Eight years ago, Kibbutz Ein Gedi, a tropical paradise overlooking the Dead Sea, was on the verge of closure. The latest blows were the Dead Sea's receding, which destroyed a great deal of valuable land, and the intifada, which scared away the tourists, a vital source of income.
But for a long time, the kibbutz had been dying of socialism. "There was so much waste," recalls Yonki Ayalon, one of Ein Gedi's founders in 1956, sitting at her dining-room table with her husband and daughter. "We couldn't afford socialism anymore. It cost too much."
In the old days of the kibbutz movement, so much food would go to waste that pets were typically obese. Since members got unlimited electricity, they commonly left their air conditioners running when they went out to work so it would be cool when they came home at the end of the day, says Daniel Gavron, author of the 2000 book, The Kibbutz: Awakening from Utopia.
When the crunch came at Ein Gedi, the first thing the kibbutz did was force members to start paying for their food and electricity.
Next to go was what Ayalon calls the kibbutz's "hidden unemployment." There were numerous members working at Ein Gedi's farm, spa and guest house who weren't really needed, so many of them were told to find new sources of income. Necessity was the mother of invention; one kibbutznik, for instance, became a masseuse, another a manicurist, another a gourmet French cook, another a quilt-maker, another a taxi driver.
Then, four years ago, the biggest change of all went into effect: Kibbutz Ein Gedi ended its nearly 50-year-long system of equal salaries for all members - no matter what work they did, no matter how well or poorly they did it - and switched to the system of "differential salaries." Since then, members have been paid according to their productivity, to the amount of wealth they produce.
The result? "Our standard of living is much higher now," says Ayalon, 71, a clerk at nearby Ahava cosmetics whose husband, Avner, 73, is on pension after a lifetime of farm work. "We have money to travel overseas, to help our children and grandchildren. You see so many people here remodeling their homes."
The young adults who left Ein Gedi in droves over the last couple of decades have started to return, though usually as renters, not members. "They want Ein Gedi the place, but not the kibbutz," says the Ayalons' daughter, Meirav, 44, a public relations consultant.
What happened at Ein Gedi is an example of what's happened to the kibbutz movement as a whole in recent years - it's been saved by a strong dose of capitalist individualism. In the last three or four years, the movement - which includes 273 kibbutzim, some 100,000 members and 20,000 non-member residents - has emerged from 20 years of life-threatening economic and social crisis and lifted its head above water.
The average kibbutz household income now stands at approximately NIS 11,000 a month - on a par with the nationwide family average. And after losing an estimated 30,000 to 50,000 members between 1985 and 2005, the kibbutz population has recently been on the rise due to higher birthrates, the return of members who had left (usually young families) and the addition of new members, often outsiders who "marry in" to the kibbutz.
Last year, some 1,200 new members joined the kibbutzim - the first year in more than a generation that saw more people joining than quitting.
"I wrote at the end of my book that the kibbutz was finished. Today I have second thoughts," says Gavron, himself a former kibbutznik.
SOME SERIOUS problems, though, remain. A few dozen kibbutzim, especially in the far reaches of Galilee and the Negev, continue to fall behind economically; their members are less concerned about how to distribute wealth than about how to create it.
On kibbutzim in general, the population is aged; while the young aren't leaving almost automatically like before, too many of them still leave - after army service and the near-mandatory year or two of traveling abroad - for the movement's demographic good health.
The kibbutz may be viable once again; it has a future, but it can never return to its glory days from the 1930s through the 1950s, when it was the elite of Israeli society, when the kibbutznik epitomized socialist Zionism's "new Jew" - settling the land, fighting the enemy, scorning self-indulgence (at least publicly).
In that era, the kibbutzim produced a hugely disproportionate share of the country's political and military leaders. Then it attracted the most determined and idealistic youth. Today, the more candid members speak of an unjust "stigma" commonly attached to them - that the only reason they're still there is because they couldn't make it in the sink-or-swim world outside. The kibbutz pioneers were known for their holier-than-thou attitude; this stigma upon their descendants is a kind of payback.
