The Privatization of Israel Amir Paz-Fuchs · Ronen Mandelkern Itzhak Galnoor Editors The Privatization of Israel The Withdrawal of State Responsibility Editors Amir Paz-Fuchs Sussex Law School University of Sussex Brighton, UK Itzhak Galnoor The Van Leer Jerusalem Institute Jerusalem, Israel Ronen Mandelkern School of Political Science, Government and International Affairs Tel Aviv University Tel Aviv-Yafo, Israel ISBN 978-1-137-60156-8 ISBN 978-1-137-58261-4  (eBook) https://doi.org/10.1057/978-1-137-58261-4 Library of Congress Control Number: 2018934676 © The Editor(s) (if applicable) and The Author(s) 2018 This work is subject to copyright All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed The use of general descriptive names, registered names, trademarks, service marks, etc in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations Cover credit: Tjasa Krivec/Peter Lane/Alamy Stock Photo Printed on acid-free paper This Palgrave Macmillan imprint is published by the registered company Nature America, Inc part of Springer Nature The registered company address is: New York Plaza, New York, NY 10004, U.S.A Preface Is there a completely private good in the sense that there is no governmental involvement whatsoever in owning, financing, delivering and regulating it? I suppose we can construe several examples such as jewelery, assuming that even the materials used are not subject to some regulation Is there a completely public good in the sense that it is entirely in the hands of a public authority? In this case, we may refer to the traditional roles of public bureaucracies that were engaged in technical services such as land registration or water allocation; or in administrating justice, collecting taxes, supervising weights and measures; and above all—managing war-related affairs Yet even in performing such tasks, official authorities needed the involvement of non-public entities Against this background, when we launched in 2007 the project “Privatization Policy in Israel” at the Chazan Center at the Van Leer Institute, we assumed that the definition of “state responsibility”, and the boundaries between the public and the private are a matter of ideology and social preferences, rather than a result of rigorous economic theory Ten years later, we can say with a reasonable degree of confidence that, first, the main fallacy regarding privatization in Israel (and perhaps elsewhere) has been the sweeping assumption that the economic market is always superior to the state (more efficient, better in quality, less corrupt, etc.) in producing and delivering goods and services Secondly, the assumption that state intervention is required only in cases of “market failures” proved to be incorrect, empirically (see Galnoor, this volume) v vi    Preface The adoption of the privatization policy in Israel has been part of the neo-liberal ideology which has taken root in many western countries In Israel, privatization has been the most significant, comprehensive and consistent reform since the mid-1980s regardless of which party or leader (right, center or left) was in power As this book shows, the Israeli case would be interesting for other countries because it is an extreme version of socio-economic change: moving swiftly from a centralized economy, a very strong trade union, and a sense of solidarity—to a rather polarized and unequal marked–oriented society Another comparative question emerging from our Israeli study concerns the implications of transferring services to non-governmental entities that are not democratically accountable In this context, scholars studying privatization policies in welfare oriented countries, could benefit from following the ongoing struggle within Israel to preserve state responsibility in health, education, housing and welfare The purposes of the project as a whole, as defined by its inter-disciplinary steering committee were: • Examine the advantages and disadvantages of privatization policy in Israel in various fields and assess the responsibilities of the state and the impact on an equitable and just society • Monitor developments in privatization and nationalization and function as the focal point for research, analysis and publications on these issues • Develop and advance legislation on privatization and out-sourcing and propose recommendations for a suitable regulatory system that will create effective decision-making mechanisms • Empower decision makers and the Israeli public through access to real-time studies and information that will encourage debate and appropriate regulation of privatization and of out-sourcing In addition to the book on privatization, published in Hebrew in 2015, the following summarizes the main output of our project to date • Annual Report on Privatization—published since 2010, and presented to the Speaker of the Knesset The Report listed and analyzed the cases of that year and a follow