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Israel’s Bloated New Government Is Entering Dangerous Waters

Benjamin Netayahu’s newly convened government, the largest in Israeli history, is also facing the country’s greatest economic crisis in decades. As signs of public disaffection start to grow, it may try to avoid challenges to its power by provoking a violent confrontation with Palestinians.

US Embassy in Tel Aviv / Wikimedia Commons

At first glance, Israel’s longest-serving Prime Minister, Benjamin Netanyahu, seems more secure in his post today than at any time in the past few years. His government’s response to the coronavirus crisis has been quite successful, relative to the Western states to which Israelis are used to comparing themselves. The centrist party Blue and White, whose rise created a stalemate leading to an unprecedented three elections within the last year, has split. Its head, former IDF chief of staff Benny Gantz, entered government in return for a promise that Netanyahu will hand over the premiership in eighteen months, pending the results of his ongoing corruption trial.

The newly convened “national unity” government includes not only two ultra-Orthodox parties and Gantz’s faction of Blue and White but the tiny rump of Israel’s once all-powerful Labor Party, giving the prime minister diplomatically useful “center-left” cover for his plans to annex large parts of the West Bank. Enjoying a comfortable majority of seventy-three out of 120 parliamentarians, the new government boasts a record thirty-four ministers, many with such made-up or flung-together portfolios as “community empowerment and advancement” and “higher education and water.”

But under the surface a great deal is changing in Israel — and not in ways that bode well for Netanyahu.

Pandemic and Crisis

As I have argued before, the stability of his rule rests on an unusual combination of factors which combined the country’s economy to grow steadily over the past decade. Until recently, the majority of Israel’s citizens (unlike the disenfranchised Palestinian residents of the Occupied Territories) enjoyed a relative prosperity; relative, that is, to countries which suffered the brunt of the 2008 financial crisis, which mostly skipped over Israel.

Since that crisis, the heavily subsidized security-industrial-technology complex has thrived by supplying repressive technologies to anxious governments and private actors around the world. The tech sector served as a motor for Israel’s economy, creating jobs and helping to inflate a real-estate bubble. Palestinian and ultra-Orthodox Jewish citizens were mostly left out of the boom, but official unemployment has remained low, though the steep rise in housing prices eats away much of the income of the third of the population who do not own their own home.

The economic collapse triggered by the coronavirus pandemic has put an end to all this. During the lockdown, the unemployment rate came close to 30 percent, the highest in the state’s seventy-two-year history, and is projected to stay above 9 percent when epidemiological conditions return to normal. Though the beleaguered public health system managed to withstand the virus, Israel’s welfare system and private charity infrastructure have been overwhelmed by the rapid destitution of hundreds of thousands. Small businesses and the self-employed, especially in services, are going bankrupt in droves.

The combination of quarantine and economic stress has already led to an uptick in the scourge of femicide, which crosses all ethnic and class barriers. Even the red-hot real estate market, a boon to the home-buying middle class, is showing serious signs of cooling down, endangering investments and possibly triggering a wave of foreclosures. All this with a stimulus package, announced before the formation of the new government, that is one of the smallest per capita in the wealthy world and contains almost no provisions for the poor.

So far, public expressions of protest have been sporadic and uneven. Given the unprecedented nature of the situation, and the fact that quarantine was only lifted a few weeks ago, a certain amount of shell-shock might be expected. But the current ambience is also evidence of Netanyahu’s success in carefully defusing any possible threat to his hegemony, and while a diffuse anger at the state establishment is beginning to spread, it has no convenient political vehicle.

The parties of the poorest Jews, the ultra-religious Shas and Torah Judaism parties, were long ago converted into patronage vehicles unable to confront Netanyahu’s Likud. As for organized labor, the new government includes not one but two former heads of Israel’s largest trade union federation, the Histadrut: Economy Minister Amir Peretz (Labor) and Justice Minister Avi Nissenkorn (Blue and White).

