The Israeli Labor Party’s existential crisis

Israelis will vote in their second election this year on September 17th. The Israeli Knesset dissolved itself on May 29th, when Prime Minister Benjamin Netanyahu failed to form a governing coalition with a 61-seat majority of the 120-strong Knesset after the April 9th election.

The British Labour Party has traditionally had three sister parties in Israel and the Palestinian territories: Fatah (the largest component of the Palestinian Liberation Organisation, which governs the Palestinian Authority areas of the West Bank); the Israeli Labor party (called HaAvoda in Hebrew); and Meretz. Labor and Meretz are both social democratic and Zionist parties (i.e. they believe in the creation of Israel as a state for the Jewish people), and both are committed to a two-state solution with the Palestinians.

Labor grew out of the socialist parties that founded and built the state. It was part of a powerful network of socialist Zionist institutions, including the kibbutz movement of collective farms and the Histradrut trade union movement. Its predecessors were the dominant party in the early decades of the state, leading every government until 1977. Since then it has only won two elections: Yitzhak Rabin became Prime Minister in 1992; Ehud Barak in 2000. But it has been in long-term decline for years.

This decline began because it was the party of the establishment and identified with the founding Ashkenazi (European Jewish) elite of the country. Oddly for a centre-left party, it failed to reach out to Sephardi (Middle Eastern and North African Jewish) Israelis and new immigrants, who instead found a political home in the conservative Likud party. The decline then accelerated with the terrorist attacks of the Second Intifada of 2000-2005, when voters perceived Labor, as the architect of the Oslo peace accords with the Palestinians, as too soft on security. Since then, Israelis have tended to shun the left, out of fear that only a right-wing government can keep terrorism under control.

Meretz is a newer, and until now smaller, party formed by a merger of small left-wing parties in 1992. It is positioned to the left of Labor and sees itself as the voice in the Knesset of Israel’s peace movement. 2019 has been a year of existential crisis for Labor.

This looks superficially like yet another instance of ‘Pasokification’ – the collapse of the formerly governing European social democratic parties that were implicated in austerity measures after the 2008 financial crash. But that isn’t the story in Israel. Israel was relatively insulated from the financial crisis because its economy is focused on growing areas of high technology. Voting behaviour and perceptions of “left” and “right” in Israel are driven primarily by where parties stand on security and willingness to take risks to achieve a peace deal with the Palestinians.

The 2015 elections marked a relative resurgence, when Labor formed the “Zionist Union” and won 24 of 120 seats, leading the main opposition. The then leader, Isaac Herzog, came from the more centrist wing of the party focused on security and resolving the conflict, having ousted a previous leader, Shelly Yachimovich, who had focused on social and economic issues. Although he was from the “security” wing of the party, Herzog didn’t propose a distinctive new vision on the peace process to recognise the failure of the Oslo paradigm and move the party on from that strategic setback.

In 2017, an attempt to refresh the party saw members use a primary election to replace Herzog with a new leader, Avi Gabbay, a tech entrepreneur who had previously been a minister from a centre-right party. He came from outside the party and his election personified the identity crisis the party had been going through since the Second Intifada.

The choice proved disastrous as Gabbay fell out badly with Tzipi Livni, Labor’s partner in the “Zionist Union”, and tore up that alliance. A group of popular former heads of the Israeli armed forces, who were unhappy with Netanyahu’s right-wing government and looking for a way to enter politics, could have joined Labour and given it much needed security credibility. Instead, they formed a new centrist party, “Blue and White” (the colours of the Israeli flag), led by Benny Gantz.

The first general election this year, in April, turned into a two-horse race between Gantz and Netanyahu. Labour voters switched to Gantz to try to ensure he emerged as leader of the largest party – a classic tactical voting squeeze. Labour was almost obliterated, losing 13 seats (or 18 compared to the Zionist Union as whole) to emerge with only six, compared to 35 for each of the big two parties (now Netanyahu’s Likud and Gantz’s Blue and White). Meretz was also squeezed, dropping one seat to four, and only just passing the 3.25% threshold required to stay in the Knesset in Israel’s system of proportional representation and party lists.

