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To understand the current industrial action, you have to go back to May 18th, when the last general strike - naturally, a protest against the government's economic plan - came to an end.

The two heroes, Amir Peretz and Benjamin Netanyahu, then sat down from 11 P.M. until 4 A.M. before finally managing to craft a solution. By a schedule, orchestrated well in advance, Peretz then set off from Jerusalem with his entourage, reaching Histadrut House in Tel Aviv by five in the morning.

There, he declared to rapturous applause from heads of local workers committees: "We have won on two counts [wages and job losses] and now we need to take that success to pensions."

But with successes like these, who needs defeat? Wages in the public sector were cut, for the first time in the history of the state. That's a success? It was agreed that some 700 workers in the public sector would lose their jobs. Was that the success, then?

But most importantly, Peretz gave in completely on the pensions issue. He reached no agreement with Netanyahu on this, leaving the minister free to pass all his reforms unilaterally in the Knesset - and that's exactly what happened.

The treasury nationalized the pension funds, fired the Histadrut-appointed managers, replacing them with their own, and sent a series of laws through Knesset which cut pension payments. This is how the Histadrut lost its last external source of power. So was that the success?

Heads of the largest workers committees could not digest this crushing defeat. The cut in wages didn't really bother them, it was only a temporary wage cut, until the end of 2004. And they weren't particularly bothered by the 700 job losses - because it won't be them or their friends who lose their jobs. The committees even approved the names.

But the pension thing really gets their goat, because this is an attack on their own pockets, and those of their chums, and the damage is serious. Some said Peretz was tired and simply fell asleep on the job. Others whisper behind closed doors that he made a complete botch-up of the affair.

But maybe one should check out whose interests are playing here. The most important interest for the Histadrut is keeping the new pension funds, even at the expense of saying goodbye to the veteran ones. This way it could keep a political power base by appointing managers and slews of paper-pushers.

It could organize shift work, divvy up the honors on boards, even withdraw a little cash - and let the government break its own head over the deficit-laden veteran funds. But Peretz gave up the old funds, without getting control of the new, which also passed to treasury control.

The workers committees have a completely different agenda. It is not so important to them who runs the funds - the Histadrut or the government. What matters to them is the cuts the treasury is implementing in their own pensions - 12-16 percent. That's why they are furious at Peretz.

It is also why pensions have taken center stage in the dispute. Not the structural changes, not the closure of government units, and not the hundreds of lost jobs. Everything centers on the pensions.