The ideological foundations of neoliberalism's political stability: an Israeli case study

Abstract

The importance of ideological beliefs held by the masses for the political stability of neoliberalism has yet to receive adequate attention. This research aims to begin to fill this gap by arguing that the ability of the neoliberal order to endure politically is assisted by key segments of the population either accepting its ideological bases or being unable to contest them. Political and socio-political research on neoliberalism tends to examine how it has become the leading framework for economic policymaking. Less attention has been given to the post rise-to-power period and even then the ideological factor is virtually absent. Directed by a Gramscian approach, this research uses the Israeli ‘social protest’ of 2011 as a case study. It probes into the ideological perceptions of the middle class through a qualitative content analysis of text-items they published during the protest on two news websites and on one blogging website. Findings indicate that significant segments of the Israeli middle class expressed ideological acceptance of neoliberalism either by explicitly supporting it or by demanding marginal reforms. Another finding is that within the middle class there is a group that lacks any relevant ideological framework regarding economic issues.

Acknowledgements

I would like to thank Mario Sznajder, Michael Shalev and Ronen Mandelkern for their valuable comments on earlier versions of this article. I would also like to thank the two reviewers for the Journal of Political Ideologies for their helpful comments and suggestions.

Notes

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^2. Susan C. Stokes, Mandates and Democracy: Neoliberalism by Surprise in Latin America (Cambridge: Cambridge University Press, 2001); Jacob S. Hacker and Paul Pierson, ‘Winner-take-all politics: public policy, political organization, and the precipitous rise of top incomes in the United States’, Politics and Society, 38(2) (2010), pp. 152–204; Bruno Palier and Kathleen Thelen, ‘Institutionalizing dualism: complementarities and change in France and Germany’, Politics and Society, 38(1) (2010), pp. 119–148.

^3. Clem Brooks and Jeff Manza, Why Welfare States Persist? The Importance of Public Opinion in Democracies (Chicago, IL: Chicago University Press, 2007).

^4. See Harvey, op. cit., Ref. 1.

^5. Michael Shalev, ‘Liberalization and the transformation of the political economy’, in Gershon Shafir and Yoav Peled (Eds) The New Israel: Peacemaking and Liberalization (Boulder, CO: Westview Press, 2000), pp. 129–159; Daniel Maman and Zeev Rosenhek, The Bank of Israel: Political Economy in the Neoliberal Era (Jerusalem: Van Leer Institute, 2009) (in Hebrew).

^6. At the time, Israel was minimally affected by the World Crisis in terms of growth, unemployment and inflation, unlike other countries where mass protest occurred as well.

^7. See Blyth, op. cit., Ref. 1.

^8. As will be presented later, the data for the research was gathered some time before and during the protests.

^9. See Sydney Tarrow, Power in Movement: Social Movements and Contentious Politics (Cambridge: Cambridge University Press, 2011).

^10. Gosta Esping-Andersen and Roger Friedland, ‘Class coalition in the making of West European economies’, Political Power and Social Theory, 3 (1982), pp. 1—52. See also Erik O. Wright, Class Counts (Cambridge: Cambridge University Press, 2000).

^11. George J. Borjas, Labor Economics (New York: McGraw-Hill, 1996); Gary S. Becker, Human Capital (New York: Columbia University Press, 1964).

^12. Colin Crouch, ‘Privatised Keynesianism: an unacknowledged policy regime’, The British Journal of Politics and International Relations, 11(3) (2009), pp. 382–399.

^13. Stephan Haggard and Robert R. Kaufman (Eds), The Politics of Economic Adjustment (Princeton, NJ: Princeton University Press, 1992).

^14. Adam Przeworski, Capitalism and Democracy (Cambridge: Cambridge University Press, 1985).

^15. Kevin M. Morrison, ‘When public goods go bad: the implications of the end of the Washington Consensus for the study of economic reform’, Comparative Politics, 44(1) (2011), pp. 105–122. Both supporters and critics of neoliberalism among political economists agree that interest groups may be able to block or roll back market-oriented reforms using the political arena. Naturally, dispute arises whether it is desirable to do so.

^16. Stokes, op. cit., Ref. 2.

^17. Peter Gourevitch, ‘Keynesian politics: the political sources of economic policy choices’, in Peter Hall (Ed.) The Political Power of Economic Ideas: Keynesianism Across Nations (Princeton, NJ: Princeton University Press, 1989), pp. 87–106.

^18. Edward L. Gibson, ‘The populist road to market reform: policy and electoral coalitions in Mexico and Argentina’, World Politics, 49(3) (1997), pp. 339–370.

^19. Blyth, op. cit., Ref. 1.

^20. Peter A. Hall, ‘Policy paradigms, social learning, and the state: the case of economic policymaking in Britain’, Comparative Politics, 25(3) (1993), pp. 275–296.