Next year will mark the 100th anniversary of the agricultural settlement started by a small group of Zionist laborers at the southern shores of the Kinneret near the Arab village of Umm Juni; the following year, they established it as a communal settlement - the first kibbutz, Deganya.
Spread out across the highway from the Kinneret, Deganya is almost as paradisaical as Kibbutz Ein Gedi. It's a forest of trees, bushes and flowers dotted with little bungalows and smelling of freshly-mowed grass. On a wilting August afternoon, the most audible sound was of birds chirping, and the most visible movement was of a few pensioners tooling around the narrow pathways on golf carts and bikes. Not much seemed to have changed here in a long time - until one noticed the late-model cars parked in some of the backyards.
Until two years ago, Deganya members couldn't own their own cars and had to reserve the use of one of the kibbutz's vehicles. This and many other old ways were put aside with the shift from equal to differential salaries.
Taking a break from her managerial duties at Deganya's old-age home, Nina Ben-Moshe, born here 70 years ago, recalls the effect capitalism had at the "mother" of the kibbutzim. "All these members who'd been staying home with back problems suddenly felt well enough to go back to work," she says with a knowing laugh. The kibbutz's operating deficit closed in almost no time. "There were a lot of parasites in the old days. It's not like that so much anymore," says Ben-Moshe.
The head administrator at Deganya, Shai Shoshany, stresses that the kibbutz didn't make the switch to differential salaries because it was hard up economically, but because so many young people were leaving and older members were chafing at the bit. Deganya wasn't short on money, it was short on individual freedom and opportunity.
Sitting in his office next to a photo on the wall of A.D. Gordon, the Tolstoyan spiritual father of the kibbutz movement who toiled and is buried at Deganya, Shoshany says: "It used to be understood that young people here would do their army service, take a year or two to travel overseas, then leave the kibbutz and not come back. Now, kibbutz life is an option for them again."
Recently, four young members who'd left Deganya have returned with their families. One is Moran Chen, who is playing on the floor of her apartment with her infant son, Kinar. Chen's mother, Nurit, a leading educator at the kibbutz, stops by to give the boy a hug.
On maternity leave from her job as a teacher's supervisor, Chen, 31, and her partner, Eyal, a doctoral student at the Technion, returned to the kibbutz after spending several years away studying and traveling. "There's something in the atmosphere now - it's freer," she says. "People aren't looking at you, judging you on whether you're working hard enough."
She says she almost certainly would not have come back to Deganya if the kibbutz had stuck with the old, rigid model. "For one thing, I would have had to put my son in kibbutz day care when he was three months old and gone back to work; now I can stay home with him as long as my job allows," she says. "For another thing, we wouldn't have been able to save any money; now we can."
SOME 180 kibbutzim, or two-thirds of them, have gone over to differential salaries, with the remaining one-third keeping to the system of equal salaries - so far. These old-model kibbutzim tend to be wealthy, such as Ma'agan Michael, Be'eri, Gan Shmuel, Gan Yavne and Shefayim. A saying heard around the kibbutz movement is: "The more money you have, the more socialism you can afford."
Yet even among the majority of kibbutzim that have gone capitalist, it's not Thatcherist, raw capitalism; it's what kibbutzniks rightly compare to the "Scandinavian" or "social democratic" economic model. It combines aggressive, business-minded creation of wealth with high, progressive taxes to prevent overly large income gaps, to maintain high-standard public infrastructure and services and to provide a strong safety net for the handicapped and elderly, the latter group being disproportionately large on the kibbutzim.
While a few dozen kibbutzim are hard up financially, the great majority are beautifully maintained rural enclaves with good schools, health care, sports and cultural facilities, pensions and old-age care. "There's still a far greater degree of mutual care on the kibbutz [than in Israeli society at large]," says Gavron.
Achieving this miniature Scandinavian way of life involves assessing the value of each kibbutz member's work and paying him accordingly, then taking much more in taxes from the haves than from the have-nots. The upshot at Deganya, says Shoshany, is that the before-tax salary of the average member runs about 15 percent higher than the average Israeli's, but the after-tax salary is about the same.
