The Harbinger of a New Social Order

Amir Peretz needs to tackle the unions as Sharon dealt with the settlers.

The biggest compliment Amir Peretz received yesterday after winning the Labor chairmanship race came from the financial markets: the shekel weakened against the dollar yesterday, hitting a two-year low, while trading on the TASE opened down. The compliment is that the election of a new leader of a party thought to be dead did not pass quietly, but elicited reaction from the markets.

Meanwhile, the concern of players on the financial market is not the election of Peretz per se, but the ramifications it could have on holding early elections after a relatively long period of political stability. The expectation that Peretz would lose the Labor race, which was proved wrong yesterday, raises the question of whether it is a mistake to ignore the possibility he could become Israel's next prime minister. In any case, Peretz is, as of now, a candidate for either prime minister or opposition head.

Peretz has a great narrative: A mustachioed "leader of workers" conquers the Labor Party, wiping out several generals in the reserves, from Lt. Gen. Ehud Barak to Maj. Gen. Matan Vilnai and Brig. Gen. Benjamin Ben-Eliezer, not to mention Shimon Peres, vice premier and former prime minister.

Peretz has a number of confidantes who surround him in the Knesset and the Histadrut Labor Federation, of which he is chairman. The person considered closest to him is also the youngest: Rachel Turjeman, who began at the Histadrut eight years ago as his assistant. After that, Peretz appointed her head of the department for international contacts, marketing and PR, and then CEO of the Histadrut's daughter company, Haverim Umarvichim. Other Peretz confidantes include Benny Gaon, who controls Gaon Holdings and is one of the only businessmen who openly supported Peretz; Uzi Baram, former tourism minister and Labor secretary general who was a political consultant for Peretz during the 1999 elections; and Ofer Eini, whom Peretz managed to get into the Histadrut's second-most powerful position - head of the trade union department.

For months, no one but Labor insiders seemed interested in the chairmanship race, but now new elections are on the horizon, as is a new social order. The first ones to get nervous are the wealthy. They were afraid of Benjamin Netanyahu and Ariel Sharon because of their extreme political positions, and they're afraid of Peretz because of his socialist economic position. Sharon, let's recall, evacuated Gush Katif. Netanyahu, for those who forgot, signed the Hebron agreement and met with Yasser Arafat. The message is clear: What comes out of the Prime Minister's Office isn't the same as what comes out of the opposition benches, and at the end of the day, reality is stronger than any prime minister - if not in his first term, then in his second.

This means that if Peretz is elected prime minister, he will not be able to do anything he wants. He will not be able to shut down the economy, and he will not be able to use money that isn't there, but he will be able to change priorities. It will be nice if Peretz advances important social laws like a law of mandatory pensions, but he will also be obligated to advance economic reforms like those carried out in the last few years regarding taxes, banks and ports.

To preserve the economy and its growth, Peretz, to a certain degree, will have to forget where he came from and deal with the corruption in the public sector, the nepotism in the major government companies and local authorities, and the preferential treatment given to members of the large workers' committees at the banks and the Israel Electric Corp. compared to other workers. Identifying the weak workers is not complicated: in every bank with thousands of workers making NIS 20,000-NIS 25,000 a month under a collective agreement, there are hundreds of workers making only a quarter of the salary, without suitable social conditions.

Sharon is the father of the settlements, and he turned his back on them because that was what's good for the country. Peretz is the father of the large and corrupt workers' committees, and one can hope that he, too, will act for the good of the truly weak and of the economy as a whole.

Haim Bior contributed to this story.