Israel: New budget declares war against Israeli workers

New workers’ party necessary to fight back

The 2007 Budget was ratified by a large majority in the government. The current budget continues the policy of attacking the Israeli workers’ living conditions. Welfare benefits are frozen; the privatisation of the most basic social services continues; and unemployment benefit for workers under the age of 28 are simply cancelled. The government forces us – the workers, the unemployed, the pensioners and the youth in the country – to pay the price for its military adventure in Lebanon. And while the government attacks all the working women and men in Israel, it does not forget to take care of its real friends – the capitalists. This budget will grant them benefits and tax cuts.

“Slogans Aside and Policy Aside”

When the Minister of Finance, Hirchson, submitted this budget proposal for the government’s approval, he confessed in one of his interviews: “As a present Minister of Finance and a former member of the Financial Committee, I must say: Slogans Aside and Policy Aside”. His fellow ministers, Amir Peretz could definitely identify with this saying. The Labour Party’s sweeping support for the budget is hardly surprising. From Peretz’s first day in office it was clear that all his pre-election demands for a 1,000 US$ monthly minimum wage and for a mandatory pension law would remain nothing but empty words. The Labor ministers do not only sign a budget brutally violating all of their election promises, but also lead the same policy – which they have made an appearance of criticising – carried out by the previous Minister of Finance Benjamin Netanyahu. All of this, of course, is done in the name of covering the costs of the Lebanon War, as if it was some natural disaster and not a planned act by the Israeli government. The Health, Education and Welfare budgets will be increased by a mere 3.6%, which, taking into account the population growth and the pace in which the demand for these services rises, is actually a cut in these budgets. Welfare benefits, already reduced by 9 billion NIS in the last five years, are going to be cut by another billion NIS.

The Kadima-Labor government, of course, isn’t content with mere “war cuts”. The current budget includes in it a plan for structural changes of the Israeli economy, with its main aims being the reduction of wages and working conditions in Israel, turning it into a paradise for the big bosses. The budget talks about attacking the working conditions of public sector workers and sacking almost a thousand of them. Meanwhile, the process of firing public sector workers would be simplified by a transition to employment through personal contracts, as an unorganised workforce. This transition, applied to all new workers, also harms the job security of the senior workers in the public sector. As of this year, long-term employees in the public sector would lose their right to object against their reduction.

The Privatisation of public services

Privatization lies at the heart of the current budget. The government intends to privatise the electricity company and the municipal water companies, to complete the privatization of the postal services and the three largest state-run hospitals, and to prepare the airfield authority and the prison service for privatisation. This is nothing but a wide-scale plan to transfer all of the central public services into the hands of a few big-business families. Past experience, both locally and globally, shows that the long-term result of privatization is a sharp decline not only in the work conditions of a company’s employees, but also in the quality of services it provides to the public. When the main objective is to make the greatest possible profit, the much worsened working conditions make it difficult for the employees to provide the required service, and in many cases the new owners save money on the expense of safety and quality. Privatising the postal services and the electricity company would destroy the last two surviving stable workplaces. The “streamlining" of each of these services will include mass sacking, drastic cuts in the job conditions of the remaining workers, and the employment of most of them through manpower agencies with no option for unionisation. This, of course, would also hamper their ability to provide services. The privatisation effects every one of us as consumers who will get a lower quality of services at higher costs, but also as workers, as it helps transform the Israeli economy into a slave market. Through privatisation, the government seeks to weaken workers with more industrial muscle, and thus disarm all Israeli workers. Today Olmert, with the help of Peretz, attempts to finish the job started by Netanyahu and his predecessors and bring about the destruction of the organised working class in Israel.

Unprecedented attack against young workers

The government’s policy of privatisation creates unemployment and poverty. Thousands of workers, sacked from their workplaces which were privatised, are unable to find a job with fitting pay and basic job conditions. This is also true for young people when they enter the job market. A quarter of the unemployed workers are in their twenties. For most of them, finding a stable and unionized workplace is almost not an option. Several unprecedented attacks await this group in the current budget. One of them is the government’s ambition to cancel unemployment benefit below the age of 28, without giving thought to the number of soldiers who have ended their military service who cannot not find a job. A month after the government has sent tens of thousands of soldiers to die in Lebanon without water, food, or basic gear, it spits in their faces once more when it cancels the little money they get for these three years. In addition to this, as part of the “Arrangements Law”, the government plans to close down the seven centers for occupational training. The purpose of these steps is to lower the wages in the Israeli economy and turn young workers into a group which will accept any job at any pay.

