Israel Update Week Ending January 28
Plea Agreements: Deri,Litzman,Netanyahu, Snow in Israel,Food Prices Rise
POLITICS & LEGAL
This week Israeli politics closely intertwined with several legal matters. First, MK Aryeh Deri resigned from Knesset as part of a plea deal, in which he pleaded guilty to Income tax violations. Deri stated he would nevertheless remain in politics and continue to lead the Shas Party — just not as a member of Knesset. On Thursday, MK Ya’akov Litzman, former Health Minister and current leader of the Degel Torah Party, agreed to a plea deal requiring him to resign from the Knesset and pay a $900 fine. Litzman was charged with and pled guilty to “violation of public trust,” regarding the case of the accused pedophile from Australia. The former MK used his position as Health Minister to repeatedly delay extradition of the accused woman, a former girl’s yeshiva principal.
In another legal development, the Justice Ministry decided not to pursue any charges against police involved in the death of Ahuvia Sandak (age 16), killed in a crash while fleeing from police in December 2020, after allegedly throwing rocks at Palestinians. This case became a cause célèbre among the far right-wing and sparked weekly demonstrations in Jerusalem.
The events above all took place in the final days of the term of Attorney General Avichai Mandelblit, whose tenure as AG ends next week. Combined with an earlier decision to give Likud MK Chaim Katz a sweetheart plea deal, these decisions raise questions about the Israeli Justice system’s handling of allegations of public corruption perpetrated by senior ministers. It also underscores a systemic problem that exists, in that the State’s Attorney General also serves as legal advisor to the government.
In Mandelblit’s case, he became Attorney General after serving as Government Secretary under Netanyahu. The current hierarchy ultimately leads to the AG making decisions about people with whom he has worked closely. Most politicians tend to be personable and friendly. Under these circumstances, it is natural for the AG to go a little easy on his “friends.” As a solution, it has been suggested to divide the job of the government legal advisor and that of the State’s Attorney General.
The legal quandary at the forefront one week ago, i.e., the expected plea agreement between former Prime Minister Netanyahu and the State, cobbled together during the Mandelblit's final days, was not completed. Netanyahu released a video, in which he declared he would never agree to the “moral turpitude clause” of the plea agreement, which would ban him from politics for seven years. The Netanyahu trial resumes next week, after a delay caused by one of the prosecutors testing positive for Covid-19.
In a related development, the government voted to establish a national commission of inquiry in “The Submarine Affair;” an affair that is in fact, three separate, albeit connected matters. The first issue was the decision to commit to purchasing three additional submarines from Germany, years before those subs were needed. Netanyahu justified the decision by asserting the price was a one-time offer, and Israel should not miss that opportunity. However, it turns out that the “bargain” price was not secured, and now that the final contract was signed, the total price went up 80%. The second issue surrounds why PM Netanyahu agreed to allow Germany to sell their most advanced submarine to the Egyptians, behind the backs of the entire Israeli defense establishment. The final matter of inquiry concerns the reasons why surface warfare ships were purchased on a no-bid basis from the same manufacturer as the subs. While the manufacture of the required subs is highly specialized — as very few companies can produce modern diesel-electric subs — the surface ships purchased could have been built in Israel, South Korea, or even the US, using US defense funds. Hopefully, the commission will be able to investigate and address each of these matters.
It should be mentioned — the commission appointed to investigate the tragedy at Mt. Meron last May suffered a major setback, when its chairperson, former Israeli Supreme Court Chief Justice Miriam Naor, died suddenly. Her death abruptly ended the career of one of Israel's most distinguished jurists.
FOREIGN AFFAIRS
In commemoration of Holocaust Memorial Day, Knesset Speaker Micky Levi addressed the German Bundestag. Additionally, Foreign Minister Yair Lapid flew to Austria to participate in a memorial at the Mauthausen concentration camp.
Next week, President Herzog heads to UAE to conduct an official State visit. Meanwhile, Turkish President Erdogan announced that Herzog would visit Turkey.
MILITARY
The IDF suffered another accident this week, when two Border Patrol soldiers on the Egyptian border were wounded by friendly fire, during attempts to stop smugglers.
WEATHER … LET IT SNOW!
All Israelis stopped for a few hours, forgot all our various issues, and enjoyed the most significant snowstorm to hit Israel in six years — either directly or vicariously. Jerusalem was coated with 20cm of snow. Jerusalem was not the only place to get covered in snow. All the higher altitudes in the center of the country received their share of snow, while on the Golan Heights and Mount Hermon it is still snowing, as of Friday afternoon.
