This year, hundreds of thousands Israelis have been taking to the streets to protest judicial reforms pushed by Prime Minister Binyamin Netanyahu’s government. The mass opposition has been notable both for sheer numbers and the wide range of social segments involved, including right-wing voters who would never normally take part in anti-government demonstrations.
Yet among the broad-based coalition of opponents, organized labor has been notably ambivalent. Although individual unions went on strike against the reforms, the Histadrut—Israel’s equivalent of the AFL-CIO or Britain’s Trades Union Congress—refused to authorize a general strike, something critics charged might have prevented the reforms from passing.
It might be surprising that Hisdarut’s leadership was so reluctant to commit to protests against what is likely the most right-wing government in Israeli history, but this posture was the result of an underappreciated aspect of the Israeli right, led by Netanyahu’s Likud party: It is very generous to the poor, trade unions, and public-sector workers who form a large part of its base. As one journalist claimed after last year’s election, “far-fetched as it sounds, the Likud today is the bastion of socialism in the Knesset.”
A small but influential cohort of Anglo-American conservatives are calling on parties of the right to become the true guardians of working-class values and prosperity. If those conservatives are serious about rethinking industrial policy, boosting union strength and density, and adopting pro-family social-welfare policies, they would do well to learn from Netanyahu’s Likud, which has been in power for most of the past quarter-century.
Given Israel’s long-term alignment with US foreign policy interests, and the traditional support for the country among Anglophone conservatives, you might assume that the Jewish state’s economic policy over the past generation or two has tracked that of the United States and Britain: emphasizing free trade and far-flung supply chains, weak labor unions, and low-wage, unskilled jobs.
There is some truth to this: In the recession of the early 2000s, then-Finance Minister Netanyahu introduced an austerity-based recovery plan, slashing social spending and subsidies to the private sector. Even so, Israeli governments in general—and the governing Likud party in particular—advocate welfare and economic policies that would be seen as “socialist” in the United States, and support the kind of strong unions and regulated markets that few British Conservatives dare touch.
Israeli child benefits are much more generous than European norms, and there would be no question of a two-child benefit cap as introduced by the Conservative-led British government in 2011. Instead, the government gives cash rewards to families for each additional child, essential to maintaining the support of ultra-Orthodox voters. And this year, Israel introduced free childcare for 2-to-3-year-olds (state education begins at age 3)—more generous than anything proposed by Britain’s Labour party.
In March, the unions and the government reached an agreement to boost public-sector pay by 11 percent, alongside reductions in public employees’ working hours. The 2018 pensions law is one of the most generous in the Organization for Economic Co-operation and Development, and public transport is heavily subsidized and among the lowest in the OECD.
These policies have had the greatest benefit to the poorest-paid Israelis and allowed the Israeli right to form a much closer relationship with organized labor than its equivalents in the West.
This is partly fueled by pragmatism on both sides: There is little the Israeli Labor Party, with its four seats in the 120-member Knesset, can offer organized labor, so leverage with the Likud is the best way for unions to advance their members’ interests. Several of the Likud members of the Knesset have backgrounds in trade-union leadership, such as Minister for Tourism Haim Katz, a former engineering shop steward and general secretary of the airline-workers’ union.
For Netanyahu, support for these policies reflects similar pragmatism. Asaf Yakir, an Israeli academic whose doctoral thesis focused on the socio-economic policies of Israel and Hungary, tells me that Netanyahu will essentially pursue anything he thinks will win him votes: “To placate right-wing critics, he talks up his reforms in the early 2000s, and claims that current policies are simply a continuation of that. But if political reality dictates that he makes a radical move, [Likud] will always sacrifice ideology for expedience.”
For some time, the independence of the central bank has been sacrosanct, Yakir tells me, but the inflation of recent years led some Likud members to talk about monetary intervention—not because of a disinterested ideological evolution, “but because their people are not able to pay their mortgages” or afford the rent.
Voting at Israeli elections is heavily determined by demographics, and there is a direct correlation between low incomes and voting for parties of the right. Netanyahu’s governing coalition of the Likud, religious, and settler parties has its base among the Jewish Israeli working class—itself divided between Ethiopians, Mizrahim, immigrants from the former Soviet Union, and settlers.
At first glance, this coalition looks more bound together by cultural issues, specifically Israeli nationalism, support for settlements, and anti-Arab sentiment, while its constituents differ on some important economic questions. Likud wants to divert more money to settler towns, for example, while the ultra-Orthodox are more concerned with welfare and businesses closing on the Sabbath. Some of the settlers are actually from affluent backgrounds, often in the United States, and have economic interests that are in the long-term incompatible with most of their fellow right-wing voters.
But apart from the affluent settlers, these groups have important shared economic interests: They tend to be in low-paid, precarious work, with large families. They want to change the structure of the Israeli economy so it better serves their interests, and they are using the power of an ostensible free-market party to do so.
There are decided limits to their radicalism, and internal redistribution takes place within a neoliberal framework. Much of the recent economic success of Mizrahim and even Palestinian citizens of Israel has been possible due to the availability of cheap, unregulated, and unprotected labor from the West Bank. Palestinians now provide the bulk of the cleaners and construction workers who build and service the gleaming skyscrapers of Tel Aviv.
Still, the Israeli right has proved more successful and resilient than its American or British counterparts, in no small part because of its openness to organized labor and government redistribution. Even in Israel, appeals to national security and traditional values aren’t enough. If conservatives want to replicate the electoral success of the Israeli right, it is going to cost them.