up on the previous one, and serves as a public monitoring source It has now been Preface    vii reconstituted as an interactive website (http://hafrata.vanleer.org.il/, in Hebrew) • Policy Papers—aimed at stimulating public discussion on topical issues Examples: privatization of ports; privatization of public water corporations; contracting-out teaching; privatizing governmental policy–making; compulsory arbitration; regulation of private schools; privatization of the checkpoints in the West Bank; out-sourcing national parks • Regulation Research—as a follow-up a new project was launched in 2012 to examine regulation in Israel through test cases It will be published as a book in 2018, with concrete recommendations for regulatory models appropriate for Israel • Academic Courses on Privatization—taught at several universities and colleges by academics involved in the project • Conferences on Privatization—numerous public conferences on general and specific topics of privatization and regulation • Manual on Privatization and Out-Sourcing for Government Ministries—published in 2014 as a guidebook for decision-making for ministries considering privatization of social services • Legislative Initiative—in collaboration with the Association for Civil Rights, a committee of experts drafted a bill aimed at creating a general policy of privatization and out-sourcing The possibility of legislation was discussed with the Ministry of Justice and submitted as a private bill in 2017 by Members of Knesset from different— coalition and opposition—parties • Collaborative Governance—The most recent extension is a workshop, which started in 2015, to examine collaboration between the state and non-state agencies as an alternative, in certain areas, to privatization It will present public policy-making processes in Israel that are formal, collective, deliberative, consensus-oriented and based on trust and exchange of knowledge between the participants The results will be published in a book (Palgrave, 2019) Our work, summarized in this book, indicates that government ministries and local authorities in Israel virtually ceased functioning in certain areas, while private and voluntary organizations operate in their stead The claim that the state is still responsible for policy-making and regulation, while only performance has been privatized, needs to be carefully examined The shift from a policy orientation that places heavy viii    Preface obligations on the state, to an extreme consumer orientation that essentially perceives citizens solely as clients, has had drastic repercussions for the meaning and strength of democracy in Israel Jerusalem, Israel Itzhak Galnoor Acknowledgements We wish to thank above all the Yaakov Chazan Center for Social Justice and Democracy, and its Director, Nomika Zion; and the Van Leer Institute and its former director Gabriel Motzkin, for being the home-port of this research project We are grateful to our many colleagues whose work, included and not included in this book, are part and parcel of the project We acknowledge the contribution of Brian O’Connor, Politics Editor at Palgrave, whose enthusiasm for our work initiated this book in 2014, and the current editor, John Stegner, whose support along the way has been essential to our work Thanks to the two anonymous readers who helped us with comments and suggestions to improve the quality of this book We would like to express our appreciation for the support given to the Chazan Center by The Kibbutz Movement, the Havatzelet Fund, The Friedrich Ebert Stifung, and The Sebba Charitable Trust ix Contents Privatizing Israel: An Introduction Ronen Mandelkern and Amir Paz-Fuchs Privatization Policy: The Burden of Proof 19 Itzhak Galnoor Part I  Privatization of Public Assets Privatization and Nationalization of Space in Israel: Are They Complementary Processes? 51 Erez Tzfadia and Haim Yacobi Incorporation and Privatization in the Infrastructure Sectors in Israel: Processes and Consequences 73 Eyal Tevet Part II  Privatization of the Israeli Welfare State Pension Privatization in Israel 101 Lilach Lurie xi 404  R MANDELKERN AND A PAZ-FUCHS to them The fact that this process is buttressed by privatization policies should not be surprising As part of the neoliberal paradigm, privatization schemes aim to create a competitive environment in areas where none existed and to galvanize it where it did And in a competitive environment, there must be winners and losers (otherwise, what is the point of the competition?) Where the resource that is subject to competition is a classic market good (e.g television or cars), the character of the competition is unlikely to correspond to particular identities within the polity (e.g white/black, center/ periphery) However, as the chapters in this volume suggest, when competition permeates the fields of, for example, migration (Shpaizman), health (Filc), education (Harel Ben Shahar), pensions (Lurie) or land (Yacobi and Tzfadia), a clientelistic atmosphere becomes prominent The middle class are pitted against the working class; the elderly against the younger generations; the center against the periphery; the indigenous population against the newly arrived migrants; and migrants from one country against those from a different country The seams of solidarity are constantly tested, and social and economic gaps expand To what extent is this, and the corresponding difficulty in finding a common narrative, a danger to democracy? The answer to this question depends on one’s understanding of democracy, what it entails and what the requirements are for its continued existence And yet it is arguably acceptable that a thriving democracy benefits from the people’s ability to come together Thus, a ‘republican’ ideal of democracy presupposes the idea that there is a ‘res publica’ (public thing) to which we aspire And supporters of ‘deliberative democracy’ plausibly suggest that ongoing deliberations are not (only) an end in themselves but should also lead to better results for everyone involved, and to the implicit understanding that the rules of the polity are reinforced in and by the process While one may convincingly argue that a democracy does not require these facets to exist, the case may be made that a democracy that lacks these attributes is a thinner, poorer version of the ideal Conclusions: Privatization and State Responsibility Privatization does not necessarily undermine the power of the state In many senses, privatization allows the state to function more autonomously, for example, vis-à-vis labor unions Accordingly, in many instances privatization is considered by its adherents as a means for 16 CONCLUSIONS  405 enhancing state responsibility for the provision of public goods and services This is mainly true in the case of contracting-out, which many Israeli policymakers would outright reject its definition as a form of privatization, since the state retains its responsibility for outsourced services for which it continues to pay, while the value of every shekel or dollar spent is maximized In other words, and like neoliberalism more generally, privatization does not necessarily imply the withdrawal of the state in the face of the market (Ban 2016; Brown 2015) The market and the state are not necessarily exclusive entities, and in many cases of privatization the two actually support each other But state power does not necessarily align with state responsibility In the current context, and following T.H Marshall’s lead (1950), state responsibility refers to the state’s role in minimizing risk (of ill health, disability, unemployment, old age, etc.) and advancing equality (through education, communication, transportation, etc.) The neoliberal dominance has shifted this responsibility from the state to the individual, through a process referred to by scholars as ‘responsibilization’ (Brown 2015) Brown describes responsibilization as involving “the moral burdening of the entity (individual) at the end of the pipeline” It “tasks the worker, student, consumer or indigent person with discerning and undertaking the correct strategies of self-investment and entrepreneurship for thriving and surviving; it is in this regard a manifestation of human capitalization” The American 1996 welfare reform, or welfareto-work, legislation, does not have ‘welfare’ in its title at all Instead, it is the Personal Responsibility and Work Reconciliation Act (emphasis added) The Israeli welfare reform, which was already discussed, reflected an extreme adoption of this logic In many countries, “responsibilization” policies have been promoted by center-right think-tanks and by conservative politicians In Israel, one finds that neoliberalism in general, and privatization in particular, has been advanced by both right- and left-wing governments and, within the civil service, by the Ministry of Finance, which has developed a reputation for promoting a neoliberal agenda (Maron and Shalev 2017) One may ask, therefore, whether the traditional loyalty to the idea of small government has been abandoned? How these policies align with the most cherished of ‘liberal’ rights, that is—the right to be left alone? This is, yet again, a testament to the force of the neoliberal revolution: when neoliberalism has faced off with liberalism, it has come out ahead To bring us full circle, then, the state has not withdrawn from power under 406  R MANDELKERN AND A PAZ-FUCHS the aegis of privatization and neoliberalism In important respects, it yields far more power It is its dedication, or responsibility, to addressing risks and advancing equality of opportunity that has been significant redrawn, or withdrawn Bibliography Arlosoroff, Meirav 2011 The General Manager of the Ministry of Welfare: A Privatized Service Is Not Worse Than a Government Service (in