Summer protests against the high cost of living, Tel Aviv, Aug. 8 2011.
Summer protests against the high cost of living, Tel Aviv, Aug. 8, 2011. Photo by Tali Meyer
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Every executive and entrepreneur knows a crisis is an opportunity. For many of our decision makers, from the prime minister through the finance minister, the politicians and the businesspeople, the recent events could be called a crisis. They woke up one morning and discovered that a large portion of the population feels left out and marginalized, and does not share the financial leaders' enthusiasm about the wonderful state of the economy.

The alacrity with which politicians, public figures and so-called "financial leaders" declared their support for the demonstrators and the tent-dwellers also reflects fear: They understand that Israel's public discourse is beginning to change, and that there is a huge group of people who until now lacked a voice, a face and power - and who now, for the first time, are rearing their heads.

For many years, strong organized groups, like the defense establishment, the monopolies, the tycoons and the government, controlled Israel's public discourse. They represent hundreds of thousands of households, but alongside them is another, larger group - the unconnected. We called them unconnected because they had nearly no chance of ever connecting to the nodes of power and the center of the discourse. The tent protest is the first time this many of the unconnected have woken up, united and decided to speak out. They suddenly realized that their life - their economic and social future - has been obscured by the security smokescreen and the dispute between right and left, religious and secular. They realized the "start-up nation" story of high-tech creating social mobility and growth is important - but relevant to only a small group.

The unconnected are protesting housing prices, the price of cottage cheese, the price of cellular telephony and the level of welfare and health services. It all boils down to one main issue: They have discovered that they are being crowded out, as economics puts it. They are being crowded out by the widening gaps in Israeli society, which have become piercingly obvious in recent years.

The unconnected have no leadership, and will not necessarily develop one. They will have more trouble formulating a list of demands and goals because unlike the connected, their interests are broad and varied. Any significant increase in the government's outlay will ultimately come at their expense - because they fund the government, yet have no access to its udders.

The opportunity in the chasm

But the social rift that the protest tents revealed could be a big opportunity: an opportunity for the unconnected, an opportunity for people who want to see a more advanced economy and a more just society here, an opportunity for leaders who want to advance the economy and society but have had trouble doing so due to the prevailing atmosphere. The big opportunity is in the public discourse: Now, it is focusing on the economy and society, it does not distinguish between right and left, it addresses broad interests, not specific ones.

One could dismiss this new discourse as mere "talk," and say that ultimately only deeds count. But this is a mistake. Those familiar with Israel's system of economic and political decision making know that discourse has tremendous influence on the decision makers. Even those who want to do the right, professional thing are often blocked by the nature of the public discourse. The larger the unconnected's role in the public discourse, the more the decision makers will act on their behalf.

But since the unconnected are comprised of hundreds of thousands of households, if not more, the solution must be structural and profound. This is not just a zero-sum game here - taking from one group and giving to another - but rather a matter of enlarging and redistributing the cake. This is not just an end, but rather a means: When an increasing part of the population feels it is being crowded out, you won't have long-term growth and improving quality of life.

Thus far, most of Prime Minister Benjamin Netanyahu's responses to the protest have not been helpful. The ills the protest has raised cannot be addressed through hasty plans, line-item budget increases or immediate taxation changes. The prime minister must look the public in the eye and tell the truth: Decreasing inequality, improving quality of life and solving most of the problems will take long-term planning, difficult decisions and painful concessions. He must also tell the public something harder to say, but the moment is approaching when there will be no alternative: Many of the connected will have to pay a price in order to improve the unconnected's lot.

Don't blame business

At the moment the public discourse is focusing mainly on changes in tax policy, some of them needed. The prime minister has already realized that some of the theories on which he built the tax system over the past decade don't hold water. But decreasing inequality, increasing GDP growth and improving quality of life require changes that take far more time and are more difficult than changing tax policy: They require making the public sector more effective, becoming more competitive, improving education and health care and bringing the ultra-Orthodox and the Arabs into the workforce.

The prime minister and the demonstrators are wrong to blame the business sector for the inequality. Ten tycoons who control public money are not the business sector. The public in Israel appreciates the successful, the entrepreneurs and the businessmen, and wishes them well. It does not like, and rightly so, those who benefit from the ties between government and big business, who do not build but rather receive government benefits.

Netanyahu's committee examining competition within Israel's economy should not seek only to lower prices, but rather to make the economy more competitive and fair. This will strengthen not only consumers but also businesses and workers. The tent protest is a tremendous opportunity to change Israel's discourse: from the interests of the strong to those of the majority; from political to socio-economic; from a zero-sum game to enlarging the cake; from ideological to professional; and from dividing to uniting.

The difficulty the unconnected are having in finding a leader, and formulating demands and an action plan is understandable - this process could take months or years. But one thing is certain: The unconnected must not let representatives of the connected take them over or negotiate with them. Someone who is giving them his hand is trying to kill them gently. They do not need him. They are the country's largest group, and only they can help themselves.