COVID–19
The Omicron variant continues to run wild in Israel. More people were confirmed to have Covid in Israel during January 2022 than over the entire course of 2021. While the Omicron variant is milder in Israel, like in the rest of the world, the vast number of infected patients — over 70,000 a day — have filled Israeli hospitals close to their breaking point, with 946 seriously/critically ill patients hospitalized.
The hope is that infections will drop in another week. However, hospitalization is a lagging indicator, and will therefore, will probably continue to increase. The other lagging indicator is death, which has surged to between 20-40 deaths per day.
This week, the most significant controversy was the decision to end the quarantine of students exposed to other students infected with Covid. Instead of relying on parents to test their kids twice each week, Health Ministry experts begged the government to hold off on ending the quarantine requirement for at least another week, until the current wave of Covid infection subsides.
The government went ahead anyway, and eliminated the quarantine requirement for children, in the name of returning to normal. Advocates of keeping kids in the classroom at almost all costs are bolstered by a study which show that kids today are more depressed. I doubt it is primarily the lack of school causing extra depression among children. The fact parents are undoubtedly under significant additional pressure due to Covid, likely triggers increased depression among children. Parents themselves are undoubtedly dispirited by the situation this last year. All this anxiety and stress rubs off on kids.
COST OF LIVING
One of Israel's largest food importers, Diplomat, official importer of Heinz Ketchup, Stark Kist Tuna, Huggies, and Pampers (among the 2,000 items they import), announced a price hike of between 4-16%. Diplomat blames the increase on rising costs in the world. While worldwide prices have indeed surged, these upturns are more than offset by the steady strengthening of the Shekel against the Dollar. So, this means the importer, who possesses a near monopoly plans to raise prices because they can. Consequently, in this county, where food costs are among the highest globally, food and various other necessities are about to become even more expensive.
PHILANTHROPY
A progressive, public-spirited group of Hi-Tech entrepreneurs have established a new organization called “1.8”. This exciting effort is being spearheaded by leaders from Bird Israel, Lemonade, Melio, and Seed the Dream Foundation, already including members in all high-tech fields. The new organization’s goal is to get all high-tech employees to pledge 1.8 of their stock, or options, to charities that make a real difference in Israel.
Members of the Israeli high-tech community have done exceedingly well in the past few years, and the idea promoted by 1.8 is to invest a portion of those profits back in projects that will have a significant impact in Israel. Moreover, as a collective, Israelis are now wealthy enough that we should be able to address the needs of the underserved in our society.
Speaking about the wealthy … JNF made almost $1 billion on the sale of land in Israel this past year. So, as you probably guessed, it is no longer necessary for you to put your pennies into those little blue and white boxes anymore. The government wants those profits turned over to them, while JNF seeks to put the money in its pension fund for worker retirement.
ECONOMY
StoreDot announced that its new battery technology extends the lifespan of batteries, making them highly effective during a vehicle’s lifespan and for ‘second life’ applications. This improved technology combines the innovative electrochemistry system of the company's silicon dominant cells to ensure minimal drop-off in performance even as the battery ages, beyond its useful EV life.
Robust performance is maintained even after 1000 cycles and 80% capacity, the point at which rival lithium-ion fast charging technologies start to deteriorate in performance rapidly. Even after 1700 cycles, long after the accepted industry norm, StoreDot's batteries maintain 70% of the original capacity, making them highly effective in second life usage for less dynamic applications such as energy storage and grid load balancing systems.
StoreDot has been known for its quick charging capabilities. This new announcement comes weeks after the company raised $80 million in a Series-D funding round. Dr. Doron Myersdorf, a StoreDot CEO, stated a few weeks ago:
“We are now properly funded to take our silicon-dominant XFC cells to the end of the R&D phase and into scale-up in readiness for mass production in 2024 for global vehicle manufacturers. In addition, it will help overcome the major barrier to EV ownership – charging times – providing a 50% reduction, and, ultimately, helping us all achieve a zero-emissions, clean world.”
Firebolt, the cloud data warehouse for builders of next-gen analytics experiences, announced a $100 million Series-C funding round, reaching a $1.4B valuation just 12 months after emerging from stealth mode. This latest round of funding brings its total investment to $269 million. The financing round one of the first after the rapid drop in the NASDAQ of many Israeli companies shows that the reduction has not impacted funding.
SiteAware, the pioneer of Digital Construction Verification (DCV) technology, today announced a $15 million Series-B funding round led by Vertex Ventures Israel, with participation from existing investors Robert Bosch Venture Capital GmbH, Axon Ventures, Oryzn Capital, The Flying Object, and lool Ventures that led the company's seed round. This round followed a $10 million Series-A funding in October 2020. The company will use the funds to fuel continued growth and establish DCV as a new technological standard across the US construction industry.
