Constructing the Neoliberal-Neoconservative Alliance in Israel
The Role of American-funded Think Tanks
On October 15, 2010 Roger Hertog, Chairman of the New York based Tikvah Fund, gave a remarkably revealing speech. The occasion was his acceptance of the William E. Simon Prize, an award granted annually to prominent philanthropists who invest heavily in promoting free enterprise, and in the speech he laid bare the principles of his philanthropic strategy. Hertog, who preceded Charles Koch and Paul Singer in winning this award, defined two main paths for investment. First, and most importantly, he makes long-term investments in universities, scholarships, and educational programs. “Unless we populate the humanities with an alternative to the ascendant ideology,” he argued, “conservative ideas about limited government, rule of law, individual liberty and the role of religion will over time lose out.” Second comes middle-term investments, contributions to “think tanks, small magazines, books and other free-standing institutions” that can disseminate the ideas his long-term investments develop. Taken together, those initiatives form an effective network for the generation and dissemination of free market ideas.
It is, it must be admitted, an astute investment strategy, one that sets Hertog up to accomplish his goals. One such goal, the pursuit of which explains much of why he was receiving the Simon Prize, is the application of this strategy to Israel. With over $150 million in assets, Hertog’s Tikvah Fund has over the last decade pursued both long- and middle-term investment strategies in an effort to reshape the Israeli polity. It has funded: higher education institutions, think tanks, policy centers, journals, and magazines – all of which promote two things: neoconservative ideas in civic life and neoliberal policies in the economy.
While Israeli public opinion has largely rejected the economic message of those groups, it still receives strong support from Benjamin Netayahu’s conservative government. And yet the focus of such groups on Jewish ethno-nationalism and hawkish foreign policy is awarded a central place in public debate, especially as Israeli society has grown increasingly nationalistic in recent years. In a previous article, I explored the shifts in Israel’s political economy that led to the current moment. Over the past eighty years Israel (and the Jewish community in Palestine that preceded it) has gone from a “developmental state” based on a corporative model, which was mainly concerned with promoting the Zionist goal of Jewish nation-building, to a liberalized economy centered around fiscal prudence and capital markets, with familiar implications in extreme inequality and deuterating public services. This neoliberal transformation, which took place from the 1980s on, not only sought to revamp economic structures but also to reimagine a civic-based liberal society in place of a Jewish-centered polity. In this essay I will discuss how those American-funded think tanks “solve” the conflict between these neoconservative and neoliberal agendas. How is Hertog’s strategy being applied to the Israeli context, and what obstacles does it face?
The harbinger of the current wave of conservative think tanks was the Shalem Center. It was established in 1994 with funds from two of the most significant Jewish donors to the United States’ Republican party, Sheldon Adelson and Ron Lauder. Despite its funding levels, the Shalem Center largely remained obscure until Netanyahu came to power and, in 2009, appointed many of the Center’s fellows to top positions in his government. By the time Haaretz wrote that there “is no think tank today with as much influence on the Israeli government,” the Shalem Center had already begun to shift its focus towards the Israeli academy. It is not a coincidence that this funding strategy fits with Hertog’s prime investment strategy – as Hertog himself has become the Center’s biggest funder. The government of Netanyahu, who during his first term as prime minister lamented the “ideological tyranny” of Israel’s intellectual elite, provided the expensive land and the formal post-secondary accreditation required to, in 2013, turn the center into Shalem College, Israel’s first conservative liberal arts college.
The transformation of the Shalem Center into a college did not mean abandoning middle-term for long-term investments, however. New groups, funded by the same sources, continued Shalem Center’s advocacy work. First among these new think tanks is the Kohelet Policy Forum. With an annual budget nearing $3 million, over the last 6 years the Kohelet Policy Forum has relentlessly advocated for the dismantling of Israel’s remaining social-democratic institutions. In 2018 alone it has recommended: the marketization of public education, the privatization of state-owned companies, and the reduction of benefits for single-parent families.
Hertog’s Tikvah Fund, which financially supports the settlement project, also set up the online news magazine Mida in 2012. Initially headed by Ran Baratz, who was later tapped by Netanyahu to be his communications advisor, Mida is a sort of well-articulated version of Fox News. It not only champions radical free-market ideas, but also attacks widely approved positions in Israel, including: women’s and LGBT equality, governmental transparency, and a legal minimum wage. It is supported by journals, magazines, and even a recently established book club – all of which aim to create a “national conservative alternative to the progressive left and post-modernism.”
If Tikvah were alone in such efforts their effect on Israeli society might be minimal. But they are not. Other, similar, groups founded in the last decade include: The Friedberg Economics Institute, which organizes lectures with liberal economists; the Jerusalem Institute for Market Study, which pushes for deregulation; and the Jewish Statesmanship Center, which provides training for public system professionals. This well-funded wave might get another boost soon: just last August Israeli media documented a private meeting in Jerusalem between officials from these organizations, a top aide to the U.S. ambassador, and Chase Koch, son of the infamous Charles.
