In the mid-80s, several kibbutzim found themselves in a deep economic crisis, standing before a yawning chasm of debts. For many, the economic crisis led to a social crisis, and members began to leave. The younger generation did not return to live in the kibbutz after army service.
The collapse of Kibbutz Beit Oren was perhaps the most frightening indicator to kibbutz members that their unwritten "deal" with the state - "you are our emissary to the periphery and the border, working the land and contributing to security, and I, the state will support you when needed" - was no longer in force.
This sense of mission was the most valuable asset the kibbutz had. It had no other. All at once, kibbutzniks were hit with the understanding that from that moment on, carrying a huge debt, their future was in their own hands.
The process of privatization had begun. Until that moment, every member had a budget equal to that of his or her neighbor; now kibbutzim began transferring more areas to the management of the family.
There are still some kibbutzim that still hold to a model that is somewhat less that fully cooperative, but more and more kibbutzim have privatized even health and education services.
In most cases, kibbutzim employed the services of external consultants, termed "prophets of privatization." Often these consultants got rich and left, sometimes leaving the kibbutz bogged down; some placed their clients firmly in the driver's seat of a new car, but others left them peddling their bicycles.
The kibbutz sprouted capitalist wage differentials of 8:1. The kibbutz director could send his kids to be educated and take care of his ailing mother, while the daycare worker would wonder how to get her sick mother to the hospital for tests.
Devotes of the cooperative model see differential salaries as a sad imitation of the capitalist model in its most rampant form. The kibbutz parent organizations, on the other hand, insist a safety net is still in place, and that no kibbutz has members living below the state-defined poverty line.
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