^21. Marc Blyth, ‘Structures do not come with an instruction sheet: interests, ideas, and progress in political science’, Perspectiveson Politics, 1(4) (2003), pp. 695–706.

^22. Daniel Beland and Alex Waddan, The Politics of Policy Change (Washington, DC: Georgetown University Press, 2012).

^23. Beland and Waddan, ibid.; Colin Hay, ‘The “crisis” of Keynesianism and the rise of neoliberalism in Britain – an ideational institutionalist approach’, in Campbell and Pedersen (Eds), op. cit., Ref. 1, pp. 193–218.

^24. Campbell and Pedersen, op. cit., Ref. 1, p. 1.

^25. See John L. Campbell, ‘Institutional analysis and the role of ideas in political economy’, in Campbell and Pedersen (Eds), op. cit., Ref. 1; Colin Hay, ‘The normalizing role of rationalist assumptions in the institutional embedding of neoliberalism’, Economy and Society, 33(4) (2004), pp. 500–527; Ronen Mandelkern and Michael Shalev, ‘Power and the ascendance of new economic policy ideas: lessons from the 1980s crisis in Israel’, World Politics, 62(3) (2010), pp. 459–495.

^26. This may also be true for policymakers, as the discussion by Beland and Waddan, op. cit., Ref. 22, unintentionally points out.

^27. Harvey, op. cit., Ref. 1.

^28. Robert W. Cox, ‘Gramsci, hegemony and international relations: an essay in method’, Millennium, 12(2) (1983), pp. 162–175; Andreas Bieler and Adam D. Morton, ‘A critical theory route to hegemony, world order and historical change: neo-Gramscian perspectives in international relations’, Capital & Class, 82 (2004), pp. 85–113.

^29. Adam D. Morton, ‘Structural change and neoliberalism in Mexico: “passive revolution” in the global political economy’, Third World Quarterly, 24(4) (2003), pp. 631–653; Arne Rückert, ‘Producing neoliberal hegemony? A neo-Gramscian analysis of the Poverty Reduction Strategy Paper (PRSP) in Nicaragua’, Studies in Political Economy, 79 (2007), pp. 91–118.

^30. Cox, op. cit., Ref. 28; Stephen Gill, ‘Globalization, market civilization and disciplinary neoliberalism’, Millennium, 24(3) (1995), pp. 399–424.

^31. Antonio Gramsci, Selections from the Prison Notebooks (New York: International Publishers, 1971).

^32. Chantal Mouffe, ‘Hegemony and ideology in Gramsci’, in Tony Bennet, Graham Martin, Colin Mercer, Jane Woollacott (Eds) Culture, Ideology and Social Process (London: Batsford, 1981), pp. 219–234.

^33. Bob Jessop, State Theory: Putting Capitalist States in Their Place (Pennsylvania: Pennsylvania State University Press, 1990), p. 208.

^34. Gramsci, op. cit., Ref. 31, p. 244.

^35. Gramsci, ibid., pp. 105–106.

^36. Yinon Cohen, Yitchak Haberfeld, Guy Mundlak and Ishak Saporta, ‘Union density in Israel 2000–2006: years of stagnation’, Labor, Society and Law, 12 (2010), pp. 533–549 (in Hebrew).

^37. Peter S. Cahn, ‘Consuming class: multilevel marketers in neoliberal Mexico’, Cultural Anthropology, 23(3) (2008), pp. 429–452.

^38. Omri Shamir and Guy Ben-Porat, ‘Boycotting for Sabbath: religious consumerism as a political strategy’, Contemporary Politics, 13(1) (2007), pp. 75–92.

^39. Gramsci, op. cit., Ref. 31, p. 377.

^40. Mouffe, op. cit., Ref. 32; for the uni-form position, see Nicos Poulanzas, Political Power and Social Classes (London: Verso, 1978).

^41. Ernest Laclau and Chantal Mouffe, Hegemony and Socialist Strategy: Towards a Radical Democratic Politics (London: Verso, 1985); see also Aletta J. Norval, ‘The things we do with words – contemporary approaches to the analysis of ideology’, British Journal of Political Science, 30(2) (2000), pp. 313–346.

^42. Rückert, op. cit., Ref. 29.

^43. The morphological approach is also a very worthy participant in this field. However, it is theoretically more concerned with the structure of ideologies than with their connection to social processes and actors (see Michael Freeden, Ideologies and Political Theories: A Conceptual Approach (Oxford: Clarendon Press, 1996)).

^44. Michael Freeden, Ideology: A Very Short Introduction (Oxford: Oxford University Press, 2003), p. 3.

