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The purpose of a supreme court is to ensure that democratically elected government do not make undemocratic laws.
If one were to have a system as they do in America, then theoretically, were there to be a majority of a certain type of people they could force undemocratic laws on the people.
In egypt, for instance, the president has appointed a court, and in turn they have approved a far more radical constitution, with sharia as basic law, which no legal figure would ever recognise as democratic.
To put things differently, democracy is fair, but it is not necasarily right. [For instance why should i pay higher tax just because so many people were stupid enough to vote for Obama?]
I am not justifying the israeli supreme court in any way, i’m just pointing that the system suggested defeats the entire purpose of the court.