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What Now?

In Its Search for Social Justice, Israel Must

Take the Third Way

 

August 14, 2011

By Benjamin Kerstein

The protest movement that has dominated Israeli politics and culture for the past month would seem to have run its course. It has succeeded in changing the public discourse, rearranging priorities across the social and economic spectrum, bringing hundreds of thousands into the streets, and garnering the support of an overwhelming number of Israelis, according to some reports, as much as 90 percent.

In terms of concrete accomplishments, however, not much has happened. The Netanyahu government has put together a blue-ribbon panel to examine the situation and recommend reforms. According to Haaretz, there are some good signs that the panel, unlike most similar bodies, may actually intend to do something:

Netanyahu told Professor Manuel Trajtenberg, the head of the panel of experts who will talk with protest leaders, that he understood it was necessary to change economic policy.

But Trajtenberg went further, telling Netanyahu he had to change his fundamental positions. Netanyahu agreed and said he had read a new book about how Herzl adapted himself to changing circumstances.

“I understand my views need to change,” Netanyahu reportedly replied.

There is a strong possibility, however, that this is simply a stalling tactic. Netanyahu may well be hoping that, come the U.N. vote on Palestinian statehood in September, the protests will be quickly forgotten and things will return to normal. By the time the panel issues its report, no one will care or even pay much attention.

If true, this is likely wishful thinking on Netanyahu’s part. The objective economic factors that have driven the protests – income inequality, high prices, shortage of housing, under funded public services, etc. – will not go away by themselves. Even if public sentiment is moderated by concern over security issues, after a short period of time it will likely return, angrier than ever, to the issue of social justice. No god, the saying goes, can stop a starving man.

There is no need, however, for Israel to wait on the PM’s panel. The process of reform can be undertaken immediately, and on a non-partisan basis. At this very moment, a viable right-left social justice bloc already exists in the Knesset. It would be composed of the major opposition parties Kadima and Labor, along with large sections of the Likud and the religious parties.

Given the widespread sentiment across all sectors of society in favor of reform, major legislation would also likely be supported by Meretz, the religious nationalist parties, and the Arab parties. Such an informal coalition would compose well over half the Knesset. More than enough to enact the reforms the public is demanding so fervently.

This is the case because, in spite of its success over the last few decades in remaking Israeli society, the free market system favored by Netanyahu actually has very little political support in Israel. At most, it is fervently believed in by Netanyahu and a few of his close advisors. Everyone else has gone along because it seemed to be necessary and seemed to be working. Now, it seems to be doing neither.

For most of Israel’s neoliberal era, support or acquiescence in free market policies was also driven by two other factors: an acknowledgement of the historical failure of socialism, and a fear of returning to the bad old days of Israeli austerity and the domination of the Labor Party. Neoliberalism appeared to be, under these circumstances, the only viable policy.

There is already another option, however, and it may be uniquely well-suited to Israeli society: the “third way.”

Third way economic policies have been described by economist Joseph E. Stiglitz as a system that

recognized the important, but limited, role of government, that unfettered markets often did not work well, but that government was not always able to correct the limitations of markets.

A successful third way policy would be a synthesis of the virtues of socialism and the free market system, while using both systems to ameliorate each other’s flaws. It would involve, for example, a country in which businesses are encouraged to flourish and grow, but the tax revenues garnered by this growth are then channeled into the public sector in order to provide for a more equitable distribution of wealth and a strong foundation of basic services like education and health care.

In a small, tightly-knit, socially conscious, but also dynamic and innovate nation like Israel, a third way policy would likely be both successful and garner widespread political support.

The third way is often linked to two other political-economic concepts: the “radical center” and communitarianism. A radical center stresses the importance of a pragmatic middle way between more extreme ideological poles, while communitarianism emphasizes the importance of recognizing the non-political binds that unite various communities within a larger nation, as well as a recognition of the responsibility of these communities to their members and the state’s responsibility, in turn, to these communities.

In many ways, Israel is already a communitarian society, with a highly fractured society composed of many different ethnic and cultural groups, most of which are nonetheless united on certain basic principles. The state, moreover, grants substantial rights and autonomy to many of these groups and recognizes the importance of their communal bonds.

The radical center has had a rough time of it in Israel as late, but there are strong indications that it also exists, albeit in latent form. The 90-something percent of Israelis who support the protests come, must come, from many different groups and sectors in Israeli society. It is highly unlikely that this massive majority supports the more extreme demands of the protest leaders. They come, must come, from Israel’s beleaguered middle class. They want radical change, but they want that change to be neither socialist nor neoliberal in nature. They must be, in other words, radical centrists.

Squeezed between the radical socialists and anarchists who are attempting – quite unsuccessfully – to hijack the current discontent to their own ends, and a small but powerful neoliberal establishment, this radical center needs and deserves a third way, and the Knesset should act immediately to satisfy its demands.

It should do so by informally establishing the social justice bloc I mentioned above. This bloc should then propose legislation that deals solely with social and economic reform, avoiding the fraught and irrelevant issues that have driven Israeli politics to its current impasse.

Israel has reached another historic moment. The failure of neoliberalism has been far less severe than that of socialism, and the human cost has been hardly comparable, but it has failed nonetheless. If Israel wants to avoid the terrible consequences of that failure that have now engulfed most of the rest of the world, it must act and act soon.

Israel is lucky in that all the tool to do so are readily available. There is a third way and there is the political means to enact it. The radical center in the streets has found the will to act. It is time for the radical center in the Knesset to do the same.