Taxis are also plentiful, but be advised that taxi drivers are required by law to use the meter for travel within the cities. Some drivers may attempt to avoid this by simply not turning it on and quoting you a fixed rate in shekels.
While quoting a fixed rate is perfectly appropriate for going to the airport, intercity trips, or trips where you are asking the driver to stop and wait for you, it is neither advisable nor legal for a simple trip from one place to another within the city. You will nearly always do better for trips within a city if you use the meter, so insist that the driver turn on the meter. Get out without paying if the driver refuses, as is your right—the driver is breaking the law by refusing. All the drivers understand some English, but you can say in Hebrew, “taf’il et ha-moneh, bevakasha” (“turn on the meter please”). Or just ask for a receipt (“kabbalah” in Hebrew); they have to use the meter to generate a receipt.
The problem is less than it used to be, but stick to your guns and make sure that that meter has been turned on. In Jerusalem, I recommend a driver David Mizrachi at (054) 481-6950; he is honest, fun to chat with (though his English is limited), and very interesting. Other good choices are Yehuda Levi, (052) 240- 7080 and Lior Dabush, (050) 955-9505. In Tel Aviv, I recommend Beny at (054) 303-0700 and Ofer (054) 545-5205. But you can simply grab a cab on the street or through your hotel—just make sure that the driver turns the meter on! You will pay slightly more if you or the hotel calls for the cab, rather than flagging one on the street, but it’s a small surcharge.