Hebrew) The Marker, August 10 https://www.themarker.com/career/1.680658 Asiskovitch, Sharon 2017 Bureaucrats, Politicians, and the Politics of Bureaucratic Autonomy In Neoliberalism as a State Project: Changing the Political Economy of Israel, ed Michael Shalev and Asa Maron, 122–137 New York: Oxford University Press Ban, Cornel 2016 Ruling Ideas: How Global Neoliberalism Goes Local New York: Oxford University Press Beramendi, Pablo, and David Rueda 2014 Inequality and Institutions: The Case of Economic Coordination Annual Review of Political Science 17 (1): 251–271 https://doi.org/10.1146/annurev-polisci-032211-210535 Blyth, Mark 2013 Paradigms and Paradox: The Politics of Economic Ideas in Two Moments of Crisis Governance 26 (2): 197–215 https://doi org/10.1111/gove.12010 Brown, Wendy 2015 Undoing the Demos: Neoliberalism’s Stealth Revolution, 1st ed New York: Zone Books Crouch, Colin 2011 The Strange Non-death of Neoliberalism Cambridge: Polity Dattel, Lior 2014 Ministry of Education Ltd.: How Hundreds of Private Bodies Receive 11 Billion Shekel The Marker, October http://www.themarker com/news/education/1.2450395 ——— 2016 Meet the Companies That Receive Billions from the State— Without a Tender (in Hebrew), March https://www.themarker.com/ news/education/LIVE-1.2867881 Gal, John, and Shavit Madhala-Brik 2016 The Outsourcing of Welfare Services In State of the Nation Report 2016, ed Avi Weiss, 353–387 Jerusalem: Taub Center http://taubcenter.org.il/the-outsourcing-of-welfare-services-trendsand-changes/ Hall, Peter A 1993 Policy Paradigms, Social-Learning, and the State—The Case of Economic Policy-Making in Britain Comparative Politics 25 (3): 275–296 Hamdani, Assaf 2009 Concentrated Ownership and Business Groups in Israel: A Legal Analysis Policy Paper 78 (in Hebrew) Jerusalem: Israel Democracy Institute 16 CONCLUSIONS  407 Harel, Alon, and Assaf Sharon Forthcoming Radical Privatization (in Hebrew) Mishpatim—Hebrew University Law Review http://law.huji.ac.il/sites/default/ files/law/files/hrl_vshrvn_-_grsh_yntrntyt_.pdf Kemp, Adriana, and Rebeca Raijman 2007 Migrants and Workers: The Political Economy of Labor Migration in Israel (in Hebrew) Jerusalem: The Van Leer Jerusalem Institute and Hakibbutz Hameuchad Kretzmer, David 2002 The Occupation of Justice: The Supreme Court of Israel and the Occupied Territories Albany: State University of New York Press Linder-Ganz, Ronny 2017 Considering to Switch a Sick Fund? 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Hameuchad Index A Absentees’ Property Law, 56 Accountability, 13, 40, 42, 43, 149, 162, 174, 178, 182, 191, 193, 239, 242, 244, 245, 262, 263, 402, 403 Activation, 376 Americanization, 6, 400 Antidiscrimination, 152 Arrangements Law, 129, 134, 370, 372, 378 B Bank of Israel (BoI), 2, 8, 10, 77, 86, 91, 241, 320, 370, 371 Banks, 9, 29, 33, 59, 60, 88, 159, 318 Blurred Boundaries, 29, 38, 39 Bottom-Up Processes, 246–248, 250 Budget Fundamentals Law, 299, 370 Budgets Division, 369, 391 See also Ministry of Finance (MoF) Bureaucracy, 26, 42, 62, 165, 230, 403 C Capitalism, 8, 11, 52, 317–319, 322, 400 Capitalists’ profits, 312, 322, 334, 335 Centralization, 27, 68, 103, 104, 111, 162, 164, 319, 355 See also Decentralization Choice, 13, 32, 38, 102, 131, 141, 149, 155, 160, 162–165, 178, 182–184, 189, 190, 202, 204, 205, 208, 211, 213, 215, 257, 346, 353, 386, 387 consumer, 190, 386, 387 Civil rights, 31, 36, 89, 232 Civil service, 6, 11, 14, 20, 22, 26, 33, 34, 41–43, 107, 118, 177, 229, 231, 241, 249, 283–286, 288, 291, 299–304, 344, 351, 352, 395, 405 See also Bureaucracy Civil Society, 14, 15, 29, 32, 40, 42, 46, 204, 341–349, 356–359, 385, 394, 396 Class, 56, 58, 62, 151, 157, 160, 163, 187, 296, 311–313, 316–319, © The Editor(s) (if applicable) and The Author(s) 2018 A Paz-Fuchs et al (eds.), The Privatization of Israel, https://doi.org/10.1057/978-1-137-58261-4 409 410  Index 322–325, 327, 328, 334, 335, 374, 389, 390, 396, 404 struggle, 314, 322 Collaborative Governance, 39, 43, 46 Colonialism, 52 Commercialization, 13, 149, 162, 164 of State schools, 13, 149 Committee on the Rights of the Child, the, 237 Commodification, 12, 74, 75, 85, 88– 90, 93, 94, 123, 125, 126, 129, 130, 132, 135, 142, 173, 195, 204 See also Decommodification Community-based services, 376, 380 Comparative Nonprofit Sector Project (CNP), 345, 349, 350, 358, 360 Competition, 7, 9, 12, 13, 23, 25, 27, 30, 36, 42, 45, 74, 80–83, 85–88, 91–94, 103, 104, 111, 113, 117, 118, 135, 136, 138, 149, 151, 162, 178–180, 182, 184, 190, 193, 231, 264, 316, 323, 346, 354, 388, 390, 392, 393, 396, 397, 401, 404 diminished, 397 market, 7–9, 13, 23, 30, 36, 81, 82, 85–88, 91, 103, 104, 111, 113, 117, 135, 136, 138, 162, 178, 179, 182, 190, 389, 392, 393, 402, 404 Compulsory education, 150, 152, 153, 161, 163 Concentration, 12, 33, 85–88, 92–94, 163, 179, 321, 324, 325, 330, 334, 335, 355, 397 Conditionality, 204, 205 Conflicts