Sunday, 29 March 2009

Secular mayor brings business sense to Jerusalem

Sunday, March 29, 2009

Matthew Kalman, Chronicle Foreign Service

Jerusalem -- Nir Barkat, Jerusalem's newly elected mayor, is on a mission: to drag this ancient city into the 21st century.

Behind the iconic image of the Old City dominated by the Western Wall of Herod's Temple and the shimmering golden Dome of the Rock, is a near-bankrupt modern metropolis that is slipping deeper into poverty.

Since local taxes are low in contrast to other Israeli metropolitan areas, city services are limited and 56 percent of children and 33 percent of families live in poverty, according to the Jerusalem Institute for Israel Studies.

Barkat, 49, is a former paratrooper turned high-tech millionaire whose BRM Technologies is a pioneer in anti-virus software. A secular Jew born and raised in a city where 40 percent of its 750,000 inhabitants are ultra-Orthodox, his electoral victory in November reversed a rising religious hold on power.

"He was boosted by internal divisions inside the ultra-Orthodox camp," said David Horovitz, editor in chief of the Jerusalem Post.

In S.F. today

Barkat, who refuses to take a salary, will visit San Francisco today to promote investment and tourism. Assisting that effort is Isaac Applbaum, a founding general partner of Opus Capital in Menlo Park, who has reportedly invested millions in Israeli high-tech startups.

"I'm trying to put into practice the mayor's vision to ... rebuild Jerusalem from one of the poorest cities in Israel to one of the greatest," said Applbaum.

As mayor, Barkat has promised to preserve the fragile religious "status quo" whereby shopping malls and buses do not operate on the Sabbath, but movie theaters and non-kosher restaurants are allowed to remain open in secular neighborhoods.

He has also vowed to bring business sense to a city riven by political and religious factions. Mapam, a left-wing Israeli minority party, represents the interests of Palestinian residents who regularly boycott municipal elections. Secular Jews are irate over ultra-Orthodox residents, many of whom are on welfare or receive student stipends and are not obligated to pay taxes.

Problems, not politics

As a businessman and right-leaning independent who only entered politics five years ago, Barkat says he will focus more on solving problems than winning political debates.

"I've brought something that's called 'no surprises' to the way I manage Jerusalem," Barkat told The Chronicle in a recent interview. "When there are problems, let's put them on the table and solve them together. That gains a lot of trust rather than arm-wrestling to see who wins every round."

Years of underinvestment and poor planning have resulted in severe problems in transportation, education and housing, economists say. The city's annual budget of $800 million is less than Tel Aviv's, even though Jerusalem has twice the population. Barkat says only 45 percent of residents over 15 are employed, or 1 taxpayer for every 3 residents, in contrast to Tel Aviv, where 64 percent over 15 are employed and where there are 3 workers for every 3 residents.

One of Barkat's first acts has been to reassess a light-rail project that has snarled city traffic for five years, soared over budget and is three years behind schedule. He has proposed canceling future lines and replacing them with a flexible Bus Rapid Transport system.

More importantly, the new mayor is fixed firmly on creating jobs, building more housing and improving city services. Last year, 17,000 youths left the city to look for work elsewhere, according to city records.

In the absence of tax revenue, Barkat hopes to attract foreign investment in outsourcing of office services such as call centers and health-life sciences centered around the city's renowned Hadassah Hospital and Teva Pharmaceuticals, the latter a world leader in generic drugs.

"As mayor, I intend to focus on those areas where Jerusalem has competitive advantages and build them into business clusters," he said.

Barkat also plans to increase the number of tourists from 2 million to 10 million within a decade in order to create 150,000 new jobs with more tourist events and biblical theme parks.

Christians, Muslims, Jews

"No other city in the world can provide an opportunity to see Christians, Muslims and Jews at their best, with all their differences, and leverage their differences," Barkat said.

Perhaps his toughest challenge will be defusing simmering tension between Israeli and Palestinian residents, the latter who consider themselves living under occupation and comprise one-third of the city's population. Barkat says he can advance relations by improving city services to East Jerusalem, where most Palestinians live. The area was annexed from Jordan after the 1967 Six-Day War.

According to the Association for Civil Rights in Israel, 160,000 Palestinians have no running water; East Jerusalem lacks 40 miles of sewage lines, and the government has built more than 50,000 housing units on expropriated Arab lands and none for Palestinians.

"Definitely there are gaps," Barkat conceded. "My goal is to improve the quality of life of the people, of the residents of East Jerusalem. We will do that. It's my duty."

At the same time, he dismissed criticism leveled this month by visiting U.S. Secretary of State Hillary Rodham Clinton of plans to demolish 88 Palestinian houses illegally constructed in East Jerusalem. He called her comments "unhelpful" to the peace process.

But Fakhri Abu Diyab, whose house in the Silwan neighborhood has been targeted for demolition, said he had no choice but to build without city permits.

"The municipality refused to let me build on a piece of land that I received from my father and my grandfather," Diyab said. "I was forced to build without a permit. ... What they want is to evict us."

Meanwhile, some analysts say Barkat must soon show results to win over skeptics who regard him as an ingenue rich-kid dabbling in politics.

"He will have to prove himself in office if he is to achieve the second and third terms he has already announced he will seek," said the Jerusalem Post's Horovitz.

E-mail Matthew Kalman at

This article appeared on page A - 7 of the San Francisco Chronicle

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