That those organizations are lacking popular or partisan support for their neoliberal economic message is a something they themselves acknowledge. “We are the minority, even in our own camp,” Baratz admitted in a recent interview. Their aim is to change that.
Baratz’s ideological assessment might be exaggerated, but the political environment he decries is not so far off. An unprecedented wave of mass protests in 2011, targeting the rising cost of living and crumbling public services, is still deterring major Israeli parties from cutting welfare benefits or privatizing substantial state services. The memory of those protests also forced Netanyahu, to the detriment of his favored conservative think tanks, into supporting rather-unlikely policies, including halting the decrease in corporate taxation, raising the minimum wage, capping salaries in financial institutions, and implementing free education for all 3-year-olds. These are not the kind of policies one would expect from a politician who once described himself in a Businessweek interview as the first Israeli prime minister “genuinely committed to free markets,” and who is now at the peak of his political power.
But Netanyahu’s personal proclivities are constrained in current Israeli society, and not only by a political moment hostile to neoliberalism. Netanyahu is also constrained by the ethnic divisions that form his political base. The popular base of support for the Israeli right since it took control of the government in 1977 has been lower class Mizrachi Jews, impoverished for decades by the Labor-created dual economy. The ruling right-wing Likud Party, initially a coalition of liberal forces, could not afford to engage bluntly in policy that would hurt its voters – and indeed some of the most drastic neoliberal steps were done under Labor governments. Neither could Likud realign itself with business elites or liberal bourgeoisie who opposed the party’s hawkish policies and ethno-nationalist discourse. Netanyahu knows this contradiction first hand: as Finance Minister in the early 2000s, he implemented the biggest-ever cuts in welfare (reducing child allowances and unemployment by almost half and enacting massive budget cuts that increased Gini inequality by 8%), and quickly lost the support of the poor and lower classes. In the next election, with Netanyahu now heading Likud with a clear neoconservative platform, the party received its worst ever result.
To a certain extent, Netanyahu now faces a problem familiar to those who follow American politics, one formulated clearly by Wendy Brown. It is the problem of how to reconcile the amoral rationality of neoliberalism with the expressly moral one of neoconservatism. Ironically, this conceptual gap only deepens as his government speeds up the process of retracting and revoking the liberal achievements in civil rights, the rule of law, and peace-seeking which was associated with Israeli neoliberalism in the 1990s. Netanyahu’s aim has been to replace these with a strong sense of Jewish ethno-nationalism realized though moralized state power in both foreign and domestic relations.
Simply put, the conservative government cannot use classic liberal arguments to promote its neoliberal agenda while it attacks the same arguments on a weekly basis. It is these newly-influential neoconservative think tanks, to whom such a task falls. It is the Shalem Center, the Tikvah Fund, Mida, and others that are leading the long-term outreach and education campaign to reframe the neoliberal message as part of a Jewish-national discourse.
The best conduit they have found for this task so far lies in Israel’s National-Religious sector (sometime referred to as Modern Orthodoxy in the U.S). This is the relatively small, but politically powerful, community that sees Zionism as a religious project rather than a secular national movement.
Chaim Navon, a Rabbi from the city of Modi’in and a popular columnist and author, is a rising star in the Israeli Religious-Zionist sector. Last year, in an article for De’ot, a progressive journal on Religious-Zionism, he wrote the following:
The state of Israel is important and essential for the Jews and Judaism. We won it by God’s grace. But the state is not a goal, it is an instrument: an essential instrument for the national sovereign existence of the people of Israel in their land. …Worldwide, economic liberalism goes hand in hand with a national approach, because a thin bureaucracy leaves room for a healthy people and a strong society. Today people and communities feel that it is the faceless bureaucracy of the state that needs to care for the poor, not them. But individuals and communities do so much better than the state.
Rabbi Navon’s justifications for his economic message are in line with the strategy employed by all groups in the neoconservative campaign. If the 1990s neoliberal reforms were framed around a promise for peace and global connectivity, the think tanks and groups surveyed here adapt their ideas and activities to the same ethno-nationalism that justified much economic policy during the country’s so-called socialist years.
For example, The Kohelet Forum, whose motto is “national sovereignty, individual liberty,” can focus its policy papers on deregulation and free markets and still push to limit legal oversight of the government because such oversight may obstruct statesmanship and war-making. This is also why the IZS, the progenitor of the infamousNation State Basic Law , can advocate closing down academic bodies due to their “post-Zionist trends.” (A much-decried 2010 IZS report reviewed every syllabus taught in Israeli Sociology Departments and rated its degree of “Zionism” or “post-Zionism.” Anderson’s Imagined Communities was marked as a prime menace.)
