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About a year ago, senior Labor Party officials decided to "sacrifice" themselves and join the government, "to save the disengagement." Party chairman Shimon Peres promised that as soon as the disengagement went into effect, they would quit the government and fight for power.

But Peres, along with Laborites Haim Ramon, Isaac Herzog, Dalia Itzik, Ophir Pines-Paz, Benjamin Ben-Eliezer, Shalom Simhon and Matan Vilnai, fell in love with the deep and soft easy chair of government. The authority, respect and power drove them crazy, and they forgot the promise. The Labor leadership completely lost its will to govern. What's left is only the will to keep their seats.

Even though they don't determine anything in the government and they have no influence, they still want to continue serving Prime Minister Ariel Sharon. They don't think it's at all important that there is no political process, and they don't care that the Gaza Strip is surrounded and closed off, or that unemployed Palestinian youths without hope have nothing left to do other than to join one of the militias. They are also not moved by the continued growth of the settlements, or the fact that the state budget belongs to former finance minister Benjamin Netanyahu. For them, their seats are all important.

That's why the promise of Amir Peretz - who will lead Labor out of the government in less than a week if he becomes party chairman - is so refreshing and important, and proves that we are dealing with a natural leader.

But what will happen if the party does quit? What is Peretz's calling card? When it comes to diplomacy, he is a pure dove, someone who sees the Palestinians as human beings who deserve equal rights, and as people with whom one should arrive at a reasonable solution based on the formula of two states for two peoples. But Peretz has acquired his political capital in the social-economic arena, and it is worth expanding on this.

Peretz is the loyal and consistent representative of old-style socialism - that of class struggles. He is an advocate of a centralized and nationalized economy, of a big government responsible for everything. This is archaic socialism that leads to so-called equality translating into abject poverty for all - except the small group of party members. See, for example, the Soviet Union. Peretz's worldview has left this world. It doesn't exist in the social-democratic parties in Europe - not in England nor Germany, not in France nor even Sweden. When the Swedish prime minister was asked recently about the conditions for economic success, he mentioned a free economy first.

In all the pathos-ridden - not to mention haughty - comments and speeches Peretz has made, he has supported an increase in the budget and the deficit, and the imposition of more and more taxes on the public. In April 2003, when the economy was in a serious crisis, Netanyahu presented his rehabilitation plan. At that time, Peretz presented his "alternative plan," which recommended closing the budget deficit by levying taxes and imposing loans on the public.

He even predicted that Netanyahu's plan (cutting the "fat" government-sector budget and lowering taxes) would make the economy regress and cause a deep recession and rising unemployment. But the fact is that the economy went from negative growth to the highest growth in the West (5 percent), and unemployment decreased from 11 percent to less than 9 percent.

Peretz opposed all reforms and every idea introducing competition that encourages growth, leading to a decrease in prices and thus improving citizens' lives. He opposed transforming the post office into the equivalent of Bezeq, introducing competition to the Egged and Dan bus companies and the Israel Electric Corporation, selling the banks, reforming the capital markets and the ports, splitting Oil Refineries and the Mekorot water company, and saving the pension funds. No, no, no, he said.

Peretz transformed the Histadrut labor federation into a Byzantine courtyard, a branch of his One Nation faction. Those who don't conform to this leader's expectations and help him out find themselves outside. He has headed the Histadrut for 10 years, but the labor federation is still not doing well and has a total deficit of NIS 1.2 billion.

Some say there is no need to relate seriously to Peretz's comments on economic issues. After all, they say, as chairman of the Histadrut, he is dependent on large committees, but as Labor leader and a candidate for the premiership, he will accommodate his rhetoric to reality.

However, this is a paternalistic and arrogant approach. We must take Peretz's comments seriously - and the conclusion is that from the economic-social perspective, Peretz cannot be the leader of a party in power, only of a niche party. This is because the predominant majority is interested in a free economy, in competition, in reforms, in growth and, of course, also in lessening financial gaps and fighting poverty. No one wants to live in a poor, slowed economy like that of the Romania or Albania of old.