212 countries from 1996 through 2006 shows little overall improvement in governance worldwide despite the increasing focus on the issue.


On all the measures except for political stability Israel received high marks, though still significantly lower than other developed countries.

In corruption control, Israel had a 79.6 percent score. This ranks below a fifth of the countries rated. High-scoring nations were Australia, 95.1 percent, Canada, 94.2 percent, Germany, 93.2 percent, France, 91.7 percent, and the U.S., 89.3 percent. In 2005 Israel received a 75 percent score on corruption control.

On the good governance scale, Israel received a reasonable score, 70 percent, which put it far ahead of its neighbors such as Syria, 36.2 percent, or Iran, 23.3 percent. However, the Emirates scored 69 percent, and Israel was again far behind Western nations such as Belgium, 91 percent, Germany, 94.3 percent, and the U.S., 91.9 percent. In 2005 Israel actually scored higher, 74 percent.

Israel's worst ranking came in political stability, 14.4 percent, which was also down from 19 percent in 2005. Israel thus ranks among African regimes such as Kenya, 15.4 percent, and Liberia, 12.5 percent.

In 2005 the World Bank considered Israel one of the riskiest countries in the Western world, with an unstable, inefficient and irresponsible government, and with a high level of corruption compared with developed countries.

The World Bank cautions against reading too much into global averages, and also reveals that some governments, including those in Africa, could make a difference relatively quickly when undertaking reforms.

These countries could expect a three-fold increase in per-capita income in the long term, the bank estimated.

"Until the mid-nineties, I did not think that governance could be measured. The Worldwide Governance Indicators have shown me otherwise," says Shlomo Yitzhaki, director of the Central Bureau of Statistics (CBS) and an economics professor at Hebrew University.

"It constitutes the state of the art on how to build periodic governance indicators that can be a crucial tool for policy analysts and decision-makers benchmarking their countries," he said.

"Uniquely, it publicly discloses the aggregated and disaggregated data, as well as the estimated margins of error for each country. It definitely sets a standard for transparency in data."

According to Daniel Kaufmann, an author of the report and director of global programs at the World Bank Institute: On average we do not find evidence around the world that governance has improved significantly. Whether it is rule of law or control of corruption, on average there is no compelling evidence.

In June, Kaufmann warned that even though Israel is considered one of the 50 leading nations in fighting corruption, in recent years there has been a deterioration in this area. He added that among industrialized nations, Israel was in the bottom five in every parameter related to good governance.

"The good news is this is just an average and hides enormous variation from one country to the other, and there are a large number of countries that are showing that in eight to 10 years, it is possible to significantly improve governance," Kaufmann said.

For example, between 1998 and 2006, there were improvements in democratic accountability in Sierra Leone and Niger, while the rule of law improved in Algeria, Liberia and Tajikistan.

Serbia and Tanzania were examples of countries that were able to better control corruption, the report said.

Still, the indicators also showed that governance deteriorated in Venezuela, Ivory Coast and Zimbabwe.

Meanwhile, Somalia, Myanmar, Equatorial Guinea, Haiti and Zimbabwe ranked lowest in terms of being able to control corruption.

Nordic countries such as Finland, Iceland, Denmark and Norway, as well as New Zealand, received the highest overall governance scores.

The latest indicators are based on hundreds of variables and views of thousands of individual and firms in surveys. They measure governance within the governments of the World Bank's member countries and have put the bank at odds against some governments, like China, which question whether the bank should be involved in rating countries on governance. The indicators show that China ranks in the bottom decile on voice and democratic accountability. Despite its governance shortcomings, the Asian giant has been able to attract vast foreign investment and enjoys fast-paced growth.

Elsewhere, Chile, Botswana, Costa Rica, Uruguay and Estonia are among more than a dozen developing countries that beat industrialized nations such as Greece or Italy on the governance scale.

"It is achievable to have high levels of governance while still being an emerging economy, which is a precursor of sustained growth," Kaufmann added.Being part of the industrialized world did not mean countries escaped governance challenges. "Not so," he said. "The countries that set the standards for governance include the Nordic countries, New Zealand and a few others, but by no means all the countries in the G7 are necessarily at the top," he added.

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