+972 Magazine / February 14, 2023
In the struggle against the far-right government’s plans for total control, Israel’s elites could bring the regime to a breaking point.
Influential sectors of the Israeli public are in a state of panic — and for good reason. The dominant narrative among virtually all Israelis who do not support Prime Minister Benjamin Netanyahu is that a coup is underway. Justice Minister Yariv Levin’s plans for judicial overhaul, which will give unchecked power to the government at the expense of the Supreme Court, do indeed represent a drastic change in the Israeli regime. People who see Israel as a liberal democracy (very often by omitting millions of Palestinians) say the country is on the verge of becoming a dictatorship. The general feeling is that Israel as we know it is on the brink of collapse.
Some are calling this moment the end of democracy. Others, more precisely, describe it as a deterioration into fascism. Most of the hundreds of thousands of protesters taking to the streets are focusing on Levin’s reforms, while left-wing Israelis and the Palestinians cannot but point to the intensification of the occupation’s violence under National Security Minister Itamar Ben Gvir, and the escalating oppression toward Palestinian citizens. Irrespective of precise political orientation, there is a general sense of emergency.
This collective panic is widespread but is especially potent among the upper classes – both upper-middle-class supporters of Yair Lapid’s Yesh Atid party, and the millionaires and billionaires who sit atop Israel’s finance and tech sectors. In the past few weeks, since Netanyahu and Levin announced their plans for judicial overhaul, substantial portions of Israeli and foreign capital have gone into defensive mode: venture capitalists are contemplating withdrawing funds from Israeli businesses, wealthy Israelis are gradually moving their money abroad, and young, privileged professionals who do not possess an EU passport are scrambling for one.
There’s a possible “run on the banks” dynamic at play: the protesters are convinced that the end of democracy is near, therefore they expect the worst. The pragmatic conclusion is to hedge their losses. These small actions, such as moving some funds abroad, signal that the panic is real. The media picks up on this elite discontent and reports the developments using alarmist messaging, which serves only to fuel the public’s panic. This dynamic is still relatively localized, but there are signs that it will continue to grow if the government pushes ahead with its legislative agenda.
The Israeli economy, for now, remains robust, and it would take something on the scale of massive divestment to destabilize it. But among Israeli elites, there is a new sense of estrangement and discontent with the state and the anti-liberal future they associate with the far-right coalition. For the first time in many years, an economic downturn seems realistic, and it is this economic precarity that puts Netanyahu in a bind.
The strength of Netanyahu’s long rule was never his populist appeal but rather his competence in delivery, notably with regard to the economy. He was good for Israel’s big business owners, who silently supported him as long as he advanced Israeli tech and maintained the country’s high credit rating. While they were likely not enamored of his corruption or his attacks on the media, they refrained from confronting him as long as he opened up new markets in the Gulf and kept corporate taxes low.
Now, however, Netanyahu’s messianic coalition partners are catching up with him, and he is no longer in full control of the situation. The business elites see this, and they are worried. The prime minister cannot be seen as a responsible moderate when his top ministers are avowed racists such as Ben Gvir and Finance Minister Bezalel Smotrich. Yet he also has no political alternative: the divide between pro- and anti-Netanyahu factions in the Knesset is so broad that Netanyahu has only one possible coalition, and his partners expect action. They demand a complete legal overhaul in order to see through their grand plans for this country: entrenching apartheid, advancing annexation, and expelling Palestinian representatives from the Knesset. And they won’t budge.
Israeli elites — start-up millionaires, self-styled liberals from the Tel Aviv suburbs, urban left-leaning intellectuals, and former military officers — are all rapidly becoming estranged from the state. The people who acted as privileged rulers are now finding themselves far from the centers of power, and this enrages them. The fact that the Israeli center, which rose to prominence in the last two decades by shunting the Palestinian issue and focusing on economic prosperity, now considers the state a threat means that further radicalization is possible.
It is strange to speak about elite radicalization, but this is precisely what is happening. The antagonisms within the Israeli ruling classes are becoming more acute. And among the most striking evidence of this radicalization are the signs of erosion in militarist nationalism within the anti-Netanyahu camp.
Centrist voters are now openly talking about not sending their children to the army if the reform passes. Reservists are marching against the government, waving the emblems of their army units. This type of resistance, in which military service is being overtly politicized, is unprecedented among mainstream Zionist communities. And all the while, there is prevalent talk of divestment from the Israeli economy for political reasons — an action which, when proposed by Palestinians and the BDS movement, is taken as clear evidence of antisemitism.
It is true that the majority of these protesters are not fighting against the occupation or Israel’s racist policies, but only against the curtailment of democracy for Israeli Jews. Yet it seems that today, more than ever before, they are willing to turn their backs on things they once held sacred. If Netanyahu presses on with the reform, and the antagonism and estrangement of the elites deepen, this could mean significant problems for the Israeli government — politically, economically, and diplomatically. Israeli elite estrangement, if channeled correctly, could bring Israeli society, and the regime, to a breaking point.
Netanyahu’s new government is extremely dangerous and destructive both for Palestinians and Israelis, and anything that can pose a threat to it must be encouraged. As a first step, those who oppose the occupation and support the struggle for Palestinian liberation, whether in Israel or abroad, must view these cracks as an opportunity for building a wider front against Israeli apartheid.
Nimrod Flaschenberg is a former parliamentary adviser for the Hadash party. He now studies history in Berlin.