Corruption, crony capitalism at heart of Israeli politics

Yossi Mekelberg

Published: Updated:

Last week was another sad one for the notions of good governance and transparency in Israeli politics, highlighting corruption at the heart of government. First came the conviction of former Prime Minister Ehud Olmert, who was sentenced to eight months in prison for unlawfully accepting money from a U.S. supporter. Later in the week Sara Netanyahu, wife of the current prime minister, was questioned for five hours by police on suspicion of misusing public funds to pay for private expenses.

This is only the tip of the iceberg of misuse of public resources and abuse of power in Israeli politics. Not a day goes by without revelations of politicians or civil servants suspected of corruption or cronyism. Their behavior is causing awful injustices within society, and distorts the economy and society in favor of the rich and mighty.

In Olmert’s case, the wheels of justice not only turned slowly. On appeal, the High Court of Justice reduced his sentence from six years to 18 months, partially clearing him of the main bribery charge while upholding part of his conviction for taking a bribe. On Feb. 15, Olmert will register the unenviable record of becoming the first Israeli prime minister to be locked behind bars.

His conviction ends a long political career of one of the shrewdest, most competent politicians in recent decades. Sadly, his greed and trademark arrogance led to his downfall. Olmert’s unwillingness to express sincere regret after his most recent conviction is not only further proof of his flawed character, but also of the corrupt standards that entered Israeli public life. The predictable media field day around the conviction of a former prime minister should not conceal the much wider phenomenon of corruption at the heart of Israeli politics.

Lack of transparency

According to Transparency International, Israel is ranked 37 out of 175 countries in terms of transparency. That might not appear to be that alarming, but when compared to other member states of the Organization for Economic Cooperation and Development (OECD), it is quite high. Among the main conclusions of the report is that the government, parliament and Civil Service Commission have done very little to fight corruption.

This is unsurprising considering the long list of officials convicted in recent years of corruption and misdemeanors. The offenders include a former president, ministers of finance, health, internal affairs and religious affairs, MPs, civil servants, and even high-ranking police officers.

Israel might not be the worst offender when it comes to corrupt officials, but there is an accumulated effect of consistent and persistent revelations of politicians in cahoots with big business, relationships from which they reap personal profits and party benefits. Corruption cases in Israel can be divided into two categories: cases of sheer personal greed by politicians gone astray, and forms of extremely damaging institutionalized corruption.

For decades, the country’s budget has been used to oil the wheels of coalition government. With very dubious transparency, billions of shekels are transferred to organizations associated with certain parties and politicians in an obvious bid for political support.

Increasingly, another form of institutionalized corruption is gathering pace: crony capitalism. Big corporations and businessmen are donating money to parties or filling the pockets of corrupt politicians and civil servants, achieving access to the corridors of political power and fat contracts.

Only a few summers ago, nearly half a million Israeli citizens protested for weeks, demanding social justice and transparency in public life. The spirit of 2011 seems to have evaporated and been replaced by apathy, despite continuous deterioration of acceptable standards in public life.

One of the most disturbing sagas in Israel’s modern crony capitalism revolves around the exploration and extraction of offshore natural gas from the Mediterranean. Only a few years after the country’s euphoria following news of the discovery of huge reservoirs of natural gas, a major national controversy erupted when the anti-trust commissioner ruled that the conglomerate developing the gas fields may constitute a monopoly.

This did not stop government officials, and especially Prime Minister Binyamin Netanyahu, from trying to override anti-trust regulations, even changing the minister in charge of it, in order to create favorable conditions for an alleged monopoly. The corporation has lobbied relentlessly for this deal, one that will only benefit the public in a limited way as large parts of the revenue will end up in the bank accounts of business tycoons.

Widespread culpability

There are numerous other examples of mishandling of public money in municipalities and government ministries. Wrongdoing is not confined to one political party. Recently, Israeli police recommended indicting two former Israel Beitenu ministers, the extreme right-wing party, who allegedly devised a sinister system to syphon public money into their own pockets.

The Labour party also has representation in this parade of corruption in former defense minister and party chairman Binyamin Ben-Eliezer, accused of money-laundering and taking bribes. No government corruption can be excused under any circumstances, as it destroys good governance, transparency and social justice, and deprives those of resources who are most in need.

Israel is, for better or worse, the product of the Zionist movement. The country’s corruption fails the very people it gathered from around the world to accomplish its national dream. Gaps between rich and poor are constantly growing, as are the cracks in social cohesion, and its young people are required to risk their lives in extremely controversial circumstances while a small elite continue to enrich themselves through malignant abuse of power.

Yossi Mekelberg is an Associate Fellow at the Middle East and North Africa Program at the Royal Institute of International Affairs, Chatham House, where he is involved with projects and advisory work on conflict resolution, including Track II negotiations. He is also the Director of the International Relations and Social Sciences Program at Regent’s University in London, where he has taught since 1996. Previously, he was teaching at King’s College London and Tel Aviv University. Mekelberg’s fields of interest are international relations theory, international politics of the Middle East, human rights, and international relations and revolutions. He is a member of the London Committee of Human Rights Watch, serving on the Advocacy and Outreach committee. Mekelberg is a regular contributor to the international media on a wide range of international issues and you can find him on Twitter @YMekelberg.

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