We are changing direction. It is true that Israeli researchers and scientists have contributed and will continue to contribute greatly to the advancement of science, research and technology overseas. However, it is also true that we contribute more than any other country, and until recently the rate was 25%, which is the highest. But we lost many people to "brain drain" who we would have wished would remain in Israel.
The claim that knowledge is distributed on a global level now is true. However, centers of knowledge and excellence concentrated in a specific area have great power, because they lead to many other things, including knowledge-based industries. Therefore, we had an interest in changing direction and not just remaining in the realm of vision and statement, and not decisions. Any decision that does not also include allocation of funds and timetables is not practical. I thought, when I spoke about this with Professor Trajtenberg and Minister of Education Gideon Saar, that we had a great opportunity because we were running the economy in a different manner. While other economies, including the leading economies in the world, were encountering difficulties because they were dealing with it using methods different from ours, I thought an opportunity was created to get the financial resources to fund the center of excellence and also to appeal to leading Israeli researchers to join their leading colleagues in Israel. When this project is established with the cooperation of the government, the universities and other partners, philanthropic funds and other parties in the industrial and business sectors can also join.
We realized this vision in a decision to establish four very advanced centers of excellence, with cognitive studies, computing research and other fields you are familiar with. We started by saying that we would allocate the funds for them and see what the response would be. And the response was rapid, and I must say that it is heartwarming that dozens of Israelis from the best universities in the West and the United States – and other universities – came forward. We already announced the second wave.
This second wave includes the establishment of ten more centers of excellence that will open at a later date. People already know that we are serious, and therefore interest is high. However, the most wonderful thing is that there are 67 requests to establish additional centers. The Jewish and Israeli intellect invents all kinds of patents and it wants to invent them here, and that is a power thing because in the end, we will be measured by the strength of our knowledge-based economy. This is a top priority for us, and I think it will lead us to new heights. It will provide us with an opportunity for even greater development. Many fruits will grow on these trees, from these heights, for the State and people of Israel.
However, a tree cannot grow unless one begins to take care of it from the bottom, at the roots, and to take care of what is in between. We worked hard and introduced reforms in the education system – in elementary school, high school and more. However, one of the main recommendations made by our colleague, Manuel [Trajtenberg], in the famous eponymous report, was to take care of the roots as well: that we introduce free education from the age of three. This is something that governments have spoken of in the past, since the establishment of the country, but in fact, no one has ever done anything about it. We decided to adopt this chapter as well; I would call it The Chapter, in the Trajtenberg Report. Next week, I will present a proposed Resolution to the government to introduce free education from the age of three in the State of Israel effective in the coming school year – this year. During 2012, we will introduce free education from the age of three.
This is a national mission. This is a primary social mission because the situation today is such that many families must spend thousands of shekels on educating their children. This is a financial burden. So we are doing two fundamental things: firstly, we are subsidizing NIS 800 per month per child. This is in addition to tax credits. If one has several children, this adds up to thousands of shekels, and this has begun this year. We know that there was great demand for this, and that is why we need to build more public kindergartens because they don't exist. Because they do not, families have to pay a fortune or are unable to pay at all. Therefore, we are going to build over 2,000 new kindergartens and day care centers for 30,000 additional children. We will subsidize afternoon child care facilities (for ages 3-9); we will subsidize parents' payments for books, textbooks or class trips. That is something truly heartbreaking. There are class trips for which parents must pay – but they cannot, so their children must stay home and that is completely unacceptable. This simply harms children; it harms the souls of boys and girls and we are going to put an end to it. This is all in the framework of the recommendations we received. We of course will rank them according to a socio-economic scale.
I think this is a tremendous change that is meant, first and foremost, to treat our social fabric and give our children a much better education. We must begin at a younger age and reach much higher. We are doing these two things – going down to the roots and climbing to heights.
How can we do this? We are not breaking the budget. Because this is a national mission, we have put it at the top of our list of priorities and we must get the money from somewhere – and we will. You need to understand, the State of Israel's budget has grown – it's not that it hasn't grown. It has grown slightly more than the population: approximately 1% more. This budget is around NIS 286-287 billion. Subtract interest, which is about NIS 250 billion – one quarter trillion shekels. We will find resources for this and all government offices are participating because this is a national mission. It is like the decision to complete the construction of the fence against illegal infiltrators seeking employment; we said that this fence needed to be completed along the Sinai border in order to protect the State of Israel, so we added money and took it from another source. You cannot plug a hole while creating a hole in a different place; you need responsible fiscal administration to find resources, and we will announce them next week.
