General secretary of the Israeli unions becomes leader of the Israeli Labour Party

Last week Tony Blair was not the only Labour leader to face defeat. In Israel Shimon Peres, the veteran Labour leader, lost his position as leader of the Labour Party. In the elections for the Labour leadership Amir Peretz won 42.35 % of the votes, while Shimon Peres only managed 39.96 % and Benjamin Ben Eliezer came in third with 16.82% of the votes.

Where will Amir Peretz take the party? It is too early to be sure in which direction the new leader of the Labour Party will move. However, it is clear that his victory came as a big surprise to many and most likely even to himself. His victory has caused a small earthquake throughout the entire Israeli political system.

As the Haaretz (November 11, 2005) pointed out, “The Labor Party woke up yesterday to a complex morning. To say the least. For 40 percent of its members, the morning was the dawn of a new day. A historic, dramatic, earthshaking turnaround. For those who voted for Peretz, the outcome yesterday before dawn breathed life into an expiring body, a moment before its death was certified.”

One thing is quiet sure. Had Shimon Peres, Haim Ramon, Dalia Itzik and Ophir Pines-Paz, remained in the leadership of the Labour Party they would have continued to play second fiddle to Ariel Sharon’s government. In such a scenario Sharon would have no problem in staying in power not only until November 2006 (when the elections are due), but most likely also through to November 2010 as he would get the backing of the old Labour leadership.

With Peretz at the helm of Labour, the political scenery in Israel is changing. Given his background, for the first time in years, the country will have two major parties that do not look like twins openly serving the capitalist class. As the Israeli journal Haaretz (November 13, 2005) reported:

“Peretz has made a list of commitments. For example, in a comprehensive interview with Globes on May 10, he listed these goals: raising the minimum wage to $1,000, bringing retirement age back down to 60-65, increasing the government's share of subsidized bonds in pension funds from 30 percent to 50 percent, instituting a mandatory pension on all wages, recognizing mortgage costs and interest for tax purposes, and changing the system of welfare allowances.”

The right wing in the Labour Party led by Peres have been following a policy diametrically opposed to this kind of programme and it has even considered splitting from the party. On Thursday, Peres, who refused to congratulate the new leader, spread the news that he had decided to take a break and suspend his political activity in the Labour Party. However, his collaborators were not ashamed to say that he is now considering forming a new party with Ariel Sharon, that the latter would lead.

Remember that Sharon also has his own problems inside the Likud. Recently he only narrowly defeated Netanyahu in internal party elections recently, and he too was threatening to split if he had lost control of the party.

However, Simon Peres’ declaring something on the eve of the elections is one thing and doing it is another. Before taking such drastic measures, the right wing of the Labour Party may want to wait and see whether they can’t bring Peretz “to his senses”.

On the other hand we have Meretz-Yahad that is considering entering the Labour Party and also many of the poor people who have been supporting the populist Likud party out of protest are likely to now support the Labour Party, with its new leadership.

The Israeli stock market and the local currency, the shekel, reacted nervously and went down slightly because of the fear of investors that the new leader of the Labour Party may move leftwards.

Shimon Peres took the Labour Party into Sharon’s government in January as a junior partner, under the pretext of backing his withdrawal from the Gaza Strip, but in reality Peres wanted to stay in the coalition until the next scheduled elections in November 2006, and even beyond. Amir Peretz on the other hand has declared that Labour would withdraw under his leadership and he is working to secure early elections this coming March or May.

Although it is not certain which way he will go, it is already clear that Peretz is not acting as a leader of a genuine socialist party who wants to lead a fight, but as a compromiser who is giving his enemies the time to recover from the shock his election as the new leader of the Labour party has caused them and give Sharon and Peres the time they need to reorganize themselves.

Instead of accusing Peres of disloyalty to the party for threatening to split it and thus break with him and instead of announcing a withdrawal from the government, as he was threatening to do, Peretz met with Vice-Premier Shimon Peres on Friday, and after the meeting declared that he would “do everything possible to ensure that the ousted party leader assist him in the decision-making.”

Not only this, but according to Israel Radio, in the first party meeting with Peretz as the new leader a decision was made that the party leadership would meet only in three weeks’ time to decide whether to quit the government! Consequently this Wednesday, November 16, the Labour Party in the Knesset will not support a motion of no confidence in the government. That is not a good way to start for someone who claims to represent the interests of the workers. Appeasing the right wing of the party will not advance the interests of the workers one millimetre.

The right wing of the Labour Party, mostly middle class Ashkenazis, many of them generals, represent the interests not of the workers and the poor but of the middle class elite who are connected to the capitalist class. On the surface it would appear as a question of Ashkenazis versus Jews of North African origin, but we should not be mislead by appearances. It is a class question rather than one of ethnic origin.

Who is Amir Peretz?

Amir Peretz was born as Armand Peretz in the town of Bojar in Morocco. His father was the head of the Jewish community and owned a petrol station. The family emigrated to Israel in 1956. They were settled in the poor underdeveloped town of Sderot, where Peretz was one of the few who graduated from high school. Unlike the usual politicians in Israel who were generals in the army he reached only the rank of captain, and after being wounded in the war of 1973 became a farmer. In 1983 he became the mayor of Sderot on the Labour Party ticket. In this position he tried to improve the education system in the town.

In 1988 he was elected a member of the Knesset. In 1994, Peretz joined forces with Haim Ramon and Peretz became Ramon's deputy in the leadership of the Histadrut. Ramon took it upon himself to strip the Histadrut of its economic enterprises, but instead of nationalisation under workers’ democratic control they were sold for a few pennies to private capitalists.

