Israeli Prime Minister Benjamin Netanyahu’s unexpected failure to form a new government, which indicates that his political end may be nearing, has prompted much speculation about what changes a post-Netanyahu era might bring. But here’s one thing that won’t change—the right’s efforts to reform the legal system. And nothing better explains why than the about-face of Finance Minister Moshe Kahlon, previously one of the system’s ardent defenders.
Reform efforts have been widely depicted for months as nothing but a way for Netanyahu to avoid standing trial. Thus many people seem to think they’ll dissipate once Netanyahu goes. As columnist Chemi Shalev wrote in Haaretz on May 28, “Without Netanyahu and his urgent need to avoid indictment, the right-wing crusade against Israel’s Supreme Court in particular and the rule of law in general would falter … without Netanyahu’s personal stake and drive, even a right-wing coalition would find it hard to muster the anti-court majority needed for such a drastic constitutional upheaval.”
In fact, the opposite is true. Legal reform has long enjoyed widespread support in both Netanyahu’s Likud and other rightist parties; the main reason it never happened is that Netanyahu himself repeatedly stymied it throughout his decade as prime minister. His sudden change of heart indeed stems from his own legal problems, but that isn’t true of most rightist politicians or of rightist voters.
Kahlon used to be a major exception. He entered the cabinet in 2015 vowing to thwart any effort to curb the legal system’s power. In his coalition agreement with Likud, he even demanded and received veto power over such legislation. And he exercised his veto repeatedly, inter alia killing bills to change the judicial appointments system and to let the Knesset reenact legislation overruled by the courts.
But after April’s election, Kahlon’s Kulanu Party signaled that it would no longer thwart such efforts. As Revital Hovel reported in Haaretz last month, there are two reasons for this.
First, even Kulanu voters—the most moderate segment of the center-right electorate—objected to Kahlon’s defense of the legal status quo. In April’s election, Kulanu dropped from 10 Knesset seats to four, and the party’s internal polling found that its repeated vetoes of legal reforms were a major reason why. Many rightists simply won’t vote for anyone opposed to legal reform.
Second, Kahlon got mugged by reality. As finance minister, he acquired firsthand experience of the way the Supreme Court prevents governments from governing by repeatedly overturning decisions it deems “unreasonable”—a judgment other democracies leave to voters.
Most dramatically, the court overruled Kahlon’s flagship policy on what even Hovel, a court supporter, admitted were “novel grounds.” Kahlon won election by promising to lower Israel’s cost of living, particularly its astronomical housing prices. He therefore enacted a special tax on third apartments, arguing that making it more expensive to buy housing for investment purposes would cool demand and thereby lower prices.
The tax was part of the annual Economic Arrangements Law, an omnibus bill enacted together with the state budget because the government deems its provisions necessary to meet budgetary targets. It passed all necessary votes in both the Knesset Finance Committee and the full Knesset. Nevertheless, the court overturned it, claiming the legislative process was flawed.
Here, according to the ruling, are the justices’ objections: The Finance Committee’s overnight discussion wasn’t in-depth enough. Knesset members didn’t receive the bill’s final revisions in time, so they relied on treasury officials’ oral explanation of the changes. Government representatives, the committee chairman and some Knesset members repeatedly urged other committee members to stop asking questions and just pass the bill already. In short, the court said, the process was characterized by “haste, pressure and panic,” thereby depriving MKs of the chance to form an “educated opinion” of a bill with significant financial ramifications.
Or in other words, as anyone familiar with the Knesset would know, it was situation normal for the final stage of the annual budget debate, in which MKs must approve thousands of pages of legislation within days to meet the end-of-year deadline (I know this firsthand, having covered the proceedings for years as a reporter). The budget passes less through reasoned debate than through standard legislative horse trading, in which all MKs support certain items they dislike so that other MKs will support their budgetary priorities.
Nevertheless, the court decided that in this particular case, standard practice had suddenly become so unreasonable as to be unconstitutional, and overturned the law. That effectively killed Kahlon’s tax, which, like many tax hikes, was too unpopular to pass outside the annual budgetary horse-trading.
Kahlon also repeatedly fell victim to another of the Supreme Court’s unique interpretations of the “rule of law”—that a government has no right to representation in court if the attorney general disagrees with its position. For instance, as finance minister, Kahlon is ostensibly in charge of taxes. Yet the court overruled his decision to maintain differential taxes on cigarettes and rolling tobacco without his position even being granted legal representation.
The same happened when the court ordered Kahlon to raise the price of price-controlled milk (a vestige of Israel’s socialist past). To be clear, I consider price controls bad policy, especially when, as in this case, higher production costs probably justified raising prices. But by law, the price of price-controlled milk is set by the finance and agriculture ministers, not the attorney general or the court. Thus by overruling Kahlon on the grounds that his decision was unreasonable, the attorney general and the justices effectively usurped the minister’s legal authority and forced him to violate his campaign promise to keep prices down, all without his position even being represented in court.
After more than three decades of such rampant judicial activism, too many rightist legislators and voters have similar stories of policies they cared about being nixed not because they violated any law or constitutional provision, but merely because unelected justices or an unelected attorney general decided to substitute their own policy judgments for those of the elected government.
That’s what’s truly driving the movement for legal reform. And it won’t disappear when Netanyahu does.
Evelyn Gordon is a journalist and commentator living in Israel.