The uproar over the “loyalty medallion” is a parable of the “Anyone but Bibi” camp's blindness to the economic inequality that feeds support for Benjamin Netanyahu. Despite the critics' claims, the medallion isn't a sign of a personality cult but a show of support for the loyalty regime that Netanyahu is offering his voters as the Israeli version of populism.
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If that's true, the loyalty medallion is no different than the left's use of Yitzhak Rabin as a symbol for the defense of democracy. Whereas the chances of victory over Netanyahu depend on presenting a distributive alternative to the loyalty regime, the social failure revealed in the blindness to the medallion could lead to the defeat of the “Anyone but Bibi” camp.
The loyalty regime is the system of government that Netanyahu has established since 2009. He has turned voting for right-wing parties into semi-official criteria for receiving government benefits and investments. As far as Netanyahu is concerned, this was a substitution for the welfare state and a means to dismantle it, a mechanism to compensate the lower classes harmed by his neoliberal policies.
Because it's a compensation mechanism, the loyalty regime is the axis of Israeli populism and shapes its image. In this way, the conflict between Netanyahu and the justice system stems above all from the need to legitimize the loyalty regime's antidemocratic assumptions so it can compensate Netanyahu's supporters. His personal battles against the legal system wouldn't have become an explosive issue if they hadn't become an integral part of the fight to advance the loyalty regime. Similarly, the “Second Israel” theory of Avishai Ben-Haim is an ideological reflection, an unconscious one, of the logic of the loyalty regime's actions.
The "Anyone but Bibi" coalition came out against the loyalty regime, seemingly in the name of democracy but in reality to uproot the class bias of the compensation mechanism for the lower classes. So, because the "government of change" is the representative of the better-off classes, it has adopted a strict Thatcherite policy. This has idealized the compensation mechanism among the lower classes, putting the return of the loyalty regime – and Netanyahu as its representative – into the heart of the political battle. The Thatcherism of the "government of change" was revealed immediately in the cancellation of the furlough policies that Netanyahu introduced to help workers stung by the pandemic.
The furlough arrangement reflected the loyalty regime's presumptions: Netanyahu rejected the European Union's model of providing workers with economic security, and preferred furloughs and grants, which undermined economic security – and created political dependence on Netanyahu's decisions. At the same time, the furlough model and grants compensated low-wage earners and people with large families, typical Netanyahu voters.
The government’s Thatcherite policies, which harmed the lower classes and benefited the better-off, were also seen in the exacerbated budget austerity. The government’s savings translated into increased expenses for the people, widening economic inequality.
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This is how the package deal that the Finance Ministry concocted lowered the minimum wage and overtime calculations. Meanwhile, under the pretext of fighting the high cost of living, tax benefits for high earners were increased. The government’s choice not to intervene in the housing market also prioritized the better-off; homeowners benefited from rising prices while the public housing sector continued to atrophy, gravely harming the lower classes.
The economic policies of the "government of change" have pushed those hurt by its Thatcherism to cling to the loyalty regime with its compensation mechanisms; that is, populism. But populism is a false antithesis to Thatcherism. In practice, both are complements of a neoliberal order. The true antithesis to Thatcherism and populism are democracy and the welfare state. Similarly, the upper classes' poisonous illusion that democratic Thatcherism is possible rouses in the lower classes a counterreaction in the form of support for antidemocratic populism.
But Netanyahu supporters consider condemnations of antidemocratic populism an attempt to provide a moral tint for preserving the upper classes' privileges. Therefore, the loyalty regime is the lower classes' answer to the upper classes' privileged wealth. That's why the "Anyone but Bibi" camp faces a political choice: privilege or democracy; that is, social democracy. As of now, it has chosen privilege.
Meretz and Labor were supposed to rescue the "Anyone but Bibi" camp from this class-based trap. But their actions show us that these parties prefer to squabble with Yair Lapid over the leftovers of the better-off classes. As of now, only Labor's Naama Lazimi has eschewed this line and is offering an agenda that clearly speaks to the lower classes and the country's outskirts; only a change in their voting patterns offers a chance to beat Netanyahu.
The people with the power to change the suicidal direction of the left’s Titanic are the members of Labor and Meretz. Voters in these parties' primaries can reject the candidates who express nostalgia for a past that no longer exists. Instead, they can promote candidates with a radical distributive agenda; promoters of budgetary expansion with links to the unions. These are candidates who see their parties' futures in a dialogue with the lower classes that support Netanyahu, earning their trust to establish a new political alliance in Israel.
Prof. Daniel Gutwein is a socioeconomic historian.