of interest, 243, 301 Conquest of labor, 400 Consulting, 10, 14, 140, 235, 248, 255, 256, 258–261, 263–269, 271, 273, 276 firms, 14, 255, 256, 258–264, 273 services, 10, 14, 235, 248, 255, 256, 259, 265, 268, 269 Contract, 4, 14, 25, 26, 34, 35, 37, 38, 41, 87, 160–162, 177, 184, 226, 228, 245, 258, 263, 285, 286, 291, 296, 300, 353, 357, 358, 397, 398, 403 employees, 26, 240, 286, 293 Contracting, 4, 10, 30, 37, 81, 116, 134, 148, 174, 176, 177, 180, 185, 189, 192, 194, 195, 210, 213, 226, 228, 231, 235, 236, 283–285, 289, 290, 344, 357, 359, 367–369, 371–374, 376, 386–388, 390, 391, 393, 396–398, 401, 402, 405 performance-based, 174 Contractor, 46, 67, 115, 160, 179, 187, 188, 232, 234, 235, 240, 250, 286, 289, 293, 294, 298, 301, 303, 354, 355, 398, 402 Control agencies, 236–239, 243, 245, 247–250 Conversion, 25, 134, 368, 374 See also Gradual change processes Corruption, 25, 26, 29, 37, 42, 180, 319, 361 Cost, 21, 22, 25–27, 37, 38, 44, 46, 54, 74, 84, 86–88, 114, 128, 129, 136, 140, 159, 178, 182, 184, 186, 187, 189, 193, 259, 288, 294, 302, 354, 397 awareness, 294 efficiency, 21, 22, 84, 141, 259 Curriculum, 151, 152, 155, 156, 159, 161, 402 D Decentralization, 63, 65, 66, 68, 88, 149, 312, 387 See also Centralization Index Decommodification, 129 See also Commodification Delegation, 29, 148, 241, 262, 263, 271, 367 Democracy, 12, 15, 24, 32, 37, 43, 66, 68, 74, 85, 88, 91–94, 226, 249, 256, 261, 273, 344, 346, 347, 396, 402–404 and national values, 398 Democratic Deficit, 14, 240–242, 244, 245, 249, 261, 263, 265, 270–273 Deregulation, 27, 37, 38, 68, 74, 393 Disabled people, 356 Discrimination, 60, 150, 167, 243, 297, 401 Distributive justice, 33, 60, 117 Drift, 15, 368, 373–375, 377 See also Gradual change processes E Economic crisis, 24, 43, 59, 75, 76, 214, 284, 352, 371, 372 Economic growth, 13, 66, 77, 78, 215, 316, 322, 324, 331 Economic liberalization, 7, 8, 10, 15, 176, 230, 345, 369 Economic Stabilization Program, 320 Economists, 2, 33, 77, 123, 320, 370 Education, 3, 5, 10, 12, 13, 19, 22, 24, 25, 27, 30, 44, 114, 123, 147–153, 155–168, 193, 207, 214, 232, 235, 240, 242, 250, 269, 283, 292, 295, 297, 304, 323, 342, 353–355, 360, 361, 367, 370, 373, 374, 385, 388– 390, 394, 395, 397, 402–405 Efficiency, 11, 20–24, 29, 33, 34, 51–54, 64, 68, 84, 87, 92, 138, 141, 181, 182, 184, 185, 190, 193, 204, 226, 249, 255, 259, 320, 368, 392, 393, 401   411 economic, 11, 20–22, 24, 33, 51– 53, 184, 256, 320, 394, 401 social, 21, 29, 33, 52, 54, 173, 174, 181, 182, 184, 190, 193, 204, 392, 393 Elderly, 89, 107, 175–177, 180, 183, 185, 187–189, 191, 193, 211, 212, 356, 371, 404 home care services, 176, 177 people, 89, 177, 183, 356, 357, 371, 404 Electricity, 7, 22, 73, 77, 79, 82, 84–90, 94, 95, 231, 234, 318, 366, 377 Employment, 2, 4, 7, 9, 14, 16, 26, 27, 41, 56, 105, 108–110, 115, 151, 152, 159, 176, 177, 186, 187, 195, 206, 207, 209–214, 243, 269, 276, 283, 285–294, 296, 299–304, 319, 320, 325, 331, 334, 354, 367, 371, 374, 376, 379, 393, 401 Employment protection, Employment Services, 211, 213, 367, 374 Equality, 23, 32, 54, 68, 74, 89, 109, 114, 117, 123, 125, 128, 129, 131, 141, 160, 173, 190, 297, 346, 403, 405, 406 Ethiopia, 209, 214 Ethnicity, 52, 56–58, 150, 396 Ethnic tensions, 259 Expertise, 4, 14, 27, 30, 42, 176, 179, 227, 245–248, 250, 258–261, 264, 287, 298, 299, 301, 354, 395 F Finance Committee (of the parliament), 370 Financial crisis, 128, 321, 390 First Boston Bank, 256, 376 412  Index Flexibility, 14, 26, 41, 74, 75, 186, 215, 286, 295, 296, 302 employment, 14, 26, 27, 41, 186, 286, 296, 302 managerial, 26, 286 Former Soviet Union (FSU), 59, 63, 207, 209, 212 For-profit prison See Privatization, of a prison Full employment, 7, 319, 320 G Globalization, 6, 20, 26, 28, 33, 41 Governance, 63, 124, 125, 149, 173, 177, 178, 181, 225–231, 249, 250, 264, 284 hierarchical approach to, 225 participatory approach to, 225 Government big, 7, 28, 208, 293, 317, 343 civilian spending, 312, 317, 323, 334 companies, 9, 12, 16, 74–87, 90, 92–94, 229, 231, 256, 300, 386–388 See also Governmnet, corporations corporations, 2, 9, 10, 21, 26, 40, 55, 79, 81, 89, 92, 158, 181, 234, 288, 320, 366, 367, 373, 374, 376, 377, 379, 391, 393, 401 employees, 7, 10, 27, 29, 39, 77, 84, 107, 240, 245, 284, 286–291, 293, 294, 300, 301, 351, 352, 356, 371, 379 expenditures, 9, 10, 130, 316, 323, 372 funding, 39, 126, 127, 129, 136, 147, 149, 165, 174, 205, 209– 211, 213, 215, 229, 235, 236, 284, 298, 350, 352, 359, 373 involvement, 45, 76, 78, 79, 83, 87, 89, 103, 147, 159, 203, 208–210, 213, 215, 217, 318, 320 lawyers, 240 ministries, 6, 10, 30, 41, 42, 75, 84, 93, 176, 207, 234, 235, 237, 265, 273, 274, 288, 294, 302, 351, 357, 366, 370, 376, 397 purchases, 10, 176, 323 subsidies, 7, 40, 126, 316, 319 tenders, 14, 15, 85, 176, 179, 234–237, 240, 241, 248, 256, 265, 266, 268, 342, 352–357, 359, 387 Gradual change processes, 15, 365, 374 H Health