On Wednesday, more than 50 top economists at universities in the United States penned an open letter to Israeli Prime Minister Benjamin Netanyahu.
The letter was aimed at warning him that his government’s plans of overhauling the judiciary in Israel would significantly weaken it and cripple the country’s economic growth.
The letter sent to the Israeli premier was signed by 56 former and current professors at some of the leading universities in America.
It said that an independent and strong judiciary is an essential element of a system that has proper checks and balances.
The professors said that undermining this system would not only hurt democracy, but also prove detrimental to economic growth and prosperity.
The proposals that have been put forward by the coalition would restrict the capacity of the High Court of Justice to strike down government decisions and laws severely.
The Knesset would have the ability of overriding the decisions of the High Court with a majority of 61. In addition, the government would also have control over the appointment of judges.
Ministers will also be able to choose their own legal advisers instead of getting counsel from those who operate under the Justice Ministry.
The letter was signed by eleven Nobel laureates, including Harvard’s Oliver Hart, Columbia’s Edmund Phelps, Stanford’s Paul Milgrom and Massachusetts Institute of Technology’s Peter Diamond.
Daniel Kahneman of Princeton was another signatory who has been very vocal against the legal overhaul plans from the beginning.
Last month, he said that the plans of the new government have him more worried about the country’s future than he had been during the Yom Kippur War in 1973.
He stated that he believed it was the end of the country from his perspective. A number of the signatories work, or previously worked at MIT, from where Netanyahu got his own bachelor’s and master’s degrees.
University of Chicago’s Luigi Zingales also signed the letter, who had been hailed by the premier in the past.
According to the economists, the proposals that had been announced by the Justice Minister last month would have an adverse impact on the Israeli economy because they would weaken the law.
Therefore, this would push Israel in the same direction as Poland and Hungary. They said that their opinion on the challenges Israel is facing and public policy varied.
However, they were unanimous in their concerns about this matter. It had also been reported on Tuesday that five more unicorn firms in Israel have withdrawn funds from the country due to investors’ concerns.
Unicorns are companies that are valued at $1 billion, or higher. These companies did not announce their decision publicly, but some have done so.
These include Wiz, Verbit, Papaya Global and Skai. About $7 billion has already been withdrawn from Israeli banks up until now due to the judicial overhaul concerns.
The latest group of companies had withdrawn $300 million and decided not to transfer $600 million that had been scheduled to come into accounts in Israel.