At the top of Deganya's wage scale are professors, attorneys and hi-tech professionals, with the highest monthly salary being NIS 22,000 before taxes and NIS 15,000 after. At the bottom are the banana pickers and other laborers, who receive about NIS 6,000 before taxes and NIS 5,000 after.
"We make less money than most of our friends in the city, but our standard of living is much higher," says Chen. Noting the expanses of greenery on the kibbutz and the Kinneret right across the road, the swimming pool, the basketball court, the cultural activities, the animals in the shed and petting zoo that Kinar sees every day, and the lifelong friends and neighbors who "smile whenever they see him," she says: "Who wouldn't want to raise children here?"
THE KIBBUTZ movement has come an awfully long way from where it was in mid-1985, when disaster struck. What happened then was that the government, faced with inflation running at what Gavron calls a "Zimbabwean rate," took drastic austerity measures to shrink inflation instantly - which instantly left most kibbutzim with debts they had no hope of repaying.
During the previous years of hyperinflation, they'd been living in a fool's paradise - borrowing way beyond their means, figuring that by the time they had to pay back the loans, triple-digit inflation would have reduced them to easily manageable size. But in 1985, when the government wiped out hyperinflation overnight, it meant the kibbutzim's absurdly large loans would remain absurdly large, only this time in real money.
"They owed seven or eight billion dollars, something unreal," says Gavron.
Yet the government couldn't just let the kibbutzim go bankrupt; there were 130,000 people living on them at the time - where would they go, what would happen to all those communities, farms and factories? (A few dozen kibbutzim had refrained from taking out large, high-risk loans, and thus were not in such trouble, Gavron notes.) So the banks, which at the time were owned by the state, were obliged to write off most of the kibbutzim's debt and reschedule repayment of the rest. The kibbutzim were saved from bankruptcy - but they were still deeply, unprecedentedly in debt.
The country had just turned abruptly from socialism toward capitalism; the kibbutzim could no longer count on generous government subsidies and protection from competition. There would be no more overfed dogs and cats, no more leaving the flat with the air conditioner on. The world-renowned experiment in communal living would have to be run like a business.
And little by little they were. On the kibbutzim that switched to differential salaries, many say the new system is actually more egalitarian than the old one. "The inequality was just hidden before," says Ben-Moshe. Before, kibbutz higher-ups and professionals employed outside received the same salary on paper as the banana pickers, but they often concealed perks from the job, not to mention personal bank accounts, say kibbutzniks.
Now that the facade of pure egalitarianism has been dropped, there's less envy and suspicion. "You used to hear people say, 'Look at him, he doesn't work, he spends all day in the grocery store.' They'd fight over who's turn it was for everything," says Shoshany. "Now everyone does whatever he wants, whatever he can. For instance, there are some women here whose husbands are making good money, so they've decided they don't want to work, they want to do something else with their time. And if they can afford it, that's fine."
Meanwhile, about 90 kibbutzim - again, mainly the wealthier ones - are holding on to the system of equal salaries. Yet even they have gone capitalist in ways that once upon a time would have been anathema. They've turned their members into consumers, distributing equal amounts of disposable income for food, clothing and entertainment, but holding each member responsible for balancing his budget. Typically, these kibbutzim have also required many members to find profitable work outside, or create small businesses themselves, because the farms and factories at home don't have enough productive work to go around and are no longer willing to provide make-work.
FACING THE Mediterranean north of Herzliya, Shefayim is seen - and derided - by many Israelis as a symbol of the new, capitalist kibbutz. With some 1,000 members, it sits on some of the most valuable land in the country. It runs one of the most successful shopping centers that stay open on Shabbat, renting space to Toys 'R' Us, Ace hardware, Office Depot and other stores, as well as McDonald's, whose golden arches are visible from the kibbutz's old industrial zone. The Shefayim water park is mobbed during hot weather, and the 150-room Shefayim hotel is generally full. There's even a used car lot on the premises.
So many members' and visitors' cars are parked here, so many people are bustling around, that Shefayim doesn't have that country village atmosphere ordinarily found on kibbutzim. Instead, it feels more like a beautifully landscaped industrial park, with great leisure facilities open to the public.
