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American Prospect: "Elections After Arafat..." by Jo-Ann Mort, APN Board Member

...Amir Peretz represents the labor wing of Israel's Labor Party. Is his country ready for a pocketbook primary?

By Jo-Ann Mort

The world may be watching for negotiations between Israel's Prime Minister Ariel Sharon and Palestinian Leader Abu Mazen. But a different set of negotiations recently inside Israel could signal that the peace process is heading in a slightly different direction.

Israeli Histadrut chief Amir Peretz, who negotiated for two years with the current Israeli Labor Party Chairman Shimon Peres to bring his tiny-but critical-faction back into the Labor Party fold last summer-had been fighting opposition within the Labor Party's ranks so that he can run as head of the Party in primaries scheduled for June 28. Opponents were trying to deny him on technicalities, but finally, on May 31, the Labor Party Central Committee ruled in his favor.

As chairman of the Histadrut, Israel's trade union federation, Amir Peretz has the power to order a work stoppage that can nearly shut down the Israeli economy. But were he to win a race for Labor Party chief, the dovish socialist would also become the party's nominee to run against Ariel Sharon in the next national election, most likely to take place in 2006 or 2007. His popularity is expanding-and most important, he's signed up new voters to Labor. That's why he's had to endure two legal challenges by the Labor Party legal advisor--who also happens to be in rival Ehud Barak's camp, aiming for a comeback. (In addition to Barak and Shimon Peres, the other candidates are both former generals-Benjamin Fuad Ben Eliezer and Matan Vilnai. And no one on this list except for Amir Peretz is framing economic security as part of national security).

Peretz announced his candidacy by vowing that he would stop Barak at all cost-since to Peretz, Barak represents the Thatcherization of the Israeli labor left. The fact is that the socialism of Israel's Labor Party today belongs more to the nostalgic founding of the state. Since the 1970s, Israel's Labor Party has been more likely to support neo-liberal policies and privatization of Israel's economy-which, historically, represented a state socialist model-than working class interests. As their economic interests shifted, their electorate shrunk. The Labor Party and its allies on the left came to represent what in Israel is known as the "tsifoni," or "Northerners," slang referring to North Tel Aviv and its suburbs-the richest real estate in Israel.

Shimon Peres, Yitzhak Rabin, and then, Ehud Barak-it often became difficult to tell their economic policies apart from those of Israel's current Finance Minister-Bibi Netanyahu. In a few decades, under both Labor and Likud governments, Israel has gone from a scarcity society to one that has a GDP that rivals Europe, but where the old ethos of socialist equality as exemplified in the now privatized kibbutz movement has given sway to an American style capitalism. By recent government calculations, nearly one third of Israel's children live below the poverty line.

The political thinking has been that Israel needs a strong military leader to run its political wing, too-at least until there is a resolution to the conflict with the Palestinians. (Though Shimon Peres doesn't have a military background, he is the father of Israel's nuclear program and that gives him some security cache). But, the reality is that it's been the right-the Likud-that has been able to capture populist majoritarian sentiment, even while they've institute draconian privatization and welfare measures modeled on Margeret Thatcher.

The elitism of the dovish left -coupled with neo-liberal policies--have been a complete turn off to the voters who should be supporting a left wing peace agenda. And it's these economic policies that have eroded much of the electoral support that Labor-and the peace camp-need to build support for a final status arrangement with the Palestinian. Then, there's Amir Peretz.

Born in Morocco, he came to Israel with his family when he was four years old, and settled in Sderot, a Negev development town (the one where the Kassam rockets from Gaza fell t throughout the Intifada). He was badly wounded in the Israeli army (he walks with a limp) and returned to Sderot where he rose through the ranks of the local workers' council to become Mayor at age 30. He ran-and won-in Labor's open primaries in 1988, entering the Knesset for the first time. He was an early support of Peace Now-one of the few political leaders from the Moroccan Jewish community- to do so. But his political vision was always more populist than other dovish leaders.

In a 2003 interview, he told me: "I am a peace person, and I fully support the establishment of a Palestinian state, but in Israel if you ask someone if they are left or right, they will tell you about Abu Mazen or Arafat, not about single mothers."

Israel, Peretz insists, can't afford high levels of inequality.

"The State of Israel demands from its citizens to sacrifice its most precious thing," he said. "All our sons are recruited into the army. On the front we are totally equal. When they return from the field, the state is not committed to anything. Our solidarity is the guarantee for our existence."

I have often heard Peretz speculate on his own political future. With his handle bar mustache, thicket of curly black hair and trade union roots, Peretz has been compared to another labor leader turned head of state-Brazil's Lula. His goal is to accomplish the same thing that Menachem Begin did in 1977, when Begin's right wing Likud victory transformed Israeli politics. Back then, partly because Labor had forsaken the poor of the development towns, Begin led a social as well as a political revolution. As Peretz once told me, "Begin gave them a feeling they would be part of the game. Begin received a social ticket - but he traveled with that ticket to the West Bank. My dream is to travel with a social train to peace."

Jo-Ann Mort, who writes frequently about Israel, is co-author of "Our Hearts Invented a Place: Can Kibbutzim Survive in Today's Israel?" (Cornell University Press).