basket, 128, 129, 131, 136, 137 Healthcare, 9, 12, 102, 319, 321, 323, 367 Hebrew Labor, 400, 401 Hevrat HaOvdim See Workers’ Company High Court of Justice, 34, 35, 64, 65, 92, 164 See also Israel Supreme Court Higher education, 24, 25, 27, 297, 370 Histadrut See Labor federation, the Human rights, 35, 240, 243–245, 249, 347 Hybrid bodies doctrine, the, 243 Hybrid organizations, 342, 348, 353, 356, 357, 359 I Ideology, 21, 41, 44, 56, 93, 147, 162, 173, 206, 209, 318, 369, 387, 388 Index Immigrants, 7, 9, 12, 13, 55, 56, 58, 104, 201, 202, 204–215, 217, 218, 298, 394 Jewish, 9, 12, 13, 55, 56, 58, 201, 206, 207, 214, 394 newly arrived, 7, 56, 201, 207, 208, 210, 212, 213, 394 self-sufficient, 206 veteran, 58, 201, 210, 213, 214 wealthy and/or skilled, 13, 202, 206, 214, 215, 217 Immigration direct absorption, 201, 202, 209, 210, 215 from Western countries, 209, 214 Immigration policy, 399 laissez-faire approach to, 201, 205 prescriptive approach to, 201, 205, 207, 209, 210, 217 proactive approach to, 205, 211, 217, 369 Imports, 87, 316, 318, 320, 323, 331, 335 Incorporation, 12, 73, 74, 189, 284, 377 Individual freedom, 183, 209 Industrial revolution, 285 Inequality, 12, 14, 15, 22, 32, 67, 68, 102, 104, 111, 114, 117, 127, 141, 152, 154, 159, 163, 167, 187, 195, 296, 311–313, 315– 317, 322, 335, 393, 394, 401 Inflation, 8, 33, 85, 320, 324, 334 Infrastructure sectors, 12, 73, 74, 77–80, 88, 93 Institutional change, 106, 284, 285, 365, 366, 368, 373, 380 Institutional constraints, 202, 294 Institutional transformation See Institutional change Integration policy, 201, 202, 204– 206, 217, 218   413 Intermediaries, 226, 283–285 Israel Bealiya, 212 Israel Electricity Company (IEC), 87, 89 Israel Land Administration (ILA), 57, 59–62 Israel Supreme Court (ISC), 35, 39, 141, 190, 243, 300, 399 J Jewish National Fund (JNF), 55, 57, 60, 61, 83 K Kibbutzim, 323, 371 Kids for cash scandal, 37 Knesset, 35, 45, 61, 64, 65, 67, 89, 108, 128, 153, 156, 178, 236, 237, 239, 325, 360, 370, 380 Knowledge, 32, 45, 113, 206, 210, 245, 258–261, 264, 265, 267, 272, 273, 296, 298, 300, 301, 343, 395 Knowledge acquisition, 260, 261 Kovarsky Report, 230, 376 Kupat Holim Clalit (KHC), 126 See also Sick funds L Labor federation, the, 7, 15, 366 Labor Party, the, 318–321 Labor relations, 319, 386, 394, 395 Land, 11, 53–64, 67, 75, 202, 203, 389, 399, 400, 403, 404 Law of Return, 399 Layering, 15, 107, 368, 374, 375, 377 See also Gradual change processes Liability, 240, 315 414  Index Liberalism, 52, 311, 335, 405 Liberalization, 3, 7–9, 30, 45, 51, 74, 87, 105, 162, 320, 334, 335, 385, 386, 388, 401 Likud, the, 321 Local authorities, 6, 40–42, 63–68, 150, 152–154, 156, 160, 161, 163, 165, 167, 168, 269, 270, 275, 284, 293, 294, 302, 323, 387 M Majone, Giandomenico, 230 Management of punishment, 34, 35 Managerial flexibility, 26, 286 Mandatory regime, 55 Mapai See Labor Party, the Market capital, 7, 8, 92, 105, 109, 112, 123, 231, 325, 335 failures, 21, 23, 33, 123, 173, 232, 249, 302 free, 23, 32, 33, 52, 62, 87, 88, 90, 91, 105, 107, 113, 158, 209, 234, 290, 311, 317, 322, 335 labor, 2, 7, 9, 84, 109, 115, 130, 204, 205, 211, 296, 302, 312, 316, 317, 319, 320, 322, 325, 335, 401, 404 superiority, 210 Marketization, 173, 174, 176, 184, 195, 355 Military Industry, 9, 77, 367, 374 Military spending, 317, 319, 323, 325, 330, 335 Ministry of Construction and Housing, 235 Ministry of Defense, 397 Ministry of Economy and Industry, 235 Ministry of Education (MoE), 30, 150, 152–168, 207, 214, 235, 240, 268, 285, 292, 304, 353–355 Ministry of Energy, 76, 86, 239 Ministry of Environmental Protection, 235 Ministry of Finance (MoF), 2, 8, 76, 81, 105, 108–114, 117, 118, 129, 132, 133, 135, 136, 141, 176, 177, 188, 213, 214, 235, 239, 249, 269, 274, 295, 304, 353, 354, 369, 370, 372, 374–379, 387, 391, 403, 405 Ministry of Health (MoH), 30, 125, 137, 139–141, 289, 300, 301, 304, 397 Ministry of Immigrant and Absorption (MoIA), 207–209, 211–215 Ministry of Industry and Trade, 233 Ministry of Justice, 235, 299, 352 Ministry of National Infrastructures, Energy and Water Resources, 235 Ministry of Social Services, 175–178, 182–184, 192, 193, 354, 389, 395 Ministry of Transportation, 236 Minorities, 54, 294, 298, 399, 401 Mixed economy, 28, 312 Monitoring, 191, 192, 227, 229, 233–237, 239, 240, 243, 250, 259, 268, 368 Multiculturalism, 148 Municipalities, 37, 64–67, 175, 176, 191, 285, 370 N National Employment Tribunal (NET), 190, 285, 291, 292, 303 National ethos, 201, 206 National Health Insurance (NHI), 28, 124–126, 128, 129, 133, 135, 136, 138 Nationalism, 3, 11, 52, 68, 69 Index Nationalization, 11, 20, 28, 44, 51, 53, 54, 56, 58, 59, 61–63, 68, 69, 75, 366, 370, 372, 388 Nation state, 398, 401 Natural monopoly, 23, 74, 388 Natural rights, 243 Neoclassical economics, 375, 376 Neoliberal ideas, 213 Neoliberalism, 2, 3, 28, 59, 101, 118, 201, 335, 386, 387, 390, 405, 406 Neoliberal revolution, 