Economy seen as the key to next Israeli vote

The state of Israel’s economy will like decide its political future, a Likud Cabinet minister said.

Environment Minister Gilad Erdan, and up-and-comer in the Netanyahu Cabinet who passed up the post of ambassador to the United Nations, was interviewed Thursday about cost-of-living protests sweeping Israel.

Though he voiced confidence in the government’s handling of the crisis, Erdan told Army Radio, “I admit that the next election, for the first time in the country’s history, will likely be decided by the economy rather than matters of diplomacy or security.”

The next general election is scheduled for 2013, and looks unlikely to be advanced given the stability of Israel’s broad-based coalition government.

Faced with spreading tent-squatter camps and an intensifying doctors’ strike, Prime Minister Benjamin Netanyahu hastened to announce housing reforms. But many protesters were not placated, and Israel’s Histadrut labor federation threatened to pitch in with demonstrators next week.

Deputy Prime Minister Dan Meridor, a veteran Likud statesman, signaled there would be limits to Jerusalem’s accommodation.

“It’s a new, fascinating phenomenon—people, mainly young people, some of whose claims have real basis, some of which don’t. It’s a struggling generation,” he told Army Radio. “The government must not give populist answers but, rather, real ones.”