From Ideological Alliance to Pragmatic Exchange: Organized Labor and Party Politics in Israel, 1995 – 2023

Research in the field of political economy addresses the weakening of labor organizations in the neoliberal era as a result of the loss of their traditional sources of power. Alongside this, in the last two decades, one can find much evidence of the renewal of labor organizations, which is expressed in strategies aimed at rebuilding the sources of their power and influence. This article examines the phenomenon as a product of the renewal of partnership relations between labor organizations and political parties across the political spectrum. The article analyzes the Israeli case, in which a political alliance developed between the Histadrut (the General Federation of Labour) and the Likud Party at a time when the Likud adopted distinctly populist characteristics. At first, this alliance, which was formed on the ruins of the historical partnership between the Histadrut and the Labor Party, allowed for the renewal of the Histadrut’s influence on socio-economic policy and the promotion of inclusive growth. However, alongside these changes, the alliance was an important component in the fortification of the Likud government, which continued to implement neoliberal economic policies, and since 2023 has also strived to dismantle the institutions of liberal democracy and led an unprecedented policy of war crimes and crimes against humanity in Gaza.

This phenomenon, occurring throughout the 21st century in Israel and other developed countries, reflects a profound transformation in class politics in the neoliberal era: While the historical alliance between labor organizations and the left was based on a shared value and institutional infrastructure, the new alliances with the populist right are based on pragmatic and temporary political relations of exchange. This approach allows labor organizations to maintain influence over the distribution of resources, but the price is support for neoliberal policies in other areas and sometimes also legitimizing policies that undermine the democratic institutions that are essential to their operation. By analyzing the Israeli case, the article contributes to understanding the transformations in the political economy in the neoliberal era, and illuminates the change in the role of labor organizations, from agents of social change to partners in preserving existing power structures; from partners in building liberal democracy to those who support its destroyers.