311, 312, 335, 405 Netanyahu, Benjamin, 9, 66, 108 New Governance, 225, 228, 249 New Public Management, 6, 63, 147, 173, 258, 286, 295, 343–345, 347, 351, 352, 375, 376, 386, 387 1948 war, 58 1973 war, 1967 war, 319 Non-governmental organizations (NGOs), 12, 53, 110, 117, 234, 237, 303, 403 Normative deficit, 240, 242–245, 249 O Organization for Economic Co-operation and Development (OECD), 3, 75, 101–103, 130, 132–134, 141, 142, 323, 341, 347, 359 Ottoman Law, 55, 351 Outsourcing See Contracting P Palestinians, 7, 55–57, 61, 62, 127, 399, 400   415 Paradigm, 203, 208, 210, 225, 379, 386, 389–392, 404 See also Policy, ideas neoliberal, 208, 386, 404 Path dependency, 105, 368 Pension, 7, 12, 19, 101–118, 291, 319, 367, 372, 385, 392, 394 People with intellectual disabilities, 373, 374, 376, 379, 390 Personal social services, 174–177, 179, 180, 183, 184, 192 Planning rights, 53, 54, 56, 58, 60, 63, 399 Policy capacity, 14, 42, 192, 255, 264, 265, 272–275, 321, 334, 355, 358, 394, 395, 398 change, 2, 4, 10, 15, 38, 44, 166, 201–203, 209, 211, 212, 217, 218, 228, 229, 257, 258, 266–268, 283, 285, 342, 365, 366, 378, 379, 391 feedback, 105 formulation, 13, 14, 248, 255–266, 269–275 ideas, 15, 195, 201–203, 205, 207–212, 215, 217, 218, 257, 355, 365, 376, 386, 387, 389 neoliberal, 2, 13, 15, 45, 54, 194, 202, 205, 208, 209, 215, 217, 320, 369, 387, 388, 390 paradigm, 203, 208, 210, 225, 379, 386, 389–392 solutions, 203, 211, 212, 257–259, 272, 355 Political economy, 2, 8, 15, 311, 317–319, 321, 322 Political system, 6, 33, 129, 203, 369, 370 Postal service, 298, 374 Power resource theory, 316 416  Index Precarious work, 312 Prison, 4, 20, 31, 33–38, 46, 244, 378, 379 Private goods, 23, 28 Private sector, 24, 25, 28, 37, 63–65, 78, 90, 126, 133, 134, 147, 189, 195, 205, 225, 228–230, 232, 234, 236, 243, 256, 259, 260, 264, 286, 302, 318, 319, 369, 375, 376, 401 Privatization by attrition, 4, 134 fiscal, 4, 195, 334, 371, 372, 386, 390 full, 32, 34, 36, 37, 43, 79, 80, 115, 159, 186, 228, 229, 232, 234–236, 405 of funding, 4, 13, 129, 141, 147, 149, 151, 152, 155, 159, 165, 167, 174, 215, 217, 229, 235, 236, 350, 373, 396 incremental, 232, 233, 275, 369 major, 7, 9, 11, 32, 44, 105, 106, 108, 124, 141, 173, 195, 229, 256, 312, 342, 352, 365, 366, 375 meaning of, 3, 19, 148, 151, 246, 386 minor, 32, 76, 275 myths and legends of, 20, 21, 27 by omission, 4–6, 10, 228, 386, 390, 395, 396 partial, 4, 21, 27, 58, 61, 126, 141, 228–230, 232, 235, 236, 325, 376 of a prison, 4, 11, 20, 31, 33–38, 244, 378, 379 proponents of, 6, 20, 21, 37, 378, 395, 397 of provision, 4, 6, 12, 13, 27, 29, 30, 32, 113, 124, 125, 129, 134, 138, 148, 149, 155, 157, 160, 190, 191, 215, 217, 230, 321, 342, 365, 366, 380, 387, 390, 392, 395–397, 405 selective, 53, 56–59, 63, 167, 389, 401 unintended consequences of, 386, 396 Professionalism, 13, 178, 185, 189, 193, 234, 303 Property rights, 52–55, 57–60 Proportionality, 244, 245 Public administration, 173, 181, 255, 256, 263–265, 274, 395 Public goods, 21–23, 30, 38, 40, 42, 386, 392, 403, 405 merit, 21, 22, 42 Public norms, 191, 193, 242–245 Public philosophies, 203, 210, 212, 215, 218 Public–private mix, 176 Public–private partnership (PPP), 29, 46 Public sector, 7, 8, 24, 26–29, 42, 43, 125, 133–135, 138, 140, 141, 143, 157, 173, 176, 187, 188, 190, 193, 194, 210, 229, 230, 232, 238, 246, 255, 258–260, 263–265, 272–275, 286, 288, 296, 298, 301–303, 319–321, 323, 325, 335, 369, 375–377, 379, 389, 395, 400, 401 Public services, 4, 6, 7, 10, 39, 75, 89, 174, 187, 229–232, 249, 283, 289, 294, 298, 300, 302, 303, 311, 325, 341, 351, 360, 367, 368, 386, 389–392, 396–398 Public utilities, 2, 3, 7, 11, 87, 94, 311, 366, 375, 377, 385, 389, 390, 392–394 Q Quasi-nongovernmental organizations, 41, 351 Index R Redistribution, 259, 312, 316 Reforms, 6, 8, 26, 36, 53, 73, 84, 85, 88, 93, 94, 102, 103, 105–108, 110, 117, 118, 124, 138, 142, 149, 162–164, 173, 176, 177, 181, 230, 258, 283, 290, 293, 295, 320, 343, 369, 370, 372, 376 Refugees, 55–57, 204, 218 Regulation, 12–14, 23, 24, 27, 29–33, 37–40, 42, 44, 46, 53, 60, 77, 78, 84, 88–94, 102, 105, 114, 117, 124, 125, 129, 135, 136, 138, 140, 150, 157, 158, 160–162, 165, 174, 191, 193, 205, 209, 213, 214, 217, 225–228, 230–232, 235, 237, 238, 246–250, 284, 289, 386, 388, 390, 391, 394, 402 Regulatory agencies, 230, 231, 234, 239, 240, 302, 303 Religion, 90, 151, 369, 398, 399 Responsiblization, 405 Rights to education, 159, 160, 232, 240 to freedom and dignity, 244 to freedom of occupation, 232 to health care, 232 to privacy, 232, 244 social, 13, 20, 21, 29, 33, 52, 56, 60, 178, 180, 181, 186–188, 232, 285, 293, 294, 296, 298 Risk management, 113, 259 Rule setting, 225, 227, 228, 232, 248, 249 S School choice, 149, 162–165 Schools, 5, 13, 147–168, 234, 240, 250, 350, 354, 361, 402 charter, 155, 160, 162   417 church, 150 democratic, 151, 155, 164, 166, 402 non-state, 13, 147–150, 152, 155–157, 