Bennett Presents His ‘Economics 101′ Lesson

In a new video, Economics Minister Naftali Bennett deflects the criticism of Zionist Camp supporters for a deal he made last year to persuade Intel to upgrade its facility in southern Israel.

The critics, said Bennett, accused him of “giving away too much” by giving Intel tax and grant concessions of up to $6 billion, to convince the company to upgrade its plant in Kiryat Gat.

That action, said Bennett in the video, marked a fundamental difference in approach between his philosophy of economic growth, and the philosophy of the semi-socialist Labor party.

“Labor believes that you need high taxes on big businesses, and to take money to give to the poor,” Bennett said in the video. “Makes sense, no?”

No, says Bennett. “The time has come to tell the truth – the opposite is true.”

Intel, said Bennett, had spent several years deciding on where to build the new facility, with Intel's Kiryat Gat processor manufacturing center up against Intel locations in Ireland and the US.

In the end, Intel chose Israel for the upgrade to manufacture chips for its next generation of products. “If the taxes on companies in Israel had been as high as Labor wanted, Intel would have had a much easier decision to make; they would have built the facility in Ireland, because the corporate tax rates there are much lower.

“They don't come to Israel because they are Zionists – they come to make money,” Bennett said.

Had Israel implemented the policies Yitzhak Herzog and Tzipi Livni, co-leaders of the Zionist Camp, sought to implement, then “Intel would have gone with Ireland, which would have gotten the thousands of new jobs created by Intel. The Irish government would have gotten the proceeds of the income tax from those jobs. Israel would have gotten nothing."

“We would have done the 'right' thing, but we would be left jobless,” Bennett added.

In order to keep Intel here, Bennett said, he made them an offer they couldn't refuse – a large government grant, and a reduced corporate tax rate of only 5%. “Now Labor is crying foul over this, but what happened? Was this really a 'raid on the Treasury' that they accuse of? No – Israel benefitted from thousands of new jobs, in a peripheral community,” and that is only in direct employment.

In addition, he said, one has to take into account the “multiplier effect” of the many more jobs that will be created, with vendors, caterers, restaurants, and other support to service the new workers. “We successfully got Israel a record investment worth $11 billion, and the government will benefit with hundreds of millions of shekels in income from taxes,” Bennett added. “Everyone wins."

“If the Left wants to attack me, then that's their right,” said Bennett. “But at least we now know the truth.”

Source: http://www.israelnationalnews.com/News/News.aspx/191879

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