The greatest achievement of the “cottage cheese revolution” – the
Facebook-initiated boycott of cottage cheese, is that for the first time Israeli
consumers protested the exorbitant price of a consumer item and seem to have
initiated a cost cutting revolution after three friends, convinced 90,000
outraged customers to boycott the purchase of cottage cheese.
first time, the silent, long suffering Israeli consumers – exploited by
governments and politicians who cooperate with rapacious oligarchs, producers,
retail chains, trade unions, importers and suppliers, kibbutzim and moshavim who
plunder the consumer mercilessly by inflating the price of everything (so that
cottage cheese here is double the price of American cottage cheese) – have
raised the banner of revolt and said “enough.”
Who is to blame for the
shameful situation in which millions of Israeli workers – who earn about half
what American workers earn – have to pay double for everything.
Who is to
blame for the fact that hundreds of thousands of Israeli families can barely
make ends meet? FIRST AND foremost it is our politicians.
Not only have
MKs the gall to levy high regressive indirect taxes on the puny salaries
Israelis earn, they also make it possible for the monopolies owned by the
oligarchs to exploit the public by legislating laws that enable them while
undermining price cutting reforms.
Most ministers also do little or
nothing to protect the public. An outstanding exception, Minister of
Communications Moshe Kahlon, has been courageous in stopping the
telecommunications industry from ripping off the public, charging many hundreds
of millions, if not billions, in excess invented “fees.”
out because most of his colleagues do so little to fight the monopolies that
Ministers not only helped fashion, they also perpetuate our
distorted economic system, betraying the public by allowing the many
monopolistic practices because their owners help them recruit voters for their
primaries or help finance them.
Prime Minister Binyamin Netanyahu knew
what he was saying to his ministers when he exhorted them to follow the Kahlon
example and find creative ways to get price cutting reforms enacted and
As for Knesset members, too many of them work for the
oligarchs’ lobbyists to secretively undermine reforms by introducing competition
damaging clauses into almost every law. Only by creating a counter-lobby that
will publicly expose their secretive plots can they be shamed to stop such
Regulators, who are ostensibly appointed by
government to protect the public betray it too. They are overly “sensitive” to
political pressure and are reluctant to take on the oligarchs. They have done
only the minimum possible to defend the public from the excessive fees charged
by the banks for decades now, or to protect the public’s pensions by making sure
that financial institutions do not make high risk loans to few
They have let directors appointed to look out for the public
interest to renege on their duty and serve the oligarch’s interests.
regulators, mostly former bureaucrats or academics, live in a virtual world.
They love to split legal hairs as an excuse for doing nothing to change the
They block common sense reforms because they do not fit some
abstract notions they invented in the academia. Much of their energy is wasted
on turf wars. Regulation costs the economy many millions.
It levies high
costs and retards the progress of enterprise. It has seldom succeeded in
preventing major crises, in Israel as in the world at large, yet so many call
for more stringent regulation where regulation has already failed.
cottage cheese crisis also exposed the illusion that the moshavim and the
kibbutzim, though proven as disastrous social and economic failures, could still
serve as model for decent economic practices, in contrast to “piggish
The government-sanctioned milk producing monopoly that is
dominated by the kibbutzim and moshavim has been practicing price gouging. Their
members must be well aware that those who suffer most from inflating the price
of milk are the poorest families. “Over our dead bodies,” the kibbutz and moshav
apparatchiks who run the milk monopoly asserted when informed that the
government may sanction the importation of milk in order to promote competition
and reduce prices. So much for social consciousness.
illusion was the belief that Diaspora investors will bring with them more
equitable and competitive standards of economic behavior. Alas the diaspora
investors in Apax, which bought Tnuva, were only too happy to make exorbitant
monopolistic profits rather than establish standards of decent business
behavior. They are no exception. Many prominent diaspora investors have chosen
to join existing local cartels instead of funding new players and increasing
competition and efficiency of Israeli business.
Last but not least was
the dispelling of the illusion that introducing more women into the highest
echelons of Israeli business would make it more humane.
indeed make a great difference but not if they decide like Ofra Strauss, the
president of the Strauss food conglomerate and Zahavit Cohen, Tnuva’s
Chairperson to compete with men in who is more rapacious.
It may be
salutary that certain illusions have been dispelled. It may make the Israeli
consumer realize that he must rely on himself, that he must demand from his
politicians reforms that will protect him from abuse by the oligarchs who are
united against his most basic right: a chance at a fair, decent
The writer is director of the Israel Center for Social and