Think About It: Who’s afraid of social democracy?

Today, “socialism” in all European-style democracies (including Israel), is in fact “social democracy” that accepts the mixed economy in which the state and private entrepreneurs share in the running of the economy and society, each in the spheres where its marginal advantage is greatest.

November 11, 2012 22:51
4 minute read.
Shelly Yacimovich at Labor Central Committee

Shelly Yacimovich at Labor Central Committee 370. (photo credit: Marc Israel Sellem/The Jerusalem Post)


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The other day I happened to take a glance at Israel HaYom, and my eye caught the headline of an article by the paper’s neo-liberal economic correspondent Zahi Sternlicht, entitled “The US has Chosen Socialism.”

Why socialism? Because, according to Sternlicht, Barack Obama chose to deal with the economic crisis in the US by nationalizing the banks and, to add insult to injury, nationalized the health system as well. “Old school socialism,” Sternlicht called it.

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Two points should be made:

• It was president George W. Bush who signed the Troubled Asset Relief Program into law on October 3, 2008, (a month before Obama was first elected president) earmarking $700 billion for the bailout of the banks. In the course of the first Obama administration this sum was greatly reduced, and the most recent figure (last week) shows that the outlay is now estimated at “only” $42.10b.

Furthermore, exactly 25 years earlier, on October 6, 1983, Israel’s finance minister decided to earmark up to NIS 20b. to bail out the Israeli banks from the consequences of the bank shares crisis. The government at the time was a Likud government, and the finance minister was Yoram Aridor, who was soon replaced by Yigal Cohen-Orgad – both Likudniks. Labor was “safely” in opposition at the time.

• Obama didn’t nationalize the American health system. What he did was introduce a rather watered-down version of his original plan for national health insurance.

It should be noted that since Otto von Bismarck first introduced national health insurance in Germany back in 1883 (even though he was a deep-seated opponent of socialism), national health insurance is considered one of the cornerstones of the progressive modern state in the whole of Europe, and in Israel, where no one even questions its necessity, though many criticize its implementation.

But the Israel HaYom economic correspondent is not the only one who accuses Obama of being a socialist. Many of his republican opponents in the US do the same. In the United States, where socialist ideas never caught on (a fascinating subject in itself), and where McCarthyism after World War II left tens of millions of Americans either brainwashed regarding the dangers of communism and socialism, or in a state of total shock, one might forgive people for their ignorance on the subject. But in Israel?

Socialism in its most extreme form calls, inter alia, for the nationalization of the means of production, state control over social services, the idealization of labor in the meaning of gainful employment, the right of workers to organize, and full equality among human beings as a target to be strived for.

Today, “socialism” in all European-style democracies (including Israel), is in fact “social democracy” that accepts the mixed economy in which the state and private entrepreneurs share in the running of the economy and society, each in the spheres where its marginal advantage is greatest; that believes that all citizens of a state are entitled to a basic decent existence for which the state is largely responsible, though the individual is also expected to take responsibility for his fate; that understands that neither private enterprise, nor public enterprise, nor even trade unions can operate properly without checks and balances, and some measure of control; and that unbridled capitalism (what we call in Israel “swinish capitalism”) is the greatest enemy of “social justice.”

Besides believing in certain economic and social principles, Social Democracy is all about accepting pluralism as a basic reality, and willingness to compromise. This basic attitude is valid not only for domestic affairs, but also in international relations. In this sense social democrats have a lot in common with liberals, and moderate conservatives, but almost nothing in common with extremists of any sort, including fanatic communists, neo-conservatives and neo-capitalists, and religious fundamentalists, be they Muslim, Christian, Buddhist, Jewish, or whatever.

In this complex puzzle there is nothing about Obama that is not purely liberal, or which justifies his being labeled a social democrat (not that being a social democrat is anything to be ashamed of!).

Labor Party chairman Shelly Yacimovich (whom The- Marker’s economic correspondent Nehemia Shtrasler – another neo-liberal – insists on calling a neo-Bolshevik) is a typical social democrat. This includes her pragmatic approach to the Jewish settlers in Judea and Samaria (that angers many so-called “peaceniks”), who she insists on viewing as human beings, despite her strong belief in the two-state solution, and in the danger of the bi-national state, or the apartheid state, in the direction of which the settlers are inadvertently (or in some cases deliberately) pushing the State of Israel.

The Labor Party will be holding a primary for its list toward the elections to the 19th Knesset on November 29. Not all the newcomers to the Labor party who are planning to run in this primary may be considered social democrats (for example, I have my doubts about journalist Merav Michaeli), but there are some interesting names, some more radical, and others more pragmatic, but none of whom would be insulted to be called a socialist.

These include the director-general of the Macro Center for Political Economics, Dr. Roby Nathanson; Prof. Yossi Yonah from Beersheba University, who played an active in the social protest of 2011; hi-tech and social entrepreneur Erel Margalit; retired police commander (Investigations and Intelligence Division) Moshe Mizrahi; and Georgianborn MK Nino Abesadze, formerly from Kadima.

As to Zahi Sternlicht – neo-liberalism is perfectly legitimate, as long as one gets one’s basic facts right. And as to Nehemia Shtrasler – his personal vendetta against Yacimovich has simply got out of control.

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