Stanley Fischer recently announced that he will be stepping down from his position as the governor of the Bank of Israel (akin to being the chairman of the US Federal Reserve) in June. Stanley Fischer has been credited for steering Israel through the global financial crisis, and the Bank of Israel under his stewardship has earned many accolades and honors.
In 2005, then-finance minister Binyamin Netanyahu convinced Stanley Fischer to accept the Bank of Israel’s top position and immigrate to Israel after an illustrious career that included stints as the Vice Chairman of Citigroup, Vice President and Chief Economist at the World Bank, and the First Deputy Managing Director of the International Monetary Fund. This was a major achievement for the State of Israel, as Fischer had the international stature to inspire global confidence in the country’s economy and add gravitas to the Bank of Israel.
What many people do not know about Stanley Fischer, however, is that this was not his first foray into the Israeli economy.
In 1985, when Shimon Peres was serving as Israel’s prime minister, the country was suffering under the burden of an annual inflation rate of 400% (no, that is not a typo). Peres turned to US Secretary of State George Schultz - who himself was an economist and former secretary of the US Treasury - for guidance, and Schultz recommended that Peres ask Fischer to help solve the country’s economic woes. Peres diligently followed Stanley Fischer’s advice and later admitted to being amazed when things turned out as Fischer had predicted.
And then in 2005 Fischer “gave it all up for an Israeli salary” – in Shimon Peres’ words – when he became the governor of the Bank of Israel. Stanley Fischer sacrificed personal gain – having chosen the governorship over more prestigious opportunities abroad – for the betterment of the Jewish state, a testament to both his clarity of purpose and his sense of a higher calling that guided his decision.
Fischer recently received the prestigious Chaim Herzog Award. The award jury said, "Stanley Fischer is an American Jew who came willingly to contribute his energy, experience and insight for the benefit of Israel. . . During his tenure as Governor of the Bank of Israel, Stanley Fischer was faced with the global economic downturn and complex geopolitical and social realities. He intelligently steered the economy and led it to growth. Thanks to his vigorous efforts, Israel did not find itself in a financial crisis as did other countries. . . Prof. Stanley Fischer worked energetically for Israel's acceptance into the Organization for Economic Cooperation and Development (OECD) and contributed greatly to Israel’s economy, all the while improving its image in the world."
To be sure, Stanley Fischer has had his fair share of detractors. For example, many in the real estate industry blame his tight credit requirements for creating a shortage of new apartments. They claim that by curbing the amount of financing allowed to real estate developers, the Bank of Israel has prevented developers from building more apartments, which has put upward pressure on housing prices.
Nonetheless, Israel and the global Jewish community are indebted to Stanley Fischer for his vision, his courage and his leadership in having the strength of his convictions – which sometimes diverged from the majority of the world’s leading economists – to set the country in the direction of economic growth and stability.
Gedaliah Borvick is the founder of My Israel Home, a real estate agency focused on helping people from abroad buy and sell homes in Israel. To sign up for his monthly market updates, contact him at gborvick@gmail.com.