^45. Robert Higgs, ‘The complex course of ideological change’, American Journal of Economics and Sociology, 67(4) (2008), pp. 547–565.

^46. Some efforts to promote market economy reforms were made as soon as the late 1970s but with limited success (Mandelkern and Shalev, op. cit., Ref. 25; Maman and Rosenhek, op. cit., Ref. 5).

^47. Lev L. Grinberg, Split Corporatism in Israel (Albany: State University of New York Press, 1991); Michael Shalev, Labour and the Political Economy in Israel (Oxford: Oxford University Press, 1992).

^48. Michael Shalev, ‘Labor, state and crisis: an Israeli case study’, Industrial Relations, 23(3) (1984), pp. 362–386.

^49. Michael Bruno, Crisis, Stabilization, and Economic Reform (Oxford: Clarendon Press, 1993).

^50. See Konstantin Kosenko, ‘Evolution of business groups in Israel’, in State of Israel, The Committee on Increasing Competitiveness in the Economy – Recommendation Draft (Jerusalem: State of Israel, 2012), pp. 249–285 (in Hebrew).

^51. David Levi-Faur, ‘Regulatory capitalism and the reassertion of the public interest’, Policy and Society, 27(3) (2009), pp. 181–191.

^52. Cohen, Haberfeld, Mundlak and Saporta, op. cit., Ref. 36.

^53. Avi Ben-Basat (Ed.), ‘The obstacle course to a market economy in Israel’, in The Israeli Economy, 1985-1998: From Government Intervention to Market Economics (Cambridge, MA: MIT Press, 2001), pp. 1–58; Tali Kristal and Yinon Cohen, ‘Decentralization of collective agreements and rising wage inequality in Israel’, Industrial Relations, 46(3) (2007), pp. 613–635; John Gal, ‘The rise and fall of unemployment insurance in Israel’, International Social Security Review, 58 (2005), pp. 107–116.

^54. Shlomo Svirski, ‘Israel in the global space’, in Dani Filc and Uri Ram (Eds) The Rule of Capital: Israeli Society in the Era of Globalization (Tel Aviv: Hakibbutz Hameuhad, 2004), pp. 57–83 (in Hebrew); Daniel Gottlieb, ‘The effect of migrant workers on employment, real wages and inequality: the case of Israel—1995–2000’, Position Paper (Jerusalem: Bank of Israel, 25 July 2002).

^55. Ronit Nadiv, Employment through Manpower Contractors in Israel, 2000 (Jerusalem: Ministry of Labor, 2000) (in Hebrew).

^56. Yoram Gavizon, ‘Tnuva's milking cow: milk prices down by 8%, cottage up by 30%’, The Marker, 15 June 2011.

^57. Press release of the Bank of Israel in the Bank's website (accessed February 2013), www.boi.org.il/en/NewsAndPublications/PressReleases/Pages/120313b.aspx

^58. 80% owned by the state and 12% owned by the Jewish National Fund and administered by the state.

^59. Moshe Bar-Nathan, Michael Beenstock and Yoel Haitovsky,‘The market for housing in Israel’, Regional Science and Urban Economics, 28(1) (1998), pp. 21–49.

^60. Polina Dovman, Sigal Ribon and Yossi Yakhin, ‘The housing market in Israel 2008–2010: are housing prices a “bubble”?’ Discussion Paper No. 2011.06 (Jerusalem: Bank of Israel); ‘Israelis are paying more for communication, food, transportation and housing’, The Marker, 31 March 2011.

^61. Nicholas Hookway, ‘“Entering the blogosphere”: some strategies for using blogs in social research’, Qualitative Research, 8(1) (2008), pp. 91–113; Paul J. Stephenson, ‘Napoleon, nostalgia and number plates: an analysis of the reactions to the Attali Commission's proposal to abolish the French Départment’, Journal of Contemporary European Studies, 20(4) (2012), pp. 477–495.

^62. Daniel Oesch, ‘Coming to grips with a changing class structure: an analysis of employment stratification in Britain, Germany, Sweden and Switzerland’, International Sociology, 21(2) (2006), pp. 263–288.

^63. Examples: engineers, technicians, accountants, insurance representatives, medics and teachers.

^64. More items written by the same author were found in the blogging source, but were seldom relevant for the task.

^65. David L. Altheide, Qualitative Media Analysis (Thousand Oaks, CA: Sage, 1996); Robert M. Entman, ‘Framing US coverage of international news: contrasts in narratives of the KAL and Iran Air incidents’, Journal of Communication, 41(3) (1991), pp. 6–27.