Yet despite all the trappings of capitalism, Shefayim, founded in 1927, is one of the socialist holdouts of the kibbutz movement; all its members still receive the same salary, no matter what kind of work they do (although high earners receive bonuses of a few hundred shekels). However, Shefayim probably won't be able to hold out much longer, nor will many of the other kibbutzim that make enough money to share it out every month not only equally, but generously as well.
Sitting in the restaurant at Shefayim's hotel, Shimon Gutsfrucht, 64, seems the ultimate, classic kibbutznik. With a thick, salt-and-pepper moustache and a day's beard, wearing sandals and a plaid shirt open at the neck and showing tufts of white chest hair, he looks like he came off a produce label from the 1950s. His personality is also classic kibbutz - gruff at first, but very soon warm and generous. I ask Gutsfrucht his position at Shefayim.
"I deal with real estate investments and entrepreneurship," he replies.
People live very well at Shefayim, he says - just about every family owns a car and takes a vacation abroad once every year or two. A second-generation member, Gutsfrucht says that in his parents' day, newly married couples were given homes of 27 square meters. "Now they get 120 meters that they can expand to 150," he says, noting that the new two-story duplexes with gardens at the edge of the kibbutz are for them.
I ask how many of the young people leave Shefayim after doing the army and traveling the world. "None," he says.
When a Shefayim member marries an outsider, the couple invariably makes its home on the kibbutz. Every year for the last 15 years or so, about 10 new members have been marrying in. Compared to the veterans, these people have wide professional and economic horizons. They have no socialist roots, either. Shefayim's population is getting younger, wealthier and more worldly. Naturally, they want the kibbutz to move in their direction.
"Five years ago, we first started discussing going over to differential salaries," says Gutsfrucht. "Three years ago we had the first vote of the membership, and the reformers got about 40%. If we held another vote today, they would get over 50%."
According to the kibbutz's bylaws, a two-thirds vote is needed to make such a dramatic change, and Gutsfrucht doesn't think it will happen within the next year or two. Instead, he gives it about five years. "I don't delude myself, it's clear the change is going to come, and it's causing some friction at the wealthier kibbutzim, including this one."
At Shefayim, the two camps divide roughly along the lines of age and earning ability; along with most of the older and/or less-skilled veterans, Gutsfrucht opposes the switch to differential salaries, at least for the time being. "It's going to be hard on the people who've worked here all their lives and are now between 50 and 65. If they're going to be paid according to the market value of their work, they're going to lose out, and how are they going to find better paying jobs? For their sake, there has to be a transition period," he says. "But in the end, the change is inevitable."
At kibbutzim that have already made the change, though, there is a general sense among young and old alike that it was the right decision; the economic and demographic numbers speak for themselves. In fact, their future points toward even more capitalism.
At Deganya, as at many other kibbutzim, the next reform on the agenda is home ownership: transferring the title of kibbutz apartments from the kibbutz to the members themselves, depending on their seniority.
"Even socialists want to pass something down to their children," says Shoshany.
At the Ayalons' apartment in Ein Gedi, parents and daughter agree that the kibbutz should eventually stop being a kibbutz entirely and become a "community settlement" - one with good schools and facilities, but without any central economic planning and without high taxes. (Meirav, a public relations consultant, and her brother Rafi, a business consultant, each pay the kibbutz's top marginal tax rate of 60%.) "The way it is now, it's neither here nor there," Yonki suggests.
There's no disagreement between the Ayalon generations, either, about the kibbutz movement's socialist past: It was great for its time.
"We needed those old ideals," says Yonki.
"To settle a new kibbutz in the wilderness meant you weren't just a pioneer, you were a super-pioneer. My parents were strutting around like peacocks when I came here," says Avner, who left his parents' established Galilee kibbutz for Ein Gedi in the early 1960s.
From Meirav's perspective, the kibbutz movement's century of life has been a natural process of evolution. "It was abnormal to build the kibbutzim just like it was abnormal to build this country - you needed a bunch of psychopaths to make it work," she says. "But they had to go through that stage to get to this one."
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