Unexpectedly, Netanyahu failed to form a coalition due to irreconcilable differences between Avigdor Lieberman, leader of a right-wing party representing secular Russian Jewish immigrants, and the parties representing the ultra-Orthodox Jewish minority. Another general election was called.

But Labour hasn’t managed to capitalise on this opportunity to bounce back. Gabbay resigned and the party held a new primary election for leader. This was won by veteran politician and former party leader from 2005 to 2007, Amir Peretz, against two young candidates Stav Shaffir and Itzik Shmuli, both of whom emerged from the 2011 social justice protests movement.

Peretz is a former defence minister who procured the Iron Dome anti-missile system, but he was also in charge during the Second Lebanon War, which is perceived as a strategic failure by the Israeli public. His interest in Iron Dome came from the experience of Hezbollah rocket attacks during that war. He’s a man of the left, who as a militant leader of the Histadrut trade union called more than one general strike. Unusually for a Labour leader, he is of Moroccan Jewish origin. He comes from the peripheral town of Sderot on the Gaza border, where he was mayor, so believes he can reach out to Sephardi voters who would usually back Likud.

Unfortunately, Peretz has made a catastrophic mess of the round of mergers that preceded the August 1st deadline for parties to finalise their election lists. The key factor in this was his reaction to the attempted political comeback by former Israeli Labor PM Ehud Barak, a hugely charismatic but deeply divisive figure who nearly reached a peace deal with the Palestinians. Barak believes he is the only person able to defeat Netanyahu, a man he led in an elite army commando unit but then served under as defence minister.

If Barak hadn’t stood, there would only have been the two left parties, Labor and Meretz, and it should have been possible for both to pass the threshold and get seats. But with a third left party, some realignment was necessary to avoid one or more of the left parties failing to win any seats.

Defeated leadership candidate Stav Shaffir proposed a grand alliance of the left, merging Barak’s new Democratic Party, Labor and Meretz. But Peretz shunned this idea, perhaps due to animosity towards Barak for displacing him as leader in 2007. Instead, Peretz agreed a rather strange alliance with Gesher, a small centrist party. As Gesher is led by Orly Levy, also of Moroccan Jewish origin, it looked like Peretz was doubling down on his appeal to Sephardi voters while also trying to target centrist voters. He is taking a huge gamble trying to pull in votes that wouldn’t usually go to a left party.

Shaffir then ploughed ahead with her idea of a grand alliance of the left, but without Peretz and the official Labor party. In her words: “Labor is my ideological home, but the house is burning, and when that happens you go outside to extinguish the flames and build it again.” A new “Democratic Union” has been formed consisting of Shaffir and her supporters, Meretz and Ehud Barak’s Democratic Party. Barak has symbolically taken only the tenth place on the party list, suggesting that to get him into the Knesset the party will need significantly more votes than Meretz got in April. But he has been named as the Democratic Union’s first choice for ministerial office (you don’t have to be an MK to be a minister).

The first opinion polls following these mergers show Labor/Gesher on the same six or seven seats it got in April and the Democratic Union is projected to get seven or eight, double Meretz’s April haul. Both look paltry compared to the 29 or 30 seats that the two big parties are likely to secure. With its core vote haemorrhaging to Blue and White, a new competitor in the Democratic Union and its brightest rising star Shaffir outside the party, Labor looks in a terrible mess. It might fail to win any seats at all. As for Democratic Union, its broad coalition looks inherently unstable. Any coalition with Ehud Barak in it is a split waiting to happen, as he led a breakaway from Labour in 2011.

Whilst the two parties of the left look like peripheral players at the moment, the broader context of the election has the potential to change that. Lieberman’s desire to see Netanyahu fall could see the creation of a unity government of left and right, or some kind of coalition of the centre and left, or even Netanyahu reaching out to a counter-intuitive coalition partner from the left. Whether or not Labour and the Democratic Union can scrape across the line into the Knesset is vitally important to the maths of how the next Israeli government is constituted, and whether the Netanyahu era comes to an end this September.