^66. Oliver and Johnston argue correctly that framing and ideology are not compatible concepts. However, their argument relates to social movements. The texts analysed here were written by individuals expressing their understanding of the social protest. Therefore, framing is seen here as an analytical tool to ‘get into’ the writer's mind rather than as a social process (Pamela Oliver and Hank Johnston, ‘What a good idea! Ideologies and frames in social movement research’, in Johnston and Johan A. Noakes (Eds) Frames of Protest: Social Movements and the Framing Perspective (Lanham, MD: Rowman & Littlefield, 2005), pp. 185–203).

^67. Altheide, op. cit., Ref. 65.

^68. Freeden, op. cit., Ref. 43, p. 4.

^69. For the use of the morphological approach in the analysis of ideologies held by non-elites, see Michael Freeden, ‘The Politics of Ceremony: the Wootton Bassett Phenomenon’, Journal of Political Ideologies, 16(1) (2011), pp. 1–10.

^70. The subcategory is partly subject to limited ability to analyse some of its items due to their short length (see the earlier discussion).

^71. See Friedrich Hayek, The Constitution of Freedom (London: Routledge & Kegan Paul, 1960); Milton Friedman and Rose Friedman, Free to Choose: A Personal Statement (London: Secker and Warburg, 1980); Michael D. Yates, Naming the System: Inequality and Work in the Global Economy (New York: Monthly Review Press, 2003); Harvey, op. cit., Ref. 1.

^72. Shlomo Hasson (Ed.), The Relations between Religion, Society and State: Scenarios for Israel (Jerusalem: Floersheimer Institute, 2005); see also Dan Horowitz and Moshe Lissak, Trouble in Utopia: The Overburdened Polity of Israel (Albany: State University of New York Press, 1989).

^73. Beliefs attributing high importance to yeshiva students exist within Israeli society as well (for the national-religious group, see Moshe Hellinger and Yossi Londin, ‘The socio-economic ideology of religious Zionism in Israel: 1995–2007’, Journal of Political Ideologies, 17(1) (2012), pp. 87–106); however, no such expressions were evident in the sources used.

^74. Freeden, op. cit., Ref. 43; Desmond S. King, ‘New Right ideology, welfare state form, and citizenship: a comment on conservative capitalism’, Comparative Studies in Society and History, 30(4) (1988), pp. 792–799; Irving Kristol, Reflections of a Neoconservative: Looking Back, Looking Ahead (New Delhi: Allied Publishers, 1983).

^75. An opposing strand of beliefs—one holding left-wing views in peace and security issues—appeared throughout the social protest but was not present in the sources surveyed. Typically, left-wing writers locate the sources of the social protest at Israel's presence in the occupied territories and the resources such presence attracts.

^76. Social networks may have made such willingness to expose personal details more common. However, such exposure was not found in any other subcategory.

^77. Yoav Peled, ‘Ethnic democracy and the legal construction of citizenship: Arab citizens of the Jewish state’, American Political Science Review, 86(2) (1992), pp. 432–443. The ‘republican resource’ is present in category A as well but only once, while here it is repeated eight times.

^78. Albert O. Hirschman, Exit, Voice, and Loyalty (Cambridge, MA: Harvard University Press, 1970). The exit theme is mentioned once in the Reservationist and the Furious subcategories, as well.

^79. Hirschman, ibid., p. 30.

^80. Yinon Cohen, ‘War and social integration: the effects of the Israeli-Arab conflict on Jewish emigration from Israel’, American Sociological Review, 53 (1988), pp. 908–918.

^81. ‘The willingness to develop and use the voice mechanism is reduced by exit, but the ability to use it with effect is increased by it’ (Hirschman, op. cit., Ref. 78, p. 83).

^82. This roughly corresponds to Hirschman's ‘loyalty’ concept (Hirschman, op. cit., Ref. 78).

^83. The electoral success of the Yesh Atid party in the 2013 elections seems to support such conclusion.

^84. Michal Shamir and Asher Arian, ‘Collective identity and electoral competition in Israel’, American Political Science Review, 93(2) (1999), pp. 265–277.

^85. See Philip G. Cerni, ‘Embedding neoliberalism: the evolution of a hegemonic paradigm’, Journal of International Trade and Diplomacy, 2(1) (2008), pp. 1–46.

^86. Hay, op. cit., Ref. 25.

^87. Marc K. Landy and Martin A. Levin, ‘Creating competitive markets: The politics of market design’, in Marc K. Landy, Martin A. Levin and Martin Shapiro (Eds) Creating Comparative Markets: The Politics of Regulatory Reform (Washington, DC: Brookings Institute, 2007), pp. 1–22; Bruno, op. cit., Ref. 49; Gabriel Valdes, Pinochet's Economists (Cambridge: Cambridge University Press, 1995).

^88. Gramsci, op. cit., Ref. 31, pp. 5–6.

^89. Colin Crouch, The Strange Non-Death of Neoliberalism (Cambridge: Polity Press, 2011).