Peretz became chairman of the Histadrut in December 1995. During his early years at the head of the Histadrut, Peretz was regarded as a militant. At that time there were many strikes. However, in recent years Peretz has moderated his position and has been responsible for putting a stop to many strikes.

During the years of the former finance minister Benjamin Netanyahu, in spite of his left wing rhetoric, he was quite cooperative with the government’s further push toward structural and financial “reforms”. This in effect meant handing over Israel’s economy   known in the past for its publicly owned economy under the control of the Histadrut and the state   to the few rich families that rule Israel.

In 1999, however, Peretz resigned from the Labour Party to form his own party, Am Ehad ("One Nation"). Am Ehad won two seats in the Knesset in the General Election of 1999, and three seats in 2003. Clearly this could not lead him to his personal ambition of becoming the Prime Minister of Israel!

As many of the past welfare reforms were destroyed by the policies of finance minister Benjamin Netanyahu, Peretz became more popular among Israel's Jewish working-class, as he stood out as an oppositionist. He then decided to use the Labour Party as his vehicle to power and Am Ehad merged with Labour in the summer of 2004.

After the merger, Peretz ran for the leadership of the Labour Party on a platform of ending the coalition with Likud, led by Prime Minister Ariel Sharon, and returning to Labour's historical social democratic policies and to the welfare state.

The Haaretz has shown some concern at such a figure becoming leader of the Labour Party. In the same article quoted above, and referring to his programme, it said:

“Perhaps he would not do all of this immediately, but can one doubt that he would implement a large part of these specific commitments and others within a short time if and when he is elected prime minister? This would be an economic earthquake that would make the political earthquake seem negligible.”

However it then gave the Israeli ruling class something that may help to calm their nerves. It added that:

“They say that Peretz is a sane politician, stable and practical, and that he will not make changes or upheavals that will likely spiral out of control and cause harm to the economy and society; he will surround himself with veteran politicians and experts who will analyze and present to him the implications of decisions such as those he outlined in the interview.”

In other words, they will surround the man with the same people who decide economic policy today and point out to him that any meaningful reform would be “harmful” to the economy and gently push him back to the right.

The same article goes on to say:

“The platform Peretz brings with him is the product of his development in the 1960s and 1970s, and it is appropriate for that period. During that time, the entire national economy was largely an independent operation, and it was possible to act according to ideological considerations and ignore the world at large. In the 21st century, no modern economy can allow itself to act independently of what is happening in the larger world, where the prevailing forces are globalization, competition and mobility of the means of production. An attempt to act in disregard of external and internal market forces would result in economic retreat, and this would lead to social damage worse than that which Peretz has promised to repair.”

What worries them in particular are Peretz’s links to the trade unions. They say in fact: “No less worrisome than his ideological commitment is his political link to trade unions, and the large workers councils in particular. It would be an illusion for one to think that Peretz would be able to act solely in accordance with the state's interests, ignoring the interests and pressures of this powerful sector.”

What they mean by the “state’s interests” is very clear. These are the interests of the Israeli capitalists who do not want any interruption in the policies presently being applied in Israel, cuts, cuts and more cuts in welfare spending.

He recently declared that within two years of taking office he “will have eradicated child poverty in Israel”. While he makes such statements, that are clearly popular with workers, he has also stated that he is committed to a market economy. Here we have the underlying contradiction in Peretz. On the one hand he has promised much to the workers, but on the other he says he respects capitalism, for that is what the “market economy” is. If he refuse to go beyond the confines of Israeli capitalism, then he will come under big pressure to fall into line. This is an indication of how he will move if and when he gets into office.

Similarly, Peretz, on the question of Arab –Jewish relations holds “dovish” positions. He was an early member of the “Peace Now movement”. He was also, in the 1980s, a member of a group of eight Labour Party Knesset members, led by Yossi Beilin, who supported the idea of a two state solution. He is on the record as saying that the unresolved conflict with the Palestinians is the reason for rising inequality. He has opposed the settlements on the West Bank, saying that these use up funds that could have helped to solve these problems.

Having considered all this, if we want to make some international comparisons, he is more like Brazilian president Luiz Inacio Lula da Silva than Hugo Chavez in Venezuela.

Although we note his record and we see the contradictions in his statements, clearly his victory reflects a growing polarisation within both the Labour Party, where a right wing and a left wing have now emerged, and within Israeli society as a whole, between those who have and those who have not. We can expect that under his leadership the Labour Party will look more like a traditional social democratic party, supported by the workers and poor in Israel. It is not by chance that a man whose power base was and is the Histadrut has replaced the traditional officer caste that dominated the Labour Party. It would not be the first time in history that in a moment of crisis a Labour Party has been saved by a leader of the unions. Peretz has more authority among the workers than the old Labour guard.

Therefore Marxists should not give Peretz a blank cheque, nor present him as a great socialist. But we should give him critical support whenever he takes a step to the left. We should support any real move he may make in support of the workers and the poor. We should demand within the Israeli labour movement that he sticks to his word and organises the struggle against cuts, privatisation and so on. And we should criticise him whenever he fails to advance the cause of the working class. It is in fact possible that many new activists could join the Labour Party under this new leadership. We should be in touch with this layer and have a friendly attitude to the workers who join the party. As there is no real alternative, even this party can reflect the pressures of class struggle in the future.

We say to these new activists who now trust Peretz but not Peres: demand a clear lead from Peretz, remove Peres and the old guard once and for all, leave the government now and fight for a Labour government that would unravel all the anti-working class policies pushed through by successive governments over the recent years. Unless this happens, then in spite of the new leadership’s words, the Labour Party will be sucked back into collaboration with the Sharons of this world and those who will suffer are the workers and poor.