And, again, the millionaires will get more…

As in every budget, the cuts are made, according to the Ministry of Finance, due to necessity. Hirchson has chosen to present them in the following way: “we have entered the war with surplus income. It does not exist anymore. We use them to compensate the residents of the north, the agricultural sector and the business owners”. Even if these things were correct, why do we have to pay for the politicians’ nonsense? What about the millions rolling around in the stock exchange? Why they could not be used to compensate the residents of the north? In practice, even in these days the government does not forget to look after the needs of the 18 big-business families, the real bosses of the State of Israel. The construction companies will get in the current budget an exemption from paying tax for changing land utilisation, that is the transformation of green areas into real estate, which would bump up their price by hundreds of percents. The government continues Netanyahu’s “tax reform”, which benefits only the big employers and speculators, along with continuing the reduction of the employers’ payment to social security, until its total cancellation in 2010. The bonuses, which only the rich gain in this budget, do not fit into the government’s propaganda about a cut due to necessity. It seems that the Ministry of Finance’s officials have decided to pay the war’s expenses out of the workers’ pockets and on the back of the weakened strata of society and of the youth.

There is another budget, there is another economy

The current budget shows to us, again, the conflict of interests which exists in the Israeli society, between the workers’ right to live a decent life, and the millionaires’ desire to continue and inflate their profits. Within the framework of capitalism, the entire discussion about the allocation of resources is managed from the standpoint according to which every decline in the profits of the elite must be followed by a cut in the living conditions of hundreds of thousands of workers as a compensation.

When Stanley Fisher, the chairman of the Israeli Bank was asked about the harm done to the poorest sections of society in Israel by the 2007 budget, he replied: “It is possible to do things which will help them [the weakened strata] now, but this will not help them in the long term. The thing which will help them in the long term is growth”. According to Fisher’s capitalist logic, one must help the super-rich become even richer, and, someday, this richness might trickle down. We know that there is no connection between this logic and reality. In practice, neo-liberal policies have already caused much destruction to Israeli society. According the last Poverty Report, 1.6 million men and women live under the official poverty line, more than a third of the children in Israel are poor, and the most enraging piece of information: 60% of the workers who live under the poverty line work in a full-time job. The policy of the various governments, from both the right and the [so called] left, and of this government in particular, intentionally creates a situation in which people who work 40-50 hours a week cannot make a living for their families.

This is done in order to make Israel attractive to investors, or, in other words: to make Israel into a market of cheap and unorganized labor, in which the hired workers can be exploited and replaced at any given moment. In order to present a real alternative to the budget we must present a real alternative to the conventions of the capitalist economy. A situation in which 18 families control 80% of the economy does not allows us any breathing space. Basic living conditions such as housing, medical services, education and a stable workplace are becoming almost privileges. This is why a social force that will fight against the elite’s control of the economy and society is needed so desperately.

Only through struggle will we win

The resistance to the current budget and its attacks already exists. Most of the workers in Israel oppose the budget. According to a survey conducted by the Macro Center for Political Economy, about 58% of the public sees the cuts in the welfare budgets as absolutely unjustified. Active resistance exists as well, but the problem of the Israeli working public is that the active resistance is not organized enough. The electricity company’s workers have already taken industrial action. Similarly, a labor dispute has been declared in the Ministry of Welfare, the Ministry of Agriculture, the Ministry of the Interior and in the "klalit" health maintenance organization. When the budget was presented by the government, the Histadrut bureaucracy headed by Eyni refrained from declaring a general strike – a necessary step in face of the widespread harm caused by the budget to the organized as well as unorganized workers. The current leadership of the Histadrut does not strive to unite the various groups struggling against the Ministry of Finance’s attacks, but leaves each of these groups to fight on its own. The example of the municipal workers, whose pay was withheld for two years, shows how the Histradrut’s leadership does not only refrain from leading workers’ struggle, but also blocks it. The struggle about the current budget is an excellent opportunity to unite the ranks of the militant workers within the Histadrut and create a real opposition towards the new elections for the Histadrut leadership, an opposition which will actively and totally resist the government’s neo-liberal policy and which will serve as an alternative to the passivity and defeatism of Eyni and his faction.

The struggles against the approaching budget are going to erupt in several different places and from several different groups. Some will come from among the organized workers and some from the ranks of other groups in the population to which the budget causes harm. We must unite the various struggles and build a united front of all those who suffer from the government’s policy. On this basis it will be possible to wage a winning struggle which will show to the bosses the power the workers possess once they are united and act together. The long-term expression of this power must come in the form of building a fighting workers’ party, a party which will be different, in its very essence, from all the parties in the Knesset. Such a party will serve as the political voice of all these who are oppressed Israeli capitalism, and will be active on a day-to-day basis in the neighborhoods, the workplaces and the schools.

This article is a translation of one which appears in the present issue of the Struggle, newspaper of Maavak Sotzialisti in Israel.

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