I think that this is tremendous news for families and children in Israel and for the people of Israel as a whole. I think this will narrow social gaps and provide our children with the tools and a more equal chance of facing up against children in other countries in the global economy in which we live. Whether we wish it or not, we must provide our children with the best educational and intellectual tools, and we are doing so in practice, with money, plans and in execution.
I want to say something else because I had a very moving, albeit short, conversation with Professor Danny Schectman. I don't know if you are familiar with the rule we have in the government. When ministers want to talk and we need to allow them to talk, then I say to them, "All right, we need to allocate time, because otherwise…" You know, there are quite a few ministers. So I tell them, "Look, I was once at a conference in Colorado, and there were several Nobel Prize winners in economics there, and they were allowed to speak in turn. Each one spoke for one minute. In that minute, they said something that made people's jaws drop and eyes widen. So, I'll give you a bribe: two minutes, half a Nobel Prize." So I arrived at this meeting with Danny Schectman, and I said to him, "Tell me, what did you receive the Nobel Prize for?" And he took a minute on the board to explain it to me. As someone who is not from that field, it seemed a very reasonable thing to me, but if I had asked someone else to explain it to me, I think he would have wasted many more minutes, and I wouldn't have understood. After the explanation, we went into a room and spoke about something else. We sat in my office in Tel Aviv and Danny Schectman said something else. He said, "Look, the key to our power is not just academic knowledge; it is in the joining of knowledge with initiative. Without initiative and free entrepreneurship, knowledge will not go too far, it will get stuck." He continued, "For decades, I have been teaching courses on initiative," at the Technion, if I am not mistaken, "in order to encourage this joining of knowledge and economic activity."
I cannot help but totally agree with him because I think that knowledge is a necessary component. That is clear! And education from below, educating children from early childhood to the tops of the trees, higher education and centers of excellence above that, is necessary. However, unless we have a free and dynamic economy that encourages initiative, provides proper salaries for those who excel and creates economic growth each year, each decade – we will not have the resources to provide a solution to our social needs as we do now. It is the result of growth. Economies that do not grow do not have these means, and we are different than many, if not most economies in the West in that we do not only know how to pick the fruits, we also know how to grow the tree, and as you see, that is the combination of education and a free economy.
I say this because if we do not understand this and think that we can pass on a free and dynamic economy and make do with education, we will fail – as we will fail if we do not take care of education. We are familiar with countries in which there is extraordinary education, perhaps the best in the world, but the country's economy was closed and did not help. I am speaking about the former Soviet Union. They had the best mathematicians, physicists, meteorologists in the world and it did not help. They simply sat around and got frustrated until they could get on a plane and escape one way or another. They arrived in Palo Alto and started creating added value immediately.
We want both things. We have both things, and we must continue to have both things. We must continue to grow through various means because we are only eight million people. We need a tiny portion of huge markets. This week, the Foreign Minister of India will visit Israel. Two weeks ago, our Minister of Finance was in India. We have ties with China; President Peres was in Vietnam several weeks ago. This is not coincidental. We need a tiny portion of a huge market and we can achieve this.
We must make additional domestic changes, but these two things must exist: education from the bottom all the way to the top; and a free and dynamic economy that creates new markets. We can do this; we must do this because ultimately, it is the only way to overcome the law of large numbers.
The law of large numbers worked historically. Usually, peoples with greater numbers won. We are exceptions, anomalies. We overcame this iron law of history thanks to special powers, powers of faith and creativity that we embody. We also succeeded in increasing our per capita GDP quite quickly, much more than our neighbors. By doing so, we succeeded in reducing the gap in the size of their shared economies vis-à-vis our economy, and we are increasing the gap even more by that same spark of creative and genius our people has, which is now finding concrete and practical expression. These are the tools that we have to ensure our future. It is of course not just science or computers, including the cyber arena, a field that today the citizens of Israel better understand its importance. We established a national cyber headquarters in order to deal with these challenges. This is also a war of brains.
However, it is not just a war and contest of brains, it is also related to the heart. It relates to our hearts in that we speak of cooperation between us and a commitment to renew our national lives and our historic homeland, and to ensure that our people, who share a past, will have just as bright a future. With your help, with the help of this important action, we are on the right path.