161, 165–167 private, 4, 5, 13, 147–149, 151– 162, 164–167, 234, 402 semi-private, 402 specialized, 148, 150, 153, 155, 163, 164 Seaports, 377 Selectivity, 204 Separation of powers, 241 Settlement Division, the, 400 Sharon plan, the, 58 Sick funds, 7, 125–129, 132–134, 136–138, 141–143, 393 Single parents, 211 Small businesses, 39, 268 Social assistance, 174, 177, 185 Social citizenship, 173 Social justice, 73, 109, 195, 380 Social protest, 43, 44, 174, 175, 194, 378 Social security, 102, 124, 139, 390 Social services, 2, 10, 11, 26, 39, 44, 123, 173–181, 183, 184, 187, 188, 191, 194, 195, 208, 212, 214, 229, 231, 237, 283, 286, 293, 298, 323, 334, 342, 344, 356, 360, 367, 373, 388–390, 395, 397, 403 Solidarity, 44, 90, 109, 148, 167, 173, 297, 343, 344, 355, 403, 404 Stabilization Plan, the, 8, 370, 372 Stagflation, Standards, 31, 78, 90, 149, 162, 179, 182, 191, 193, 233, 236, 354, 355, 389, 390, 400 State autonomy, 8, 133, 150, 156, 160, 167, 284 418  Index education, 3, 12, 13, 24, 25, 27, 30, 44, 123, 147–153, 155–157, 159–162, 164–167, 193, 207, 214, 232, 295, 342, 353, 367, 388, 395, 402, 405 inherently governmental function, 39 intervention, 57, 123, 147, 151, 160, 205, 312, 316 policy, 2–4, 7, 11–13, 15, 20, 21, 29, 30, 33, 35, 38, 39, 41, 42, 44, 45, 54, 56, 57, 105, 106, 141, 148, 149, 155, 157, 165– 167, 187, 192, 194, 195, 201, 202, 204–210, 212, 215, 217, 218, 227–230, 239, 246, 250, 255, 256, 258–263, 265–268, 270–274, 284, 312, 316–318, 320, 323–325, 327, 328, 331, 334, 367, 369, 376, 387, 388, 393–396, 398, 399, 402 positive, the, 28, 39, 229, 230 regulatory, the, 191–194, 230, 232, 249 responsibility, 13, 19, 20, 24, 27–32, 35–38, 42–44, 68, 88, 113, 124, 129, 136, 173, 194, 201–206, 209, 210, 212, 213, 215, 217, 218, 226, 229, 358, 367, 386, 402, 405, 406 roles, 13, 40, 43, 228–230, 232, 234, 243, 246, 249, 250, 255, 259, 270, 302, 312, 394 State Comptroller, 62, 86, 132, 137, 141, 153, 183, 185, 186, 191, 192, 208, 262, 263, 289, 299–302, 353, 358, 360, 377 State-owned production, 323, 328, 330, 331 Strikes, 324, 325 Subsidized employment, 210, 213 Supreme Court See Israel Supreme Court T Teachers, 14, 33, 152, 156, 159–161, 210, 284, 285, 289, 293, 295, 299, 350 Tendering, 174, 176, 178–180, 396 Tenders, 14, 15, 25, 85, 176, 178, 179, 189, 228, 234–237, 240, 241, 248, 256, 265–269, 271, 273, 275, 342, 352–357, 359, 360, 387, 395, 403 public, 14, 25, 86, 175, 176, 178, 179, 188, 189, 234, 236, 237, 239, 240, 256, 267, 271, 273, 352, 353, 387, 403 Third sector, 3, 4, 29, 32, 40, 42, 53, 124, 274, 349, 358–361 See also Civil Society Top-down processes, 247, 248 Trajtenberg Committee, 10, 44, 174, 194 Transparency, 43, 66, 114, 117, 141, 154, 158, 190, 260, 261, 300, 403 Treasury, the See Ministry of Finance (MoF) Two-tier economy, 294 U UK, 28, 84, 95, 102, 161, 215, 258, 297, 313, 343, 348, 360 Ultra-orthodox, 150, 151, 155, 156, 158 Unemployment, 8, 33, 76, 116, 210, 211, 324, 325, 334, 405 Union density, 321, 324, 330, 334 Unionization, 9, 187, 312, 334 Index Unions, 2, 7, 12, 26, 41, 102, 117, 133, 152, 286, 295, 296, 303, 319, 322, 325, 334, 377–379, 391, 395, 404 See also Labor federation, the Universalism, 206, 395, 398 Universal services, 214 USA, 23, 34, 37, 46 V Values, 13, 31, 41, 53, 54, 61, 62, 64–68, 90, 109, 148, 151, 160, 165, 167, 173, 178, 182, 190, 193–195, 203, 247, 248, 250, 259, 262, 269, 270, 276, 301, 344, 346, 369, 386, 389, 398–403 cultural, 259, 270 national, 61, 65, 66, 68, 269, 270, 386, 389, 398–401 Vouchers, 182, 213 W Welfare reform, 372, 374, 376, 378, 379, 390, 391, 405 See also Wisconsin Plan Welfare services, 3, 7, 9, 12, 13, 21, 44, 45, 65, 113, 123, 174, 182, 187, 191, 193, 203, 304, 320, 350, 354–356, 361, 367, 374, 389, 395   419 Welfare state, 9, 11–13, 20, 33, 44, 90, 105, 106, 109, 173, 174, 176, 187, 188, 194, 212, 229, 230, 319, 341, 350, 360, 371, 386, 394–396 regulatory, the, 194, 230 Welfare-to-work, 177, 181, 183, 185, 186, 189, 190, 192, 195, 391, 403, 405 See also Wisconsin Plan Wisconsin Plan, 372, 374, 376, 378, 379 Workers agency, 14, 134, 287–290, 292– 294, 296–298, 300–303, 377, 393 disempowered, 294, 297 generations of, 377 migrants, 29, 297, 401 Workers’ Company, 366, 371 See also Hevrat HaOvdim World Bank, 12, 101, 105, 117 Y Yom Kippur War, See also 1973 war Z Zionism, 201, 399, 400 Zionist Federation, ... transformation of the structure of the Israeli economy and the Israeli public sector and the logic of labor relations Before privatization processes in Israel began, vast segments of the Israeli economy.. .The Privatization of Israel Amir Paz-Fuchs · Ronen Mandelkern Itzhak Galnoor Editors The Privatization of Israel The Withdrawal of State Responsibility Editors Amir... As the rest of the volume covers the privatization of Israel in a variety of areas and issues, it is divided into four major themes The three first themes correspond to a basic distinction of the