Ironically, the two right-wing parties most hostile to redistribution, Naftali Bennet’s Yemina and Avigdor Lieberman’s Israel Beiteinu, have both been left out and have already started complaining about the new government’s supposed pink tinge — perfect cover for the resolutely neoliberal austerians of the Finance Ministry.

Traditions of Protest

Left out of government at the other end of the spectrum remain Yair Lapid’s centrist Yesh Atid (a split from Blue and White), the now-tiny liberal party Meretz, and the only growing, dynamic oppositional force in Israeli politics: the Palestinian-majority Joint List, holding the third-largest presence in the Knesset with 15 seats. But both Yesh Atid and Meretz represent well-off Ashkenazi constituencies and have no roots in the working class.

In a striking contrast, the Joint List, led by Ayman Odeh of the socialist Democratic Front for Peace and Equality, represents Israel’s poorest constituency. It has been loudly pushing for a social-democratic response to the crisis that would benefit the majority of citizens, Jewish as well as Palestinian.

But the pervasive racism which doomed the prospect of a governing coalition between Blue and White and the Joint List and nixed Gantz’s chances of forming his own government is also a real obstacle to Odeh’s chances of leading a class-based, multi-ethnic opposition.

Even given the assumption that infection and death rates will remain at their current low level, life in Israel will have changed for good, and for most Israelis, for the worse. High unemployment, a steep drop in living standards, a possible wave of bankruptcies and financial bailouts — all augur political instability of the kind that the world has known since 2008 but that has so far mostly bypassed Israel.

Under such circumstances, predicting the future is hazardous. But the experience of past protests is instructive. One precedent to keep in mind is the “social protest” movement which flared up in Israel in the summer of 2011. Uniquely among the “movements of the squares” that spread throughout the world in that year, the young, middle-class residents of the tent camps that filled Israel’s public spaces from July to September focused their economic demands on affordable housing rather than unemployment, under-employment, or wages. Few working-class and poor Israelis participated in these protests, in great part because many had jobs they could not afford to endanger.

For now, protest against the economic collapse and its consequences seems to be following similar same class contours: self-employed professionals and medical residents were the first professional groups to organize and take to the streets. Industrial action, led by the small but militant trade union federation, Koach La’ovdim, has largely been concentrated among already-organized workers such as daycare teachers and bus drivers.

The Days Ahead

But large-scale unemployment and harsh austerity of the kind which seems on their way could change all this.

Anger is already smoldering among schoolteachers, who rallied quickly to teach online when the pandemic was declared and are now pushing back against government demands that they contribute extra work days over the summer for no additional pay. The most vulnerable working-class citizens, Palestinian, Ethiopian-Jewish and Mizrahi-Jewish, possess traditions of street struggle, though in the Mizrahi case these have not been active since the 1980s, when Israel’s Black Panthers and their successors in the Tents Movement demanded that the government provide good jobs, welfare, and public housing instead of subsidizing West Bank settlements. In the best-case scenario, these traditions might be resuscitated with the help of the handful of left activists active among these groups.

In the face of such a possible threat to hegemony, however, it is not difficult to predict how Netanyahu’s new and ultra-militaristic cabinet would respond: by provoking a military escalation. The pistol — annexation of large parts of the West Bank, with the enthusiastic approval of a US administration under Trump or the hand-wringing complicity of one under Biden — is already on the table. It has even been enshrined in the coalition agreements entered into by Netanyahu’s new partners.

But the very hollowing-out of Palestinian resistance engineered by Israel over the last two decades could be the Achilles’ heel of this strategy: if a new intifada does not break out over annexation, and if Israel’s hand is forced into provocations that are too transparently disruptive for the international community or the “moderate” elements of the coalition to stomach, then the stratagem could fail.

To go any farther at this stage would be idle speculation. But while Israel’s near future may be very different from its recent past, it remains clear that any mass movement aiming at the transformation of Israel’s internal social structure will have to take a stance against the colonial stranglehold over the Palestinians — either that, or be itself strangled by the “national question.”