But Rabbi Navon himself is also emblematic of ideological changes happening in the Zionist Religious community, which is now the target audience for the American-funded neo-con project. A self-defined socialist in his youth, Navon is now a leading voice for Jewish-based, free market ideas, and heads the Tikvah Fund’s National-Religious Leadership Program.
The National-Religious sector is a relatively small and close-knit group making up only some 10% of the Israeli population. Historically it has been rooted in the labor movement, and unlike other Jewish Orthodox streams, it has welcomed a strong state. But after the occupation of new lands in 1967, the messianic wing of this community transformed into the political body that drove the expansion of Jewish settlements into the West Bank and Gaza – a process that began its slow drift away from the left. Its two-pronged political program first aimed to establish a Jewish presence in “Greater Israel” under three ideological pillars: “the Land of Israel, the People of Israel, and the Torah of Israel.” Then, it sought to move from its secondary role in Israeli society into what it saw as a “serving elite” – a reincarnation of the state’s founding labor-kibbutz class.
This latter stage moved this small group into the heart of the Zionist political mainstream. And today under Netanyahu, and despite their minority status in the country, National-Religious hold key positions in all major Israeli institutions, including the army, the security services, the police, the public service, the media, and the justice system. Its organizational capabilities and communal education institutions have allowed it to become one of the most influential political forces of the last decade. It has also come closer to groups that have been previously disconnected to it, including many secular Jews who seek to reintroduce traditional practices into their lifestyle.
It is this community that the foreign-funded think tanks hope will be the missing piece, the piece that will allow them to complete the puzzle of reconciling a popular nationalist state-discourse with the unpopular neoliberal economic message.
While surveys show that the Zionist-Religious public still holds the lowest support for unregulated free-market of all Israeli sectors, in recent years its bourgeois elite have become increasingly receptive to free market ideas. It is National-Religious journalists, intellectuals, and politicians who populate nearly every top position in the think tanks analyzed here. And this elite is being aided by religious leaders like Rabbi Navon, who popularize their ideas for a still-recalcitrant audience.
The transformation of the Zionist Religious community was made most visible five years ago when the old National Religious Party was rebranded as The Jewish Home. Its new leader, the charismatic high-tech entrepreneur Naftali Bennett, changed the party’s stated goal from: “to stand up for the hard-laborer worker [and] fight for social legislation,” to: “the party views a free economy with social sensitivity and strengthening mutual guarantee as the principles that will provide a safety net for a life of dignity for all citizens.” Bennett, who’s attracting young voters of both religious and secular-liberal background, shares Netanyahu’s brand of neoconservatism, including his contempt of labor organizations and state enterprises, and his unapologetic anti-Arab and pro-annexation rhetoric, making him a great partner for the neo-con groups.
Like in the U.S., the neoconservative and neoliberal campaign in Israel is resourceful and politically clever. And it is heavily funded by the same donors. Without popular or ideological support, it builds its advocacy on rising elites and adapts its narrative to a nationalistic discourse that is widely accepted in Israel. But unlike the American Tea-Party, who advocated from the opposition, the groups surveyed here act as an auxiliary of a supportive government that, despite being the most conservative ever to be formed in Israel, still lacks a true conservative constituency.
The brief glance at the history of the political economy of Israel/Palestine, and at the current moment of neoconservatism in Israel, suggests that the resources that are currently being invested by the Tikvah Fund and other conservative funders are paying off. Support for this strange reconciliation of nationalist and neoliberal discourses is slowly growing in Israel. But it also suggests that we are unlikely to see a simple one-way trajectory towards full neoliberalization. Public support for long-standing social institutions, the political backlash against the 1990s era, and the collective ethos of the National-Religious community might make it difficult for the neo-con think tanks to import a one-to-one copy of the neoliberal policies advocated by their American counterparts.
Instead, we might expect new forms of exclusion and inclusion to emerge, similar or different to the ones set during the so-called socialist years when the corporate economy was divided along national, ethnic, class, and partisan lines. The new line of division might, for example, be Green. And this because, while many in the settler National-Religious camp call for welfare cuts, government funding for public services is two- and sometimes three-times higher for West Bank settlements than for other Israeli towns. Other lines could come in the form of “categorical” or “loyalty” benefits (cash transfers paid to members of politically defined categories like reserve soldiers, Holocaust survivors, or victims of terror attacks) which for decades have been a defining characteristic of the Israeli welfare state. In any of these cases, the neoliberal vision of the new wave of neoconservative think tanks will have to face the particular legacy of nationalism in Israel. In that dangerous mix, the definition of who is allowed in will only continue to shrink.
Ben Weinberg is a master’s student in Sociology at The New School for Social Research. His research focuses on inclusion and exclusion in welfare regimes. Before coming to The New School, he was the Chief Editor for the Israeli-based parliamentary watchdog The Social Guard.